A conversation with Warren Buffett on the Wall Street Bailout Financial Rescue Bill

The is an intriguing one-hour program on Charlie Rose.

  • ‘You don’t want artificial prices being paid.’
  • ‘Is this being done at market?’

Well, it is certainly nice know that Warren Buffett has the same major concern that I do with the plan. I will certainly breath easier if these mortgages and mortgage backed securities are bought at market prices.

  • ‘Inflation is a likely consequence of what we are doing now.’

But Warren thinks future inflation is simply a price we have to pay to save the economy now. (That is the second person I’ve heard refer to higher future inflation.) (FYI; Real estate became to be seen as a hedge against inflation during the 1970’s.)

It is clear to me after listening to Warren Buffett that the Treasury is only concerned about buying real estate related assets and that no attention is being paid to the eventual sale of the assets.

I sense that the government will hold these assets for many, many years.

I fear that the longer the Treasury holds those assets, the more mission creep we will see and government policies will change toward using the mortgages to promote social change.