Warren Buffett joined another investment guru, Mort Zuckerman, and many economists in calling on President Obama and Congress to focus on fixing the economy. Zuckerman is a real estate guru and publisher of U.S. News & World Report and the New York Daily news. On Sunday’s Meet the Press, Zuckerman called on the president to focus on the economy.
Buffett and Zuckerman called on Obama, Speaker Nancy Pelosi and other Congressional Democrats to stop using the crisis to advance their liberal agendas. While Buffett refused to tell a CNBC interviewer this morning which programs should be deferred, he said everything but fixing the financial crisis and the recession should be put on the back burner.
Both Buffett and Zuckerman were differential to Obama for obvious reasons, but they both said the president is trying to do too much and is confusing the public and markets.
He said it is wrong for the White House to declare that it will use the crises to advance its agendas on health, education, energy and union agendas such as card checks.
Buffett opposes card checks even though “we have loads of unions” at Berkshire Hathaway (BRK.A) (BRK.B). Card checks long sought by unions and Democrats would deprive workers of secret ballots during elections held to determine whether their employers would be unionized.
Except for the possible exception of Citigroup (C), banks will fix themselves, Buffett predicted. He believes the banks’ toxic assets that have been marked to market are worth a lot more than their current values.
He reinforced his support for mark to market accounting, which keeps companies honest.
Corporate America, he declared, has played games when reporting their financial results and its misbehavior has helped cause the financial crisis.
Buffett believes that banks, which have cut their dividends in recent weeks, will generate the capital and cash flow from earnings that they will need to recover on their own.
Buffett also knocked investing gold, which “just sits there” and has to be stored and insured. Companies generate earnings, he said.
The investment guru refused to look back and comment on the efforts of the Bush administration to bailout banks and automakers.
He believes in looking forward and in looking for business and investment opportunities.
While Buffett said Obama is smart and the best president we could have to deal with the economic crisis, he didn’t comment on the president’s obvious economic ignorance and lack of understanding of what the bearish stock markets and scared consumers are telling him. Indeed, CNBC failed to deal directly with economic ignorance issue.
Earlier in the morning, Buffett reportedly said inflation could be worse than it was in the 1970s. Later in the program, he said the best protection for individuals is their own earning power and owning a business directly or by investing in stocks.
On taxes, Buffett said billionaires like him should pay more than a 17% effective marginal tax rate, but overall, taxes should be lower. He said concerns about reducing deductions on charitable contributions as proposed by Obama would not be a big deal.
As for the carbon tax, he said utilities would pass the tax through. Although he talked around the issue, he clearly is against the carbon tax. Jobs one, two and three, he repeated, is fixing the economy.
Like president Obama, the public generally doesn’t understand the economic problem. While Buffett didn’t say this about Obama, he said there is a communications problem. It’s the president’s job to educate the public, he said.
But until Obama gets it himself, even teleprompters won’t help him educate the public.
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