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Billionaires Dumping Stocks, Economist Knows Why

Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.

Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.

In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.

With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.

Unfortunately Buffett isn’t alone.

Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee.

Finally, billionaire George Soros recently sold nearly all of his bank stocks, including shares of JPMorgan Chase, Citigroup, and Goldman Sachs. Between the three banks, Soros sold more than a million shares.

So why are these billionaires dumping their shares of U.S. companies?

After all, the stock market is still in the midst of its historic rally. Real estate prices have finally leveled off, and for the first time in five years are actually rising in many locations. And the unemployment rate seems to have stabilized.

It’s very likely that these professional investors are aware of specific research that points toward a massive market correction, as much as 90%.

One such person publishing this research is Robert Wiedemer, an esteemed economist and author of the New York Times best-selling book Aftershock.

by Anonymousreply 8205/31/2014

Before you dismiss the possibility of a 90% drop in the stock market as unrealistic, consider Wiedemer’s credentials.

In 2006, Wiedemer and a team of economists accurately predicted the collapse of the U.S. housing market, equity markets, and consumer spending that almost sank the United States. They published their research in the book America’s Bubble Economy.

The book quickly grabbed headlines for its accuracy in predicting what many thought would never happen, and quickly established Wiedemer as a trusted voice.

A columnist at Dow Jones said the book was “one of those rare finds that not only predicted the subprime credit meltdown well in advance, it offered Main Street investors a winning strategy that helped avoid the forty percent losses that followed . . .”

The chief investment strategist at Standard & Poor’s said that Wiedemer’s track record “demands our attention.”

And finally, the former CFO of Goldman Sachs said Wiedemer’s “prescience in (his) first book lends credence to the new warnings. This book deserves our attention.”

In the interview for his latest blockbuster Aftershock, Wiedemer says the 90% drop in the stock market is “a worst-case scenario,” and the host quickly challenged this claim.

Wiedemer calmly laid out a clear explanation of why a large drop of some sort is a virtual certainty.

It starts with the reckless strategy of the Federal Reserve to print a massive amount of money out of thin air in an attempt to stimulate the economy.

by Anonymousreply 110/02/2012

It's from, you moron.

by Anonymousreply 310/02/2012


However, considering that I don't own any stocks, how can I possibly give a shit?

Stocks are for suckers. There's no difference between putting your money in the stock market, versus betting on red19 at the roulette table. No difference.

But kudos to the 1% who always know when to bet against America!

by Anonymousreply 410/03/2012

[quote]But kudos to the 1% who always know when to bet against America!

Patriotism is for Pussies!

by Anonymousreply 510/03/2012

OP, why do YOU hate america?

Right wing shill....

by Anonymousreply 710/03/2012

I don't think you have to be an economist to know why.

by Anonymousreply 810/03/2012

"It starts with the reckless strategy of the Federal Reserve to print a massive amount of money out of thin air in an attempt to stimulate the economy." “Companies will be spending more money on borrowing costs than business expansion costs."

These two statements are inherently contradictory, because the Fed printing money means that companies (and private individuals) will be spending less, not more, in borrowing costs (i.e. interest).

So unless the quotes are a really bad cut-and-paste job, this "guru" knows less about economics than a community college dropout does.

Oh, and it's from Newsmax, so that's par for the course.

by Anonymousreply 910/03/2012


by Anonymousreply 1004/16/2013

Warren Buffett isn't a market timer.

by Anonymousreply 1104/16/2013

Ouch! The stupid! It hurts!

by Anonymousreply 1204/16/2013

Gee, this reminds me of the endless "The Sky is Falling, Buy GOLD!" threads from a year or so ago.

How did that work out for all you doom and gloom types? Didn't I read where it's down to under $1500 an ounce?

by Anonymousreply 1304/16/2013

Closer to $1400. Dropped $200 or $300 bucks yesterday. Nothing's a sure thing..

by Anonymousreply 1404/16/2013

[quote]He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.

For a man who lacks confidence in dyed in the wool American Companies, it strikes me as odd that he just bought Heinz last month (the entire company).

In fact, he's been rather open about the fact that he's selling stock to pay for Heinz. Kraft he's been selling since they bought Cadbury, since he thought that was a dumb move. That was 3 or 4 years ago.

I'm no Buffet cheerleader, but he generally takes great pains to explain what he's doing and why.

by Anonymousreply 1504/16/2013

r13 that's what I was thinking. The person who bumped this thread has to be the same asshole who loves gold, which just dropped in value by a lot.

by Anonymousreply 1604/16/2013

[quote]For a man who lacks confidence in dyed in the wool American Companies, it strikes me as odd that he just bought Heinz last month (the entire company).

