Warren Buffett said Wednesday that the U.S. economy has “no bounce” and will take time to recover, but there is no risk of deflation to push it further into despair.
Speaking on CNBC television, the world’s second-richest person also praised efforts by the Obama administration and Federal Reserve to jump-start economic activity.
He lamented that the slowdown has hurt his insurance and investment company Berkshire Hathaway Inc., which runs close to 80 businesses and in the January-to-March period had its first quarterly loss since 2001.
“We have had no bounce” in the economy, Buffett said on CNBC television.
Asked whether the economy was still in a “shambles,” as he had said in February, Buffett said: “I’m afraid that’s true.” But he added: “I don’t worry about deflation at all.”
U.S. gross domestic product fell at a 5.7 percent annualized rate in the first quarter.
Government efforts to stimulate business activity remain a work in progress, and President Barack Obama on Tuesday again said the nation’s jobless rate will rise above 10 percent.
“They’re doing things, but they take a while to have an effect,” Buffett said. “You can’t produce a baby in one month by getting nine women pregnant.”
Buffett nonetheless maintained his long-held belief in the stock market, saying that it is “attractive over the next 10 years” relative to alternatives.
Asked whether Obama should reappoint Ben Bernanke to lead the Federal Reserve when the chairman’s term expires next January, Buffett said: “I don’t see how you could do better.”
He separately told Fox Business 麻豆原创 that he plans to keep his Goldman Sachs Group Inc. warrants, which now show a paper profit.
Last September, Goldman agreed to sell Berkshire $5 billion of preferred stock carrying a 10 percent annual dividend, and warrants to buy $5 billion of common stock at $115 per share.
“We’ll make a lot of money off Goldman,” Buffett said.
Goldman earlier this month repaid $10 billion of federal bailout money taken from the Troubled Asset Relief Program. Berkshire invested in Goldman just after it became a bank holding company, which may reduce its risk-taking capacity.
In afternoon trading, Berkshire’s Class A shares rose $840, or 1 percent, to $86,640 on the New York Stock Exchange.
(Reporting by Jonathan Stempel, editing by Gerald E. McCormick)
Was this article valuable?
Here are more articles you may enjoy.
Judge Says NY Can’t Use ‘Unconstitutional’ Law to Block Migrant Buses From Texas 
Judge Questions Transparency of Onion Bid for Infowars 
FEMA Fires Manager Who Told Staff to Skip Homes With Trump Signs 
Trump Administration Seen as Likely to Dismantle ESG Rules 
