Historically, Warren Buffett has seemingly disagreed with his father Howard who called for "a return to a gold standard" and knew the great Austrian economic school economist Murray Rothbard. However, we suspect his recent startlingly crony-laden comments on Tim Geithner's new book would have made his dad roll over his grave... "Sensational... Tim's book will forever be the definitive work on what causes financial panics and what must be done to stem them when they occur."
As Economic Policy Journal asks rhetorically, How much of a crony has Warren Buffett become?
He is quoted on the back of Tim Geithner's new book, Stress Test: Reflections on Financial Crises:
Sensational...Tim's book will forever be the definitive work on what causes financial panics and what must be done to stem them when they occur.
Buffett's father, Howard, who knew the great Austrian school economist, Murray Rothbard, must be turning over in his grave.
In the quote above, Buffett is not only discounting Austrian school business cycle theory but even Keynesianism, for an alleged-theory by the total crony Tim Geithner.
Let it not be forgotten that just days after Buffett invested $5 billion in Goldman Sachs, the Treasury announced that it would bailout Goldman and other top tier Wall Street investment banks. Buffett made a killing in Goldman stock as a result of the bailout.
So, would Buffett have put $5 billion in Goldman if he wasn't tipped off that a bailout was coming? But of course he would, bath or no bath.