Author Topic: Buffet on the American Economy  (Read 74 times)

Ant

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Buffet on the American Economy
« on: March 07, 2005, 01:29:48 PM »
He said his performance last year had been "lacklustre". He explained his mounting bet against the dollar in terms of a spiralling US trade deficit - which, he warned, may be approaching crisis point.

Mr Buffett said Berkshire had built a $21.4bn (£11bn) position in foreign exchange contracts, spread among 12 currencies. He said little appeared to have been done to tackle the problem, despite constant calls for action from "hand-wringing luminaries".

"Without policy changes, currency markets could even become disorderly and generate spillover effects, both political and financial," Mr Buffett warned. "Such a scenario is a far from remote possibility that policymakers should be considering now," the billionaire said, though he conceded policymakers' "bent, however, is to lean towards not so benign neglect".

Mr Buffett said in the last 10 years foreign powers and their citizens had accrued about $3 trillion worth of US debt and assets such as equities and real estate. At current rates, he predicted that in another 10 years' time the net ownership of the US by outsiders would amount to $11 trillion.

"This annual royalty paid [to] the world would undoubtedly produce significant political unrest in the US. Americans ... would chafe at the idea of perpetually paying tribute to their creditors and owners abroad. A country that is now aspiring to an 'ownership society' will not find happiness in - and I'll use hyperbole here for emphasis - a 'sharecropper's society'."

http://www.guardian.co.uk/usa/story/0,12271,1432051,00.html
 

Thirteen

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Re: Buffet on the American Economy
« Reply #1 on: March 07, 2005, 04:03:51 PM »
speaking of Buffet

anyone ever been to Las Vegas... damn they got some good buffets... all you can eat steak, chicken, crab legs....shits good as hell
 

Knuckles

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Re: Buffet on the American Economy
« Reply #2 on: March 07, 2005, 04:26:02 PM »
 

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Re: Buffet on the American Economy
« Reply #3 on: March 07, 2005, 08:25:59 PM »
Ant:
Mr Buffett said in the last 10 years foreign powers and their citizens had accrued about $3 trillion worth of US debt and assets such as equities and real estate. At current rates, he predicted that in another 10 years' time the net ownership of the US by outsiders would amount to $11 trillion.


it takes a conspiracy theorist to make sense of this. 

ultimately, the concentration of wealth and ownership in the hands of a small group of people has exponentially increased,  we're talking about the ultra rich and huge multl-national corporations.  as a byproduct, the same economic policies and deregulations that have promoted these trends have been taken advantage by foreign corporations and governments.  ultimately that doesn't matter. 

the consequences that buffet are talking about ultimately takes the largest toll on the ability to create and access wealth and not maintain it.  it's not the ultra-rich that will bear the burden, it's the average joe.  multi-national corporations will be well suited to endure an american economy that's  unable to promote investment and job creation, (because of high interest rates and such) as they have interests and investments globally.

and these foreign governments that own so much u.s. debt will be spending that money on these huge multi national corporation in construction projects, defense spending, and simply encouraging additional investments within their own borders to help strengthen their own economies.

basically there's no sense of nationalism in current american fiscal policy.  the policy makers are not acting to make america great, but to make their supporters and investors great.

get rich or get left out.
"a four letter word is going out to every single enemy" - kam
 

Ant

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Re: Buffet on the American Economy
« Reply #4 on: March 08, 2005, 05:35:14 PM »
Ant:
Mr Buffett said in the last 10 years foreign powers and their citizens had accrued about $3 trillion worth of US debt and assets such as equities and real estate. At current rates, he predicted that in another 10 years' time the net ownership of the US by outsiders would amount to $11 trillion.


it takes a conspiracy theorist to make sense of this. 

ultimately, the concentration of wealth and ownership in the hands of a small group of people has exponentially increased,  we're talking about the ultra rich and huge multl-national corporations.  as a byproduct, the same economic policies and deregulations that have promoted these trends have been taken advantage by foreign corporations and governments.  ultimately that doesn't matter. 

the consequences that buffet are talking about ultimately takes the largest toll on the ability to create and access wealth and not maintain it.  it's not the ultra-rich that will bear the burden, it's the average joe.  multi-national corporations will be well suited to endure an american economy that's  unable to promote investment and job creation, (because of high interest rates and such) as they have interests and investments globally.

and these foreign governments that own so much u.s. debt will be spending that money on these huge multi national corporation in construction projects, defense spending, and simply encouraging additional investments within their own borders to help strengthen their own economies.

basically there's no sense of nationalism in current american fiscal policy.  the policy makers are not acting to make america great, but to make their supporters and investors great.

get rich or get left out.

I really have no idea what you are getting at.  are you being critical of what buffet said? agreeing with it? esp. the line about conspiracy theorists?  its well known that 'outsiders' (i.e. foreign governments, corporations, and citizens) own a huge amount of american debt.  About 7 trillion today if I'm correct.  Eventually americans may, or perhaps may not, get upset with the fact that a perpetually larger share of their tax dollars go to foreign countries.
 

Don Rizzle

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Re: Buffet on the American Economy
« Reply #5 on: March 08, 2005, 05:58:19 PM »
not to mention the effect its having on the rest of the world by driving up other currencies especially europe its our manufacturing industries are bearing the burden on american fiscal negligence.

iraq would just get annexed by iran


That would be a great solution.  If Iran and the majority of Iraqi's are pleased with it, then why shouldn't they do it?