Buffett -- The Ultimate Sociopath?

(c) 2010 F. Bruce Abel



Has Buffett "explained" and put the cap on this spewing vomit called Abacus? And by implication its ilk? By saying the main loser was ABN Amro? Does that mean only some rich hedge fund, or country-fund, lost out? Ultimately there are mom and pops who put their money into whatever hedge fund or country-fund, aren't there? Pensions and insurance companies.



So how does the AIG bailout compare in structure with Abacus? I think somewhat identical. And there we have hundreds of billions of taxpayer money used directly.



Click on title above for the source of the following.







Buffett said the main "loser" in the Goldman situation, which includes civil fraud charges alleging the investment bank misled investors, and a criminal investigation, was European bank ABN Amro, which guaranteed the credit of another bank in the deal, to the tune of about $900 million.

"In the end, they made a dumb insurance decision," Buffett said. "It's a little hard for me to get sympathetic that a bank made a dumb deal."

By contrast, Buffett said his company has remained conservative and stuck with deals "we understand." He gave as an example a deal brought to Berkshire two years ago by Lehman Brothers, in which Berkshire guaranteed the bonds of about a dozen states for 10 years. Included was $700million worth of bonds issued by Ohio.

"If we lose a lot of money on these bonds, I'm not going to go to the person on the other side of the deal and say, 'Gee, you took advantage of me,'" he said.

Buffett and Munger both stressed that the government's charges against Goldman remain allegations, with no wrongdoing proved at this point.