Billionaire investor Warren Buffett says investors looking to the Fed for signs of what’s next are barking up the wrong tree — to their own detriment.

The Federal Reserve’s job is to regulate money, not forecast. The central bank was under no obligation to investors to warn them about the asset bubble that formed in the easy money days of former Fed chief Alan Greenspan, nor about over-inflated housing prices.

In an interview with Bloomberg, the sage of Omaha also criticized credit rating agencies and bond insurers, as well as Congress and the administration, for their part in failing to recognize the housing asset bubble.

He has little love for Wall Street, either.

“Wall Street is going to go where the money is and not worry about the consequences,” said Buffett. “You’ve got a lot of leeway in running a bank not to tell the truth for a while.”

Buffett also says that the Fed’s intervention into the Bear Stearns crisis was a “watershed event,” but that the panic part of the financial crisis is essentially over.

More pain is in store, he says. “The losses aren’t over by a long shot,” warns Buffett. But, he says, the economy can definitely take it at this point.

“Warren Buffet is correct,” Peter Miralles, president of Atlanta Wealth Management Consultants, tells MoneyNews.

“The goal of the Fed is to regulate the money for the benefit of the country’s economy and for the benefit of main street. Warning of an asset bubble is not the job of the Fed, nor are they very good at predicting asset bubbles,” says Miralles.

Requiring that the Fed monitor asset valuations is not “realistic,” Donald P. Gould, founder of Gould Asset Management, told MoneyNews.

“Expecting the Fed to know when a bubble actually exists and when it has gone too far is unrealistic,” says Gould.

“More importantly, it may be dangerous. Witness what happened when the Bank of Japan pierced the Japanese real estate bubble — a decade-plus of recession. Probably, it is safer to let the market undo its own bubble.”

Gould says that, simply put, asset bubbles are the result of the misallocation of capital.

That misallocation adversely affects economic growth.

“Of course, asset bubbles ultimately lead to painful contractions when the bubble deflates,” says Gould. “However, asset bubbles cannot be avoided. They are a part of the market system. They are ultimately self-correcting.”