Buffett bets $5 billion on Bank of AmericaNEW YORK (CNNMoney) -- Bank of America fina

#1
W

WA_Vol

Well-Known Member
Joined
Jul 9, 2005
Messages
18,663
Likes
12
#1
NEW YORK (CNNMoney) -- Bank of America finally caught a break. Warren Buffett's Berkshire Hathaway announced a surprise $5 billion investment in Bank of America Thursday morning, sending shares of the struggling Dow component jumping 13% in late-morning trading.The investment is seen as a major vote of confidence from one of the world's foremost long-term investors."Bank of America is a strong, well-led company, and ... I wanted to invest in it," said Berkshire Hathaway (BRK) Chief Executive Warren Buffett, in a statement. According to the terms of the deal, Bank of America will issue 50,000 preferred shares to Berkshire at a value of $100,000 each. The preferred shares will carry a somewhat hefty 6% annual dividend, paid out quarterly. The investment is seen as a major vote of confidence from one of the world's foremost long-term investors.

"Bank of America is a strong, well-led company, and ... I wanted to invest in it," said Berkshire Hathaway (BRK) Chief Executive Warren Buffett, in a statement.
According to the terms of the deal, Bank of America will issue 50,000 preferred shares to Berkshire at a value of $100,000 each. The preferred shares will carry a somewhat hefty 6% annual dividend, paid out quarterly.
Click to expand...
Think this is the bank bottom?
 
Last edited:
#2
#2
Probably. Most of these mega banks aren't going anywhere, the government won't let them fail if they are big enough, making the investment relatively low risk.
 
#3
#3
rjd970 said:
Probably. Most of these mega banks aren't going anywhere, the government won't let them fail if they are big enough, making the investment relatively low risk.
Click to expand...

pretty much. Like betting on a game Tim Donaghy is reffing
 
#4
#4
utvolpj said:
pretty much. Like betting on a game Tim Donaghy is reffing
Click to expand...

They will make money on these bubbles, then be largely immune when it pops. Stocks will drop, people will lose money...but the bank itself will stay in business.
 
#5
#5
Must be nice to have so much money that, simply by making a large investment yourself, you cause the price of the stock to jump 10 percent the next day.

$5 billion investment, made a cool $500 million in a day.
 
Last edited:
#6
#6
lawgator1 said:
Must be nice to have so much money that, simply by making a large investment yourself, you cause the price of the stock to jump 10 percent the next day.

$5 billion investment, made a cool $500 million in a day.
Click to expand...

Dude can print money, literally.
 
#7
#7
wonder if Buffet will send any extra money to the government since he feels he doesn't pay enough in taxes
 
#8
#8
MG1968 said:
wonder if Buffet will send any extra money to the government since he feels he doesn't pay enough in taxes
Click to expand...

Wondering the same thing. Since he basically created $500 million for his company overnight, he should just donate it to the government. Afterall,

He doesn't need $500 million a day, nobody does. Him keeping it obviously means he got it on the backs of the little guy and is screwing them.
 
#9
#9
rjd970 said:
Wondering the same thing. Since he basically created $500 million for his company overnight, he should just donate it to the government. Afterall,

He doesn't need $500 million a day, nobody does. Him keeping it obviously means he got it on the backs of the little guy and is screwing them.
Click to expand...


Off the short sellers, yup.
 
#10
#10
MG1968 said:
wonder if Buffet will send any extra money to the government since he feels he doesn't pay enough in taxes
Click to expand...

Warren Buffett’s Bank of America Deal Comes With Tax Break - Deal Journal - WSJ

Another advantage: he gets $300 million in dividends each year on his preferred stock. Dividends bring a major tax advantage: the dividends-received deduction.

It allows corporations to exclude 70% of the interest they’re paid when calculating taxes, leaving Buffett’s company with a 10.5% effective tax rate. The deduction eliminates some double-taxation, says tax expert Robert Willens.
 
#11
#11
not a bottom. Buffet invested $5 Billion in Goldman during September 08 and the sell off wasnt over till February.

We need some idiot in the Obama Administration to start flapping their gums about stuff they have no idea about to form a real bottom.
 
#12
#12
rjd970 said:
Wondering the same thing. Since he basically created $500 million for his company overnight, he should just donate it to the government. Afterall,

He doesn't need $500 million a day, nobody does. Him keeping it obviously means he got it on the backs of the little guy and is screwing them.
Click to expand...

what needing it have to dowith anything, its his money
Posted via VolNation Mobile
 
#13
#13
holy crap, I remember now, u think its perfectly alright for the govt to limit inheritance and take the leftover.......
 
#14
#14
VolsNSkinsFan said:
not a bottom. Buffet invested $5 Billion in Goldman during September 08 and the sell off wasnt over till February.

We need some idiot in the Obama Administration to start flapping their gums about stuff they have no idea about to form a real bottom.
Click to expand...

So true.
 
New posts
You must log in or register to reply here.

VN Store



Back
Top