Warren Buffett Agrees with Harper

[Vancouver King]

I love guys like you! Helped me make significant $$ today.

Irrational fear is great for long investors, and can even help amateurs like me make good coin in this environment.

Now I know you are full of bull. Playing with daddy's E Trade software are you?

[peter_puck]

"You know, five years from now, ten years from now, we'll look back on this period and we'll see that you could have made some extraordinary (stock market) buys. That doesn't mean it won't get more extraordinary a week or a month from now. I have no idea what the stock market is going to do next month or six months from now. I do know that the American economy, over a period of time, will do very well, and people who own a piece of it will do well."

http://www.cnbc.com/id/27116449

You are missing the whole point of the reaction to Harpers comment. The problem (in perception) was that people are fearing losing their houses and jobs in a collapsing economy. Harper responded that "hey there are great buys available in the market". To somone with no job and up to their eyes in debt, that sounds like "well let them eat cake".

That is not what Harper meant, it was how it was spun.

[peter_puck]

What relevance does that have? The guy's a sick, greedy bastard...

The guy leads a modest life, he has promised most of his fortune to charity. He has been a champion of ethics in business for years

There are plenty of sick greedy bastards, but I don't think he is one.

There are Tobbacco executives who have a much more opulent live style that made their money finding ways to market cigarrettes to kids. There are Wall Street executives who made fortunes pushing bad mortgages to the poor.

I don't think he is in the same league

[Argus]

You are missing the whole point of the reaction to Harpers comment. The problem (in perception) was that people are fearing losing their houses and jobs in a collapsing economy. Harper responded that "hey there are great buys available in the market". To somone with no job and up to their eyes in debt, that sounds like "well let them eat cake".

That is not what Harper meant, it was how it was spun.

Except the economy isn't collapsing, unemployment is at a 30 year low, and there is no rise in mortgage defaults in Canada.

[Argus]

I love guys like you! Helped me make significant $$ today.

Irrational fear is great for long investors, and can even help amateurs like me make good coin in this environment.

I had actually planned to buy some more bank stocks today, late in the day, if the market was down again, and instead I spent the last hour and a half of trading putting together a new elliptic exercise machine I bought. Oh well, I don't expect a huge exploding recovery first thing Tuesday - but I do think we've just about reached the end of overselling and will start to see an upward swing soon.

[August1991]

Americans, and increasingly Canadians, are fed up with insiders and govt cronies lusting after whats left of working people's savings and investments.

Yeah, being endorsed by somebody who exploits other peoples' misery and financial devestation is really great. That guy embodies all that is wrong with the modern economy.

Both these posts are typical of zero-sum thinking. You both seem to believe that if Warren Buffet is rich, it's because someone elsewhere in the world is poorer. His wealth was taken from others.

Well, kengs, modern economies don't work that way. There is such a thing as a non zero-sum game.

[Vancouver King]

Both these posts are typical of zero-sum thinking. You both seem to believe that if Warren Buffet is rich, it's because someone elsewhere in the world is poorer. His wealth was taken from others.

Well, kengs, modern economies don't work that way. There is such a thing as a non zero-sum game.

It's easy to play a non zero-sum game when you have a treasury to backstop your mistakes. Surely you don't think sub-prime mortgages represented an expansion of real wealth?

[Jobu]

I had actually planned to buy some more bank stocks today, late in the day, if the market was down again, and instead I spent the last hour and a half of trading putting together a new elliptic exercise machine I bought. Oh well, I don't expect a huge exploding recovery first thing Tuesday - but I do think we've just about reached the end of overselling and will start to see an upward swing soon.

I put in my bids in the first hour of trading, sold near the end of the day. Unfortunatly, not at the top, but well above the bottom.

8,000 on the Dow, as far as I am concerned, is the bottom. We won't close under that.

[peter_puck]

Except the economy isn't collapsing, unemployment is at a 30 year low, and there is no rise in mortgage defaults in Canada.

The economy is collapsing. It is going to take a few months for the credit crunch to show up in the standard economic numbers, but it will. If you look at all the stocks that are falling, they include companies with little debt and no connection to the housing industry. The fear is that companies and business will no longer buy their product.

[Who's Doing What?]

