Patterico's Pontifications



Filed under: General — Patterico @ 2:10 pm

Warren Buffett has said: “A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.”

So what do you do when Warren Buffett is fearful?

9 Responses to “Uh-Oh”

  1. So…who’s being greedy right now (and prompting his fear)? Other than the government of course…

    Timothy Watson (92eba3)

  2. If you’re going to retire within the next five years, put your money under the mattress. If you’re going to retire in twenty years, buy. Warren Buffet’s investors may be as old as he is. They need income, now. Nothing to do with a forty-year old or even a fifty-year old.

    nk (502275)

  3. Same Buffet… I don’t 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.

    That quote was also in the linked interview. And a more rigorous reading of the second article reveals that Buffet and Munger are not actually ‘fearful’ over their portfolio holdings, they are merely saying the economy is likely to be moribund [okay…DOA] for this year and who knows further out. These two are renowned for their long holding periods. So although they have been buying ‘too early’, one needs to take into consideration what they are buying, as well as what they have been selling. They have their own special way of determining value and buy point that has been a great strategy for the post-war decades, but even they can’t know how things will turn out. Politics being the crucial fly-in-the-ointment, in my way of thinking. I don’t practice the value approach, as I try to stay much more nimble, except for hanging on to precious metals since 2003 through some real roller coaster volatility. Buy and hold has always scared me. Takes guts, and deeper pockets than I have.

    allan (eb75b3)

  4. Buffet has been noted for increasing his holdings of BNSF lately, yet rail traffic is down – notice all of the news stories about strings of parked rail-cars throughout the country.
    As someone who always looks forward, perhaps he sees a strong increase in rail transportaion in the future reinforcing the shift to long-range rail transport away from trucks that started during the period of $4-5/gl diesel?

    AD - RtR/OS (5e419c)

  5. Gold. Silver. Platinum.

    Ed (52bb9a)

  6. Guns. Ammo. Canned goods.

    Leviticus (c729f2)

  7. Certainly guns and ammo are the only commodities that Obama has succeeded in supporting higher price and higher demand in.

    SPQR (26be8b)

  8. Forget what he says; what is he doing? Maybe he’s trying to keep everyone else fearful while he quietly acts greedily?

    Or maybe not.

    Xrlq (62cad4)

  9. What makes you think Buffett is fearful? I would bet he is doing as he usually has in the past — looking for good investments to make.

    If you want to “buy low and sell high,” you could hardly ask for a better opportunity to “buy low.”

    The problem, of course, is figuring out what is probably going to be higher priced in the future when you may want to (or need to) sell — something that Buffett has had an eery ability to figure out.

    Micajah (918bfe)

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