RRJ

Buffett Serving Free Lunch? (Part II)

Your labyrinthine hypothesis shows just how much contortion you have to do to make this a horrible decision on Mr. Buffett's part. I admit to not understanding it, whereas I fully do understand what Mr. Buffett and the SEC have said about how Berkshire is accounting for his very limited and relatively uncomplicated derivative positions. Occam's razor tells me you are way out in left field here.

One simple possibility you seem to wholly ignore-- who says Berkshire has to sell these contracts at all? Why not simply let them expire and either pay (if the indexes are still below where they were when the contracts were written), or do nothing?