**buffets $us position in a shambles*****

  1. 66,002 Posts.
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    As mush as I admire Buffets principles in fundamental investing in the sharemarket I cannot help to ignore his attrocious calls on foreign currency plays.

    Interesting thread I just uncovered:

    This is topic Buffet - lessons learned in forum Forex: Politics and other Trivia at OANDA FXMessage.


    To visit this topic, use this URL:
    http://www2.oanda.com/cgi-bin/msgboard/ultimatebb.cgi?ubb=get_topic;f=18;t=000413

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    Posted by Jaded*Mikey (Member # 719) on June 14, 2005 11:58 PM:

    Do not mix politics with money.

    http://moneycentral.msn.com/content/P116165.asp#msnhp

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    Posted by tsch (Member # 2407) on June 15, 2005 12:12 AM:

    the dollar..'has shown typical American scrappiness in its comeback against doomsayers and ill-wishers.'

    Hear that?

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    Posted by Sympatico (Member # 4375) on June 15, 2005 12:14 AM:

    There is a time for laughing and a time for crying. I guess you're laughing right now!

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    Posted by OrlandoFlyBoy (Member # 3974) on June 15, 2005 11:05 PM:

    Interesting link on that page -

    Why Buffett is buying utilities

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    Posted by Marrcus (Member # 5299) on June 22, 2005 03:16 AM:

    Holding $22 billion US short - I wonder how much it costs Warren per pip?

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    Posted by earl (Member # 2624) on June 22, 2005 09:21 AM:


    quote:
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    Originally posted by Marrcus:
    Holding $22 billion US short - I wonder how much it costs Warren per pip?
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    $1,800,000 per EURUSD pip

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    Posted by 505 (Member # 5158) on June 22, 2005 11:37 AM:

    $1,800,000 per EURUSD pip



    Another world...
    (thanks earl : I think you done 3 times the calculation !!!)

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    Posted by OrlandoFlyBoy (Member # 3974) on June 22, 2005 11:52 AM:

    Hmmm, and it has gone down 1000 pips since he got in.

    Say -$1.8B --- what is that, less than 10% drawdown? Chumpchange! Hold 'til it goes back up.

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    Posted by Jaded*Mikey (Member # 719) on June 22, 2005 12:03 PM:

    I thought the article said he lifted (covered) his position in the first quarter.

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    Posted by RALPH (Member # 174) on June 22, 2005 12:19 PM:

    Buffet, who reportedly lifted his bet against the buck to a position of $22 billion and counting in the first quarter this year, isn’t sounding quite so smug anymore

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    Posted by OrlandoFlyBoy (Member # 3974) on June 22, 2005 03:25 PM:

    So, "lifted", as in INCREASED his bet...

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    Posted by Jaded*Mikey (Member # 719) on June 22, 2005 03:29 PM:

    I don't know about you guys. When I play craps in Vegas and want to remove my bets, I "lift" my chips off the table.

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    Posted by RALPH (Member # 174) on June 22, 2005 03:48 PM:

    to a position of $22 billion and counting
    Personally I am glad that buffet, soros and gates did not get what they hoped for.
    In the past people like this have gathered big positions and CREATED panic, with the media coverage in order to gain through the hype.
    One of the biggest reason is that all three of these guys own lots of gold and siler, gates even owns silver mines...as well as buffet I believe.
    If the dollar goes down then metals increase.
    The actual dollar bet could be looked at as a hedge for these guys, soros excluded.
    If gates and buffet own billions and the dollar goes up they win....if they are short the dollar and it goes up they merely break even.
    I think they were trying to get the metals up.

    [ June 22, 2005, 03:50 PM: Message edited by: RALPH ]

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    Posted by Marrcus (Member # 5299) on June 22, 2005 07:29 PM:

    It would be a pain holding that kind of position size. The horns of a dilemma. Warren would know that if he starts liquidating the position with large dollar buys, he may drive the value even higher, thereby lessening the chances of a strong retracement. Any serious effort to reduce his exposure may increase his losses. Oh woe, the problems of being a billionaire.

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    Posted by 505 (Member # 5158) on June 22, 2005 07:43 PM:

    Yes Marccus :big problem being a billionaire..
    Well... I wanted to have this "type" of problem !!!!!


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    Posted by Dash_Riprock (Member # 322) on June 23, 2005 06:05 AM:

    Ralph, the simplest explanation is pretty much always the best one, and accordingly Buffetts etc position on the dollar is based on nothing but the fundamentals of the US economy that have in no way improved since Buffett & co went public.

