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OMAHA, Neb. – Billionaire investor Warren E. Buffett said Wednesday that the global economy is definitely slowing because of continued problems in Europe and the decline in Asia.
But he said that the U.S. economy is still improving modestly and that business will improve regardless of who wins the presidential election.
Buffett said that while the U.S. economy is outperforming those in Europe and Asia, American businesses would perform better if leaders would address the nation’s fiscal problems. “We’re still inching ahead, but we’re inching,” said Buffett, who addressed a variety of topics during a two-hour appearance on CNBC.
The head of Berkshire Hathaway said he gets a sense of the economy’s direction from reports he receives from subsidiaries of the Omaha-based conglomerate. Its holdings include the BNSF railroad, Clayton Homes and a large real estate brokerage. Berkshire owns The Buffalo News, and Buffett is the newspaper’s chairman.
Buffett said he thinks the economy will improve whether President Obama or Republican nominee Mitt Romney wins the election, although he supports Obama. Buffett said he thinks the biggest differences between the two men are on social issues and whom they would appoint as judges.
“I think the economy will get better under either one of them,” Buffett said.
Buffett said that the U.S. housing industry is starting to rebound but that it is still well off its peak. Clayton is selling 10 to 15 percent more manufactured homes, he said, and Berkshire’s real estate brokers are handling 15 percent more transactions.
Eventually, the housing recovery will help hiring, Buffett said.
General Electric CEO Jeffrey R. Immelt joined Buffett for part of the interview. Both men were in Columbus, Ohio, for an Ohio State University event focused on midsize businesses. Economic trends continue to be positive, Immelt said, but business is volatile in the aftermath of the recession.
Immelt said he thinks there would be more investment in the United States if the nation’s leaders would address the “fiscal cliff” of automatic tax increases and spending cuts that could be triggered at the start of the new year.
Buffett said he thinks that the solution is obvious to all the nation’s leaders but that action in Washington, D.C., is on hold because of the election. Buffett says it’s clear the solution will involve a mix of tax increases and spending cuts.
“It’s going to get done,” Buffett said. “The American people won’t stand for it not getting done.”