We're reading monthly about numerous U.S. financial institutions needing to turn to foreign governments for money to stave off financial disaster. While some investors cry foul, alluding to nefarious plots to take over America, Bloomberg examines uber-investor Warren Buffett's take on what's occurring in the economic world today.

Instead of some global plot against the U.S., Buffett says that investments by foreign government-controlled firms are fueled by U.S. spending overseas, not political motives. These so-called sovereign wealth funds are merely responding to some to our own activities.

"This is our doing, not some nefarious plot by foreign governments,'' said Buffett, chairman of Berkshire Hathaway Inc. (NYSE: BRK.A), in his annual letter to shareholders. "Our trade equation guarantees massive foreign investment in the U.S. When we force-feed $2 billion daily to the rest of the world, they must invest in something here.''

Bloomberg reports that countries like China, Russia, and Dubai have deployed record central bank reserves to set up funds to invest as much as $2.9 trillion. We've already seen a flurry of activity. Investment funds from Singapore, Korea, Kuwait, and Abu Dhabi bought stakes during the past four months in the largest U.S. bank in terms of assets, Citigroup (NYSE: C), and Merrill Lynch (NYSE: MER), the world's biggest brokerage.

Zack Miller is the managing editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund.

Buffett: Not auctioning off America to the highest bidder originally appeared on BloggingStocks on Sun, 02 Mar 2008 12:10:00 EST. Please see our terms for use of feeds.

With this weekend's Barron's postulating that Berkshire Hathaway Inc. (NYSE: BRK.A) is overvalued (for a good analysis check out Peter Cohan's review), investors that are looking for a great holding/investment company should look at Leucadia National (NYSE: LUK). This undiscovered company with a hodgepodge of investments ranging from timber to real estate to a winery, has been a stellar performer for investors. Over the last two years, Leucadia has outperformed Berkshire by about 50% and over the last five years, it's no comparison. The little-known Leucadia has eaten Berkshire's lunch, outperforming it by more than 170%!

It's no secret that many investors are worried that Mr. Buffett will step down in the near future, and that when he does investors will flee the stock. For those wanting to continue investing in an investment company, take a long hard look at Leucadia.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. Disclosure: Writer has no position in any stock mentioned as of 12/16/07.

Berkshire overvalued -- try Leucadia originally appeared on BloggingStocks on Mon, 17 Dec 2007 10:50:00 EST. Please see our terms for use of feeds.

The battle for Dow Jones continues to heat up originally appeared on BloggingStocks on Mon, 18 Jun 2007 13:55:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Pali Capital upgraded shares of Warner Music Group Corp (NYSE: WMG) on valuation.

• Matrix USA upgraded Red Robin Gourmet Burgers Inc (NASDAQ: RRGB) to Hold from Sell on valuation.

• Berkshire Hathaway Inc (NYSE: BRK.A) was upgraded to In Line from Underperform at Fox-Pitt, Kelton.

• UBS upgraded ARM Holdings plc (NASDAQ: ARMHY) to Buy from Neutral as the firm believes the company will be a significant beneficiary of the acceleration in 3G handset adoption in 2007.

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• O2Micro International Ltd (NASDAQ: OIIM) was upgraded to Buy from Neutral at Oppenheimer citing a possible near-term court settlement with Samsung, which provides significant earnings leverage.

Analyst upgrades 3-29-07: Berkshire Hathaway & Warner Music Group upgraded originally appeared on BloggingStocks on Thu, 29 Mar 2007 10:41:00 EST. Please see our terms for use of feeds.

Reader L.N. Wright recently posed us a good question:

"What's up with BRK-B shares? They've been down quite a bit lately, and I can't find much commentary about current performance. Everyone seems to want to talk about the `good-ole-days', and how much Warren Buffett made over the past 30 or so years. What I want to know is whether the consensus is that it's worth owning the stock now and if it is expected to outperform the market in the future as it has in the past. "

One Wall Street analyst rates Buffett's Berkshire Hathaway Inc. (NYSE:BRK.A) a buy at the current bargain price of $106,700. Three consider it a hold and one rates it a sell. Yes, someone is on record urging people to sell stock in the company of the world's greatest investor. Their median target is $121,300, according to Thomson Financial. So if you follow me, the consensus is not to buy the shares even though they are going to go up.

I'm not quite sure what his beef is regarding the stock's performance. The shares haven't done much over the past three months but have jumped 20 percent over the past year.

Should someone who has the cash -- a very lucky person indeed -- snap them up now?

Well, Berkshire's Geico unit is being hurt by pricing pressures in the auto insurance market. During the third quarter, the company sounded a note of caution saying, "The industry's profitability is sure to decline next year - substantially in all probability - and Berkshire's insurers will not be immune from industry trends...We do expect, however, that our insurance results will usually outpace those of the industry and that our long-term advantage could be significant."

Continue reading Can you believe that Buffett is not a buy?

Can you believe that Buffett is not a buy? originally appeared on BloggingStocks on Mon, 29 Jan 2007 16:30:00 EST. Please see our terms for use of feeds.

• PG&E, San Francisco's utility. Worth $13 billion, this company is seen as a solid local utility that successfully weathered the energy crisis of the last several years. The stock is up $1.29 today to $40.75 on the rumors.
  
• Mercury General Corp., Los Angeles-based automotive insurer. Worth $3 billion, the company has a 16% ROE and a low debt balance. Warren Buffett loves his insurance companies, and the company's stock is up $2.35 to $57.90 in intraday trading on the speculation.
  
• Les Schwab Tires, a Prineville, Oregon-based tire store chain. Founder Les Schwab has retreated following the recent death of his daughter, and the company fits into Buffett's love for innovative and well-run companies.

What will Buffet buy? originally appeared on BloggingStocks on Fri, 05 May 2006 14:59:00 EST. Please see our terms for use of feeds.