What's Buffett Been Up To?
Nicholas Santiago | Jan 07, 2014 12:47PM ET
Warren Buffett is considered by most people to be the best investor in the world. After all, he is one of the richest men on the planet. Mr. Buffett is a disciple of the legendary Benjamin Graham. Ben Graham's philosophy was to always have a margin of safety when investing and Warren Buffet has certainly mastered that. Mr. Buffett was the son of a U.S. Congressman, so he so he was able to see how things worked in Washington D.C. and the political world.
Over the past six years Mr. Buffett has been adamantly promoting that people should own stocks. In 2008, he invested money in Goldman Sachs when many in the public thought that the firm was destined to collapse. After all, financial giant Lehman Brothers was allowed to collapse. Other giant financial firms such as Bear Stearns, Merrill Lynch, Washington Mutual, Countrywide Financial, Wachovia, and many others were all taken over for pennies on the dollar. How did Warren Buffett know to invest in Goldman Sachs Group above the other financial firms? At the time when he got involved with Goldman Sachs the common stock was trading around $125.00 a share. Of course, Mr. Buffett bought preferred shares. During the time that Mr. Buffett was invested in the company the common stock of Goldman Sachs declined to $44.47 a share before finally bottoming out in November 2008. Many investors in the public followed Mr. Buffett into Goldman Sachs stock at $125.00 a share but were shaken out when the company looked like it was on the verge of collapse. After all, who can hold a stock when it drops by more than 62 percent from their entry? Only Warren Buffett can have that kind of staying power.
In August 2011, Mr. Buffett invested $5 billion in Bank of America (PSX ). Many of the leading oil refinery companies develop polymers that allow energy products to flow freely in a pipeline. What does the Oracle of Omaha know that we don't know about a potential pipeline being built from Canada now? Either way, we can only guess that he knows a lot more than the rest of us. Sometimes when you have as much money and political influence as Warren Buffett you can make the rules as you go along. It is well known that Mr. Buffett is a major financial contributor and financial advisor to President Obama. Remember, Warren Buffett knows how Washington D.C. Works, he has been taught this since his father was a U.S. Congressman in 1942. So when it is all said and done Mr. Buffett is the greatest investor of all time, but he might also be the greatest insider of all time as well.
Nicholas Santiago
www.InTheMoneyStocks.com
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