Free

Closely watched Buffet recalculating his bets - Essay Example

Comments (0) Cite this document
Summary
Warren Buffet gives us a very interesting insight into the brilliant mindset of this very famous investor. The head honcho of Berskhire Hathaway is a living legend with his own inimitable style of takeover strategies in the world of financial cesspool…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97% of users find it useful
Closely watched Buffet recalculating his bets
Read TextPreview

Extract of sample "Closely watched Buffet recalculating his bets"

Mr. Warren Buffet – Into the Mindset of a Genius This short article on Mr.Warren Buffet gives us a very interesting insight into the brilliant mindset of this very famous investor. The head honcho of Berskhire Hathaway is a living legend with his own inimitable style of takeover strategies in the world of financial cesspool. His own investment policies tread very much on the same lines as that of Mr. Benjamin Graham, a leading name in the realm of modern security analysis.
The year 2008 saw a heavy landslide fall in American economic conditions and a downward spiraling of stocks in the Wall Street markets leading to a financial crash down that shook even the high and the mighty. Even financial wizards like Mr. Buffet took a beating, amounting to around $25 billion in personal losses. However proving that he was made of sterner stuff, he took the initial beating and then decided to turn round this very crippling period of economic recession to his own advantage. Here he treaded paths where very few would have ventured and he dared to turn tides in his own favor. It was Mr. Buffet who advised the American government to bail out the plummeting financial market. It was again him who at the very middle of this turmoil advised all Americans to buy as many stocks as possible. And true to his given advice he led the way. Against all common sense and amidst general misgivings he decided to invest $5 billion in Goldman Sachs in September 2008. This was perhaps the boldest step ever taken by him in his entire career as a financial investor. After about eight days he declared that he was going to invest another $3billion in General Electrics which was at that time on rather shaky grounds. Mr. Buffet has labeled such companies as “sleeping beauties” as their stock market values are far lower than their actual book values. He believes in taking over such companies that are in turmoil and may look for takeovers or getting grounded. He invests in them by buying large amounts of stocks in the company and gets financial help in the form of concessions, in exchange.
If we take a closer look at his modus operandi we will see a very sharp mind and a logical pattern of thinking behind these seemingly very absurd moves. As the Government sets off to bail out these companies to stabilize the failing economy we find that Mr. Buffet does not get any direct personal help. However, his stocks get the benefit of being bailed out by using the general taxpayers’ money. He invested in Goldman Sachs and General Electrics which all received financial bail outs from the government. So public money helped Mr. Buffet make billions where others were turning paupers.
At present Mr. Buffet however seems to have had a change of mind. After going on a stock buying spree last year, now we find that Berskhire Hathaway is treading a little more cautiously. Less stock are being bought at the moment and investing is being made mainly on government security and debt bonds. According to Mr. Buffet the economic crisis though on the way to recovery may yet stumble and fall back once more. In his words “We are not out of problems yet... We have got to get the sputtering economy back so it is functioning as it should be.” (quoted in Bowley, “Closely Watched Buffet Recalculating His Bets”). He has had his share of mistakes too. His investment in an energy production company when the fuel prices went sky high did not fare well and so did his stocks in two Irish bank investments. In fact we find that in the present scenario his company is selling more stocks than buying, especially those that of the infamous Moodys and has pulled down its investment in its share to only 2%.
As we read the article we understand what stuff geniuses and legends are made of and why they stand apart. This economic crisis which perhaps has been the worst in this decade saw the fall of many giants and stalwarts in the financial world. The gravity of this economic meltdown can be best understood the way Mr. Buffet framed it by comparing the financial damages to be equivalent to that sustained in the attack of the Pearl Harbor, only this time the Pearl Harbor was happening in Wall Street. He definitely suffered initial setbacks (his company made a loss of $1.53 billion and lost one fifth of its value in the market in the first quarter of 2008) and as he says, he believes in bargaining and buying things now, he pulled himself up and put on his thinking cap and made millions where others made none. As Mr. Buffet himself tells us “It has been an incredibly interesting period in the last year and a half. Just the drama...Watching the movie has been fun, and occasionally participating has been fun too, though not in what it has done to people’s lives.”(quoted in Bowley, “Closely Watched Buffet Recalculating His Bets”). Mr. Buffet, a living legend and a financial wizard to many small time investors and financiers, have lived up to his title even in this scene of economic meltdown worldwide and in spite of some of his failures in his recent investments.


Works Cited
Bowley, G. “Closely Watched Buffet Recalculating His Bets”. New York Times, Economy.
8th September 2009. B1. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Closely watched Buffet recalculating his bets Essay”, n.d.)
Closely watched Buffet recalculating his bets Essay. Retrieved from https://studentshare.org/miscellaneous/1557477-closely-watched-buffet-recalculating-his-bets
(Closely Watched Buffet Recalculating His Bets Essay)
Closely Watched Buffet Recalculating His Bets Essay. https://studentshare.org/miscellaneous/1557477-closely-watched-buffet-recalculating-his-bets.
“Closely Watched Buffet Recalculating His Bets Essay”, n.d. https://studentshare.org/miscellaneous/1557477-closely-watched-buffet-recalculating-his-bets.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Closely watched Buffet recalculating his bets

