<i>Be fearful when others are greedy, and be greedy when others are fearful</i><p>Excellent advice.<p>Buffett walks in great footsteps here. Wasn't it J.P. Getty that came out during the depression and said something like "Buy stocks. We're buying as much as we possibly can." ( I paraphrase from memory here)
Buffet is undoubtedly a great investor. But I have a slight feeling that could be doing this more for altruistic reasons rather than personal profit. He might believe that he can inject enough confidence in the system by his reputation then maybe he can help improve things. Not necessarily by enough for his investements to pay off but to avoid a worse fate for the financial system. Remember the guy has committed to giving away most of his fortune already. Anyway it is just a theory, good luck to him either way.
A word of caution: Don't invest if you can't sleep soundly at night. Buffet can probably afford to lose a few billions here and there, but you probably can't.
Had you followed that advice after the Japanese crash of 1990, you would still be down almost 75%:<p><a href="http://finance.google.com/finance?q=^N225" rel="nofollow">http://finance.google.com/finance?q=^N225</a>
I bet he's gettin something on the side to basically step into the ring of fear here and fire the flare of "now's the time". I don't think people really dispute that now is the time. The problem is the view point.<p>You basically have to put money in and swear not to look at it again until 2013. Because the day by day view of that investment is heart attack unfolding as the bad news isn't going away, the affects of the 700 billion dollar crisis, job losses, sub prime this, abused and reckless that, and so on is going to be on the fear radar for a bit.<p>You whacked the consumer with $140 oil a few months back saying hard times are ahead, and then you backed it up with current credit crisis, and then you watched wallstreet get bought by the government as everyone in their money proceeded to get to cash as fast as they could. You've told the consumer to stop spending get back to basics and thats happening.<p>Folks in lots of cash, aka Buffet are in hog heaven right now. He can throw a bunch of money in, go back in cryogenic freeze with Elvis and pop back out in 2013 or so and bathe himself in cristal. Day traders hanging out with cash are making by the minute deals only to cash out and get back in on the highs and lows of the game, cautiously as they are, they are doing that.<p>If you have funds to play, play, or throw it in there and rent out buffets cryo chamber, probably a good bet really.
All respect to Buffet in his success and this op-ed's general message. But its simplicity reminds me of George Bush's call to "go shopping" after 9/11. Do you want to overcome fear and build America's future? Then entrepreneurs lets get building. If you don't have the self-esteem to invest in your own efforts (we need them now more than ever) then follow Buffet's advice and buy a slice of the companies that will rebuild America. If you have the chutzpah though, don't "go shopping," "get building."
I have a huge amount of respect for Buffet and this article has some sound advice. But, I still don't understand if it applies only to stocks or to anything US. This sentence (2nd paragraph) "I've been buying American stocks. This is my personal account I'm talking about [...]" sounds like, I've done my share in helping out by buying equity and [I imply] you see how you do yours with buying whatever US. Correct me if I'm wrong.
Buffett was heavily invested in the Euro. When the stock market crashed he simply took his Euro's, cashed them in for dollars, and bought US Assets that were down. Most regular US citizens were invested at the top of the market and just can't afford to go buy more.
Don't forget that Buffett now has billions of dollars riding on the recovery of American stocks. His motives for releasing this aren't all patriotic, are they?
This is exactly why I would wait. Words from Buffet will reduce fear in the market. I'd rather invest when fear is at a maximum (eg, next bad quarterly report, or bad economic numbers).