Warren Buffet on the global economic crisis

You know there's economic trouble when the richest man in the world tells you that his flagship company lost 9.6% of its market value in the previous year. You know that the trouble's really serious when he says:

This debilitating spiral has spurred our government to take massive action. In poker terms, the Treasury and the Fed have gone "all in." Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once-unthinkable dosages will almost certainly bring on unwelcome aftereffects. Their precise nature is anyone’s guess, though one likely consequence is an onslaught of inflation. Moreover, major industries have become dependent on Federal assistance, and they will be followed by cities and states bearing mind-boggling requests. Weaning these entities from the public teat will be a political challenge. They won’t leave willingly.

Warren Buffet tells the full story, with his usual charm and wit, in his annual letter to Berkshire Hathaway shareholders which was released on 28 February 2009.