Ofcourse the analysis is correct. It would be nice to have Warren's money to find the right places to invest. But that is not the problem. The problem is that a lot of people lost too much to risk it again. They won't be re-investing in the market anytime soon. For some people their retirements have been destroyed, for others delayed. For some families their kid's college funds are now half gone. The only people who will get richer from this are the rich. Some average guys might get lucky and hit it big but for the most part it will once again be only the people who have lots of money, who will be making the biggest gains.

[August1991]

It's easy to play a non zero-sum game when you have a treasury to backstop your mistakes. Surely you don't think sub-prime mortgages represented an expansion of real wealth?

Did Buffet make his billions through a treasury back stop?

Vancouver King, you can quibble but I made my point. Guys like Buffet, Gates and even Conrad Black are not rich because they stole from poor people. Life (a "modern" economy) is not a zero sum game.

Bob Rae seems to have understood this idea. I'm waiting for other NDP types to understand it too.

Then we can all, left/right, have an intelligent discussion.

Ofcourse the analysis is correct. It would be nice to have Warren's money to find the right places to invest. But that is not the problem. The problem is that a lot of people lost too much to risk it again. They won't be re-investing in the market anytime soon.

I don't think you understand financial markets.

Imagine that you live on a street with 100 houses. Now imagine that five houses are sold. The first at 500,000$ and the fifth, after falling prices, at $300,000. The other 95 homeowners on the street feel impoverished. But are they?

Markets are made by a small number of people. Financial markets are inherently speculative.

If you don't like the heat, leave the kitchen. At present, I'm mostly in GICs and I have been since last spring.

Edited October 11, 2008 by August1991

[independent]

"You know, five years from now, ten years from now, we'll look back on this period and we'll see that you could have made some extraordinary (stock market) buys. That doesn't mean it won't get more extraordinary a week or a month from now. I have no idea what the stock market is going to do next month or six months from now. I do know that the American economy, over a period of time, will do very well, and people who own a piece of it will do well."

http://www.cnbc.com/id/27116449

You are not helping Harpers cause by quoting someone who says 'people who own a piece of it will do well'. Any comment on your part that confirms Harpers insensitivity will do nothing to sway anyone.

Edited October 11, 2008 by independent

[Jobu]

You are not helping Harpers cause by quoting someone who says 'people who own a piece of it will do well'. Any comment on your part that confirms Harpers insensitivity will do nothing to sway anyone.

Please explain.

[Bryan]

I put in my bids in the first hour of trading, sold near the end of the day. Unfortunatly, not at the top, but well above the bottom.

I think for the next little while we will see a lot of this too. People unfamiliar with how the market works will continue to panic as they see wild swings, while people who do understand it will contiinue to make daily in and out gains from those people's ignorance. It's pretty easy to make 5-10% a day if you pretty much know in advance that things will fall and recover every day.

That's not a game I want to play. I just want to buy in to a couple of stocks that are obviously worth significantly more than they are trading for right now, and wait.

People who complain about this seem to think that it has to be millions or nothing. Do they take the same approach to wages? You work, you earn a little so that you can earn a little more, etc. Same rationale applies. You invest a little, make a little more, invest a little more. There's no reason for anyone NOT to put a few hundred in to make a few hundred more if that as much as you can afford. It all adds up in the end.

Edited October 11, 2008 by Bryan

[White Doors]

Your point has not been made, here is what you miss: High rollers like Buffet are loathed by middle class people faced with financial disaster at the hands of other Wall St. high rollers.

Voter anger only doubled when the other Buffet types - bankers, speculators and govt cronies - got their worst crimes reimbursed by the American treasury.

I'm middle class and you don't speak for me. I have nothing against Warren Buffet.

Unless you are full of envy, there is no reason not to like him.

[independent]

Please explain.

It is a given that there are still good buys in the market. There is nothing that Warren Buffet or Harper said that takes a genius too know. It is just very inappropriate for a Prime Minister to mention how you can invest money when some people have lost a fortune or have lost their jobs. It was very appropriate for Buffet a leader in the investment community too make such claims.

Edited October 11, 2008 by independent

[Jerry J. Fortin]

Harper is free to say what he wants, as we all are. However the Prime Minister is able to sway the opinions of others. He has something to gain from the effort as does Mr. Buffet. The reality here is that the vast majority of players in the market are simply small time investors with less than a few hundred thousand dollars at stake. There is a substantial difference in the loss of 40% of a portfolio of millions that are in truth not needed by the holders of those portfolios and the meager investments of the majority of citizens that depend on those market holdings for their pension plans in order to retain some form of income.

