Buffett Punished in Bond Market as Citigroup Borrows for Less

Bloomberg reports:

Billionaire Warren Buffett’s Berkshire Hathaway Inc. is being penalized in the bond market, paying more to borrow than bailed-out companies including Citigroup Inc.

Buffett’s firm paid more for its latest debt offering than Fannie Mae and Freddie Mac, the mortgage lenders that lost a combined $108.8 billion last year. Bank of America Corp. is also paying lower interest on notes under a program in which the U.S. agrees to guarantee debt.

The difference in borrowing costs illustrates how government aid is giving an advantage to companies that needed multiple helpings of U.S. rescue funds. Each of the companies except for Berkshire were able to find buyers for notes paying 2.375 percent or less because of their government backing, while Berkshire will pay 4 percent to bondholders who bought $750 million of the firm’s AAA-rated debt last week.

“Highly rated companies, such as Berkshire, are experiencing borrowing costs that, in relation to Treasury rates, are at record levels,” Buffett said in his annual letter to shareholders on Feb. 28. “At the moment, it is much better to be a financial cripple with a government guarantee than a Gibraltar without one.”

You'll want to read the whole article.Just a reminder,Warren has been a rather big beneficiary of TARP.That's why he lobbied for it.