9:05am (EST)

When Warren Buffet Speaks, people listen…

It’s no secret, despite a struggling economy, that M&A (Merger and Acquisition) has been hot.  Berkshire Hathaway (BRK.A, $98,750, down $250.00) said it will acquire the 77% of Burlington Northern Santa Fe (BNI, $76.07, up $0.75) it doesn’t already own in a cash and stock deal.  The deal is worth $34 billion and marks Warren Buffet’s largest acquisition.  In pre-market trading, Burlington is printing $98, a $22 pop from yesterday’s closing price.

Buffett was so happy about the deal that he also proposed a stock-split for the company’s “Class B” (BRK.B, $3,265, down $18.00) shares.  Granted, there’s a HUGE price difference between the Class A and B shares as you can see but the Baby Berks’ will get a lot cheaper.  Shareholders will vote on a 50-for-1 stock split and if approved the B’s could trade for around $60…

Buffett has never split his company’s stock and although we don’t “buy-and-hold” stock, here’s one exception we may have to take a look at.  If you ever wanted to OWN a piece of Buffet’s empire, you may get your chance once the split is approved.  Now all we need is for Apple (AAPL, $189.31, up $0.81) to do a 2-for-1 split…

None of this is helping the futures, however, which are pointing towards a terrible open this morning.  The Asian and European markets fell overnight which is putting a little pressure on the U.S. markets. 

As far as economic news today, we get factory orders and sales reports from major automakers today.  Also, the Federal Reserve begins a two-day policy meeting on interest rates although the central bank isn’t expected to take any action no time soon.

Ahead of the opening bell, Dow futures are lower by 47, to 9,688, after being down 90 earlier this morning.  The S&P 500 futures are down 6, to 1,033, while the Nasdaq 100 futures are off 5 points, to 1,664.

We have been anticipating the market’s weakness and we have been taking advantage of the volatility while others have been rushing for the exits.  Yesterday, we told our subscribers to close half positions in a Research In Motion (RIMM, $55.74) trade for a 180% return while letting the rest ride.  We are also short a couple of other names which could continue to do well if the market heads lower. 

Current subscribers can check the Members Area for today’s updates.  We may also send out a trade today and if we do it will be available in the 1pm update…