Apr 20

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Bank Of England Exposes US Cronyism: Questions Why Buffett’s Berkshire Hathaway Is Not Too Big To Fail (ZeroHedge, April 20, 2015):

If you thought currency-wars were a problem, just wait until crony-wars begin. In a stunning show of disagreement among the omnipotent, The FT reports that a Freedom of Information Act request has confirmed The Bank of England wrote to US authorities seeking clarity about Berkshire’s absence from a provisional list of “systemically import” (Too Big To Fail) financial institutions (SIFIs). The US Treasury declined to comment…

With MetLife suing the US government to try to escape being deemed systemically important by Washington (which means the firm may need to hold more capital to cover unexpected losses and could face a requirement to draw up “living wills” to make them easier to wind down in a crisis), The FT reports on questions over Berkshire Hathaway’s status…

British regulators have challenged their US peers over their apparent reluctance to subject Warren Buffett’s Berkshire Hathaway to tougher scrutiny as part of a worldwide push to make the financial system safer. Continue reading »

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May 16

S&P Downgrades Berkshire From AA+ To AA, Outlook Negative (ZeroHedge, May 16, 2013):

Obviously with Buffett a major shareholder of Moody’s, the only place where a downgrade of Berkshire could come from was S&P. Moments ago, the rating agency that dared to downgrade the US for which it is being targeted by Eric Holder’s Department of “Justice”, did just that. Continue reading »

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Feb 14

So Who Leaked The Heinz Deal? (ZeroHedge, Feb 14, 2013):

Just a purely accidental modest to quite modest increase in the Heinz June $65 call open interest yesterday, and an even more accidental $1.5 million profit in one day? Surely the new Morgan Stanely head of the SEC will get right on it, and market “credibility” will be preserved. At least Buffett’s DOJ-immune rating agency Moody’s will rate the JPM’s committed financing for the HNZ takeover AAAA++++.

Heinz Confirms It Will Be Acquired By Buffett In $28 Billion Transaction At $72.50/Share (ZeroHedge, Feb 14, 2013):

Just released by Heinz. Luckily, the brand new US Secretary of State has a full conflict of interest release.

H.J. Heinz Company Enters Into Agreement to Be Acquired by Berkshire Hathaway and 3G Capital

H.J. Heinz Company (NYSE: HNZ) (“Heinz”) today announced that it has entered into a definitive merger agreement to be acquired by an investment consortium comprised of Berkshire Hathaway and 3G Capital.

Under the terms of the agreement, which has been unanimously approved by Heinz’s Board of Directors, Heinz shareholders will receive $72.50 in cash for each share of common stock they own, in a transaction valued at $28 billion, including the assumption of Heinz’s outstanding debt. The per share price represents a 20% premium to Heinz’s closing share price of $60.48 on February 13, 2013, a 19% premium to Heinz’s all-time high share price, a 23% premium to the 90-day average Heinz share price and a 30% premium to the one-year average share price.

Continue reading »

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Dec 12

Berkshire Seeks To Avoid 2013 Tax Hike, Buys Back BRK Shares (ZeroHedge, Dec 12, 2012):

Define irony: when the most vocal supporter of a dramatic change to the existing tax policy takes advantage of the last few days of the old one…

  • BERKSHIRE HAS PURCHASED 9,200 OF CLASS A SHRS AT $131,000-SHR
  • BERKSHIRE RAISED PRICE LIMIT FOR BUYBACKS TO 120% BOOK VALUE
  • BERKSHIRE MAY BUY ADDED SHRS AT NO MORE THAN 120% BOOK VALUE
  • BERKSHIRE BOOSTS BUYBACK PRICE LIMIT TO 120% BOOK VALUE VS 110%

A total $1.2 billion spent to avoid a few hundred million in new taxes. And now back to the hypocrticy of the “Buffett tax”, and “Patriotic Millionaires for America.” In other news, total donations to pay down the debt in Fiscal 2013 (starting October 1): $290,195.03.

Full release: Continue reading »

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May 16

Related article:

Charlie Munger: Gold Is For Holocaust-Era Jewish Families To Sew Into Their Garments; Civilized People Don’t Buy Gold

Got gold and silver?


