Thursday, November 18, 2010
Warren Buffett pens a "thank you" letter to his Uncle Sam for "saving" us all from the housing bubble.
You have been criticized, Uncle Sam, for some of the earlier decisions that got us in this mess -- most prominently, for not battling the rot building up in the housing market. But then few of your critics saw matters clearly either. In truth, almost all of the country became possessed by the idea that home prices could never fall significantly.Not only did Uncle Sam "not battle" the rot, he caused it, by encouraging Americans (bankers in particular) to assume financial risks (particularly in real estate) they shouldn't have taken.
One wonders whether Mr. Buffett would feel the same level of gratitude had an uncle set his house ablaze while he was inside it, and then "rescued" him from the inferno.
PS: I must add that, in terms of preventing a financial collapse, I am far less optimistic than Buffett seems to be that the government has done even this much.
Today: Added a PS.