Warren Buffett has made the headlines again. Whilst the markets remain volatile and we consider whether to go defensive, Buffett sees opportunities. Bank of America may in the view of many not seem a good bet but Buffett sees differently.

The $5 billion that he has invested isn’t going to make a material difference to the balance sheet. But what it does do is tell the world that he thinks Bank of America is not headed to zero. And Buffett betting Berkshire’s money on something is the best stamp of approval that the stock market can hope to see. Especially interesting is that Buffett was the one who picked up the phone to get this going.

This isn’t the first time he has gone against market views, in 2008 he invested in Goldman and General Electric which has gone down as landmark investments. The one key weapon for Buffett is discipline.

This is what Warren Buffett has to say about the investment.

“Bank of America is a strong, well-led company, and I called Brian to tell him I wanted to invest in it,” said Berkshire Hathaway Chairman and Chief Executive Officer Warren Buffett. “I am impressed with the profit-generating abilities of this franchise, and that they are acting aggressively to put their challenges behind them. Bank of America is focused on their customers and on serving them well. That’s what customers want, and that’s the company’s strategy.”

Buffett is a long term value investor, and combined with the views of Ron Barron although the markets are volatile at the moment is there some light at the end of the tunnel.

NOTE: This is written in a personal capacity and reflects the view of the author. It does not necessarily reflect the view of LWM Consultants. The post has been checked and approved to ensure that it is both accurate and not misleading. However, this is a blog and the reader should accept that by its very nature many of the points are subjective and opinions of the author. This is not a recommendation to buy any product or service including any share or fund mentioned. Individuals wishing to buy any product or service as a result of this blog must seek advice or carry out their own research before making any decision, the author will not be held liable for decisions made as a result of this blog (particularly where no advice has been sought). Investors should also note that past performance is not a guide to future performance and investments can fall as well as rise.