Even world's greatest investor is not spared from the US financial meltdown

World's greatest investor and one of the richest men in the world Warren Buffet said that he did some dumb things in 2008 investment that saw his share price lose almost half its value in one and a half years. In his annual letter to Berkshire Hathaway shareholders, Warren Buffett says he did some "dumb things in investments". Buffett also predicts the economy will "be in shambles throughout 2009.



Those who have invested in his company after 2004 and hold till today incue loss in capital. Those who invest in early 2008 loses up to half of their capital!

From CNBC:

The mistake of commission: buying a large amount of ConocoPhillips stock just as energy prices were near their peak. Buffett writes, "I in no way anticipated the dramatic fall in energy prices that occurred in the last half of the year." He still thinks oil will eventually go well above its current $40-$50 range, "but so far I have been dead wrong." Even if energy prices do rise, "The terrible timing* of my purchase has cost Berkshire several billion dollars."

Buffett also reveals that he spent $244 million for shares of two Irish banks that "appeared cheap" to him. At the end of the year, they were written down to their market price of $27 million, for a loss of 89 percent, and they've continued to drop.

The letter also reveals a 9.6 percent decline in Berkshire's book value per-share last year, making 2008 the company's worst year since Buffett took over in 1965. Book value fell by $11.5 billion during the year. There has been only one annual decline before this one. In 2001, book value fell 6.2 percent. "By yearend, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game."

Read more here from CNBC

They are not spared from laying-off staffs too.

Berkshire reduced staffing last year in half of its nearly 80 operating units, and said more job cuts were coming in an economy unlikely to recover before 2010.

* Maybe he should consider technical analysis?.....

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