Bank of America didn't need Warren Buffet money?

Billionaire investor Warren Buffett's Omaha-based Berkshire Hathaway stands to make a pretty penny by investing $5 billion in Bank of America whose stock had been diving toward the cellar. BofA's stock soared on the news, as did the value of Buffett's stock that he had just purchased for a song.

But what is most amazing about all this is the fact that Buffett called the bank unsolicited with his offer to buy the troubled bank stock and the bank told him that he didn't need the money, said the Tribune:

Buffett and Bank of America said he made an unsolicited call to the bank on Wednesday morning, offering to make an investment. Even though the bank has said it did not need to raise capital, investors widely believed Bank of America needed more money and to show it could raise funds easily.

Buffett told CNBC he had never spoken to Bank of America CEO Brian Moynihan before Wednesday, and that he dreamed up the idea while taking a bath.

Are these people nuts? The very existence of the bank was in question. We sold some BofA stock a while back because my wife, a Realtor, could not get the bank to accept two reasonable offers for a house whose mortgage was under water. Stupid people


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  • BoA may deserve to go under, but apparently Buffett has a lot of money (including money on which he is willing to be taxed), and made an investment decision. I'm sure you don't call up Dreyfus, Franklin-Templeton or Putnam and ask them if they want your money before you invest in a mutual fund.

    Whoever runs Clipper Fund made a dumb move investing in Merrill Lynch and AIG before they went belly up, and that was with their and others' money. Didn't see you writing about that.

    Anyway, either Buffet knows what he is doing, or doesn't, and usually does.

    This, along with your tirade about the Tollway Authority (looks like they passed the hike) indicates that you don't believe in the free market working. Either the Tollway has enough patrons to pay off its bonds or doesn't, and either Buffett makes money or doesn't. Neither should be any one else's (and especially not a conservative's) concern.

  • In reply to jack:

    Jack, I wasn't criticizing Buffett for investing in BofA. He usually makes the right pick, which is why we own some of his stock. I know my mutual funds want my money, so I don't have to call (as Buffett did). It's a ridiculous comparison. The bank was clearly in trouble and needed the money; for any bank officer to tell Buffett they didn't wasn't doing the shareholders any favors.

    Regarding the toll hikes: I don't care how high they hike the tolls. My point was simple: When Daley unveiled the O'Hare expansion, everyone was told that tolls would NOT pay for it because state and federal money was available for the construction. That was clearly a deception (a lie, if you will) because anyone who looked at the availability of federal and state highway money knew that it was bunk. Problem was that not enough people bothered to look.

  • In reply to Dennis Byrne:

    Tolls are not paying for airport expansion. Tolls are paying for rebuilding I-90, building an O'Hare bypass expressway, completing the EOE, building the I-57 interchange (for which the Tollway Authority tried and failed to get a TIGER grant), and studying Ill. 53 into Lake County. The gray part of your prior post reflected that. The only coincidence is that the EOE might end at the western terminal (and by, the way, most DuPage officials want that). If the western terminal is not built, it will end at the bypass.

    If you weren't criticizing Buffett (despite your statement "Are these people nuts?"), then I suppose you should post something with regard to what capital requirement BoA was supposed to meet and didn't, and how the Berkshire Hathaway investment took care of that. At least the Tribune reported on such with regard to Broadway Bank.

    So, this still reflects a failure to make proper distinctions, or journalism by innuendo.

  • Sorry, a </b> tag should be inserted after the second quotation mark. This software still doesn't allow proofing one's work.

  • "If you weren't criticizing Buffett (despite your statement "Are these people nuts?")....
    Come on, Jack. As usual you're reading things that aren't there. If you came away thinking I was criticizing Buffett, then you're straining to make an argument.

  • Then to whom were you referring?

    Are you going to start arguing about the antecedent of "these people?"

    The only ones mentioned in the gray box are "Buffett and Bank of America CEO Brian Moynihan."

    The only other noun in your story that could refer to "these people" is "Tribune," and if you are saying that they are nuts, I'll agree.

    Otherwise, take an English composition course.

    Of course, you don't meet the main objection, which was that if BoA was lying about not needing a bailout, you didn't provide evidence that it needed a bailout. If might have, but as I mentioned, the Tribune was able to find such evidence with regard to at least one other bank.

  • Jack, I don't have time for hair splitting. You'll have to carry on by yourself.

  • Well, then get some Pantene for your split ends.

    If you can't figure out the illogic of your positions, use your blog as you wish. Just don't try to convince us that you are a journalist.

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