Warren Buffett

How to Profit in Any Kind of Market

When it comes to the global financial crisis, many so-called "experts" think the worst is behind us. But I don't buy it.

And I'm not alone.

Just look at what some other big-name investors - each also known for their independent thinking - are saying or doing right now:

  • Bond king Bill Gross is nervous and raising cash.
  • Author, commentator and global-markets guru Jim Rogers has repeatedly said that he's not investing in stocks anywhere in the world right now.
  • Hedge-fund heavyweight John Paulson is moving aggressively into gold.
  • And investing icon Warren Buffett - never one known for tipping his hand - is candidly stating that the U.S. financial-crisis cleanup is far from complete. The fact that he's reportedly buying more shares of Korean steel dynamo Posco (NYSE ADR: PKX) would punctuate this point.
Indeed, entire nations - I'm thinking specifically of China, India, Brazil, Chile and one or two others - are adopting similar stances. And they're doing so for the same risk-fearing reasons. They want to grow their money but they don't want to place it at risk any more than we do.

This kind of uncertainty can be paralyzing, making it tough to decide where - or even if - we should deploy our investments.

Fortunately, we've been here before. And what we learned will allow us to profit no matter what the financial future holds for the U.S. marketplace.

To learn the four secrets to investing success, please read on...

With His Rebuke of Kraft, Buffett Reminds Wall Street That Shareholders Come First

A decade ago, investing guru Warren Buffett helped torpedo a $15.3 billion Coca-Cola Co. (NYSE: KO) bid for Quaker Oats Cos., arguing that the terms were lousy and the proposed price way too high.

Now Buffet is causing similar complications with a Kraft Foods Inc. (NYSE: KFT) plan to buy Britain's Cadbury PLC (NYSE ADR: CBY), announcing that he's wholly opposed to a plan to issue as many as 370 million Kraft shares to get the deal done. As Kraft's largest shareholder - Buffett's Berkshire Hathaway Inc. (NYSE: BRK.A, BRK.B) owns 9.4% of Kraft's common stock - his opinion is likely to carry the day.

Wall Street is furious: Deal fees are not as easy to come by as they used to be, and this transaction promised to be especially juicy - thanks to the spin-offs and share issues Kraft is doing to get the buyout done. Some of those maneuvers won't now be necessary, and if the transaction does get done it will be finalized at a lower price.

From the outset it was clear to me that the Kraft/Cadbury deal represented "managerial capitalism" more than it did shareholder capitalism. And in that battle, I know which side I am on.

I'm with Warren.

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Investment News Briefs

With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world. Nikkei Hits Three-Month High; Obama to Small Banks: Step Up the Lending; Tax Credit Fuels 7.4% Gain in November Home Sales; OPEC Leaves Oil Output Unchanged; WSJ: Apple Approaches CBS, Disney About Internet Television Service; Report: Computer Hackers Stole Millions of Dollars from Citi; Federal Court Upholds Ruling on Patent Infringement by Microsoft; Buffett Adds Comcast COO to Berkshire Board A weaker yen and strong technology stocks helped Japan's Nikkei 225 finish 1.9% higher at 10,378.03 yesterday (Tuesday), the highest level in three months. Most shares of tech companies gained after Barclays Capital (NYSE ADR: BCS) upgraded its rating on Intel Corp. (Nasdaq: INTC) from overweight to market weight on Monday. "The U.S. dollar strength is undoubtedly helping out the Nikkei," Cameron Peacock, an analyst at IG Markets told MarketWatch.com. "With Japan being such an export-focused economy, the weaker yen is a real positive for Japanese companies' earnings." The White House will seek to remove bureaucratic barriers that prevent community banks from lending so they can help businesses seize "enormous opportunities" for growth, U.S. President Barack Obama told the heads of a dozen small lenders yesterday (Tuesday). The president encouraged the bankers to keep the nascent recovery of the U.S. economy going by increasing their lending to small businesses and supporting the financial reform measures being proposed on Capitol Hill.

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SEC Filing Shows Buffett Played It Safe Ahead of His Burlington Northern Buyout

Having gone “all in” on a U.S. economic recovery with his $44 billion acquisition of Burlington Northern Santa Fe Corp. (NYSE: BNI), Warren Buffett showed a less aggressive stance in Berkshire Hathaway Inc.'s (NYSE: BRK.A, BRK.B) Nov. 16 filing with the Securities and Exchange Commission (SEC).

Buffett trimmed Berkshire's holdings in riskier businesses that have uncertain futures, such as newspapers, healthcare companies, and credit ratings agencies in favor of more stable long-term picks such as Wal-Mart Stores Inc. (NYSE: WMT) and ExxonMobil Corp. (NYSE: XOM).

The 13-F filing showed that as of Sept. 30 Berkshire had increased its Wal-Mart holdings by almost 90% over the summer, adding 18 million shares worth nearly $1 billion.

