Chapter 1258 (1/2)
When Andy and Lima are living a shameless, three meals a day life in Montana farm, the whole world is still shivering under the raging financial storm, and the rescue plans of various countries are like fighting for the fire, which makes the panic more out of control.
The krona fell sharply against the euro. The Icelandic central bank had to announce that it would fix the krona to the euro at 131 to 1, but then, because of the relentless selling of the krona in the foreign exchange market, the Icelandic central bank announced that it would give up supporting the krona exchange rate, Iceland was only a step away from the bankruptcy of the country.
On October 10, standard & Poor's, the authoritative rating agency, said it would consider reducing the credit rating of GM and Ford Motor Company from ”b-minus” to ”junk”. After that, the stock of GM immediately plunged, all the way to the lowest price since 1950, and the total market value of the company's stock also shrank to the lowest point since 1929.
Dragged down by this, the New York stock market, which had been hovering at a low level, made a dramatic scene less than an hour before closing.
The Dow Jones 30 industrial stock average fell below 9000 in a flash under the market's frantic selling, which is the first time since August 2003 that the Dow has missed the whole point.
Subsequently, 8900 points, 8800 points, 8700 points and 8600 points were easily broken down. Finally, the Dow closed at 8579.19, 678.91 points lower than the previous session, or 7.3%.
The S & P 500 stock index also fell 7.6% on the day, while the Nasdaq composite index fell 5.47%. This is also the 7th trading day since the 1st of this month, New York stock market fell across the board. The cumulative decline of the three major stock indexes is more than 20%...
Finally, Buffett, who has invested 8 billion dollars in the market, can't sit still. He started his public relations offensive. He took the initiative to call Paulson, the Treasury Secretary, to provide suggestions. He wrote a long letter, put forward written suggestions, and expressed his willingness to provide 20% of private funds, 100 million dollars, to support the implementation of the rescue plan!
In an hour long interview with AMC cable news, Buffett called the market turmoil ”economic Pearl Harbor” and reiterated his belief in the long-term dominance of the United States.
It is extremely rare to publicly claim that he is buying stocks. When the financial crisis caused investors to panic and sell, whether patriotic or public relations, he held Lima on the sofa and watched the old rascal talk with a dignified face. Andy admired the old guy's responsibility and judgment very much.
”The financial system is a mess now, as it is in the United States and the rest of the world...
So... I've been buying American stocks. I'm referring to my own private account. Before that, all I bought in my private account were U.S. government bonds, and there was no stock investment.
Of course, that doesn't include my Berkshire Hathaway shares, which I've donated to charity.
All my private account assets, except Berkshire shares, will soon be invested in U.S. stocks.
Why?
Because I buy stocks with a simple investment philosophy: fear when others are greedy, and greed when others are afraid. It's almost certain that the fear is spreading everywhere, investors are scared, even experienced investors are scared...
I want to make it clear that I can't predict the short-term volatility of the stock market at all. Even if the stock market will rise or fall in the next month or year, I can't see clearly.
However, before the market sentiment turns better or the economy recovers, it is likely that the stock market has risen ahead of time, and it may be a big rise. So if you have to wait for the robin to spring, then spring will be over
”Honey, when will this terrible economic crisis end? I see the news report says that in the Greater Los Angeles area alone, the number of newly homeless people has reached 73000, of which 40% are women and children, which is terrible! ”