Tags: US | Berkshire | Media

Buffett: Economy Showing 'Significant' Signs of Life

Monday, 03 May 2010 08:16 AM

 

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Billionaire Warren Buffett said Monday the economy has begun to show real strength over the last couple months, and consumers who can afford to are spending more.

Buffett appeared on CNBC Monday after the weekend's Berkshire Hathaway shareholder meeting. About 37,000 people attended Saturday's meeting to hear Buffett and his partner Charlie Munger answer questions.

Berkshire's Chairman and CEO said he's seen the most strength in his company's businesses that supply other companies like Iscar tool making and MiTek electronics.

"The best jobs program in the world is demand, and demand is coming back," Buffett said.

Berkshire's retail businesses, like Fruit of the Loom and The Pampered Chef, haven't picked up as much as its manufacturing ones. But Buffett said luxury goods sales have improved some, and over the past week, the Nebraska Furniture Mart sold $35 million worth of goods during the annual shareholder discount period.

"Consumers, the ones that can handle it, like to spend," Buffett said.

Buffett also reiterated comments he made over the weekend in support of Goldman Sachs. Buffett says he still feels good about the investment bank Berkshire invested $5 billion in nearly two years ago, and he doesn't see evidence of fraud in the government's lawsuit against Goldman.

The government has charged that Goldman misled investors about a deal involving complex mortgage-related investments that later plunged in value because it failed to disclose important information. Buffett said he's studied the charges against the investment bank and has no problem with the transaction.

Buffett said he has done business with Goldman regularly over the past 44 years, and he has confidence in the firm and its CEO Lloyd Blankfein.

"I'd rather have him running it than anybody else," Buffett said.

After Buffett's comments, Goldman shares gained $2.30, or 1.6 percent, to sell for $147.50 in early trading Monday. But Goldman's stock is remains about 21 percent lower than it was before the SEC filed its lawsuit on April 16.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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