Warren Buffet pockets $2 billion on Goldman warrants

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Back in the fall, when the Oracle of Omaha threw a lifeline to Goldman Sachs, his decision looked pretty risky; however, with the world's most successful investment bank breaking its own revenue records, it's looking like he was right on the money. Currently, the warrants for Goldman shares that he purchased are worth roughly $2 billion more than the value of the stock he bought back then.

Of course, the U.S. government could have pocketed similar profits with warrants, a move that would have benefited the U.S. taxpayers and helped offset the $780 billion in initial bailout funds. But the U.S. Treasury Department, in its deep concern for the welfare and health of Goldman, has held back from asking for a reasonable return on investment.
The results of that highly favorable policy decision by a Treasury Department staffed with ex-Goldman bankers grows more evident by the quarter. With Goldman reporting record earnings as a result of risky trading behaviors, the investment bank is now a poster child for socialized risk paired with privatized profits.

Many pundits now consider Goldman Sachs to be an untouchable, Government-sponsored entity that is insulated from the consequences of its actions. In this context, the success of Warren Buffet's Goldman investments -- something that the U.S. taxpayers should have tasted as well -- has become an object lesson in the risks of crony capitalism.
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