Magna wrote >>As I mentioned earlier, since the losses on 9/11 Buffet's holding company Berkshire Hathaway has a clause for all policies excluding damages caused by nuclear, chemical and biological attack. _________ Since the losses, BRK has changed the policy. Although, for this year his policies exclude nuclear, he is trying as quickly as possible right now to sign up as many clients as he can with a nuclear policy so he amasses the premiums to pay off everyone if it happens. His statement about nuclear war being a certainty was entirely motivated by his need to sign up new policyholders for his nuclear policy. That said, its worth speculating on the investor psychology of a man who has never suffered a loss in book value until this past year. 45 years of investing have led Buffett to a new experience: the losses of 9/11. This might also have had some effect on his willingness to believe that the worst can happen.
From Grant's: "In the May 10 issue, in breaking the story that Berkshire Hathaway stood to earn a certain sum of money if the S&P 500 closed below 1,150 on June 3, Grant's exaggerated the prospective winnings. They were $60 million (which Berkshire indeed won), not $600 million." I guess that's one big oops!