Echoing a recent blog-entry from October 13, Warren Buffett praises the ‘American system’ and advises investors to embrace the government’s program for the economy in this clip from Youtube. Buffet’s penultimate advice: “Be greedy when others are fearful…”
Today, in a stunning reversal, Treasury Secretary Henry Paulson said that the government isn’t going to buy all those distressed assets after all! That is bad news for the taxpayers, who will not get the same return on Paulson’s other “investments”. But it’s good news for people who are willing to buy at a time that distressed assets will be going for rock-bottom prices. Don’t take my word for it though, ask the richest man in the world…
How does Buffett feel about investing in distressed assets? It’s a sure bet. Buying distressed assets at distressed prices is a proven method to make money, according to Buffett. The government wouldn’t be spending taxpayer money, says Buffett, but investing it.
Where others see difficulties, Buffett sees opportunity.
“Confidence will come back,” he says. Buffett offers that the American economy has created a seven to one increase in the U.S. standard of living over the last century, despite the difficulties of two world wars, a flu pandemic, and even the Great Depression. Likening the American economy to an athlete who is ‘down but not out,’ Buffett says, “We’ve got all the ingredients for a sensational future.”
Now that the government isn’t buying, you can bet the prices for distressed assets will be lower than ever. If you can find a team with the expertise to filter out the good loans from the bad, you will make a pile of money.
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Timeline of a financial maelstrom… | Smart-Stock.net
on November 14 2008
[...] is the light at the end of the tunnel? As we noted in our most recent post, there is room for optimism, despite the recent announcement that distressed assets will no longer be the focus of [...]