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Comment by tptacek | Hacker News Reader

This is a big extrapolation of intent from a single paragraph of a very long, carefully-crafted letter. Absent from this analysis are all the grafs where Buffett explained why the bailout was the correct course of action.

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Right. I think Buffett talked about this only because it explains why Clayton Homes won't be able to lend as much in the near future. Buffett obviously thinks the bailout was best for the country and for Berkshire in the long run, but he had to explain these numbers to shareholders (from the table on page 11/12 of the 2008 letter):

                                   Pre-Tax Earnings (millions)
                                     2008   2007
                                     ----   ---- 
    Manufactured-housing finance .... 206    526

And Buffett doesn't single out bailout money. He just says that the crisis makes government-backed entities, such as FDIC-insured banks, safer for lenders. Not really surprising.

Quote: "Funders that have access to any sort of government guarantee -- banks with FDIC-insured deposits, large entities with commercial paper backed by the Federal Reserve, and others who are using imaginitive methods (or lobbying skills) to come under the government's umbrella -- have money costs that are minimal."

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