Warren Buffett Speaks in a furniture store in Omaha
Warren Buffett had an awesome discussion on CNBC - if you didn't get a chance to see it, I HIGHLY recommend you take a look.
Here is the video and it is worth watching, if you are able!
He discusses "bids as puts" - he is bidding on billions of dollars of bonds being put out by Ambac, MBIA, etc. They DID come to him for help, but when he named his price, they balked. NOW HE HAS TAKEN THE OFFER OFF THE TABLE, as he says in this video, AND he is getting a better price with more money!! Love his discussion - ... nope, I make an offer and it is on the table for 17 mins, then that put is too old!
Warren also talks about what the Dow at 100,000 at the end of the Century means (2099), it means a return of only 4.2% to 4.3% annually!! That's NOTHING - as he says, and a Dow of 10 million STILL isn't double digit returns annually!
Warren criticizes the stock broker world for using 8%. He says pension funds that say they will return 8% are pulling the wool over your eyes. Warren uses 6.5%. OK, now understand this ... Warren Buffett, the guy who has received over 20% returns, on average, most of his investing life only says 6.5% is the rule for investing.
Check out the difference after 30 years - 1.5% is huge. So the expectations with pension funds (that is the cities that "guarantee" their employees a pension) and set aside only enough for payouts, based upon growth of 8% per year, will NOT achieve their goals. (Can you say higher taxes in the future to pay for these benies!?!)
Warren also talks about "Waves of de-leveraging" - that is, the U.S. is going through a period where we need to get rid of our debt! De-debting if you will. Decreasing our debt in waves! So the market still has a way to go, no doubt (in Warren Buffett's eyes).
Here is the video and it is worth watching, if you are able!
He discusses "bids as puts" - he is bidding on billions of dollars of bonds being put out by Ambac, MBIA, etc. They DID come to him for help, but when he named his price, they balked. NOW HE HAS TAKEN THE OFFER OFF THE TABLE, as he says in this video, AND he is getting a better price with more money!! Love his discussion - ... nope, I make an offer and it is on the table for 17 mins, then that put is too old!
Warren also talks about what the Dow at 100,000 at the end of the Century means (2099), it means a return of only 4.2% to 4.3% annually!! That's NOTHING - as he says, and a Dow of 10 million STILL isn't double digit returns annually!
Warren criticizes the stock broker world for using 8%. He says pension funds that say they will return 8% are pulling the wool over your eyes. Warren uses 6.5%. OK, now understand this ... Warren Buffett, the guy who has received over 20% returns, on average, most of his investing life only says 6.5% is the rule for investing.
Check out the difference after 30 years - 1.5% is huge. So the expectations with pension funds (that is the cities that "guarantee" their employees a pension) and set aside only enough for payouts, based upon growth of 8% per year, will NOT achieve their goals. (Can you say higher taxes in the future to pay for these benies!?!)
Warren also talks about "Waves of de-leveraging" - that is, the U.S. is going through a period where we need to get rid of our debt! De-debting if you will. Decreasing our debt in waves! So the market still has a way to go, no doubt (in Warren Buffett's eyes).
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