Would your reply possibly be this? Well, it all depends on what my tax rate will be on the gain you're saying we're going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent. Only in Grover Norquist's imagination does such a response exist.
It's nice to have a lot of money, but you know, you don't want to keep it around forever. I prefer buying things. Otherwise, it's a little like saving sex for your old age.
The commission of the investment sins listed above is not limited to 'the little guy.' Huge institutional investors, viewed as a group, have long underperformed the unsophisticated index-fund investor who simply sits tight for decades. A major reason has been fees: Many institutions pay substantial sums to consultants who, in turn, recommend high-fee managers. And that is a fool's game.
Can you know you can have institutions that put curbs on that in various ways, and actually what the banks, you know, they have various capital ratios and that sort of thing, but the banks got around them, I mean, they set up sieves and that sort of thing just to get more leverage. People love leverage when it's working. I mean, it's so easy to borrow money from a guy at X and put it out at X.
I bought a company in the mid-90s called Dexter Shoe and paid $400 million for it. And it went to zero. And I gave about $400 million worth of Berkshire stock, which is probably now worth $400 billion. But I've made lots of dumb decisions. That's part of the game.
The (stock) market is there only as a reference point to see if anybody is offering to do anything foolish. When we invest in stocks, we invest in businesses.
An investor will succeed by coupling good business judgment with an ability to insulate his thoughts and behavior from the super-contagious emotions that swirl about the marketplace.
We have provided capital here with a couple of institutions recently. The Federal government did that in the '30s for the RFC and I think there could well be a proper role for government in that.
In the financial markets I find it easy to predict what will happen and very difficult to predict when it will happen. I think that things were clear during the bubble as to what would happen eventually.
It's very important that the determination of the US Congress to do what is is needed be made evident this week and by the actions of most of the members. I mean, you're not going to get total assent.