And I was at a boring Central NJ travel soccer meeting tonight when one of my partners texted me that Warren Buffet was taking a $5 Billion stake in Goldman Sachs. Hmm.
What I saw and heard of the Senate Banking Committee meeting today featuring Paulson and Bernanke defending the big deal was very disappointing. It's disappointing how we got here. It's disappointing that people don't appreciate the gravity of the situation. It's sad that politicos are angling to add pork at a time when our financial system is at risk. I thought at one point today that there was a very real chance that this deal will not get done and I haven't heard anyone offer an alternative. Not good although I think it will get done.
I applaud this Buffet move. I think that Goldman has done a fantastic job running the company for their shareholders. It just so happens that employees own much of the company but whatever. While earnings are down, they got their mortgage bets right and haven't lost money in any quarter through this storm. Buffet has a great track record even though he has made some less than stellar moves of late.
The thing I fear is that people who don't understand the Paulson plan, or why we need it in the first place are going to roll out of bed tomorrow morning and say something like, "If Warren Buffett wants to invest in the financials, why should the U.S. taxpayer be bailing them out?" People actually think the $700 billion on the table is going to AIG executives, or the Lehman/Fannie/Freddie retirement party fund or some other crap.
So, Goldman/Buffett had me feeling a little better about the world that is the U.S. economy tonight. Then the news came along that Yahoo has rekindled talks with AOL about a merger of their two failed web franchises, reminding me of how a once-great company can turn down the deal of a lifetime and shareholders and board members en masse will just yawn. Oh well.
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