Investing guru Warren Buffett criticized the Standard & Poor’s downgrade of the long-term US credit rating, saying it “doesn’t make sense” and would have a limited impact on markets.
“I don’t get it,” the highly-respected founder and chairman of Berkshire Hathaway told Fox Business News late Friday, saying his Omaha, Nebraska-based company would hold onto its considerable trove of US Treasury bills.
“In Omaha, the US is still triple-A. In fact, if there were a quadruple-A rating, I’d give the US that,” he said, hours after the S&P cut the US credit rating from a sterling AAA to an AA+.
Buffett said his firm holds well over $40 billion in short end T-bills and that the decision “doesn’t tempt me to sell. We’ll stay right there.”
The billionaire investment wizard brushed off fears that the downgrade will roil world markets.
“If nothing else takes place, meaning, if all other variables hold and there isn’t say, a new problem in Europe, it won’t make any difference,” he said, referring to the growing eurozone debt crisis.
“The US, to my knowledge, owes no money in currency other than the US dollar, which it can print at will. Now if you’re talking about inflation, that’s a different question,” he added.
The S&P has defended its decision, attributing it in large part to political gridlock in Washington and the inability of Democrats and Republicans to agree on major spending cuts or revenue increases.
AFP journalists cover wars, conflicts, politics, science, health, the environment, technology, fashion, entertainment, the offbeat, sports and a whole lot more in text, photographs, video, graphics and online.
Raw Story is a progressive news site that focuses on stories often ignored in the mainstream media. While giving coverage to the big stories of the day, we also bring our readers' attention to policy, politics, legal and human rights stories that get ignored in an infotainment culture driven solely by pageviews.
Founded in 2004, Raw Story reaches 9 million unique readers per month and serves more than 30 million pageviews.