Uncle John's Cabin

Whale Watching

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I have know for a while that Warren Buffet has been increasing his stake in the railroads, especially BNI. I'm gonna try to ride that train but I was not able to get in at his price point, under $80, but I need to get into compliance and went ahead with a purchase anyway.

Here's my take on this trade.
1) Rail looks cheaper these days to transport with oil prices in the 80-90 dollor range.
2) More bulk commodities (corn and coal in particular) need to be transfered then ever before considering the ethanol boondoggle and the coal shortage overseas.
3) Buffet is no fool and I will ride his train all the way to the bank. The market psychology has picketed up on his move and many people will be happy to follow his lead, so for better or worse, this stock should move up as people try to jump on this bandwagon.

Should I have waited for the same price point to get the most value out of BNI? Sure. But... we may not see $80 for a while now that everyone is aware of Buffet's intentions.

As always, good luck to my fellow contestants,
Uncle John