When this man speaks, you better listen: Welcome to the "Sharecropper Society" - Mercedes-Benz Forum

LinkBack Thread Tools Display Modes
post #1 of 3 (permalink) Old 03-07-2005, 06:51 AM Thread Starter
BenzWorld Elite
FeelTheLove's Avatar
Date registered: Sep 2004
Vehicle: 83 Astral Silver 280 SL
Location: Planet Houston
Posts: 28,829
Mentioned: 0 Post(s)
Quoted: 7 Post(s)
(Thread Starter)
When this man speaks, you better listen: Welcome to the "Sharecropper Society"

"Ownership society"?

Buffett deepens dollar worries
By Dan Roberts in New York
Published: March 5 2005 18:22 | Last updated: March 6 2005 22:47

Warren Buffett has warned that the US trade deficit risks creating a “sharecropper’s society� as his letter to shareholders sounded an increasingly bearish tone about the value of the dollar.

The billionaire fund manager said his own performance as chairman of Berkshire Hathaway was “lacklustre� because he struck out in his quest for new investments. Annual results showed the book value of Berkshire shares underperformed the stock market for the second year in a row while full-year profits fell 10 per cent.

But his sceptical view of current market valuations continued as Berkshire’s holdings of cash rose from $36bn in 2003 to $43bn by the end of December – equivalent to nearly all the “float�, or excess cash, generated by its insurance businesses.

Mr Buffett’s bet against the dollar also grew. Foreign exchange contracts – mostly short positions against the US dollar – nearly doubled over the year to $21.4bn, generating $1.8bn in gains as the greenback fell against other major currencies.

These currency profits were partly responsible for a sharper than expected rise in fourth quarter earnings from $2.39bn to $3.34bn, although Berkshire earnings are notoriously volatile due to the timing of investment gains.

Mr Buffett stepped up his warning about the US trade deficit and the need to finance it with foreign investment, devoting more than two full pages of the annual report to the topic.

“This force-feeding of American wealth to the rest of the world is now proceeding at the rate of $1.8bn daily, an increase of 20 per cent since I wrote you last year,� he said. “Consequently, other countries and their citizens now own a net of about $3,000bn of the US�

In particular, he warned that this meant a sizeable portion of what US citizens earned in future would have to be paid to foreign landlords.

“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,� added Mr Buffett. “But that’s precisely where our trade policies, supported by Republicans and Democrats alike, are taking us.�

Nevertheless, Berkshire’s chairman and chief executive conceded he did not do his job very well last year in finding ways to profit from the unusual market conditions

“My hope was to make several multi-billion dollar acquisitions that would add new and significant streams of earnings to the many we already have. But I struck out,� he said “Additionally, I found very few attractive securities to buy. Berkshire therefore ended the year with $43 billion of cash equivalents, not a happy position.�

Berkshire’s net earnings, which are subject to volatile swings in realised investment gains, fell from $8.15bn to $7.31bn for the year. Total assets rose from $181bn to $189bn and shareholder equity increased from $77.6bn to $85.9bn.

Mr Buffett added little new information about an ongoing investigation into potentially illegal trading practices in the insurance industry.

“Berkshire cannot at this time predict the outcome of these investigations, is unable to estimate a range of possible loss, if any, and cannot predict whether or not that outcome will have a material adverse effect on Berkshire’s results,� said the report.

Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions. They understood that our power alone cannot protect us, nor does it entitle us to do as we please. Instead, they knew that our power grows through its prudent use; our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint.

-President Barack Obama, 1st Inaugural address
FeelTheLove is offline  
Sponsored Links
post #2 of 3 (permalink) Old 03-07-2005, 12:22 PM
BenzWorld Senior Member
Date registered: Sep 2004
Posts: 491
Mentioned: 0 Post(s)
Quoted: 0 Post(s)
RE: When this man speaks, you better listen: Welcome to the "Sharecropper Society"

I think this is the number one issue facing the country right now and the press won't pick up on it. Probably because it's techincal and over the head of the avg american.

Forum killa

You have been banned for the following reason:
insulting mod

Date the ban will be lifted: Never
koop is offline  
post #3 of 3 (permalink) Old 03-07-2005, 02:21 PM
BenzWorld Member
Date registered: Jan 2005
Posts: 350
Mentioned: 0 Post(s)
Quoted: 0 Post(s)
RE: When this man speaks, you better listen: Welcome to the "Sharecropper Society"

Gee, in four years we went from a surplus to this gigantic deficit, and all this foreign debt. No, the press is not picking up on it, but they won't miss a beat in the Michael Jackson trial. Yet the right wing keeps up the propaganda that the press is liberal. Amazing. This president has been given the biggest pass in the history of the presidency.

Joe B.
Joe Bauers is offline  
Sponsored Links

  Mercedes-Benz Forum > General Mercedes-Benz Forums > Off-Topic

Quick Reply

Register Now

In order to be able to post messages on the Mercedes-Benz Forum forums, you must first register.
Please enter your desired user name, your email address and other required details in the form below.

User Name:
Please enter a password for your user account. Note that passwords are case-sensitive.


Confirm Password:
Email Address
Please enter a valid email address for yourself.

Email Address:


  • Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
    Thread Tools
    Show Printable Version Show Printable Version
    Email this Page Email this Page
    Display Modes
    Linear Mode Linear Mode

    Posting Rules  
    You may post new threads
    You may post replies
    You may not post attachments
    You may not edit your posts

    BB code is On
    Smilies are On
    [IMG] code is On
    HTML code is Off
    Trackbacks are On
    Pingbacks are On
    Refbacks are On


    Title goes here

    video goes here
    description goes here. Read Full Story
    For the best viewing experience please update your browser to Google Chrome