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Warren Buffett Watch
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Buffett's Bank Bets "Paying Off" - Bloomberg
Amid all the headlines asking if Warren Buffett has lost his "touch" as Berkshire Hathaway's stock tumbles, comes a Bloomberg story today headlined Buffett Stock Picks Beat Financials Index As He Dodged Subprime.
(Last night, CNBC's Fast Money asked if investors are "losing confidence" in Buffett.)
Bloomberg's takeaway: Buffett's moves to increase Berkshire Hathaway's holdings of Wells Fargo [WFC
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] and U.S. Bancorp [USB
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], while avoiding subprime lenders, are "paying off."
Bloomberg crunches the numbers on Berkshire's bank-related investments and finds:
- Berkshire's financial stocks gained 36 percent in the third quarter, far outperforming the Standard & Poor's 500 Financial Index, which fell 0.2% during the three month period.
- A weighted basket of Berkshire financials rose at an average quarterly rate of 2.3 percent during the 12 months ending in September. The S&P benchmark fell an average of 11.4 percent per quarter.
- Berkshire's bank stocks are down 32 percent since September 30 vs a 41 percent drop for the S&P Financials.
Bloomberg notes that Berkshire's stake in Bank of America [BAC
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] was cut almost in half during the third quarter, falling to 5 million shares from 9.1 million shares, after "Bank of America did what Buffett refused to do -- buy Countrywide Financial Corp., the subprime lender plagued by tumbling home prices and record foreclosures."
With two hours until today's closing bell, Berkshire shares are trading just below $100,000 after bouncing from a 52-week intraday low of $74,100 last Friday.
Current Berkshire stock prices:
Class A: [US;BRK.A
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Class B: [US;BRK.B
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Questions? Comments? Email me at
- Warren Buffett Tops Business Week's Ranking of American Philanthropists (November 26)
- Warren Buffett Promises More Info On Berkshire's Derivatives In Annual Report (November 24)
- Barron's: Berkshire Hathaway's Stock Price Plunge Finally Makes It "Cheap" Again (November 23)
- Berkshire Hathaway Bounces Back By 16% For Best Day In Decades (November 21)
- Berkshire Hathaway Subsidiary Keeps Coachmen Alive By Acquiring RV Business (November 21)
- USG Shares Soar On Warren Buffett's "Expression of Confidence" (November 21)
- Warren Buffett on Market Meltdown: It's Happened Before And It's Been Even Worse (November 21)
- Berkshire Hathaway Down Almost 50% From All-Time High As Stock Sinks Again (November 21)
- Berkshire Hathaway Plunges 12% For Worst Day Since 1987's Black Monday (November 19)
Data is a real-time snapshot *Data is delayed at least 15 minutes
