Warren Buffett to CNBC: Economic War "Going Slightly Our Way" & Stocks Are "Far Less Attractive"
Warren Buffett tells CNBC that he's seeing some small short-term signs of improvement in the U.S. economy.
At the start of a three-hour live 'Ask Warren' appearance on CNBC's Squawk Box this morning, Buffett told Becky Quick, "We got past Pearl Harbor. We will win the war, and it's going slightly our way."
Buffett says Berkshire's businesses are "getting better," but at a "very, very slow pace."
Some of the subsidiaries "have really had a fair amount of bounce," but others have not.
When it comes to the government's efforts to help the economy, Buffett warns, "We should not expect miracles" but does believe Washington could help boost consumer demand by putting "money in the pockets" of lower-income people who would be more inclined to spend than wealthier Americans.
Noting that the stock market has sharply rebounded over the last year, Buffett says, "My enthusiasm for stocks is in direct proportion to how far they go down." Since they're higher, "Stocks are a lot less attractive now than they were a year ago."
He says bonds are also less attractive than they were a year ago.
Buffett also called the nation's health care spending "untenable," comparing "out of control" costs to a "tapeworm eating at our economic body." While he would support the current Senate health care reform bill if pressed, Buffett says he would prefer a "Plan C" that would control costs by changing the financial incentives of the system. Right now, he complains, "We pay for procedures, not for results."
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