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Investing Warren Buffett Watch


  Monday, 10 Aug 2015 | 1:07 PM ET

Warren Buffett on Fed rates, IBM stock & Mondelez

The Federal Reserve seems ready to increase interest rates for the first time in nine years, billionaire Warren Buffett said Monday. But he added it's "not an easy decision."

"It's very tough to push rates higher in the United States, when Europe needs to keep them low. And you got this situation existing around the world," he said in a wide-ranging interview on CNBC. "But I keep hearing the [Fed] governors saying it's going to happen soon."

"It may very well happen. But I don't think it's an easy decision when … you may be affecting exports and imports very significantly, if you push rates here to be considerably higher than in Europe," Buffett said in the "Squawk Box" interview.

As for the U.S. economy, the Berkshire Hathaway chairman and CEO said he expects more of the same that's been seen in the past five years, about 2 percent growth.

Talk of a double-dip recession or a rapid acceleration appear equally unlikely, he said: "I don't see [the economy] accelerating or decelerating."

Buffett, who looks to buy stocks or business for their long-term prospects, said recent weakness in the market does not concern him.

"Stocks are going to be higher, and perhaps a lot higher 10 years from now, 20 years from now," he said, adding that's why he does not try to time the market.

Using housing as an analogy, he said people won't sell their homes if property values dipped 5 percent in the hopes of buying their homes back cheaper.

Buffett also touched on a number of other issues, from his possible intentions concerning IBM stock and Mondelez as an acquisition prospect, to the 2016 presidential race, to Berkshire's big acquisition of an aircraft parts maker.

Read more from Buffett's interview
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»Read more
  Monday, 10 Aug 2015 | 10:11 AM ET

Did Warren Buffett signal new IBM stock buy?

Billionaire Warren Buffett said Monday he's not concerned about the recent decline in IBM, in which he's a large shareholder.

The stock closed Friday at $155 a share, after the tech giant reported quarterly revenue that fell short of estimates. It has dropped about 10 percent since July 20.

Buffett told CNBC's "Squawk Box" that his ownership cost of IBM stock is around $170 a share.

Read more from Buffett's interview
Warren Buffett: Precision deal 'very high multiple'
Warren Buffett: Trump won't be a flash in the pan

"I love it when it goes down. It means the company buys stock cheap, the Berkshire Hathaway chairman and CEO said.

In perhaps a signal he's also been a buyer, he added, "It means if I want to buy stock, and you can look at our 13F in a few days ... I get to buy it cheaper." It's worth noting that he did not say definitively either way whether he's a buyer.

Shares of IBM were slightly higher Monday.

But he stressed, "I'm not a seller" of IBM—saying he does want the stock to eventually head higher, maybe "five or 10 years from now."

As of March 31—as reported in Berkshire Hathaway's 13-F filing on May 15—his company held an 8.12 percent stake, 79.57 million shares. Berkshire is IBM's largest shareholder, with almost 20 million more shares than the next-biggest investor.

He bought an additional 2.6 million shares in the first quarter, valuing his overall holdings in IBM at $12.3 billion as of Friday's close.

Read MoreBerkshire Hathaway portfolio tracker

»Read more
  Monday, 10 Aug 2015 | 8:26 AM ET

Warren Buffett: Precision deal 'very high multiple'

Berkshire Hathaway, the conglomerate owned by billionaire Warren Buffett, announced plans Monday to acquire aircraft equipment maker Precision Castparts in deal valued at $37.2 billion, including debt.

Buffett told CNBC's "Squawk Box" he made a bid for Precision during the Allen & Co. Sun Valley conference last month. "This is right up there at the top" of expensive deals, he said. "This a very high multiple for us to pay."

Berkshire's offer of $235 per share is a premium of 21.2 percent to Precision's Friday close of $193.88. Berkshire already owned 3 percent of the company, and is its largest shareholder.

"We'll probably borrow about $10 billion and use about $23 billion of our cash," Buffett said.

Precision's stock price zoomed more than 19 percent in premarket trading Monday. Berkshire's was down slightly.

Read More10 top brands Warren Buffett's Berkshire Hathaway owns

Buffett said the deal started with his portfolio manager Todd Combs, who manages $9 billion. "Three or so years ago, he added Precision to his portfolio. I had never really heard of the company before that."

Founded in 1949, Oregon-based Precision makes components such as fasteners and turbine blades for aircraft companies including Airbus and Boeing, and has annual sales of $10 billion. It also makes equipment for power stations and the oil-and-gas industry.

