Obviously Warren Buffett practices what he preaches. His strategy to buy stocks whose prices have been driven down due to fear is very evident in his latest move. Wall Street is in the grip of unprecedented panic and stock prices have plummeted, even those of one of the world's most prestigious banks like Goldman.
"Be fearful when others are greedy. Be greedy when others are fearful," Buffett has often said. Buy when people are selling and sell when people are buying. His investment in Goldman Sachs stems directly from this investing principle of his.
Buffett's investment in Goldman not only boosted the bank's confidence, but also that of investors worldwide. Essentially, Buffett's investment is an endorsement of his faith in the stability of America's financial and banking system.
It is also his way of saying 'yes' to the $700 billion bailout plan that has been criticized by many a taxpayer, economist, and politician.
Image: The headquarters of Goldman Sachs Group at 85 Broad St. in New York City. | Photograph: Mario Tama/Getty Images
Also read:
Google's amazing journey
Advertisement
