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Buffett sees clear signs that the global economy is slowing, although the US
economy is “inching ahead” as other regions decline, the Berkshire
Hathaway chief executive officer said on
Wednesday.
Yet despite the weakness, Buffett said he was “salivating”
to make another major acquisition, adding that two deals of around $20bn each
had fallen through this year.
In an interview on CNBC, Buffett said the rate of decline
was larger in Asia than in Europe, although the Asian economies are declining
off a higher base.
At the same time, he said Berkshire’s US housing-related
businesses were growing at double-digit percentage rates of late.
Buffett has maintained that the economy will not truly start
to turn around until the housing market improves, and he said on Wednesday that
housing had clearly started to turn.
Berkshire is heavily exposed to housing construction, as it owns a brick maker, a carpet maker, a realtor and the largest builder of manufactured homes.
Yet even with growth from its existing portfolio companies,
Berkshire is always on the hunt to expand by acquisition.
Buffett told CNBC: “I’m salivating” to spend some of
Berkshire’s $40bn cash pile on a deal. At Berkshire’s annual meeting in May, he
said a $20bn deal had recently fallen through, and on Wednesday he acknowledged
a second one had come apart as well.
He did not give any indication as to what kinds of companies were involved.
In a wide-ranging interview from an event in Ohio, Buffett
also said the best thing for the economy would be for US Federal Reserve
Chairperson Ben Bernanke to stay on for a third term.
With the presidential race running neck-and-neck, there has
been speculation of late that Republican candidate Mitt Romney, if elected,
would seek a new Fed chairperson when Bernanke’s term expires in 2014. Buffett
disagreed with the idea.
“I would vote for Bernanke again, and I’d get my kids out and everybody else to vote for him,” he said.
