Tuesday, February 12, 2008

Buffet's offer sends stocks higher

Warren Buffet encouraged buyers today with an offer from Berkshire Hathaway (BRK-A) for up to $800MM secondary insurance on municipal bonds. Markets liked this news. Dow is up 155 (pulling back 40 in the last couple of mins), advancers lead decliners 3-1 & NAZ is up 10. In addition, 6 major mortgage lenders will holdup on foreclosure procedures for 30 days on mortgage loans in trouble for qualified homeowners. This sounds good although many marginal homeowners will be excluded from this arrangement. The plan was proposed by the president & the Secretary of Commerce coordinated administration thoughts with the 6 lenders. Good news but problems continue.

GM (GM), a Dow company, reported a whopper loss, up .33. GM hopes more job cuts will restore profits. Masco, MAS, a favorite of mine & a major supplier for bathrooms & kitchens in homes, gave a very gloomy forecast for 2008, down 2.25. Autos & especially housing are facing tough times.

New Rules of Investing from Yahoo may be useful in these volatile times.

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