Tags: Buffett | Cramer | Ukraine | stocks

Buffett, Cramer: Ukraine Conflict Doesn't Tarnish Long-Term Outlook for US Stocks

By    |   Monday, 03 March 2014 02:52 PM

While Ukraine's turmoil is pushing down U.S. stocks Monday, it doesn't diminish the long-term potential for U.S. equities, say Warren Buffett, CEO of Berkshire Hathaway, and CNBC's Jim Cramer.

The Standard & Poor's 500 Index stood at 1,846.74 Monday afternoon, down 12.71 points, or 0.68 percent.

Buffett told CNBC he was happy to see the price of a U.K. stock that Berkshire is buying today falling amid Ukraine's tumult.

"We were buying it on Friday, but it's cheaper this morning and that's good news," Buffett said. He "absolutely" plans to buy more.

Even a full-blown conflict in Ukraine wouldn't deter Buffett from stocks. "You're going to invest your money in something over time. The one thing you can be quite sure of is if we went into some kind of very major war, the value of money would go down," he said.

"That's happened in virtually every war I'm aware of. The last thing you'd want to do is hold money during a war. You might want to own a farm, you might want to own an apartment house, you might want to own securities. During World War II the stock market advanced."

Buffett says he purchased his first stock in 1942, shortly after Japan's attack on Pearl Harbor.

Meanwhile, Cramer said on CNBC that stock declines over the Ukraine conflict could create buying opportunities.

Investors should view the market's drop like any other, unless they have investments in Germany's energy sector or the Russian ruble, Cramer says.

"This is where you would pick," he said. "You're getting a chance. We had a big selloff on Friday, and we kind of rallied in the last half hour. If we can get those prices we did at 3:30 [p.m. Friday,] then count me in."

Investors should try to compare the Ukraine situation with past geopolitical developments that depressed markets, Cramer says. Aside from that, investors should seek the best values.

Cramer thinks energy stocks and momentum-driven stocks, such as Salesforce.com, are headed higher.

Others agree with Buffett and Cramer that the Ukraine conflict doesn't spell doom for U.S. stocks.

"The Ukraine news is troubling, but there are always global risks and short-term fluctuations because of these risks,” Karyn Cavanaugh, a market strategist at ING U.S. Investment Management, told Bloomberg.

"I see this being short-term, unless it escalates. If we do see some market gyrations and volatility, it could be a buying opportunity."

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While Ukraine's turmoil is pushing down U.S. stocks Monday, it doesn't diminish the long-term potential for U.S. equities, say Warren Buffett, CEO of Berkshire Hathaway, and CNBC's Jim Cramer.
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2014-52-03
Monday, 03 March 2014 02:52 PM
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