Can one be confident that a McDonald's cheeseburger that costs $4.50 in one country is worth $1.00 in another ? Can one be confident that a house is worth $700,000 when an identical one right beside it just sold for $230,000 ? Then why would a lender be confident about making 10 percent down $700,000 loans ?.....Thus keeping up with government aspirations ? Likewise....can one be confident that a bank who loaned out over 2/3's of its assets when prices were $700,000.....is still worth its own valuation when prices were $700,000 ? ................................................................... Can one buy assets based on the confidence that credit will remain constant no matter what the economic conditions ? When credit used to be responsible for 70% of the previous prices......for 10% of the previous prices ? What is a proper percentage of price by credit.....by cash ? When a proper percentage is agreed upon....can one be confident in the price ? ..................................................................... Prices = Confidence and asset availability....
When a proper percentage is agreed upon....can one be confident in the price ? ================ Imo, collectively no, individually yes. We are in short supply of leaders. The fed bail out I don't think inspires much or any confidence in the same way as the private sector would.
Exactly....and let us guess why..... The government produces nothing...it just transfers cash flow from those that can.... THE PRIVATE CAPITALISTIC SECTOR This is where confidence counts.....
Now what?? Buffett bought some GS and GE = garbage picker. I'm not inspired are you? Was this a vote of confidence?
Buffett is just dollar cost averaging over a long period of time..... Most people cannot play the game that way..... Lots of $, time, and patience.... To the tune of 10+ years.... As you already know , he is just starting to average into fear.... He may have no further price points....or several price points....and he does not know when this will be either.... Nobody does....