Sunday, November 9, 2008

The only way a smart man can go broke...

...is by borrowing money. So sayeth Warren Edward Buffett in a conversation he held with Charlie Rose. That conversation can be watched in its entirety for free on Charlie's site. I'm further behind than I thought with my links...this interview is from October 1. The information is still perteninet though. Especially as it reletates to borrowing money. I am absolutely sure of my investments shorting world markets, but had I taken on extraordinary leverage I would have been crushed by the short-term market rally we saw. It would have wiped me out. But by owning funds that are themselves short so that I don't need to short anything on my own, I am protected from this volatility because I'm not the one borrowing the money to short.

No comments: