Filed under: Deals, Market matters, Goldman Sachs Group (GS), Wells Fargo (WFC), Cramer on BloggingStocks
TheStreet.com’s Jim Cramer says he at least recognizes value when he sees it.
Warren Buffett isn’t an idiot. He has kept his powder dry through all of this madness and suddenly, within one week, he has opened his coffers and picked up not one, but two multi-billion-dollar steals, Constellation Energy (NYSE: CEG) (Cramer’s Take) and Goldman Sachs (NYSE: GS) (Cramer’s Take).
These investments are the first sign that someone, some grown-up, is coming in from the sidelines, not because he has been talked into something that he doesn’t want to do or comprehend — which has been the case in all of the other bank financings — but because he sees a delicious rate of return that’ll be hard to take away now that he has put his balance sheet to work, one of the last with any firepower to make a difference.
First, Constellation. Here’s a perfectly good utility that, because of its business model, needs capital to work. It made several miscues that brought it to its knees — a business that is a regular, good generator of income gone bad because of financing. I have no idea how low it would have gone, but as long as it was intact, it was worth a lot more than it was selling for to someone who has financing, and that’s what Buffett has in spades. He stole the company.
Continue reading Cramer on BloggingStocks: Buffett knows the score on Goldman
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