May 3, 2010--The Sage of Omaha
At Berkshire Hathaway's annual shareholders meeting, referred to as the Woodstock of Capitalism, Warren Buffet as usual opined about various subjects. None more widely reported than his comments about Goldman Sachs and its CEO, Lloyd Blankfein. (New York Times article linked below.)
About the embattled Mr. Blankfein, Buffet gushed, "If Lloyd had a twin brother, I would vote for him."
And about Goldman's deal where investors were not told that Goldman was betting Abacus short while selling clients Abacus long, Buffet was quoted as saying that those investors should have done a better job of doing their own due diligence and not just followed Goldman's advice.
Buffet is of course entitled to his opinion; but the New York Times in its reporting about the meeting and what the Sage of Omaha had to say in fierce defense of Goldman should have mentioned a few things about Buffet and Goldman that might have put a different spin on his comments.
The Times said not a word about Buffet's sweetheart investment in Goldman last September when the tottering financial giant sold him $5 billion in preferred shares that paid a whopping dividend of 10 percent. Nor did the Times mention the Billionaire Next Door's classic quote about derivatives: he called them "financial weapons of mass destruction" while investing $63 billion in Hathaway money in just such CDO WMDs.
To its credit the Times did at least report that Buffet, as a result of his deep investment in hedging contracts, is opposed to any new derivatives regulation.
It would, though, have been much better and more responsible to hear from the Times about the rest of the Buffet-Goldman story.
About the embattled Mr. Blankfein, Buffet gushed, "If Lloyd had a twin brother, I would vote for him."
And about Goldman's deal where investors were not told that Goldman was betting Abacus short while selling clients Abacus long, Buffet was quoted as saying that those investors should have done a better job of doing their own due diligence and not just followed Goldman's advice.
Buffet is of course entitled to his opinion; but the New York Times in its reporting about the meeting and what the Sage of Omaha had to say in fierce defense of Goldman should have mentioned a few things about Buffet and Goldman that might have put a different spin on his comments.
The Times said not a word about Buffet's sweetheart investment in Goldman last September when the tottering financial giant sold him $5 billion in preferred shares that paid a whopping dividend of 10 percent. Nor did the Times mention the Billionaire Next Door's classic quote about derivatives: he called them "financial weapons of mass destruction" while investing $63 billion in Hathaway money in just such CDO WMDs.
To its credit the Times did at least report that Buffet, as a result of his deep investment in hedging contracts, is opposed to any new derivatives regulation.
It would, though, have been much better and more responsible to hear from the Times about the rest of the Buffet-Goldman story.
posted by Steven Zwerling at
5:09 AM
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