Warren Buffet gets his way. The Bank has denied it needed to raise money yet it quickly turned around and gives Warren Buffet an absolutely fantastic deal.Warren is now the lender of last resort, he has bought $5 billion of 6% preferred shares and picks up 700 million warrants for his troubles. Clearly BofA was not coming clean on its need for capital and yet investors are still enamoured with Warren’s Golden touch.
Lets make no mistake, Warren scooped the street with this deal and although it might work out in the end for Warren, let’s make no mistake, this is a charitable donation from Warren. He is the lender of last resort and clearly BofA was on life support ready to implode. Since the Fed and Government are not politically able to bail out Wall Street just prior to the election, the phone lines must have been busy as they begged Warren to step up and spread his wealth around to the needy.