Buffett Buys Goldman Stock
This is good news for the market.
Goldman Sachs Group Inc. will raise at least $7.5 billion from Warren Buffett's Berkshire Hathaway Inc. and public investors in a bid to quell concerns that pushed
up the Wall Street firm's borrowing costs and hurt its stock.
Berkshire is buying $5 billion of perpetual preferred shares, New York-based Goldman said today in a statement. Goldman, which this week transformed itself from the biggest U.S. securities firm to the fourth-largest bank by assets, also plans to raise at least $2.5 billion by selling common stock in a public offering.
Obviously, this transaction does not solve all the problems, but it is a good sign when a savvy investor like Buffett commits billions of dollars to a financial company.
Dow futures are up 140 in the after-market.
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