An Economic Pearl Harbor says Warren Buffett

“It’s not the return on my money I’m worried about. It’s the return of my money.” Yogi Berra

Who would ever imagine voluntarily investing in an investment that pays only 1/20th of 1%?

Yet that is what happened when $40 billion moved into 7 day Treasury Bills. Almost as bad as putting your cash under the mattress, isn’t it?  Fear is running rampant and despite it’s low return, there is a trust factor built into treasuries that at least you will get your money back.

Warren Buffett says he has never seen anything like the current fear and tsunami of financial crisis in his lifetime. When asked if we could be facing another Depression, he said, yes, it is possible. The root cause? Derivatives and false accounting.  (Sounds like greed and self-interest to me.)  However, Mr. Buffett also has strong confidence in the ability of America to be better off ten years from now than we are today.  He is a realist, not a doomsayer.  He believes in the “bailout plan”, but also realizes this is not an immediate answer.

He refers to the Reconstruction Finance Corporation which was used during the Great Depression.  Here is his interview with PBS journalist, Charlie Rose, about the bailout plan and our country’s future.

It’s time for fundamental change and accountability. It’s time for ethical, strong leadership. It starts with us.