The more affluent of citizens can afford to take the hit and survive but the same cannot be said for the less affluent. In order to bolster the markets the affluent need the majority of investors to remain invested in the market to support stock values and avoid losses. So what these few affluent citizens want is for those less able to take the loss.

Not exactly the best interests of a majority of citizens that is being looked after, is it?

[Jobu]

It is a given that there are still good buys in the market. There is nothing that Warren Buffet or Harper said that takes a genius too know. It is just very inappropriate for a Prime Minister to mention how you can invest money when some people have lost a fortune or have lost their jobs. It was very appropriate for Buffet a leader in the investment community too make such claims.

So should Harper be spreading false panic and willing a recession like Dion and Layton?

Or should he ignore reality?

What exactly do you want him to say?

Me? I like his honesty.

[Jobu]

The reality here is that the vast majority of players in the market are simply small time investors with less than a few hundred thousand dollars at stake.

So we've established you don't know what you're talking about...

There is a substantial difference in the loss of 40% of a portfolio of millions that are in truth not needed by the holders of those portfolios and the meager investments of the majority of citizens that depend on those market holdings for their pension plans in order to retain some form of income.

What sort of pension plans are 100% invested in the markets? They are pretty much as risk averse as they come.

So if I have millions in the market and lose 40%, somehow that doesn't matter? Yet if you lose $40 it does?

The more affluent of citizens can afford to take the hit and survive but the same cannot be said for the less affluent. In order to bolster the markets the affluent need the majority of investors to remain invested in the market to support stock values and avoid losses. So what these few affluent citizens want is for those less able to take the loss.

Not exactly the best interests of a majority of citizens that is being looked after, is it?

You are totally ignorant of how the market works and who is invested in it. Come back when you have a better idea. Until then, I'm sure you'll continue to feel sorry for yourself and expect handouts from the government and your fellow citizens.

[Who's Doing What?]

I don't think you understand financial markets.

Imagine that you live on a street with 100 houses. Now imagine that five houses are sold. The first at 500,000$ and the fifth, after falling prices, at $300,000. The other 95 homeowners on the street feel impoverished. But are they?

Only if they remortgaged their house to take advantage of the extra $200,000 in value that they thought they had. It is possible that they now have a $400,000 dollar mortgage on a $300,000 dollar house.

Markets are made by a small number of people. Financial markets are inherently speculative.

If you don't like the heat, leave the kitchen. At present, I'm mostly in GICs and I have been since last spring.

You are invested in GIC's and talking about the stock market?

People who had $100,000 in the market 2 months ago now have about $60,000. Some were hit harder, others not so hard but regardless they now have less capital than they they did.

Now what do they do? Leave their $60,000 in the market to possibly lose even more? Or do they try to cut their losses and pull it out and put it into something more stable like GIC's and Govt. Bonds?

[Who's Doing What?]

So should Harper be spreading false panic and willing a recession like Dion and Layton?

Or should he ignore reality?

What exactly do you want him to say?

Me? I like his honesty.

Personally I like his FLIP-FLOP on the issue. All of a sudden our banks need a bail out. What happened to everything being all roses with our financial situation?

[independent]

So should Harper be spreading false panic and willing a recession like Dion and Layton?

Or should he ignore reality?

What exactly do you want him to say?

Me? I like his honesty.

Harper was ignoring the reality that people were losing there investments and losing there jobs.

He did nothing to reassure them that he will do something too help.

Both Dion and Layton assured the public that if elected they would do something to aid the economy. Calming their fears.

Harper saying there were good investments out there was not being honest it was being insensitive.

Edited October 11, 2008 by independent

[Bryan]

Personally I like his FLIP-FLOP on the issue. All of a sudden our banks need a bail out. What happened to everything being all roses with our financial situation?

Our banks are the strongest in the world. They don't need a bailout, and there isn't one.

[Bryan]

Both Dion and Layton assured the public that if elected they would do something to aid the economy. Calming their fears.

Jack and Dion were CREATING fears, not calming them.

[independent]

Jack and Dion were CREATING fears, not calming them.

http://www.ctv.ca/servlet/ArticleNews/stor...?hub=TopStories

How about Harpers finance minister? He is starting to do just what Dion and Layton were telling Harper to do.

It sounds like Harper's finance minister is calling Harper a lier.

Edited October 11, 2008 by independent