"We're going to be in this business for the next 100 years," Buffett said. "Perhaps a slump in oil and gas has helped us in this case." But over the long-term, energy prices do not matter in terms of this deal.

PCC will remain headquartered in Portland and will be a wholly owned subsidiary of Berkshire. Mark Donegan, PCC's chairman and chief executive officer, will continue to run the business. "Mark is running this company," Buffett said.

Read More Warren Buffett: THIS is key to valuing stocks

As for as Berkshire going forward, Buffett said, "This takes us out of the market for an elephant," referring to a big deal of this size.

"We'll be left with over $40 billion probably of cash when we get all through [with PCC]. But I like to have a lot of cash at all times. This means we have to reload over the next 12 months or so," he said.

He added, however, that he will probably make some smaller deals in the next six months.

Berkshire said Friday second-quarter profit fell 37 percent, reflecting a significant decline in investment gains and an underwriting loss from insurance.

Read MoreWarren Buffett: Trump won't be a flash in the pan

CNBC's Javier David and Reuters contributed to this report.

»Read more
  Monday, 10 Aug 2015 | 8:43 AM ET

Warren Buffett: Trump won't be a flash in the pan

Warren Buffett said Monday that Donald Trump has a solid base of support in the race for the Republican presidential nomination that seems unshakable by the real estate mogul's over-the-top comments.

Trump will have a block of delegates when the convention arrives, but with the huge field of GOP candidates, it's possible no one will have a majority, Buffett told CNBC's "Squawk Box" in a wide-ranging interview.

"I wouldn't be surprised if [Trump] maintained a quite a solid base for some time," Buffett said—adding that he won't run out of money.

Read More Warren Buffett: Precision deal 'very high multiple'

Trump's latest controversial comments were about Fox News anchor Megyn Kelly following Thursday's GOP debate.

According to the latest NBC News Online Poll conducted by SurveyMonkey, however, Trump remains at the top of the list of GOP candidates among would-be Republican primary voters.

The overnight poll was conducted for 24 hours from Friday evening into Saturday.

Buffett—a Democrat and supporter of Hillary Clinton—called the GOP race so far a "spectator sport." He declined to say which Republican he'd like to see Clinton face in the general election.

"If I gave that prediction it would be sort of a kiss of death for the candidate," Buffett joked—saying he'd like Clinton "to run against the whole field."

Read MoreIcahn: Sure, Trump—let's do this

»Read more
  Monday, 8 Jun 2015 | 7:28 PM ET

Meet the Chinese firm that paid $2.35M for Buffett lunch

China's rampaging share market has produced a new kind of winner - the boss of Dalian Zeus Entertainment Group, who used his stock quote as inspiration for a bid to dine with Warren Buffett, and won.

Dalian Zeus, a gaming company little known outside China, stole headlines at the weekend after dishing out $2.35 million for a private lunch date with the legendary investor.

Chief executive Zhu Ye described the chance to lunch with Buffett as a dream come true, according to a report by Chinese Securities Times.

Zhu, who graduated from the Beijing University of Technology in 1999, told the Chinese media outlet that he wanted to seek Buffett's opinions on value investing.

»Read more
  Wednesday, 17 Jun 2015 | 12:45 AM ET

This market could heat up as Buffett enters

Posted By: Nyshka Chandran
Warren Buffett, chairman of Berkshire Hathaway Inc.
Lacy O'Toole | CNBC
Warren Buffett, chairman of Berkshire Hathaway Inc.

The stars are finally aligning for Australia's stock market following a recent selldown, as cheap valuations and approval from billionaire Warren Buffet lure traders back in.

The 84-year old investor told Fairfax Media on Tuesday that he intends to spend over $2 billion a year to build stakes in Australian firms after his investment firm Berkshire Hathaway invested $388 million in insurer IAG.

"If you come back in two or three years, you will find we have got four or five Australian equities," he said in a phone interview, adding that the $2 billion cashflow will come from his investment into IAG.

"There is money to be made in Australian equities over the next 10, 20, 30 years ... If we get something we feel comfortable with, we will stick with it for a very long time."

His remarks come as the benchmark S&P ASX 200 begins to recover from a three-month selloff that has left the market unbelievably attractive, according to Goldman Sachs.

