Should You Still Believe in Buffett?

On a day when the Dow lost another 400 points or so, when Citigroup touched below $10 a share, GE is below $16 and Goldman is down another 9 percent, one major investor points out that the Oracle of Omaha's investment strategy has disappointed even his staunchest supporters.

No, Warren Buffett is not tied to Citi, but he is closely tied to GE and Goldman. This investor, it should be noted, is also one of Buffett's biggest fans. All praise for the man aside, his picks and his returns have seen better days. Buffett's Berkshire Hathaway has suffered major losses this year. The company recently reported a 77 percent drop in third-quarter net income, largely attributed to more than $1 billion on unrealized derivative losses and paid hurricane claims following hurricanes Gustav and Ike.

As for Buffet's own individual bets, well, they haven't paid off, either ... yet. Buffett invested a combined $8 billion in General Electric and Goldman Sachs, on terms only someone like Warren Buffett could pull off. They have yet to break even. Goldman's stock price since Buffett invested has gone from $125 to $75, and chatter, speculation and, yes, rumors on the street about GE's woes would make even the most bullish of investors think twice.

To his credit, Buffett has lived up to his nickname of "sage" during the current financial crisis. His voice, his rhetoric, his humor and his easy-to-understand logic have together made a welcome and reassuring voice for everyone from President-elect Barack Obama to the average man on the street. He's the toughest man to get an interview with these days, and his every word can move a stock. He's said this is the worst financial crisis he's seen in a long time, if ever.

So you can look at it from three different points of view. One, no one is perfect, and even the smartest investor in the world makes mistakes. Two, when he says he's a long-term investor, he really means LONG TERM. Or three, today's Buffett is more of a symbolic and iconic figure than a master stock picker. Buffett fans probably hope the second point of view is the right one, and while they'll likely accept the first one, I doubt they're ready to accept the third.

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