Must Read: “Another Perspective” (ZeroHedge, May 14, 2012):

From Paul Brodsky and Lee Quaintance of QBAMCO

Another Perspective (pdf)

Two weeks ago, before Jamie Dimon’s thoughtful diversion, Charlie Munger of Berkshire Hathaway instructed viewers of CNBC that “civilized people don’t buy gold, they invest in productive businesses”. Munger was right in that civilized people invest in productive businesses and was right to imply that gold is a non-productive rock, but, in our humble opinion, he was wrong to suggest that gold does not have significant upside as an investment currently (even more than BRK/A?).

Continue reading »

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Apr 18

Warren Buffett diagnosed with prostate cancer (CNNMoney, April 17, 2012):

NEW YORK  — Iconic investor Warren Buffett announced Tuesday that he has been diagnosed with stage I prostate cancer in a letter to shareholders of his firm Berkshire Hathaway.

Buffett, 81, said his “condition is not remotely life-threatening or even debilitating in any meaningful way,” and that additional tests didn’t reveal incidence of cancer anywhere else in his body.

Buffett also said he will undergo daily radiation for two months beginning in mid-July. While the treatment will restrict him from traveling during the period, Buffett said his daily routine will not otherwise change.

“I feel great — as if I were in my normal excellent health — and my energy level is 100%,” wrote Buffett. “I will let shareholders know immediately should my health situation change. Eventually, of course, it will; but I believe that day is a long way off.”

Continue reading »

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Mar 04

Warren Buffett Priced In Gold (ZeroHedge, Mar 3, 2012):

Can you say bubble? Or, more to the point, can you say bursting?

Warren Buffett loves to bash gold — claiming that stocks are inherently superior, because they produce a return, whereas gold just sits.  Trouble is, stocks (and all paper assets) are subject to counter-party risk, whereas physical gold isn’t. Gold doesn’t overcompensate its CEOs, it doesn’t leverage its productive capital in toxic derivatives, it doesn’t cause industrial disasters like Deepwater Horizon, its value isn’t dependent on central banking, or securitisation, or American imperialism, or the machinations of the military-industrial complex. It just sits, retaining its purchasing power.

Warren Buffett had a great ride: he grew his wealth and businesses in an era of unprecedented growth powered by OPEC oil, and later by Chinese industrialism. That era — the era of the American free lunch — is coming to an end.  His insights are applicable to that era. Today is a different world.

Ennio Morricone – Ecstasy of Gold

YouTube

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Nov 05

“Derivatives are financial weapons of mass destruction.”
– Warren Buffett

How many of you know safe weapons of mass destruction?

Coming Derivatives Crisis Designed To Destroy The Entire Global Financial System: $600 TRILLION To $1.5 QUADRILLION Worldwide Derivatives Market – World GDP At Around $65 Trillion

MEGA BAILOUT: Federal Reserve Now Backstopping $75 TRILLION Of Bank Of America’s Derivatives Trades


Berkshire Hathaway Q3 profit falls on derivatives (Reuters, Nov. 4, 2011):

Warren Buffett’s conglomerate Berkshire Hathaway Inc reported a smaller third-quarter profit on Friday after losing more than $2 billion on derivatives related to stock market performance.

That was nearly three times what Berkshire lost on the same instruments a year ago. Buffett has sharply criticized derivatives in general, but has said these particular contracts were safe and would ultimately be lucrative.

But Berkshire was hurt, like many other insurance companies in particular, by sharp declines in a broad range of market values. In a quarterly report to the U.S. Securities and Exchange Commission, Berkshire said the indexes covered by the contracts fell anywhere from 11 percent to 23 percent in the quarter.

“It’s a noneconomic event,” said David Rolfe, chief investment officer of Wedgewood Partners, which has about $900 million under management and has held Berkshire shares for about 13 years. “Operating (was) in-line to terrific, the derivatives always need explaining.”

Berkshire reported a net profit of $2.28 billion, or $1,380 per Class A share, compared with a year-earlier profit of $2.99 billion, or $1,814 per share.

Cash at the end of the quarter was $34.78 billion, down from $47.89 billion at the end of June. During the third quarter Berkshire funded the purchase of chemical maker Lubrizol and a $5 billion investment in Bank of America Corp, which accounted for the decline.

Continue reading »

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