Warren Buffett Buying Heinz
By LawrenceNews released today.
This is exactly the kind of move I have been talking about – grabbing hard asset that is expected to generate cashflow even in bad times.
Warren is preparing for the tough time ahead for sure.
Ordinary people will not be able to do the same. Buying residential realty for rental income does not qualify as hard asset unless you can get them very cheap and pay for the property in cash. In tough times, governments can chop the rent to insignificant amount and even outright striping your rights to collect rent while enforcing the mortgage payments.
Some people may think that what I said above is outrageous. But it happened in Ontario Canada back in the early 1990s when the NDP party was in power. It also happened in all communist countries. It is a matter of time that it will become the norm in the Western countries.
Update: Read this from Zerohedge, who recommended to sell Heinz?
http://www.zerohedge.com/news/2013-02-14/guess-who-was-buying-hnz-stock-its-clients
So you’re saying the NDP slashed rents in Ontario to insignificant amounts?
There is a backdoor rule in the law they introduced (law repealed since NDP is gone) that if the tenant can prove that they cannot afford the rent because they are below the province income guideline, they can apply to slash the rent to a small percentage of their income. Landlord cannot contest the ruling and cannot kick out the tenant.
Of course, many people simply apply for the slash and no real checking was done on their claims as the government agency at the time has an agenda to destroy the people’s enemies – landlords.
Remember, the ruling cannot be challenged and is back dated by 1 year when it was introduced. So the landlords actually has to pay those tenants money as they have “overcharged” the tenants for a year already.
Not funny at all.