When you’re the richest man in the world, you can generally say what you think. Thus Warren Buffett reflected reality back in March, when he commented that ‘by any commonsense definition, the US is in recession’. Yesterday, he probably ruffled a few more feathers when he told CNBC that he thought the US economy was still in recession, and ‘could be worse’ at the end of the year.
He also remarked that a ‘financial crisis reveals which players have been swimming naked, because the tide goes out’. And, he added, ‘we (have) found out that Wall Street has been kind of a nudist beach’. As a result, he expects both the US mortgage giants, Fannie Mae and Freddie Mac, to require ‘federal government help’ to survive. He also expects more US banks to collapse as a result of ‘failures where the bankers were dumb in what they did’.