Is Warren Buffett Grazy

[BBSA]

Given the relentless barrage of bad news about the U.S. banking system and the near-constant calls for the government to nationalize the country's biggest banks, you couldn't be faulted for wondering if Warren Buffett had lost his mind when, in a three-hour appearance on CNBC Tuesday, he called this "a great time to be in banking," talked about the massive "earnings power" of banks like Wells Fargo, and said that the government actually doesn't need to supply most banks with "lots of capital." (Another explanation for Buffett's relatively upbeat forecast was that, in industry parlance, he was just "talking his book," since he has big stakes in banks like Wells Fargo and U.S. Bancorp.) But the truth is that the recent history of U.S. banking suggests there's a chance, at least, that Buffett was right.

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Seem like most of the banks are not going bust after all.

 

[DJ...]

Well someone had to try to improve the market sentiment...

 

[BBSA]

He is making some good points. The banks are recapitalize themselves and is not going bust:

banks have slashed their dividends to pennies, every dollar they earn essentially goes to recapitalization, instead of going out the door to shareholders. And with the government looking over their shoulders, it's also likely that the banks are going to be running tighter ships, so their expenses may be down as well.

 

[quik]

Is Warren Buffett Grazy

I wouldn't mind a big heap of crazy if it means a $60bn personal fortune