Warren Buffett: The One Man Who Can Make Goldman Sachs Look Like The Muppet (GS, BRKA, BRKB)
“[A]nticipating new regulatory restrictions on proprietary trading and seeking to reduce the bank’s exposure to risky assets, Goldman loan traders unloaded hundreds of millions of dollars of leveraged loans at a loss, people familiar with the matter say,” writes Wirz. “Making matters worse, many of those loans have since jumped in value.”
Here’s where it gets good.
Details of one trade in particular have recently caused a stir in the market. In November, Goldman sold about $85 million of loans in troubled newspaper publisherInc. Goldman sold the debt at about 65 cents on the dollar, having bought it months before at around 80 cents, resulting in a loss of at least $13 million.
Mr. Buffett has since made a tidy paper profit on the loans, which are now worth about 82 cents on the dollar, the people said.