Swimsuits and Tides

Today’s recession-slash-financial crisis may not have a name yet, but it clearly has a signature parable: Warren Buffett’s now-infamous observation that “you don’t know who’s swimming naked until the tide goes out.”

If you’re looking for a bookend, it would be Buffet’s equally famous pronouncement that credit derivatives are “financial weapons of mass destruction.” [Full disclosure: Buffett is Chairman of Berkshire Hathaway, which is the corporate “great-grandparent” of Edina Realty.]

Well, the tide’s definitely gone out . . . and by now, we (pretty much) know who’s been swimming naked.

In light of these events, you’d think that policymakers’ focus would be to round up some swimsuits. Instead, my read is that they’ve been trying to get the tide to come back in.*

The former task is limited in scope, has a finite cost, and is actually achievable.

The latter?

We’re in the process of finding out . . .

*I suggest a corollary to “a high tide raises all ships”: ‘first, they have to be floating.’

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

Leave a Reply