Probably because at some point ketchup will be all Americans can afford to eat.

by Anonymousreply 1704/16/2013

It is a vegetable, R17.

by Anonymousreply 1804/16/2013

That "article" has been posted for well over a year.

It just drives traffic to Newsmax, you ninny.

by Anonymousreply 1904/16/2013

I read an article a couple of months ago in a legit business news source (more legitimate than Newsmax anyway--might have been Bloomberg or Yahoo Business) that deep pockets investors were switching to commodities and leaving Wall Street to the middle-class suckers with mutual funds.

by Anonymousreply 2004/16/2013

[quote] He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson

Buffett was wrong about JNJ. He sold at $69-and-change, the lowest point in the past six-months and very nearly the lowest point in the past year. The stock closed at $83.44 today, ten-cents off its recent high -- the best in a decade.

[quote] According to Berkshire's 13-F filing with the SEC, the company held just over 492-thousand shares of J&J as of September 30. That's a 95 percent reduction from the 10.3 million shares it reported holding as of June 30. The market value of the remaining holdings is just $34 million, down $682 million.

by Anonymousreply 2104/16/2013

Maybe if these fuck faces didn't horde all the cash consumers would have some to spend with.

by Anonymousreply 2204/17/2013

Everyone knows the financial disaster "Can" was kicked down the road in 2008. Nobody really knows when the "Can" is going to explode. But everyone knows that day is coming.

by Anonymousreply 2304/17/2013

[quote]Everyone knows the financial disaster "Can" was kicked down the road in 2008. Nobody really knows when the "Can" is going to explode. But everyone knows that day is coming.

"Quotation marks" can't keep it "bottled up" "forever."

by Anonymousreply 2404/17/2013

You need to be watching what NY Billionaire Louis Moore Bacon is doing.

by Anonymousreply 2504/17/2013

I have seen this before and this has been floating around the web for the last month or so. There is even a couple videos made by some guy, I can't remember if he is a stock broker or just a news man, that talks about this same thing. Someone is working hard to put this out there cause I am running into it more and more. Not clear what the reality is though.

by Anonymousreply 2604/17/2013

I saw a link for the "original" article today. Dated 4/28/13 on Moneynew (i.e. Newsmax). Someone above posted it's been around for a year. The earliest copying of the August 2012.

Has anyone found this on the net with an older posting date.

by Anonymousreply 2704/29/2013

Anybody who thinks the Fed will allow a 90% drop in stocks doesn't know who controls the Fed.

by Anonymousreply 2804/29/2013

I knew this shit looked familiar.

I always see a picture of the same old coot on various sites with the caption about billionaires selling off stock.

Dumbass OP.

by Anonymousreply 2904/29/2013

Laughing all the way to the bank.

by Anonymousreply 3004/29/2013

He LOVES Only Gold, ONLY Gold, He Loves Goooooooollllllddddd!

by Anonymousreply 3104/30/2013

I've been waiting for this.

The paper millionaires are gonna shit.

by Anonymousreply 3202/21/2014

If you'd taken the advice of the OP of this thread, you would have missed the biggest rally in recent memory.

So why was this thread bumped?

by Anonymousreply 3402/21/2014

This article is one of those, "Hey, Stupid! Yeah, That Means You. Click on This," teasers disguised as news stories that sit on the bottom of web pages, like sunken pond creatures. Other articles alongside this one:

"(Name of Nearby Town) Mom Discovers Anti-Aging Secret!"

"The 5 Signs of Cancer in Your Body!"

"Penny Stocks Create Millionaires Every Day."

"This Stock May Explode! Can You Turn $5,000 into $500,000?"

"Can This (berry, fruit, herb) Help You Lose Weight?"

by Anonymousreply 3502/21/2014

Meanwhile back on planet Earth, Fannie Mae and Freddy Mac just paid back their 2009 bailouts.

You may resume masturbating to your fake financial disaster porn.

by Anonymousreply 3602/21/2014

That has been on the internet since Obama took office...wonder why?

As any economist will tell you - historically the stock market has done exponentially better under a democratic president than a republican president.

by Anonymousreply 3702/21/2014

My husband doubled our worth last year thanks to his stock trading.

by Anonymousreply 3802/21/2014

[quote]My husband doubled our worth last year thanks to his stock trading.

Yes, and now I can afford to dump you for someone younger and hotter.

by Anonymousreply 3902/21/2014

I am younger and hotter.

And I don't feel sorry for all the fools who missed out on the market rally because they believed some newsmax crap.

by Anonymousreply 4002/21/2014

[quote]Question should be: why is there no inflation when everyone knows it is spinning up quite rapidly? yet the numbers ...

Inflation has been spiraling out of control on Planet Libertarian for ten years now. Here on planet Earth it's still 1.5%.

