Warren Buffett spoke today, to the fabulous Julia Boorstin of CNBC (what great hair she has!). I don’t particularly care for Buffett’s politics and his ideas on taxation. But when it comes to economics and business prospects, Buffett is without match, as his investing record shows.

I agree entirely with him about the outlook for our economy the next few years. He makes the statement: “I don’t know if the movie is 2 or 4 hours long, but I know it has a happy ending”. What a positive point of view. More of us should share that perspective.

I am piggy-backing on many of Buffett’s trades since late 2008 owning: GE, WFC, USB and GS.   These are all global franchises that for the most part, came through the crash without much damage (GE is much healthier than its stock price suggests and is a raging bargain).

Regarding the housing crisis and home building, Buffett makes the point that the housing crisis precipitated our economic crisis (but he did not lay the blame properly at the feet of a laissez faire Congress that eliminated the regulatory protections needed and cheerled the mortgage industry into the ground).  His medicine: don’t build any more houses; a little simplistic, but maybe tongue in cheek.  We need to work off the inventory we already have. I think that is pretty obvious and goes without saying. But he said it by way of making the case that excess housing is the root of our problems and our economy won’t truly mend until housing inventories are once again in balance.

Without saying any more, here is the interview:

Related posts:

1. The Wisdom of Warren Buffett
2. Buffett’s Saintly Proposal – Part 2
3. The Sainthood of Warren Buffett – Part 3
4. Warren Buffett Eats Crow (Just Like a Mortal)
5. On BRK and Buffett’s Proposal to “Assist” the Mortgage Insurers