Lost in all the news of the crisis is that Warren Buffet is starting to put some of his cash to work. He has made two deals, one with Goldman Sachs and one with GE, for very very good terms. Both investments are relatively similar and both are very very good. He is guaranteed a 10% dividend for at least the next three years and has warrants to buy more stock at a relatively good price.
Here is the thing. He is able to get these terms because he is Warren Buffet. Nobody else on earth could get this deal. You could even argue that both GE and Goldman have an endorsement deal with Buffet in this case because, although they are forking over a lot of money, the get a lot in return with Buffet essentially telling the market what a great investment both of these companies are (I agree and really like Goldman Sachs long term). Buffet has made a lot of money over the years, and because of that he gets to make a lot more money for years to come.
You can’t get a better spokesperson than Warren Buffet.
Nope, and that is precisely why Goldman and GE made the deals they did even though it looks like Buffet is getting a steal.