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Ratings-Schmatings

Of course, by now you know that a few firms in the business of watching such things (but who shall remain nameless given the very real possibility of reprisals) decided to downgrade Berkshire Hathaway. Just like that. No appeal. No consideration. We ask you, where is gratitude?
Now, we know that some of you are worried that this will have an impact on the deadly and dangerous "Berkshire Puts," everyone talks about. We understand your concern. There is nothing more dangerous than a wounded put option. Add to this the fact that these particular puts weren't the subject of much discussion or explanation until recently, and the mercurial vagaries of the mystery puts only served to fuel the rumor mill. But, c'mon people, the Sage should have put these fears to rest in Berkshire's Q3 10-Q. Specifically:

Under certain circumstances, including a downgrade of its credit rating below specified levels, Berkshire may be required to post collateral against derivative contract liabilities. However, Berkshire is not required to post collateral with respect to most of its credit default and equity index put option contracts and at September 30, 2008 and December 31, 2007, Berkshire had posted no collateral with counterparties as security on these contracts.

So while everyone was wondering if, as of this moment, Berkshire was on double-secret put probation, Berkshire was bailing out Swiss re-insurance giants. Clearly, The Buff still has the touch, because they all seem to pay back early. (Though we hope that there are some big pre-payment fees attached there, Buff-buff).

Troubled reinsurer Swiss Re hould be able to generate enough funds to buy back convertible bonds issued to Warren Buffett's Berkshire Hathaway, said Chairman Peter Forstmoser on Friday.

So can we stop worrying about the puts and start concentrating on things that really matter? Like what the hell are all these CDS contracts Warren keeps talking about?
Berkshire Loses Top Rating on Investments, Buffett Role [CNBC]
Earlier:The Ghost Of Put Options Past

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Guy Whose Entire Persona Is Built Around Loving Cherry Coke Can't Even Pick Cherry Coke Out Of A Lineup

Buffett said in the letter that he was looking for someone who was emotionally stable, could avoid serious risks, think independently and read human behavior. He also tried to reassure shareholders that he was in excellent health: "It's amazing what Cherry Coke and hamburgers will do for a fellow."-- New York Times, March 9, 2007 "The Economic Club of Washington rolled out a special head table — and laid in a special soft drink supply — at the Marriott Wardman Park in the District last Tuesday for the club’s 25th anniversary, where it hosted billionaire investor Warren Buffett...Economic Club Executive Director Mary Brady said she was advised by Buffett’s assistant, Debbie Bosanek, to keep things moving and find a supply of Cherry Coke (Buffett loves it...The Marriott Wardman Park, which is a Pepsi venue, made a special exception."-- Washington Post, June 10, 2012 For six months, as the credit crisis deepened, billionaire investor Warren Buffett turned away a string of Wall Street firms that came hat in hand looking for help. On Tuesday, Mr. Buffett says, he was sitting with his feet on his desk in Omaha, drinking a Cherry Coke and munching on mixed nuts, when he got an unusually candid call from a Goldman Sachs investment banker. Tell us what kind of investment you'd consider making in Goldman, the banker urged him, and the firm would try to hammer out a deal.-- Wall Street Journal, September 25, 2008 David Rolfe, chief investment officer of Wedgewood Partners, which owns Berkshire stock, said the cancer was a non-news event. “I’m more worried about him getting hit by the Cherry Coke truck,” Rolfe said, a reference to Buffett’s professed love of the Coca-Cola product.-- Deal Journal, April 18, 2012 Whenever I lost track of Buffett, [Cherry] Coke often appeared to guide me--a carbonated version of the proverbial trail of crumbs. In London, our party went from airport to hotel in separate cars. When I arrived at the Berkeley Hotel, I did not have to wonder for long whether Buffett had preceded me. A bellhop approached with a shopping bag. ''Is this yours?'' he asked. Inside were two six-packs of Cherry Coke. Two days later, I was in the crowded lobby of the Schlosshotel Kronberg near Frankfurt, following a white-gloved waiter bearing aloft a single bottle of Coca-Cola on a silver tray.-- BusinessWeek, June 5, 1999 The above is but a mere sampling, a drop in the bucket, of articles printed over the years intended to show us how much Berkshire Hathaway CEO Warren Buffett loves Cherry Coke. That it is his exclusive soft drink of choice. That he spurns all others in its favor. That he bathes in it. That he pisses it. That he bleeds not blood, but Cherry Coke. That the mere suggestion of drinking something that is not Cherry Coke makes him sick. That the notion he wouldn't be able to tell the difference between Cherry Coke- his lifeblood- and, say, Diet Dr. Pepper or Pepsi Wild Cherry, would be laughable. And then this happened: The takeaway here is that we've all been pawns an an extremely sick game. Warren Buffett Fails the Cherry Coke Taste Test [BloombergTV]