By Andrew Clark in New York
From The Guardian
Legendary investor Warren Buffett reckons the US government can make a sizeable profit if it manages its $700bn (£380bn) banking bail-out package carefully...
"I bet they'll make a profit," said Buffett, who pointed out that hedge funds specialising in junk assets were already picking up mortgage-related securities with a view to making profits of 15% to 20%. He said a positive return was feasible if the government ignored the book value of instruments or the original cost to banks and instead paid the prevailing market rates for the bombed-out assets.
"They'll pay back the $700bn and make a considerable amount of money if they approach it like that," said Buffett. "I would love to have $700bn at treasury rates to buy fixed-income securities... (Read the rest of Andrew Clark's story)
Thursday, September 25, 2008
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