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View Full Version : Warren Buffet "stocking" up


tony hipchest
10-17-2008, 11:35 AM
great advice and great article. theres a reason warren is the richest man in america (as of a week or 2 ago) and possibly the world.

http://www.nytimes.com/2008/10/17/opinion/17buffett.html?_r=1&ref=opinion&oref=slogin

THE financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher. In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary.

So ... Iíve been buying American stocks. This is my personal account Iím talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings, which are all committed to philanthropy.) If prices keep looking attractive, my non-Berkshire net worth will soon be 100 percent in United States equities.:jawdrop:
Why?

A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nationís many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.

...

Equities will almost certainly outperform cash over the next decade, probably by a substantial degree. Those investors who cling now to cash are betting they can efficiently time their move away from it later. In waiting for the comfort of good news, they are ignoring Wayne Gretzkyís advice: ďI skate to where the puck is going to be, not to where it has been.Ē
I donít like to opine on the stock market, and again I emphasize that I have no idea what the market will do in the short term. Nevertheless, Iíll follow the lead of a restaurant that opened in an empty bank building and then advertised: ďPut your mouth where your money was.Ē Today my money and my mouth both say equities.