Warren Buffett Watch

NBC News Warren Buffett sits down for a Dateline NBC interview with Tom Brokaw at Washington's Newseum.

Dateline NBC aired portions tonight (Sunday) of an interview with Warren Buffett by Tom Brokaw.  The conversation was taped late last week while Buffett was in Washington.

Buffett tells Brokaw that Barack Obama is the right "commander in chief for the economy" but warns that no one should expect a "miracle" turnaround in the next few months.

Buffett and Brokaw also covered many other topics, including Obama's leadership style, excessive executive compensation, the challenges facing Detroit's automakers, China, and the role of greed in good times and bad.

This is the first part of complete transcript of that interview, as provided by NBC News.  CLICK HERE FOR PART TWO OF THE VIDEO AND TRANSCRIPT.

TOM BROKAW, NBC NEWS:

Last fall, Warren, a pollster told me that the election was between hope and fear. When it comes to the economy, who's winning, hope or fear?

WARREN BUFFETT:

Well, right now fear is. I mean, you're seeing it everyplace. You saw it at-- in the sales of almost every item at-- at Christmas. There's a lot of fear throughout the country. Even-- even with people whose jobs are fine, and who have money in the bank. But they-- they're worried.

I've been describing this as the domestic equivalent of war. Is that an overstatement?

BUFFETT:

Well, actually, in September I said-- this is an economic Pearl Harbor. I-- that was the time Congress had made it in. It really is an economic Pearl Harbor. It-- the-- the country is facing something it hasn't faced since World War II.

And they're fearful about it. And they don't know quite what to do about it. And the point is-- and-- and it-- and temporarily it looks like we're losing. It has that-- that same aspect. Interestingly enough, we were losing for a while after Pearl Harbor. But the American people never doubted that we'd win. I mean, we had that attitude then. I think, right now, that they're sort of paralyzed.

BROKAW:

Is Barack Obama the right commander in chief for the economy?

BUFFETT:

He's the absolute right commander in chief. That-- you know, that's another thing the American people seem to do, occasionally, is that we elect people that are right for the times. You know, whether it was Lincoln, Roosevelt. And-- and I would say Obama-- you-- you couldn't have-- anybody better in charge.

BROKAW:

But why is he right for the times?

BUFFETT:

Well, he's-- he-- he's smart, he's got the right values, but he also-- he understands economics very well. He's cool. He's-- he's-- he's analytical. But then, when he gets it all thought through, and he's fast-- he can convey to American-- the American people what needs to be done. Not to expect miracles. That it's gonna take time. But that we're gonna get to the other end. And-- and I-- I-- I don't think there's anybody better for the job than-- than-- the president-elect.

BROKAW:

He often cites you as an advisor. And I know that you've been in touch with his economic team. But what often happens to somebody who gets elected to that office, particularly, they're more to you to tell you what they know than they are to listen. Does he listen?

BUFFETT:

He's a listener. I-- I first met him, maybe, four years ago, or something like that. He was a listener then, he's a listener now. But, on the other hand, he makes up his own mind. He will-- he will not be-- his team won't run him. He'll use his team, he'll use them very effectively. He'll synthesize, he'll-- he'll-- he'll analyze. But, in the end, it'll be his decision.

BROKAW:

Apart from his election, in your judgment, is there any other good news in the economy?

BUFFETT:

There's not much good new right now-- no. The-- we are-- we are in the middle of the economic Pearl Harbor right now. I mean, our ships have been sunk. Now-- (LAUGHTER) now we have to get mobilized-- to win the war, which we will.

BROKAW:

Your friend, and my boss, Jeff Immelt -- who is the CEO of General Electric

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[GE  Loading...      ()   ], had a phrase that I thought, in many ways, not just because he's my boss, but I thought he summed it up pretty well when he said, "This is not a cycle, it's a reset."

BUFFETT:

Well, there's-- there-- there's some real truth to that. And-- we have lived in one way in one type of economy. And-- and-- we're now deleveraging that economy. We're-- we're gonna have to live without the same impetus from credit expansion that-- really helped propel the economic engine for a long period of time. The-- the-- that-- that wind will not be at our back. But there's all kinds of things that will be in our back. But that-- he's right about resetting with-- without credit expansion being the propellant for the economy.

BROKAW:

And the stimulus program, that-- the new president wants to have, and that Congress is cobbling together, in your judgment is it sound? Are there some things they're-- they should be doing they're not doing?

BUFFETT:

Well, they're doing-- they-- they-- they're gonna turn the fire hose on this-- on this fire. I mean, the-- the-- and-- and-- it's-- it's-- it's a blunt instrument, to some extent. At-- at-- but it's very, very big. We're-- we're-- we're gonna-- we're gonna have a medicine coming in a dosage we've never seen before. And-- it-- but it won't-- it won't-- it won't have immediate impact. It should-- it takes time for it to-- to hit the economy in real force. So people should not expect miracles in February or March or April. That isn't gonna happen.

BROKAW:

I'm very interested in that. And the conditioning of the American consumer. We've been through some downturns here in the last 40 years. But we've always made a snappy recovery. The first two years of the Reagan administration, that was a very sharp recession. At the end of George Bush 41's administration, very sharp recession. But then we made a big comeback with the information technology. I-- I wonder if the American people don't, in the back of their minds, say, "Well, we'll come out of this one pretty quickly."

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