Is Warren Buffett Signaling a Housing Recovery?

by Robert Williams, Publisher Thursday, November 5, 2009

Warren Buffett is teaming-up with Goldman Sachs as the investment bank attempts to buy $3 billion of tax credits from taxpayer-owned mortgage firm Fannie Mae.

According to The Wall Street Journal, investments in low-income housing tax credits has waned dramatically in the face of the credit crisis.

Credits are being sold for between 65 cents and 79 cents on the dollar. By comparison – at the height of the real estate boom – developers were fetching 95 cents on the dollar.

(Property developers receive tax credits – worth between 30% and 60% of a project’s cost – to encourage building in low-income areas and to hold rents down. They typically then sell the credits to large financial institutions for the tax benefits they offer.)

Although Buffett and Sachs surely intend

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Warren Buffett’s Berkshire Hathaway Inc (NYSE:BRK.A) is finally starting to offload its 20% stake in ratings agency Moody’s Corporation (NYSE.MCO).

Here are listed sales in the filing, courtesy of 24/7WallStreet.com:

· 7/20/09… 1,817,000 at $28.7269 average in open market sale.

· 7/21/09… 3,915,100 at $26.9188 average in open market sale.

· 7/22/09… 2,254,200 at $26.6425 average in open market sale.

What took Buffett so long to start selling Moody’s? We have no idea. Moody’s runs one of the biggest scams on Wall Street. It charges the companies whose securities it rates (just like Standard & Poor’s and Fitch also do).

So what do you think these ratings agencies did when presented with a whole load of junk mortgage-backed securities to rate? They assigned them investment grade status and pocketed the cash.

If these ratings agencies had instead acted honestly and responsibly (rather than pimping

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I always get excited when changes to the Dow Jones Industrial Average (DJIA) occur.  I don’t really know why.  But you can bet I was glued to my TV when Chevron, Bank of America, and Kraft replaced Honeywell [HON: 35.72, 0.00 (0.00%)], Altria [MO: 17.35, 0.00 (0.00%)], and AIG [AIG: 1.65, 0.00 (0.00%)] last year.  This year, the DJIA has changed yet again, with Cisco [CSCO: 20.08, 0.00 (0.00%)] and Travelers [TRV: 44.04, 0.00 (0.00%)] replacing GM [GM: 0.00, 0.00 (0.00%)] and Citi [C: 3.41, 0.00 (0.00%)].

The DJIA is meant to reflect the overall US economy, comprised of a mix of the largest companies in different sectors.  The stock pickers over at News Corp. (who select the Dow 30 components) do a pretty decent job of creating

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A couple of days ago, I said I was looking at purchasing some railroad shares. They are a longer term play on the broader economy, and there are a couple of big factors I like in the industry. Those are efficiency, lower fuel costs than trucking, access to moving commodities, which I think will be coming back strong. You can see more of a href="http://briskycapital.blogspot.com/2009/05/prospects-strong-for-norfolk-southern.html"that analysis here/a.br /br /My update is that I did some more research, and I'd like to adjust what I'm looking to buy a bit. Norfolk Southern, which I mentioned before, is a good company with strong margins. But they have too much exposure to automobiles for me. I'm looking at some of the west coast names a little harder, and those are Burlington Northern Santa Fe (a href="http://finance.yahoo.com/q?s=bniamp;.yficrumb=DHHJXdr.Qk4"BNI/a) and Union Pacific (a href="http://finance.yahoo.com/q?s=unp"UNP/a). They both have exposure to ...

digg_url = 'http://zignalsblog.blogspot.com/2008/12/stocks-for-2009.html'; Like the Christmas Sales, the Stocks for 2009 are making an early appearance. So let's see who has gone for what: Jubak at MSN: Exxon Mobil (XOM); target of $91 JP Morgan (JPM); Preferred share target of $42 Energy Transder Partners (ETP); target of $42 ONEOK Partners (OKS); target of $52 by December 2009 and $58 by June 2009. Petroleo Brasileriro (PBR); target of $41 Transocean ltd (RIG); target of $117.60 Gorman-Rupp (GRC); target of $35 Middleby Corp (MIDD); target of $75 Chesapeake Energy (CHK); target of $39 US Bancorp (USB); target of $44 Kinross Gold Corp (KGC); target of $19.75 by June 2009 Enbridge Inc (ENB); target of $48 by February 2009 Fortescue Metals Group (FSUMF); target of $5 Plum Creek Timber Co. (PCL); target of $53 Rayonier Inc (RYN); target of $55 Ultra Pertoleum (UPL); target of $107 Thompson Creek Metals (TC); target of $9.90 Yara International (YARIY); target of ...

Via the CollegeAnalysts.com, James Cullen ponders is Warren Buffett Buying more American Express (NYSE:AXP) shares? Last Friday, Warren Buffett was on CNBC for several hours in the morning answering questions on all sorts of topics with his usual reserved wisdom. If only I could get Warren to speak with me for three hours… <!-- e9 = new Object(); e9.noAd = 1; e9.popOnly = 1; //--> One of the big revelations was that Buffett has been adding to either Wells Fargo (WFC) or American Express (AXP) – both extremely large positions in the ...

Investors are currently limited to the iShares Dow Jones Transports (IYT) as a transport ETF option with net assets of $698 million and 20 component stocks (stats as of 8/8/08 from the iShares website). The top five holdings account for 43.2% of invested assets and include the following: Burlington Northern Santa Fe (BNI, 10.7%), Union Pacific (UNP, 9.6%), FedEx (FDX, 9.1%), Overseas Shipholding Group (OSG, 6.9%), and United Parcel (UPS, 6.9%). In addition, the iShares Dow Transports ETF also includes three passenger airlines: AMR Corp. (AMR), Continental (CAL), and JetBlue (JBLU); although the combined weighting for these three companies is negligible; they represent an opportunity cost by occupying three positions in the fund and omit industry leader Southwest Airlines (LUV).

As evidence of increased commercial interest and product development of globally-focused transport ETFs among major ETF …