Jeffrey Goldberg

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Dick Durbin, Savvy Investor

16 Jun 2009 03:04 pm

In my recent cover story for this magazine (you can subscribe to it and read it on high-quality paper!), I wrote about the great divide in personal finance between them that know and them that don't. I realized that I was in the category of them that don't know. In other words, there are people in America -- very few of them -- who are privy to real-time information about the true state of individual equities, and mutual funds. The rest of us, I argued, are just guessing when we invest.

Well, count Illinois Senator Dick Durbin, the number-two Democrat in the Senate, of being in the "them that know" category:

As U.S. stock markets plummeted last September, the Senate's No. 2 Democrat, Dick Durbin, sold more than $115,000 worth of stocks and mutual-fund shares and used much of the money to invest in Warren Buffett's Berkshire Hathaway Inc.

The Illinois senator's 2008 financial disclosure statement shows he sold mutual-fund shares worth $42,696 on Sept. 19, the day after then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke urged congressional leaders in a closed meeting to craft legislation to help financially troubled banks. The same day, he bought $43,562 worth of Berkshire Hathaway's Class B stock, the disclosure shows.
To be fair, he didn't know everything -- he was probably smart to get out of mutual funds, but his investment in Berkshire Hathaway's Class B stock hasn't worked that well for him, having dropped in value fairly precipitously since September.

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