Warren Plays Inside Poker

Here are the facts . . . draw your own conclusions.

1. It is common knowledge that President Obama and Warren Buffett have a close relationship (which will, no doubt, result in Obama being on Berkshire's Board of Directors within 12-18 months of getting out of office). Obama calls Buffett and talks about all sorts of things. Buffett writes Op-Ed pieces in the Journal that basically support Obama's calls for higher taxes. Buffett is the Poster Child for Obama's insistence that the wealthy can, and should, pay more taxes. After all, they say, even Warren Buffett pays a lower tax rate than his secretary!

2. Warren Buffett sits down with President Obama on Monday of this week to discuss the President’s pending "major jobs address" after Labor Day. Obama discusses his new jobs creation plan with Buffett, who gives him his opinions and the benefit of talking to someone who knows a lot about how the economy works (unlike . . .oh, forget it, that is just distracting from my point). Berkshire companies employ hundreds of thousands of workers and are involved in all sorts of businesses from carpet making to ice cream selling.

3. Two days later (on Wednesday of the same week), according to Buffett, he takes a bath (interesting . . . most men take showers, but that's neither here nor there). While contemplating his navel in the tub, Buffett gets an epiphany . . . "EUREKA!", he shouts, and leaps from the tub, dries off and calls Bank of America CEO Brian Moynihan.

4. The following day, Buffett pulls the trigger on a $5 Billion investment in Bank of America Preferred Stock and Warrants, thereby buying a major stake in another one of the largest financial institutions in the USA (he also owns a major stake in Wells-Fargo).

5. Bank of America is one of the few remaining "too big to fail" financials. In other words, BAC has an implicit guarantee or backstop from the Federal Government and will not be allowed to fail.

6. Buffett announces, today, the same day he announced his $5 Billion investment in Bank of America, that he is hosting one of those multi-million dollar fundraisers for Obama’s 2012 Campaign, in New York City later this year. Coincidence. Pure and simple. It was in the works for a long time.

I am SURE that talking to the President on Monday about his as-yet-unannounced job creation plans (and whatever else they talked about) had NOTHING whatsoever to do with his Tub Epiphany, two days later, to buy a $5 Billion stake in the (toxic) Bank of America. Warren just figured that one out in the tub, while thinking big thoughts.

I am SURE that the fact that Buffett and the President have a close relationship will not affect decisions Treasury makes about the future of Bank of American ONE BIT. No way.

I am ABSOLUTELY SURE that there is just no connection between these dots. They are just the random walk of life’s silly little events. Ain’t it funny how they make that pretty pattern, though?