"Value looks as good as it has in a decade," said the bank's strategist Matthew Ross in a report this week. He notes Australian equities look 10 percent undervalued relative to other developed markets like the U.S., Europe and Japan.

"At 15.8 times price-to-earnings, Australia also trades at a 9 percent discount to MSCI World - well below its 1 percent average premium and just shy of its largest discount in a decade."

Read MoreBubbly, anyone? The Sydney property debate

The S&P ASX 200 index rallied over 1 percent on Wednesday, but has lost more than 4 percent since April. Banks were largely responsible for the selloff, triggered by lackluster earnings reports and a push for stricter capital requirements by financial regulators.

»Read more
  Friday, 22 May 2015 | 11:19 AM ET

Buffett: This is better than raising minimum wage

Posted By: Rebecca Ungarino

Billionaire investor Warren Buffett, in commentary for The Wall Street Journal, said expanding the Earned Income Tax Credit (EITC) is a smarter alternative to raising the minimum wage to $15 an hour.

Buffett said a "major and carefully crafted expansion" of the EITC is a better answer to leveling the growing wealth gap in the U.S., wherein millions of employees are working, though just scraping by, as the rich get richer. But the wealth gap, Buffett wrote in the Journal, is not to be blamed on any sort of "conspiracy."

Read MoreWealth gap widens in developed world

"The poor are most definitely not poor because the rich are rich. Nor are the rich undeserving," he said.

The chairman and CEO of Berkshire Hathaway calls on American innovators like Henry Ford, Steve Jobs and Sam Walton; Americans who achieved the attainable and promising American Dream. Buffett then notes many citizens are living the "American Nightmare - behaving well and working hard but barely getting by."

Buffett writes the widening wealth gap is an "inevitable consequence of an advanced market-based economy." But he does not deny the issue: "In recent decades, our country's rising tide has not lifted the boats of the poor."

»Read more
  Monday, 4 May 2015 | 8:07 AM ET

Buffett: THIS is key to valuing stocks right now

Billionaire Warren Buffett said Monday the stock market would be viewed as "cheap" now if interest rates continued to remain low.

"If these interest rates were to continue for 10 years, stocks would be extremely cheap now," the chairman and CEO of Berkshire Hathaway said Monday on CNBC's "Squawk Box," two days after Berkshire's annual shareholder meeting.

»Read more
  Monday, 4 May 2015 | 9:41 AM ET

Munger: McDonald's one of US' best educators

Posted By: Fred Imbert

Despite all the criticism of McDonald's, the fast-food giant is one of the nation's best educational institutions, Berkshire Hathaway's Charlie Munger said Monday.

"They take people and give them a first job, which enables them to get a second job. They do a very good job of educating troubled young people to be good citizens and they're probably more successful than charter schools," Berkshire's vice chairman told CNBC's "Squawk Box."

»Read more
  Monday, 4 May 2015 | 6:06 AM ET

Buffett helps us see the future: 4 blue chip CEOs

Warren Buffett's financial acumen and affable personality is well documented, but the CEOs of Berkshire Hathaway's big four investments—IBM, American Express, Coca-Cola, and Wells Fargo—paint a vivid picture of Buffett as an ally, a confidant, and astute observer of human nature.

"Millennials love him," Coca-Cola Chairman and CEO Muhtar Kent said of the octogenarian investor. "Young people love to be around him, and he loves to be around young people because he has just got this unique ability to follow consumers ... where they want to go."

"He interprets … consumers' value today versus yesterday, and what they're going to value tomorrow," the Coke boss added.

Kent, along with IBM Chair and CEO Ginni Rometty, American Express Chairman and CEO Ken Chenault, and Wells Fargo Chairman and CEO John Stumpf, sat down with CNBC over the weekend at Berkshire Hathaway's annual shareholder meeting in Omaha, Nebraska, to talk about the folksy billionaire next door.

»Read more

About Buffett Watch

  • Warren Buffett is arguably America’s most-admired and most-followed investor. Buffett is the largest shareholder and CEO of Berkshire Hathaway and one of the world’s most famous and most generous philanthropists. Legions of investors - from all walks of life - follow Buffett's homespun investment philosophy: invest in what you know, invest in value. Here on CNBC.com's Warren Buffett Watch, we’ll keep you up to date on what the “Oracle of Omaha” is doing by following Buffett's trades, words and deeds.


  • Senior Coordinating Producer

  • Warren Buffett is the chairman, CEO and largest shareholder of Berkshire Hathaway