Thanks for sharing the news from your alternate reality.

by Anonymousreply 4202/21/2014

There is no inflation because dollars are flooding the world to pay for our trade deficit.

by Anonymousreply 4302/21/2014

But every one of those dollars is a claim on American labor that will have to be paid some time in the future.

That said, I'm not taking the libertarian point of view, just stating that "reesrve currency" of the world is not a good place to be.

by Anonymousreply 4402/21/2014

R44, oh honey, just wait until the dollar stops being used as the world's reserve currency(probably in the mid-to-late 2020s). That's when the shit will really hit the fan.

And yeah, you are a libertarian.

by Anonymousreply 4502/21/2014

No I am not a libertarian. There is no realistic alternative to global managed trade, we just don't have to be chumps about it, letting everyone else industrialize at the expense of our workers.

by Anonymousreply 4602/22/2014

[quote]letting everyone else industrialize at the expense of our workers.

Which is why we should be opposed to the TPP.

by Anonymousreply 4702/22/2014

A few DL'ers understand something about economics. Then there are the R4's, who complain their entire lives about being poor because the 1% steal all the money.

If you look back at 1929, it's quite clear to us what happened, yet they had no clue as they danced their way into it.

Same now. We've learned how to rig the numbers to prevent normal things from happening. You'd think we would know Not to fool with Mother Nature.

by Anonymousreply 4802/26/2014

R41 is an idiot.

The OP is a bigger idiot.

by Anonymousreply 4902/26/2014

Billionaires are starting to see that "class warfare" is coming, and that US style fascism is on the rise.


Thus, it is quite interesting that two billionaires, Tom Perkins and Ken Langone, have recently called out USG policies against the rich as being Nazi like. To be sure, the arguments launched by Perkins and Langone are crude and lack the deep understanding that Rockwell displays in his analysis, but still the direction the argument is taking is encouraging.

Indeed, it is so encouraging that fascist-type economic policy supporter Paul Krugman has deemed it necessary to use his blog space to attack the notion:

Here comes another billionaire who thinks that anyone who talks about income inequality is a Nazi; this time it’s Ken Langone, co-founder of Home Depot. I don’t have anything useful to say about this, other than the observation that there must be a lot of these guys. I mean, there aren’t that many billionaires, so that coming up with multiple examples of the genus who not only believe that progressives are just like Hitler but are willing to say so in public must indicate that a substantial proportion of our billionaires share this belief, but more privately.

by Anonymousreply 5003/20/2014

billionaires who don't believe in income equalization are dooming the earth as we know it

by Anonymousreply 5103/20/2014

If you buy groceries and don't see inflation, you're mad.

by Anonymousreply 5203/20/2014

[quote]Thus, it is quite interesting that two billionaires, Tom Perkins and Ken Langone, have recently called out USG policies against the rich as being Nazi like.

Actually, what's "quite interesting" is that you thought that wonderfully laughable article worthy of reposting. That has to be one of the dumbest things I've ever read.

by Anonymousreply 5303/20/2014

Because everybody knows that inflation is determined exclusively by food prices, libertarian idiot R52. And that nothing else, say, global drought, might be driving it.

Keep fucking that chicken.

by Anonymousreply 5403/20/2014

R51 is 100% correct

by Anonymousreply 5503/20/2014

That article has been around for 2 years.

by Anonymousreply 5603/20/2014

I usually see the OP's headline right next to an ad for raspberry ketones or acai.

by Anonymousreply 5703/20/2014

"The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness."

-John Kenneth Galbraith

by Anonymousreply 5803/20/2014

The class warfare has been waged nonstop by billionaires since the 1970s. They are worried about losing it, not about stopping it.

by Anonymousreply 5903/20/2014

R52 - Food prices are going up, but prices for other items are going down. Overall, there is very little inflation. Inflation is half of what it was when Reagan was touting Morning in America.

by Anonymousreply 6003/20/2014

R51 and R55-

How so?

by Anonymousreply 6103/22/2014

But only because "inflation" is measured by what average people consume and average people have flat or declining incomes. The total amt of money in circulation matters nonetheless.

by Anonymousreply 6203/22/2014


You mean those 7 billionaires in the 70s?

Most billionaires - the Kochs, Soros, Buffet, the Walton's- got their money from leveraging government contracts and using legislation to squeeze out competing companies. Gates and Zuckerberg have benefitted from government contracts (the former) and NSA/CIA contacts (the latter).

A true free market would produce few billionaires since income would be far more evenly distributed.

by Anonymousreply 6303/22/2014

Exactly, R62

Wages are lower than they were in 1978 (inflation adjusted) while prices are much higher for core costs- energy, food, housing, education, health care- despite the fact that you can afford a flat screen TV, an iPad and cable.

Education and health care have seen the most government intervention, and thus prices are much higher.

