Sunday, February 24, 2008
Everyday, it seems we are fed the latest dose of bad news about the economy -- from housing to unemployment to inflation. Did it ever occur to you that there might actually be good news out there? Good news that puts all of the bad in perspective and calms the bad-news blues that always seem to be accumulating in our stomachs. I believe the good news that so many people miss is that life is ticking on and it a good life, even if it never makes the cover of the New York Times or the Wall Street Journal. People are going to work, caring for their families, building lives, serving their communities and their fellow man. I would like you to let you in on a secret. Blessings abound in this world. Opportunities are everywhere and one of the greatest capitalists of all time agrees with me, or maybe I should say, I agree with him. While in Canada recently, Warren Buffett was asked if he was pessimistic about the United States in light of the subprime crisis. The following are some excerpts of his comments in an interview with the National Post of Canada. (click to read whole article) "Warren Buffett said Wednesday he is confident the U.S. financial sector can get through its troubles without a government bailout and remains bullish about the long-term prospects for the U.S. economy. "I am a huge bull on the American economy," said Mr. Buffett, in an exclusive interview with the National Post. "We'll always get through," he said. "I'm a bull on the United States. Just think about how silly it would have been to be anything other than a bull on the United States since 1790. It is not a smart thing to sell the United States short over the years -- or Canada for that matter. The world does get better. People get more productive. More human capacity is unleashed over time." I have no notion if Mr. Buffett is a person of religious faith, I hope he is, but I have noticed that he has more faith in the United States and humankind than most other financial people I have known over the last 30 years. He is constantly buying or trying to buy companies that the markets are shunning; companies investors are throwing away as being worthless; companies whose time has past, or whose problems are too daunting to survive. The following is just a short list of some of Mr. Buffett's investments in recent years: He bought a building materials company when asbestos lawsuits were filling up court dockets; he bought at least two troubled utilities; he recently bought a handful of US banks at the height of the subprime crisis; he bought a mobile home manufacturer; he bought into Lloyds of London when the risks were huge. He was active in taking on more risk in his reinsurance divisions after the devastation of 9/11 and Katrina. He recently offered to take on the risk of nearly 800 billion dollars worth of the municipal bonds of American cities and towns. In all these actions Mr. Buffett has been exhibiting faith. Faith in humankind. Faith in the laws of our country. Faith in the leadership and workers of the companies he buys. Faith in our system of private ownership and the rule of law. Somewhere along the line he learned something very valuable from which we can all profit: Everything is not going to hell in a hand basket, in fact its destination is in the other direction. This bit of wisdom has enriched him beyond measure, brought him remarkable fame, and given him a joie de vivre that few people possess. He says he tap dances to work. This does not sound like the kind of man who pays much attention to the evening news.