Uncle Sam Wants Payback - Buffett Speaks

government tax increaseWhat? You thought the government was just going to keep giving handouts for free? Never. The IRS has announced that those who took advantage of the first time home buyer tax credit that was issued in 2008, will now need to start paying that back on 2010's tax return.

How this will work is that all those who took advantage of the $7,500 maximum tax credit in 2008 will be asked to add $500 to their taxable income for the next 15 years. If the house is sold before the 15 years is up, then the full amount will be due upon the sale.

What will really ruffle some feathers is that only people who took the credit in 2008 will be required to pay.

Not like this is going to affect the overall economy much. When you consider that about 70% of Americans are estimated to not be paying their home mortgage right now, you better believe their not paying their taxes either. At any rate, Uncle Sam is starting to look for payback, and its only going to get worse.

Another interesting side note is that Warren Buffett has reduced his portfolio holdings of Berkshire Hathaway to 25 positions, the lowest we've seen form Buffett in several years. Obviously, Warren himself, is having to think that indeed this run has to be coming to an end soon. This was surprising to many, considering that Buffett has been rather optimistic through much of the recovery.

In addition to reducing his holdings, Buffett also sold off all the remaining of his Bank of America stock, and up'd his positions in Wells Fargo. It seems as though Warren had seen enough of bad underwriting and news from the bank giant and has not gotten out. Wells seems to be a safe play at this point for financials as they remain as the high standard of underwriting and continue to make a killing off of interest spreads. Happy Trading.


  1. Anonymous Says:

    I thought Buffet sold all those stocks because the guy who bought them was leaving the company. So Buffet sold everything that he wasn't personally passionate about.

  2. Finance Fanatic Says:

    Warren publicly speaks more political, if he felt the positions would add value in the short term, he would have not sold them

  3. Penny Stock Blog Says:

    Talking about the excessive debt of the united states what will happen to the united states if china and all the countries and all investors the world over shun the dollar. Interest rates would most certainly rise and the federal reserve would be forced to buy bonds from the treasury to fund the government and pay interest on all of the governments bills notes and bonds. When the buyers for united states debt obligations disappears the whole system will come crashing down. This is the type of thing that peter shiff has been warning everyone about when the ability of the united states to pay its debts becomes clearly in doubt all the buyers for united states debt securities disappears overnight.


    Uncle sam wants his and he wants it now.

  5. Anonymous Says:

    Uncle Sam wants always to payback. But really what will happen with USA if all the countries and all investors the world over shun the dollar. essaytoday.net

  6. Teresa Halminton Says:

    That's very true. Thank you for telling the truth.
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