Buffett Invests $5 Billion in Bank of America

[Poll_Blind]

Source: New York Times

On Thursday, Berkshire Hathaway, run by Mr. Buffett, announced plans to invest $5 billion in Bank of America, a vote of confidence for the beleaguered financial firm.

The conglomerate has agreed to buy 50,000 preferred shares that will pay a 6 percent annual dividend. Bank of America has the option to buy back the shares at any time for a 5 percent premium. According to CNBC, Mr. Buffett approached Bank of America early Wednesday about a potential deal.

The investment by Berkshire should help allay market concerns about Bank of America. Shares of the financial firm have been battered of late over fears the company lacks sufficient capital. The stock has fallen by nearly 30 percent since the beginning of August.

“I remain confident that we have the capital and liquidity we need to run our business,” Bank of America chief executive Brian Moynihan said in a statement. “At the same time, I also recognize that a large investment by Warren Buffett is a strong endorsement in our vision and our strategy.”

Read more: http://dealbook.nytimes.com/2011/08/25/buffett-to-invest-5-billion-in-bank-of-america/

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Much more at the link!

PB

[banned from Kos]

1. The idiot teabaggers over at ZeroHedge are blowing fuses on this news.

New Conspiracy Theories are popping up every 30 seconds over there as they pray for America's demise.

[Major Hogwash]

2. Bishop to Rook 2

Your turn, JP Morgan.

[Miss_Underestimated]

3. I hope he has some $$ left to invest in a team to prosecute those who cooked the books

over there too

:mad:

[benld74]

4. Me thinks someone needs a tax write off next year,,,

[im1013]

5. He who says we should tax him more.

Yeah, ok.


:puke:

[scheming daemons]

6. Um... what does one have to do with the other?

He says he is personally coddled too much by politicians, that his tax rate is too low.



At the same time, his company invests $5 billion in Bank of America. If Bank of America tanks, then this is a tax write off for Berkshire-Hathaway... *NOT* for Warren Buffet on his 1040.


THe two things have nothing to do with one another.


He *STILL* should have his *PERSONAL* tax rate be higher, even while his company makes investments in other companies. Two separate tax entities.

[Uncle Joe]

7. Buffett recognizes a good opportunity when he sees one, perhaps he believes the deal being worked

out to let the banksters off the hook will prove profitable for BOA?

On a thread by WillyT

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439x1808485

Obama Goes All Out For Dirty Banker Deal

(snip)

The idea behind this federally-guided “settlement” is to concentrate and centralize all the legal exposure accrued by this generation of grotesque banker corruption in one place, put one single price tag on it that everyone can live with, and then stuff the details into a titanium canister before shooting it into deep space.

This deal is all about protecting the banks from future enforcement actions on both the civil and criminal sides. The plan is to provide year-after-year, repeat-offending banks like Bank of America with some stability and certainty, so that they know exactly how much they’ll have to pay in fines (trust me, it will end up being a tiny fraction of what they made off the fraudulent practices) and will also get to know for sure that there are no more criminal investigations in the pipeline.

Thanks for the thread, Poll_Blind.

[Honeycombe8]

8. I hope that's good for BRK in the longrun, since I own that. Wish I had

bought BOA at a lower price, when I had the chance.

Always a day late, a dollar short. :(