While the world waited for a defense of America’s credit worthiness, the president unfortunately chose to quote a businessman who may be flirting with a credit downgrade too.
During his Presidential remarks the president quoted billionaire Warren Buffett about the quality of America’s credit rating. Buffett said if the United States deserves a AAAA rating if such a rating exited. On Friday Standards and Poor’s downgraded U.S. sovereign debt from AAA to AA+.
Bad decision on the president’s part.
This morning Standards and Poor’s issued a “negative” rating for Buffett’s Berkshire Hathaway company. The rating agency has downgraded some insurance companies from AAA to AA+. Buffet’s company holds deep positions in those firms. A credit downgrade is expected to follow the S&P’s negative rating.
I think everything exposed to US Treasuries is going to get downgraded, even with investors snapping up the Treasuries. No one is fooled.
You are correct. The downgrades of the GSEs started today; state and municipal bond issues will follow tomorrow. Financials are in the toilet today. BankAmerica & Citigroup are off 16%, 17% on the day on very heavy volume. Indeed BA is over 500mm shares traded.
Never ever trust Buffett’s political statements meant for public consumption. Everyone of those statements is designed to promote some government-favored industry niche in which Buffett is solidly ensconced.
Rather watch what he’s doing. I guaran-darn-tee you the whole Berkshire Hathaway proprietary trading group is burning down the house, selling short millions of shares and loads of commodities contracts and buying gold, Treasuries, other AAA bonds and going long on cash.
Warren Buffet is now officially irrelevant.
Buffet has financial interest in S&P’s rival Moody’s.
Warren Buffett moved from the shrewd investor to political hack years ago.
Uncle Warren has been lionized by the media because he’s rich, socially liberal and good Obama pal. If Uncle Warren were out there screaming about spending instead of carrying Obama’s water, you would quickly witness him become persona non grata. I’ll bet money the last 20 years of Uncle’s returns are more attributable to inside information than technical skills.
The “oracle” and hypocrite completely missed the last real estate bubble, and though Uncle Warren calls derivatives “weapons of financial mass destruction”, he himself holds some of the largest derivative positions in the world.
Mealy-mouthed politician more than “oracle.”
Buffet always whines that taxes are too low. Yet instead of giving some of his extra money to the feds he gives it to Bill Gate’s tax sheltered foundations. This reduces his tax burden further depriving the government of his money. By his actions Buffet believes a private person like Gates can spend his money for good causes much more effectively than the government can.
Won’t it be nice in 2012 to have an honest President? Just think: President Bachmann, President Paul, President Ryan, President Palin, President Trelawney…just think of all the peace and quiet…of the government doing what it should and looking after it’s citizens best interests. Think of a President who doesn’t make excuses for the way things are, but strives to fix everything that’s been made to go wrong, putting a border fence along the Texas-Arizona and all the other states that need border safety. Think of a federal government that ceases to sue its states, sell heavy duty guns to Mexico. Just think of all of the normal activity in this country without Obama and his cabinet there. What a blessing. Criminals always think they will never get caught. They always think they are just too, too clever. Well, the time is coming my friend…