Warren Buffett predicts: Congress Will Do "Right Thing" By Approving Bailout

[Amerigo Vespucci]

Warren Buffett to CNBC: $5B Goldman Investment Also Bet Congress Will Do "Right Thing" By Approving Bailout

http://www.cnbc.com/id/26866865

Warren Buffett tells CNBC he's making his surprise $5 billion investment in Goldman Sachs because "the price was right, the terms were right, and the people were right."

In a live telephone interview with our Becky Quick on Squawk Box, Buffett said he likes to "bet on brains" and called Goldman the best firm on Wall Street.

But he also made it very clear that he would not have bought anything right now if he wasn't confident Congress will do the "right thing" and approve the financial bailout proposal put forward by Treasury Secretary Henry Paulson.

He compared the urgency of passing a bailout with American's decision to go to war after Pearl Harbor was attacked in 1941.

Buffett told us the financial system was on the brink of collapse last week before Paulson and Bernanke went to Congress with their plan. And he warns that last week will "look like Nirvana" if a bailout plan isn't passed by Congress.

He calls the current crisis everyone's problem, not just Wall Street's, with the markets in a "very, very difficult situation."

While "no one likes to write" a $700 billion check, Buffett thinks the government could make a profit when it eventually sells the now-toxic debt it would be acquiring in a bailout. "They could make money on this," he predicts, if it's handled properly.

[NC_Nurse]

1. "...if it's handled properly."

That's a big effin' IF. WHAT have these jokers handled properly in 8 YEARS!!! NADA.

[ixion]

2. I generally agree with Buffett, however we disgree here

about this being the right thing.

[Phred42]

3. BUffetts BIllions are on the line here - He's running home to momma

[Not the Only One]

9. Yep

The Rescue Warren Buffet 2008 Bill.

No handouts for the rich.

[Solly Mack]

4. Is there a list of who, exactly, will buy the "toxic debt" eventually?

Can we get that list once the selling begins?

[Romulox]

5. Also in the news: Buffet increasing position in company that stands to clean up in bailout. nt

[avaistheone1]

10. Then I suppose we don't have to guess why Buffet is for it .

[Rosa Luxemburg]

6. Dear Mr Warren can you spare the taxpayers about $700 billion dollars?

since you have bought Constellation energy and have bailed out Goldman Sachs you might aswell do the rest while you at it.

[Hawkowl]

7. Put Buffet in charge

Put Warren Buffet in charge of managing the $700 billion dollars instead of the Treasury secretary and I won't have a problem with the bailout. He apparently can make money off of anything. But to turn it over to the same incompent thieves is insanity.

[TBF]

37. Seriously? "Making money off anything" is our goal?

Warren Buffet is our problem. Put 100 homeless people on the oversight committee. I'd like to see a little equality for once.

[OneGrassRoot]

8. In the full context, his involvement takes on a different meaning...

I'm one of the economic dunces, so I don't have any words of wisdom. Only observations.

At first it seems many of us were excited about his proposal because it seemed to contradict the need for a government bailout. Seeing he made the decision BECAUSE of the proposed bailout makes this a different ballgame (his influence, I mean).

I'm not saying it's good or bad; I just don't see his proposal as a slap in the face to Congress as I did yesterday.

Thanks for more complete information. :)

[ShortnFiery]

17. With respect, Buffet's a billionaire. I think his "world view" is a VASTLY different than ours.

:shrug:

[OneGrassRoot]

20. No doubt. That's why I don't see it as "good" or "bad."

Just different than I did yesterday with more complete information. :)

[Triana]

11. "if it's handled properly" - since WHEN has bu$hco handled ANYTHING properly?

Pffft!

[avaistheone1]

12. Let the Japanese banks buy these troubled corporations.

There interested and they have plenty of money.

[Delphinus]

13. It is NOT

the right thing. Period. If he's so much in favor of it, let HIM buy the freaking shit!

[whatchamacallit]

14. Buffet is just like Greenspan; revered as a god until he isn't

He's just another hyper-rich puppet master.

[Schema Thing]

19. Er... except he really is a god.

And a really good guy, too.

[RoadRage]

31. Uhh.. maybe a hyper rich puppet.. but he has morals..

plays clean, points out fraud as soon as he sees it (even if it's in one of his own companies), and lives in a $600,000 house (which may seem like a lot.. but he is the 2nd richest man in the world).

I'm just saying.. i live in Omaha, NE - and the guy does a lot of good when he could really do whatever the fuck he wanted and no one could tell him otherwise.

He also did donate like 99% of his fortune to charity (The Gates Foundation) when he dies.. not many rich puppet masters do that.

[ShortnFiery]

15. Oh yes, in BushBot CorporateKing World, BILLIONAIRES run this Country.

How does it feel to us "little people?"

