I wrote this a while ago, before Warren Buffett retired, and lost track of it. Now it’s late, but I think still timely.
I asked Google AI this question:
“why don’t investment banks follow Warren Buffett’s advice?”
This is the summary of what it said:
“Investment banks do not follow Warren Buffett’s advice primarily because their business models and objectives, such as a focus on short-term performance and high-volume transactions, are fundamentally different from Buffett’s long-term, value-investing strategy at Berkshire Hathaway.”
So, I guess short-term investing is reckless and long-term investment is conservative? Trump wants interest rates to return to zero. Treasury Secretary Scott Bessent calls for less banking regulation.
Treasury Secretary Bessent calls for looser regulations for the U.S. financial system
Will we be able to get through another financial crisis without “capitalizing the gains, and socializing the losses?”
I disagree with a lot of what fund manager and author Rucshir Sharma says in that installment of Wall St. Week. He makes the argument that everything would be great if we stuck to Adam Smith’s original vision. Ideologues of every persuasion, including Supreme Court justices, are mistaken in their adherence to whatever it is they consider “originalism” to be.
In that same video, Bloomberg’s John Authers says that, “Capitalism and Democracy have a symbiotic relationship.” Not always, as seen in China. It’s possible, if not likely, that China is already practicing Capitalism 4.0.
Authers also says the capital markets indicated the big shifts in modern Capitalism. I’d say that Wall Street isn’t a barometer of trouble, it causes the trouble.
My retirement money is in IRA CDs. I have no investments, as such, other than a modest holding in private shares at my former place of employment. That investment would be worth vastly more today if not for the HITECH Act, which was part of ARRA in 2009.
HITECH was a prime example of Industrial Policy. That’s when a government decides to intervene in a particular industry.
Trump’s brand of industrial policy is, of course, transactional, as seen in his recent deal with Nvidia. Recently on Marketplace, Adam Posen, president of the Peterson Institute for International Economics, had this comment about what is becoming, under Trump, state capitalism.