Things like consumer electronics and elective surgery have had little government intervention, and are much cheaper than they were in the 70s.


by Anonymousreply 6403/22/2014

what about those bankers offing themselves? by jumping off buildings etc?

by Anonymousreply 6503/22/2014


Inflation (aka money printing) is rampant, it just has not fully hit the consumer level yet. Don't you think historic highs in the S&P and Dow and (now, once again) housing are inflation? The effects of inflation are hitting energy, food, housing costs, education, health care--- you know, the things people actually NEED- but just wait until the government can no longer export inflation (via the petro-dollar) to the foreign countries that have been financing (on very cheap credit) the lifestyles of America.

That's why this bullshit with Russia over Crimea is so fucked up. If Russia cuts gas supply to Europe then the people are fucked. If China and Russia enter a deal with OPEC nations to settle oil costs in Rubles or Yuan, then the US dollar is fucked.

by Anonymousreply 6603/22/2014

“Corporate insiders are more bearish than they have been in almost 25 years. That isn’t good news for the stock market, since these insiders — corporate officers and directors— know more about their companies’ prospects than the rest of us. In fact, you may want to take their pessimism as a signal to ditch some of your stocks or shift into industries in which insiders aren’t heavily selling, such as energy, financials and basic industrials. Just be aware that this record bearishness isn’t evident from many of the insider indicators that get widespread attention on Wall Street—those based on a ratio of insiders who are selling to those who are buying.

According to the Vickers Weekly Insider Report, published by Argus Research, which calculates a proprietary version of this sell-to-buy ratio, insider selling over the last eight weeks, relative to insider buying, is higher than average, but no higher today than it was one year ago—when the S&P 500 was poised to produce an impressive double-digit gain. And in late 2003, just as the 2002-07 bull market was gathering steam, the insiders’ sell-to-buy ratio rose to even higher levels than it is today.

by Anonymousreply 6703/28/2014

Kill him.

by Anonymousreply 6803/28/2014

Americans are too busy watching reality TV to notice.

by Anonymousreply 7003/28/2014


Covering your ears and screaming "NYAHNYAHNYAHICAN'THEARYOU!" doesn't change reality.

by Anonymousreply 7103/29/2014

No, but it might be one way to block out your verbal diarrhea.

There are other, more permanent ways, of course.

by Anonymousreply 7203/29/2014

This is ridiculous sensationalism-- everyone is constantly 'predicting' what is going to happen to the stock market, so of course some of them will be correct at times. With the billions of dollars pouring into the market from 401ks, iras, etc., the market will never not recover from tanking in our lifetimes.

by Anonymousreply 7303/30/2014

The big boys know the US government is tanking. That's why they are buying gold, silver, and foreign properties.

by Anonymousreply 7405/31/2014

Eat my golden pussy.

by Anonymousreply 7505/31/2014

The Dow was 13,500 when this thread started in October 2012. It is now over 16,500.

If it smart money was dumping stock, the smart money was not very smart.

by Anonymousreply 7605/31/2014

So you buy high and you sell low?

by Anonymousreply 7705/31/2014

Isn't the Dow being falsley bolstered by QE? And once the Fed stops printing money to use to prop up the economy, it is all going to collapse?

I noticed just the mention of the Fed changing anything makes the stock market falter.

by Anonymousreply 7805/31/2014

I think they are bumping this thread because Japan has reported inflation for the first time in decades (a positive thing) and the US a Q1 decline of GDP, partly in response to Fed tightening, partly in response negative effects on spending of tax increases and health care mandates;and of course mainly in response to the weather.

by Anonymousreply 7905/31/2014

[quote]If the Federal Reserve wasn't a private company composed of the "Too Big To Jail...I mean Fail" banks, they would have been liquidated. Their bad loans would have been re-priced, and their stockholders bankrupted. But, since those stockholders control the government, they got a bailout.

The Federal Reserve is not a private company. It is a part of the government. Banks are REQUIRED by law to buy stock in it to provide capital, but the stock has NO VOTING RIGHTS and distributes NO PROFITS.

by Anonymousreply 8005/31/2014

It is a private company in that it is owned by private banks.

by Anonymousreply 8105/31/2014

Never bet against America.

We have political stability, nukes, ideal geography, land worth zillions, and the resources to be self-sustaining.

We made a decision in 2009 to "keep the peace" economically, rather than let nature destroy a toxic financial system. This avoided food riots and tent cities, but it rewarded the banksters and left the toxic system intact.

I think a better bailout in 2009 would have been to just give every American citizen $15,000 and let them pick the winners and losers. Capitalism fails when those with money attempt to choke off nature.

Because we no longer have a meritocracy, another financial crisis is inevitable. After all, what's the "money question" on the Gamblers Anonymous intake questionnaire?

by Anonymousreply 8205/31/2014
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