Buffet Predicts Eventual US Stock Market Recovery
Monday March 16, 2009
In the opinion of one of the world's richest men, and most successful investors of all time, the US economy has 'fallen off a cliff' to find itself in nearly a worst-case scenario. Buffet's own company, Berkshire Hathaway, also realised losses, and its book value per share fell 9.6% in 2008 - its worst performance since 1965.
However, Buffet remains optimistic about the future of banks and other key financial industries after maintaining that they would earn their way out of trouble. In some cases, certain banks would be back and better than ever within the next three years and the overall economy should be back in order in five years at the longest, but hopefully a lot sooner.
In an interview held on America's CNBC television, Buffet also warned of potential future inflation that could oust previous highs experienced in the 1970s. He stated that some of things currently being done to fix the economy could cause us pain down the track, and remarked, "In economics, there is no free lunch."
Although the Australian stock market does not rely as heavily on the US as it has done in the past, this is potentially good news for investors and future world stock markets. For more information on shares, check out our section on stock trading.
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