Re: Sunny Point to Ponder on Drudge Report - Blood Boiler
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Posted by observer
(152.163.189.170) on March 04, 2003 at 08:43:11:
In Reply to: Sunny Point to Ponder on Drudge Report - Blood Boiler posted by Keyser Soze on March 04, 2003 at 06:42:50:
Not a Drudge Report reader and not about to become one but, I'd suggest Buffet's comments were taken out of context at some point. Warren Buffet's Berkshire Hathaway Fund uses derivatives to hedge interest rate and currency exposure in their vast insurance and reinsurance dealings. Heck, one way UPS stays profitable is using derivatives in the oil market to lock in fuel cost. Agribusiness is able to export grains worldwide by using derivatives on the Chicago Board of Trade to lock in grain cost and interest rate cost to carry inventory. Some people who own gold mining operations figured out the could use derviatives years into the future to sell gold as the price cratered from the $800 range to $250 last year.
Dervivatives are not evil and WB knows it. I'd wager much more money has been made by business's using derivatives wisely than has been lost by the few who used them for additional leverage to speculate. Routine success stories grounded on sound risk analyst techniques are too boring for the Drudge Report.
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