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Warren Buffett agrees with my decisions...

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February 11, 2008 – Comments (5)

OK, so he didn't exactly call me on the phone and say "Hey Deej, I completely agree with the changes that you have made in your investment philosophy over the past year and a half." but a lot of what Warren Buffett had to say in an interview today supports the decisions that I have made.

A few weeks ago I posted that I was focusing more on foreign companies and U.S. companies that are heavily involved in exporting because "I disagree with the sentiment that the dollar has reached a bottom and believe that it will continue to weaken over time." I also said "Oil" (I suppose that I vould have elaborated a little more on that one).

Well, here's what Buffett had to say today:

- " The U.S. dollar is likely to fall during the next decade if policies don't change, he said."

-  "Buffett has said he was looking for acquisitions outside the U.S., in part to hedge against long-term declines in the dollar."

- "If something is unsustainable, it's going to have consequences; so far the consequences have been a general decline in the dollar against major currencies,'' Buffett said. ``If we continue the same policies, we're going to get the same results in the next five or 10 years."

Furthermore, Buffett believes that " Inflation has been in 'remission' and is likely to be more prevalent in the next 10 years"  I realize that this doesn't exactly say "buy oil," but a weak dollar and rising inflation (combined with increasing global demand and a finite supply) will likely ultimately drive the price of oil much higher.  Even if the price does drop a little because we experience a slowdown here in the U.S. (I won't mention the "R" word).  I hope that oil does drop some because if it does, I'll gobble up all sorts of oil...stock that is.  Oil itself isn;t as tasty as one might think.  I am very bullish on it over the next decade.

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=aG3Ye9xx6_tA 

Deej

5 Comments – Post Your Own

#1) On February 11, 2008 at 11:11 PM, HistoricalPEGuy (61.48) wrote:

Thanks Deej.  I think we are in the same camp on this one.  And while I love Buffett, please don't fall into the trap that says "I think the same way Buffett does, so I must be on to something or right in my thinking".  Buffett is often wrong - he's just right a ton more often than he is wrong, which makes him such a valueable figure to watch.  This blog sounds like (doesn't mean thats what you actually believe) you're justified in your thinking simply because Buffett has similar ideas.

Regards ---- HPEGuy

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#2) On February 12, 2008 at 12:38 AM, abitare (39.45) wrote:

Buffett called you on the phone? Wow!

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#3) On February 12, 2008 at 5:47 AM, Capsperson wrote:

I agree with you totally !

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#4) On February 12, 2008 at 5:59 AM, TMFDeej (99.41) wrote:

Thanks for the comments everyone.  I see your point, HPEGuy.  While he obviously has a very impressive investment record, I actually am not a Buffett clone my any means.  I never just go out and blindly purchase the same sort of industries or companies that he does, like adding railroads right now, etc...  I have become thoroughly convinced that the dollar will fall, that strong foerign companies in countries like Brazil and India will outperform most U.S. based companies, and that the price of oil is going to continue to rise.  Its just nice to see someone who has been as successfull as Buffett agrees at least somewhat with the conclusions that have independently arrived at.

 Deej

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#5) On February 12, 2008 at 8:43 AM, dwot (67.78) wrote:

I think the US dollar is likely to fall as well...

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