James Thorne, senior portfolio manager and chief capital market strategist at Caldwell Investment Management, explains why he believes Berkshire Hathaway decided to buy into Home Capital Group.

“Mr. Buffett doesn’t walk into a boardroom and wave a magic wand and make everything better. This could take a heck of a lot of time, and we’ve got a housing cycle that’s starting to roll over and housing prices are starting to go down. Does it take bankruptcy off the table? Sure. But I think people have got to stand back and take a breath of fresh air and realize that there’s a long road to recovery here and this by no means changes the precarious situation that the Canadian housing market is in.”

Why Warren Buffett is buying into Home Capital