Critique of a play to be watched

...production it would be in his firm reliance on this element of the Greek stage, but as the play advances one witnesses the implementation of modern methods of shot selection and editing that are melded into this otherwise authentic production. In these regards, Hall’s version of the Eumenides is not as entirely authentic in the classic Greek sense as he would have the audience believe, yet is perhaps more powerful for it, as his subtle re-workings emerge in aspects that open the play to broader contextual meaning and purpose. In great part the screen space is outlined in black and white. While it is a filmed stage production and one can argue that this is simply an aspect of its reproduction onto the...
4 Pages(1000 words)Essay

Boeing Bets the Company

...?Boeing Bets the Company Boeing in 2004 was the market leader in the manufacturing of commercial and military aircrafts. The company was facing issues due to the fact that its closest competitor, European Aeronautic & Space Company (AEDS), was taking a lot of market share away from Boeing in the commercial sector of the industry. Boeing made some key acquisitions to improve its position in the military market, but as a consequence they loss track of the importance of the commercial airplane sector. The market share of the company decreased from 70% in 1996 to less than half that by 2003. The company faced a major threat to its business because AEDS developed a new airplane that made Boeing’s 747 aircraft virtually...
3 Pages(750 words)Term Paper

To What Extent can Standardized Tests be used in Measuring the Competitiveness of Nursing School Curricula

3 Pages(750 words)Article

Tesco - Warren Buffet

...? Tesco - Warren Buffet 0 Introduction The report aims to talks about entrepreneurship and the skills associated with it. The report is based on Tesco and the man behind Tesco success, Warren Buffet. The overall purpose of the report is to analysis the key skills of entrepreneurs such as Warren Buffet which has helped them to become great entrepreneurs. By analyzing the key skills it will help individuals to cultivate the necessary skills which can make one successful entrepreneur. In addition to the entrepreneur’s skills, the concept of marketing and marketing mix has also been explained in relation to the chosen organization. In an organization the culture plays a vital role and henceforth the report also aims to discuss about... of...
6 Pages(1500 words)Lab Report

Journal Review.Describing Trends & Reading Closely

...?Journal Review – Describing Trends and Reading Closely In the of writing of this paper, I have discovered some insights about my field in economics which I might have otherwise missed had I not tried to look towards understanding how it seems from a non-economist’s point of view. Economics as a whole is not solely concerned with just a single aspect of it, as it can be expected that changes within the society caused by cultural or biological reasons could dictate or change the observed trends in for example, the trends in the kinds of employees hired by large companies. Also, economic concepts can be explained in a much simpler way to others by creating similarities or analogies to things which may be expected to be...
9 Pages(2250 words)Essay

Warren E. Buffet 2005

...Warren E. Buffet 2005 0 Introduction Widely known as 'the Oracle of Omaha' Warren Buffett is the Chairman of Berkshire Hathaway and considered to be the greatest investor of the century. Even though the wealth of Warren Buffett oscillates with the performance of the stock market, the valuation of his wealth was standing close to $ 42.3 billion and he continued to be the second richest man in the world. The investments of Warren Buffett are being handled by his company Berkshire Hathaway as a holding company. The investments of Warren Buffett at some point of time included investments in companies like Coca-Cola, American Express, and Gillette. Buffett had the clairvoyance...
19 Pages(4750 words)Essay

Warren Buffet

...is correct in his statement. In as far as the chance to amass huge returns exists; the active investor has more fees to incur and stands a big risk to make losses on the investments. The fact that Buffet is an active investor in the Berkshire Hathaway and has witnessed a reasonable return cannot blind any potential investor on the needs of active investment. The implication of this situation is not to discourage active investment but rather to call for caution while investing. This paper does not in any way dissuade people from engaging in investment as active investors. It only presents a case in support of passive investment ahead of active one. References Bernstein, W, 2001, The intelligent asset...
2 Pages(500 words)Essay

HIS

...of a “self-made man.” He was not highly educated or an Eastern elite, but a westerner, a sel-made man, and a man of battle, who represented the common man and the West in his ascendancy to the presidency. Some would say his ignoring the US Supreme Court in Worcester v Georgia and moving the American Indians westward on the Trail of Tears to be an infamous legacy as well. 9. Do you think: removal of the Indians to west of the Mississippi was the only way to save them? Why?Of course, there were other ways to “save” the American Indians of the East, but would have come at a cost to American expansion and industrialization, as well as states’ plans to attract settlers. Honoring previously executed treaties...
1 Pages(250 words)Assignment

Warren Buffet & His Organization

...How the organization was led Warren Buffet led his organization to success and won the heart of the employees as well as the other members of the society. Warren was inspirational to his followers which had positive impacts on their ability to carry out their duties effectively. According to the participative leadership style, the leaders can achieve their goals and objectives by sharing the decision making abilities with the employees. This was evident during the leadership of Warren. Empowering the employees to make decisions is useful in ensuring that a sense of belonging to the organization is developed. This encourages the employees to be loyal to the company. Loyal employees...
3 Pages(750 words)Assignment

1st Warren Buffet and 2nd Hershey Foods

...Express, The Coca Cola Company, Wells Fargo and Company among others. American Express is one of America’s leading credit card service providers. Buffet owns 14.8% of this finance corporation. Over the past months, the company lost partnership with Costco wholesale that opted to start working with Visa. The loss at Costco is more substantial, but the partnership contract is valid till early 2016. Berkshire has increased its equity share at Coca cola from 8.9% to 9.1% due to stock purchase. Buffet has been keen and committed to progress in Coca Cola than any of his investment. According to (Hagstrom 58) most people will agree that Warren Buffet has been strong on...
4 Pages(1000 words)Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Closely watched Buffet recalculating his bets for FREE!

Contact Us