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Buy, Sell or Hold: Buffett's Berkshire Hathaway Inc. Has Been Masterfully Managed and Will Continue to Benefit Investors

Last year, on Aug 25, I recommended readers start buying shares of Berkshire Hathaway Inc. (NYSE: BRK.A, BRK.B) in incremental amounts until the end of 2008.  I emphasized that Berkshire should be a core, long-term holding in investors’ portfolios and not a stock to trade in and out off.   Today, the stock is about 11% […]

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Buffett Bets on Bright U.S. Economic Future With Burlington Acquisition

Warren Buffett believes in the United States' economic future, and yesterday (Tuesday) he put his money where his mouth is.

Berkshire Hathaway Inc. (NYSE: BRK.A, BRK.B) acquired railroad Burlington Northern Santa Fe Corp. (NYSE: BNI) in a deal valued at $44 billion, the largest in Berkshire's history.

Berkshire, which already owns 22.6% of the company, will pay $100 per share in cash and stock for the remainder of Burlington's business. The offer values Burlington stock at a 31.5% premium to its Monday close. The deal, expected to close in the first quarter of next year, includes $10 billion in Burlington debt.

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The Technology That Will Replace 148 Billion Barrels of Oil

Not many investors noticed in September 2008 when Warren Buffet took a 10% stake in Hong Kong-based battery maker BYD Co. Ltd. for $230 million. They should be noticing now. Shares in BYD, which also makes cell phones and automobiles, have quintupled in a little more than 12 months, meaning that Buffet's investment is now […]

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Moody’s Strips Its Biggest Investor of Top Credit Rating

By Don Miller Associate Editor Money Morning Moody's Investors Service (MCO), today (Thursday) cut Berkshire Hathaway Inc.'s (BRK.A, BRK.B) top-level Aaa credit rating by two notches, despite Berkshire chief Warren Buffett's status as the ratings agency's biggest shareholder.   Moody's was the last major ratings agency to downgrade the Berkshire, after Fitch Ratings Inc. stripped […]

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Buffett Bargain Hunting Despite 2008 Losses

By Jason Simpkins Managing Editor Money Morning Famed investor Warren Buffett didn't fare much better than anybody else in 2008. But the Oracle of Omaha remains optimistic, convinced that investors who brave today's fierce financial tempest will be rewarded in the long run. "I've been buying American stocks," Buffett said in an editorial in The […]

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Jim Rogers and Warren Buffett at Odds on Fannie/Freddie Bailout

By Jason Simpkins Associate Editor Few analysts have abstained from voicing an opinion about the U.S. government's plan to seize control of Fannie Mae (FNM) and Freddie Mac (FRE), the nation's embattled mortgage behemoths, and that include such eminent investors as Jim Rogers and Warren Buffett. Of course, two of the world's greatest financial analysts […]

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Buffett Reignites Berkshire Hathaway with a $4 Billion Spending Spree

By Jason SimpkinsAssociate Editor Not even Warren Buffett was immune to the stock market’s rampant first-half gyrations, as Berkshire Hathaway Inc. (BRK.A, BRK.B) notched its worst first half in 18 years, with the shares skidding more than 16%. But only a fool would count out the great Oracle of Omaha, who has spent the past […]

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Warren Buffett, the "Oracle of Omaha," Tells German Audiences That the U.S. Economy is in a Deep Recession

By William Patalon III Executive Editor Money Morning/The Money Map Report The United States is already in a recession and it will be longer as well as deeper than many people expect, U.S. investment guru Warren Buffett said in an interview published Saturday in the German magazine Der Spiegel. The United States is "already in […]

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Dueling Views on Housing: Jim Rogers Sees More Pain to Come While Warren Buffett's Housing Expert Sees Rebound Under Way

From Staff Reports When asked about their outlook for the crisis-ridden U.S. housing and financial-services markets, two U.S. financial experts provided outlooks that completely contradicted one another – once again underscoring how tough it is for investors to predict when the U.S. economy will turn around. Jim Rogers, a best-selling author who co-founded the famed […]

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Leading Candidate to Succeed Warren Buffett Relinquishes Role at Berkshire Subsidiary

By William Patalon III Executive EditorMoney Morning/The Money Map Report David Sokol, widely viewed as the leading candidate to eventually replace investing guru Warren Buffett as the chief executive officer of Berkshire Hathaway Inc. (BRK.A, BRK.B), is changing jobs. Sokol announced that he plans to step down as CEO of the MidAmerican Energy Holdings Co., […]

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Oracle of Omaha Discloses Annual Salary

By Jennifer Yousfi Managing Editor For the 27th year in a row, Berkshire Hathaway Inc. (BRK.A, BRK.B) Chairman Warren Buffett received an annual salary of $100,000. In addition, Buffett received no bonus or stock options for heading up one of the most successful investment vehicles in the world, as Berkshire Hathaway profit increased 20% in […]

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