epeon

Buffett's BNI Purchase: Bearish Bet on the Economy?

I am a bit puzzled by Buffet's bet, too. He waited till BNI went up from March and then put on top of that another 30% premium. It seems to me, that the US economy has to come around big for him to make out well.

Buffet did this last year when he bought COP at the top. He also bought GE at 20. Of course, in the GE case he got a 10% preferred dividend to tide him over. With the Obama policies, I think we could see several years of low growth. It may take him some time for this to work out. Again, just like COP.

Buffett Puts Money to Work; Buys General Electric Preferred Stock

Buffet gets deals that no one else can. If I could get that deal I would buy those GE bonds, too. Of course, it dilutes the stock for the GE stockholders. The high interest costs comes of the earnings and hurts the GE stockholder, too. But, gee, there just little people so it is ok.