November 8, 2005

THE HIGH COST OF HATING W (via Luciferous):

Buffett cuts forex loss after $1.2b hit (Jesse Westbrook, November 8, 2005, Sydney Morning Herald)

Warren Buffett's Berkshire Hathaway reduced a bet against the US dollar after losing more than $US900 million ($1.23 billion) from foreign currency investments this year.

Mr Buffett, who has said the US trade deficit would weaken the US dollar, cut his foreign-currency forward contracts to $US16.5 billion in September from $US21.5 billion in June, Berkshire said in a statement. The US dollar in July reached a 13-month high against a basket of six major currencies.

"To his credit, he reduced his exposure before the recent run-up of the dollar cost him more," said Tom Russo, a partner at Gardner Russo & Gardner in Lancaster, Pennsylvania.

When you bet based on bile instead of brains you're likely to get burned.

Posted by Orrin Judd at November 8, 2005 5:30 PM

warren loves his country right up to the point where his wallet begins.

Posted by: anon bilionaire at November 8, 2005 6:20 PM

Too bad Berkshire Hathaway isn't the type of company where the Board of Directors could fire the CEO for this kind of blunder.

Posted by: AWW at November 8, 2005 9:13 PM

If Bill Lerach weren't under investigation, he'd be all over Buffett's behind and on the way to court.

It's funny, but if Warren Buffett had made this bet in 2000, he would have made a lot of money. By allowing his 'hatred' to foment, he waited just long enough to make his deal when the dollar was just about bottoming out. Maybe his buddy George Soros can teach him about currency swings.

Posted by: jim hamlen at November 8, 2005 9:37 PM

I wonder if Buffett's broker tried to get him to change his mind, or if he just smiled and took the money.

Posted by: ratbert at November 9, 2005 10:13 AM

This story along with the Paris riots just make me smile.

Posted by: Bob at November 9, 2005 10:14 AM
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