Demagogue of the Year goes to Warren Buffet

Posted by Jack Crooks - Black Swan Capital

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Our Demagogue of the Year Award goes to Mr. Warren Buffet

“The demagogue is one who preaches doctrines he knows to be untrue to men he knows to be idiots.”  –   H. L. Mencken

Heck, there were so many worthy entries this year it was so hard to choose.  But Mr. Buffet trumped the pack with for his zealous defense of derivatives and those that have misused them so well to produce profits for so few—Goldman Sachs.  Another masterly performance was given by the Dr. of Duplicity at his annual meeting of Kool-Aide drinking sycophants.  Jim Jones would be proud.  

At one time not too long ago our Master of the Market deemed derivatives dangerous and destructive, hurting the little guy and playing no proper role in our financial system.  But now that Berkshire has learned how dangerously profitable derivatives can be, our hero has changed his tune.  Word on the street is he urged and another asset he controls—Nebraska Senator Ben Nelson (Mr. Obama you may remember purchased an interest in that asset earlier this year)—to slip in a little special deal for Berkshire in the new banking bill, hoping to stave off congressional requirements for more collateral needed from derivative devotees—which incidentally if passed in its current form might nip Berkshire more cash to cover the company’s $63 billion derivative exposure; thus lowering the effective return on dangerous derivatives profit producers demonstrably.  

The beauty of it all is why Mr. Buffet takes away this year’s prized Demagogue award hands down: Mr. B is able to maintain his folksy down to earth man on the street persona in the midst of all his dealing and duplicity.  Really is great stuff.  I think it’s well past time Mr. Blankfein get Mr. Buffets’ PR man on the horn. 

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