Warren Buffett gave an interview on CNBC this morning. He mentions that the companies under the Berkshire Hathaway umbrella are starting to show that “there is a slowing down going on” throughout the economy on a global scale. He mentions that the US economy is thriving more than in Asia and Europe.
Warren Buffett also tells us that US Home construction is picking up once again. The businesses that Berkshire Hathaway has tied directly into the housing market are showing more signs of profit. Shaw carpet, one of the businesses under the Berkshire Hathaway umbrella, will double in profits this year. Mister Buffett also told us that Clayton Homes, another Berkshire company, plans to build 15% more manufactured housing units in the coming months.
Due to the spike in business and profits, Berkshire Hathaway expects to add an additional 8000 people to its workforce. At the time of this writing, Berkshire Hathaway currently employs 270,000 individuals in the workforce.
Not all is perfect in the world of Berkshire Hathaway. Their Iscar metalworking business experienced a drop-off in orders from their Asian customers Buffett tells CNBC. He also mentions that Europe is still working through problems that they have yet to straighten out.
Warren Buffett is one of the most successful investors in history. There is no denying it. As such, investors follow Buffett’s views on the economy and investing closely. During the interview on CNBC this Wednesday, he mentions that the Tuesday market declines leave him “salivating” and ready to buy more stocks. He also plans to acquire another large company that Berkshire Hathaway will own outright.
On Tuesday night, someone approached Buffett about a $6 billon dollar company. Since he is already familiar with this company, he plans to learn more about it over the next few days.
Berkshire Hathaway already has a large stake in Wells Fargo bank. Regardless, they bought more shares this week and added to their already sizable investment.
He warns investors that US bank stocks will not rebound to the levels they once saw prior to the financial crisis. They no longer have the ability to use as much leverage as they once were capable of using in the past. Buffett reminds us that banking is “still a good business” in the United States.
Buffett once again endorsed Federal Reserve Chairman Ben Bernanke, saying he “has done an absolutely superb job.” He also predicts that Bernanke would most likely continue as Federal Reserve chairman if anyone asked him to stay for another term.
Although, Buffett mentions that his “instinct” tells him that the quantitative easing program from the Federal Reserve is not the correct strategy any longer.
“I get a little worried about continuously expanding” the Federal Reserve’s balance sheet, he mentions on CNBC.