WORLD
Buffett sees no bank crisis
Baku, May 2 (AZERTAC). Berkshire Hathaway CEO Warren Buffett says the sovereign debt issues in Europe pose a greater threat to investors and the world economy than to the health of U.S. banks, to which he said poses only a slight risk.
“My personal view is the chances of a banking crisis of any sort in the United States are very low,” he said, adding that European banks could have problems if those nations are unable to resolve their debt problems.
At the Sunday news conference that concludes Berkshire Hathaway`s annual shareholder events, the company`s vice chairman was even more critical of the European Union`s debt-ridden members.
Charlie Munger compared the situation in Europe to a business partnership with six productive partners who decide to add a seventh partner who then wants to do nothing but sit around, get drunk and live off the other six. It`s a question of how long the six will tolerate the seventh.
He said most of the measures taken so far to avert government bankruptcies and debt defaults in Greece, Ireland and Portugal have been inadequate.
“I think people are still thinking they can stop this elephant with a little bigger peashooter,” Mr. Munger said.
The two men also endorsed investment in the world`s emerging markets, with Mr. Buffett saying Berkshire would be crazy not to look for investment opportunities in a country with the economy or population of India.
“It`s of enormous interest to us as a market,” he said.
However, Mr. Munger cautioned that India seems to have adopted more of the Western world`s vices than its virtues. He said India’s bloated bureaucracy and widespread bribery are slowing the country’s economic growth.
“That is a country with a lot of dysfunction in it,” Mr. Munger said.