We have NO representative government when Billionaires, Wall Street, the M$M and BushCo make all the decisions as to how to spend Middle Class America's tax dollars. :nuke:

[slipslidingaway]

16. Goldman to Raise Capital, With $5 Billion From Buffett

http://www.huffingtonpost.com/howard-a-rodman/keith-richards-cockroache_b_128760.html

"...The billionaire Warren E. Buffett will invest $5 billion in the investment bank Goldman Sachs, as part of the bank's efforts to raise $7.5 billion in fresh capital, a Goldman spokesman, Lucas Van Praag, said Tuesday. In return, Berkshire Hathaway, the conglomerate run by Mr. Buffett, will receive perpetual preferred shares in Goldman, Mr. Praag said. The preferred stock will pay a 10 percent dividend.

So here's how a real bailout works: Goldman Sachs needs money, Warren Buffet gives them money. In return, Warren Buffet gets stock that pays a ten percent dividend.

Now, for comparison, here's the shell game version. Keep your eye on the pea...



Paulson Debt Plan May Benefit Mostly Goldman, Morgan (Update2)

Goldman Sachs Group Inc. and Morgan Stanley may be among the biggest beneficiaries of the $700 billion U.S. plan to buy assets from financial companies while many banks see limited aid, according to Bank of America Corp..."

[ShortnFiery]

18. Greedy EVIL Bastards - one and all.

:nuke:

[slipslidingaway]

24. Agree n/t

[whatchamacallit]

21. Buffet knows the dems will pass the bailout, and he will be sitting pretty to profit from our misery

What a great system we have.

[slipslidingaway]

28. He said this morning that he would not have invested money

in GS unless he thought the bailout was going to go through.

[whatchamacallit]

32. He's no dummy, this is a golden opportunity. Good for him/bad for us. n/t

[FrenchieCat]

22. Warren Buffett is stabilizing the markets, and allowing

patience on Wall Street while congress hammers out the right deal, the one that includes the Obama provisions. You see, if the markets swang wildly, it would put more stress on congress to hurry up. Buffett just bought congress time for them to get transform the blank check.

It isn't about Buffett's greed, which is why he endorsed Barack Obama, and why he voted Dem in 2004.

Buffett and his company don't normally buy stocks via Wall Street.

[OneGrassRoot]

26. Thanks for sharing your thoughts about this.

I keep trying to understand what his intention may be, given his connection to Obama. This is a very plausible explanation to me.

You know, Frenchie, I read what you wrote a week or so ago about how you only got involved in politics in 2000. I may not always agree with you, but you certainly have a keen insight into these matters, and I always appreciate your input.

:)

[FrenchieCat]

35. Thank you.

The thing about Buffett is that he has a stake in making sure that the world of finance stays strong and stable, as we should all. However, he is for the Obama tax plan, meaning he doesn't have an issue with paying his fair share.....and he quite understands that Bush and McBush are totally fucked and are bad for America.

He is putting his money where is mouth is, and telling the market to chill out. It is working too. You notice that the market has stayed close to even since hes put his money into it. Stabilizing the situation really does buy congress time...which is what congress needs. If the markets were down real low today, the WH and lackies would be telling congress to hurry the fuck up.

Maybe I understand this because I am an accountant. :shrug:

[whatchamacallit]

29. Sure, that "10% dividend preferred stock" is *so* egalitarian

I don't trust Buffet any more than the other royals.

[DCKit]

23. "...called Goldman the best firm on Wall Street."

Then why do they need to be bailed out? If that's the best, perhaps we're better off without Wall Street.

[ShortnFiery]

25. THESE CROOKS are now being investigated by the FBI but we, the taxpayer should

give them our tax dollars. WTF is wrong with out Congress!?!

[redqueen]

27. "They could make money on this," - doesn't that require an equity stake?

Are we demanding that yet?

[RoadRage]

33. It's been proposed, and looking more & more likely. NT

[redqueen]

34. It needs to be DEMANDED.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=4076190&mesg_id=4076190

[Naturyl]

30. I never trusted this robber.

So what if he sometimes supported Democrats? I'm not that easy to dupe.

These guys are strictly out for themselves.

[ShortnFiery]

36. Ed Schultz is NOW siding with the billionaires - someone needs to make him smart.

Gee Ed, not all of us have thousands of "chump change" to invest in the stock market. :(

[FrenchieCat]

38. Warren Buffett who normally doesn't invest in the Market

is trying to do more than making a profit.
He is sending a message to Wall Street, that all will work out,
and to chill the fuck out.

He is preventing a panic, and giving time for congress
to work out a deal that will not only benefit Wall Street,
but also main street. He is not a trickle down theory guy.
He understands that appropriate regulation actually protects
his investments.