I published a recent post imagining how Warren Buffett could his justify his bet on Goldman Sachs. I doubt that he took my advice, but he and I might be on the same wavelength:
I'm no fan of Goldman Sachs, but their ability to influence the federal government's regulatory mechanisms offers them a durable competitive advantage that Buffett ought to love. Come to think of it, Berkshire Hathaway is going to need every ounce of influence that GS can steer its way. The firm has billions in custom-made, long-dated European puts and other derivatives outstanding that might be subject to collateral requirements under new legislation. Warren Buffett feels that his company should be compensated if it is forced to re-write these special contracts.
Maybe Goldman Sachs is teaching the Oracle of Omaha how to ask for a stealth bailout. That would cause me to re-evaluate my esteem for the man and Berkshire "Too Big To Fail" Hathaway.
Full disclosure: No position in GS or Berkshire Hathaway at this time.
Berkshire Hathaway CEO Warren Buffett declared his support for Goldman Sachs Group Inc. CEO Lloyd Blankfein Saturday, and said he has no plans to sell his company's stake in the bank.
I'm no fan of Goldman Sachs, but their ability to influence the federal government's regulatory mechanisms offers them a durable competitive advantage that Buffett ought to love. Come to think of it, Berkshire Hathaway is going to need every ounce of influence that GS can steer its way. The firm has billions in custom-made, long-dated European puts and other derivatives outstanding that might be subject to collateral requirements under new legislation. Warren Buffett feels that his company should be compensated if it is forced to re-write these special contracts.
Maybe Goldman Sachs is teaching the Oracle of Omaha how to ask for a stealth bailout. That would cause me to re-evaluate my esteem for the man and Berkshire "Too Big To Fail" Hathaway.
Full disclosure: No position in GS or Berkshire Hathaway at this time.
