latest derivatives warning (w. buffet)

[Mark Heide]

Brad,

I just wanted to provide a link if anyone is interested to Buffets stock list based on Robert Hagstrom's The Warren Buffett Way strategy:

http://www.quicken.com/investments/s...picks=hagstrom

You will see that there are only 18 stocks that you should buy using this strategy. But, I would skip some of the ones with P/Es above 20. Since, Bush will start his full blown war in a few weeks, you might want to wait for some bargains.

Another fact about this economy that is different is the high prices of stocks. The reason why I say the prices are high is traditionally in down markets most P/Es have hit 10 when panic had set in and everyone was selling. It didn't happen with the "dot.com" bubble. But, for the past three years I've noticed a kind of wave pattern. What I mean by this is that the stocks will go down, then some good news comes, but they never reach the point they were previously at the previous year. I expect some sell off once the war is full blown, and I predict that because of the three different major factions of citizens in Iraq, that it will take at least several years to get a transitional government started. You can debate the amount of time it will take.

Good Luck

Mark