http://www.abcnews.go.com/Business/E...6980506&page=1
Even the world's best-known investor couldn't get it right in 2008,
apologizing to his shareholders for doing "some dumb things" with their money. Billionaire Warren Buffett said in his annual letter to shareholders that while last year was a bad year for all investors, he made some mistakes that he now regrets.
"I made some errors of omission, sucking my thumb when new facts came in that should have caused me to reexamine my thinking and promptly take action," Buffett wrote in a letter released this morning.During 2008, the price of Buffett's Berkshire Hathaway stock fell from $90,343 a share to $77,793.
Berkshire's 2008 net income of $4.99 billion, or $3,224 per Class A share, was down from last year's $13.21 billion, or $8,548 per share, in 2007.
The company's profits fell 62 percent.Buffett said the performance was "unsatisfactory."
Joel L. Naroff, president and founder of Naroff Economic Advisors, said Buffett is doing the right thing by acknowledging what went wrong.
"I think that's the way a good investor should operate: recognize you made some mistakes, see what they are and try to correct them going forward," Naroff said.
In his letter, Buffett recalled how 2008 was a brutal year for everybody in the market.
"By year end, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game," Buffett said.
He added: "The watchword throughout the country became the creed I saw on restaurant walls when I was young: 'In God we trust; all others pay cash.'"
Naroff said that it's a prime example of how bad things are in the economy when someone like Buffett stumbles.
"I think when somebody as astute as Warren Buffett has problems, I think we all have to recognize that this was a real difficult year and hopefully next year won't be nearly as bad," Naroff said. "His performance was not nearly as bad as the indices did, so he outperformed them."
Buffett's predictions for 2009 aren't much rosier. He said he expects many of Berkshire's companies to be impacted by the recession and earn below their potential in 2009.
