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Warren Buffett Invests $5 Billion With Bank Of America, Plans NYC Obama Fundraiser


By

Jen Chung

Published Aug 25, 2011

Modified Aug 25, 2011


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By

Jen Chung

Published Aug 25, 2011

Modified Aug 25, 2011


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Bank of America says that Berkshire Hathaway, headed by tax-loving billionaire Warren Buffett, will invest $5 billion as the company tries to emerge from its disastrous, economy-wrecking involvement with subprime mortgages. BoA's shares have recently fallen to two-year lows, so this news has helped: An analyst told Bloomberg News, "This is a tremendous vote of confidence in the U.S. banking industry as well as Bank of America. Bank of America was being punished or victimized as one of the weakest U.S. banks that could be in financial distress. For Buffett to step up like this for BofA has implications for all the other banks."

Buffett, who invested $5 billion in Goldman Sachs in 2008 (which paid off big-time), said, "Bank of America is a strong, well-led company, and I called [CEO] Brian [Moynihan] to tell him I wanted to invest in it. I am impressed with the profit-generating abilities of this franchise, and that they are acting aggressively to put their challenges behind them."

The Oracle of Omaha is also lending his support to President Obama, by way of holding a $10,000-38,500/head fundraiser for Obama at the Four Seasons. There's also a Q&A with former White House adviser Austan Goolsbee—the invite says, "As all guests are seated for dinner, Buffett will go around to all tables and shake hands, then he and Austan will sit for the program and discussion."

Tagged

Bank of America

banking

economy

president obama

subprime mortgage

warren buffett


Jen Chung

Jen Chung is a former WNYC and Gothamist editor.

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