Warren E. Buffett

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Warren Buffett
Warren buffett 01.jpg
Occupation Investor

Warren Buffett is a highly successful American investor and a recognized philanthropist. He was voted the world's richest man by Forbes.com in 2008. According to the publication, Buffett had a net worth of $62 billion.[1]

As the U.S. economy reeled from the credit crisis in 2008, Buffett announced he would invest $5 billion in Wall Street.[2]While many other investors held tight to the sidelines, Buffett put $5 billion into Goldman Sachs. Two weeks before that, a subsidiary of Buffett's - Berkshire Hathaway - agreed to acquire Constellation Energy Group Inc. at $4.7 billion. During the time period, he also invested in General Electric [3] and a Chinese battery manufacturer that aimed to sell electric cars in the U.S. in 2010.

The bankruptcy of Lehman Brothers Holdings Inc. and Washington Mutual Inc., and the emergency sales of Merrill Lynch & Co. and Wachovia Corp. had especially fueled fears about the vulnerability of firms that relied upon capital markets for short-term funding. Buffett contended, however, that he had chosen to be "greedy when others are fearful."[4] He described the U.S. economy as a great athlete who'd had a cardiac arrest.[5]

Buffett warned that the U.S. would face "its biggest financial meltdown in American history" if congressional negotiators couldn't find common ground on a $700 billion plan to rescue Wall Street.[6]

Buffett's investment philosophy is well known in the financial sector. If he can't understand it, he won't invest in it.[7] He also looks for favorable long-term economics, able and trustworthy management, a sensible price tag and low-cost producers.[8]

Background

In early June of 2010, Buffett and Moody's Corp. were scheduled to face questions from a bipartisan panel probing the roots of the financial crisis. The congressionally chartered Financial Crisis Inquiry Commission (FCIC) subpoenaed Buffett to appear at the New York hearing on the credibility of credit ratings and the investments made based on those ratings. Rating agencies like Moody's, Standard & Poor's and Fitch Ratings had been criticized for giving unrealistically high ratings to complex investments backed by risky mortgages and other assets.[9]

In August of 2011, it was announced that famed investor Warren Buffett's company Berkshire Hathaway would invest $5bn (£3.1bn) in Bank of America. News of the decision sent Bank of America's shares more than 25 percent higher.[10]

Published Works

Buffett wrote the foreword for The Ten Commandments for Business Failure, a book by Aaman Lamba.[11]

His essays have been published as The Essays of Warren Buffett: Lessons for Corporate America edited by Lawrence A. Cunningham.

Education

Buffett received a bachelor of arts/science degree from the University of Nebraska Lincoln and a master of science degree from Columbia University.

Resources

References

  1. The World's Billionaires: #1 Warren Buffett. Forbes.
  2. Bottom-Feeding Billionaires. Sify.
  3. High Anxiety: Buffett Soothes Market With GE Stock Buy. The Salt Lake Tribune.
  4. Buffett Says Economy `on Floor' After Cardiac Arrest. Bloomberg.
  5. The Financial Rescue Package: Buffett Should Play On A Bigger Stage. The Globe and Mail.
  6. Buffett To Congress: Bail Out Economy Or Face 'Meltdown'. CNNPolitics.com.
  7. Warren Buffett: All-American values from the Sage of Omaha. The Telegraph.
  8. Can M&A Save Warren Buffett?. WSJ.com.
  9. Buffett To Front Financial Crisis Probe. Yahoo! Finance.
  10. Warren Buffett invests $5bn in Bank of America. BBC.
  11. Review. Desicritics.