Buffett on Derivatives

this is so funny I just had to post it:
<b>
*DJ Buffett Calls Derivatives 'Weapons Of Mass Destruction'

(MORE) Dow Jones Newswires
03-03-03 1449ET- - 02 49 PM EST 03-03-03
</b>



it gets better:

<b>*DJ Buffett: Few Stocks Even 'Mildly Interesting'

(MORE) Dow Jones Newswires
03-03-03 1453ET- - 02 53 PM EST 03-03-03
</b>

the oracle has uttered.

 

He fears that which he does not understand.

 

yeah, he didn't understand the "new economy" either and people laughed at him then too.

 

So, are you implying that whenever Buffett says he does not understand / dislikes something, there is a positive correlation between that statement and the thing or idea failing?

Hell, then we better not ask him how computers work.

 

Its part of his folksy act. Shucks I don't understand those new fangled computers. Then he goes out and buys a distressed telco, Level 3. Suddenly he seems to understand alot about tech when the price is low enough.

 

wasn't he buying a ton of silver a couple of years ago when joe public was fighting over internet IPO's. lol lol lol

 

Buffet uses TONS of derivatives. Look at a Berkshire 10Q. And he says in his letter he uses derivaties. I think he's talking about the abuses by executives and the more exotic, hard to analyze, unsecured derivatives.

 

buffett is the classic 'black swan" phenomena. if he was starting out now from nothing, he would not and could not make it.

surfer

 

I'm not familiar with this reference. Is this from a story of a black swan?

 

"Berkshire Hathaway acquired a derivatives dealer when it bought reinsurer Gen Re. After failing to sell this business, Mr Buffett is now closing it down though he admits this will take years. 'Reinsurance and derivatives businesses are similar. Like Hell, both are easy to enter and almost impossible to exit,' he says."