    Greenspan: Deficits pose serious threat to economy

    April 22, 2005

    By JEANNINE AVERSA The Associated Press

    WASHINGTON — Bloated budget deficits pose a danger to the nation's long-term economic health, Federal Reserve Chairman Alan Greenspan warned anew Thursday. He issued a fresh call to policy-makers to move swiftly to get the government's fiscal house in order.

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    THE NEW YORK TIMES...no company nor nation can keep living off of borrowed time, borrowed money and borrowed energy as the USA is doing and get away with that...

    [ June 23, 2005, 06:09 AM: Message edited by: Dash_Riprock ]

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    Posted by 505 (Member # 5158) on June 23, 2005 06:39 AM:

    Hi Dash
    Good morning
    You, you will have "problem" being a billionaire ???


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    Posted by Dash_Riprock (Member # 322) on June 23, 2005 06:48 AM:

    Bonjour 505, no, I think I'll be able to handle being a billionaire when that situation comes knocking on my door.



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    Posted by RALPH (Member # 174) on June 23, 2005 03:18 PM:

    Dash,
    I will tell you why I disagree with your statement.
    All three of these guys---gates,Soros, and Buffet have "secrecy clauses with the SEC.This really means that when they make investments they don't have to go public for 1 year.
    Now when these guys purchased all the Silver and silver mines it was very secret and gradual...it surprised most people to find out that buffet had amassed so much silver in such a short time without anyone knowing about it.
    My point is that with the importance these players have on their privacy in investments why would they then have it announced several times worldwide that they were all short the dollar.
    If they were speculateing as normal then they would follow their normal code of silence.
    Ralph.

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    Posted by RALPH (Member # 174) on June 23, 2005 03:21 PM:

    Dash,
    I just wanted to add that silver could go up 800% in the event of a panic...a much better deal then the dollar short.

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    Posted by Dash_Riprock (Member # 322) on June 24, 2005 06:15 AM:

    Ralph, to me such entirely unsubstantiable theories belong in the realms of myths or conspiracies.

    I honestly don't believe that the richest and the second richest man in the world have together cooked up a very dangerous and indeed entirely uncertain scheme to drive the price of silver up by driving the price of the dollar down so that they can get just a bit richer, particularly when this is the first time for either of them to hold a FX position.

    Besides the last people who tried to corner the silver market were the Hunt brothers and they went bankrupt doing that.

    No, I believe the only reason Buffett and Gates went public with their positions was as a massive wake up call to the Bush regime to finally get it's entirely unsustainable money hemorraghing act together before it's too late.

    June 23, 2005
    NEW YORK - Billionaire investor Warren Buffett said on Thursday in an interview on CNBC he maintains a long-term bearish view on the dollar due to the size of the U.S. trade deficit, despite the currency's recent strength.

    ...However, the massive gap in the U.S. external accounts can only push the dollar lower over time, Buffett noted.

    "We are going down a path that has long been described as dangerous by some of the smartest people in this country," he said, referring to warnings from Federal Reserve Chairman Alan Greenspan and former Fed chief Paul Volcker that the U.S. current account deficit is unsustainable.

    The latest available data show that the U.S. current account deficit widened to $195 billion in the first quarter of this year, or 6.4 percent of gross domestic product — a record by both measures.

    This means the U.S. economy must attract around $2 billion of foreign capital every day just to balance its books, alleviate the downward pressure on the dollar and prevent a sharp spike in interest rates....

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    Friday June 24, 4:07 AM
    Buffett Worried By Deficits

    NEW YORK (Dow Jones)--Billionaire investor Warren Buffett expects the dollar to eventually renew its softening and said the government must address the question of deficits.

    On the Dollar and the Trade Deficit:

    Buffett said the trade deficit was "a deeply embedded structural problem."

    The investor cited Federal Reserve Chairman Alan Greenspan in 2002, saying that countries who experience similar trade-deficit trends in the past, "invariably have run into problems."

    "Eventually the current-account deficit will have to be restrained," Buffett said.

    "We've gone from being a country that owned more of the rest of the world than they owned of us to a country probably $3 trillion in the hole right now in terms of our net worth position," Buffett said. "So it will have had a effect, it may be a month from now, it may be five years from now."

    As a consequence of such imbalances, Buffett warned that the dollar will continue its downdraft "at some point," and indicated that he expects the dollar to be weaker five years from now....

    [ June 24, 2005, 06:28 AM: Message edited by: Dash_Riprock ]
 
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