Even as market participants are beginning to become slightly edgy over latest Bull Run on Wall Street, fearing whether the multi-year-high valuations are due to exuberance amid improving macroeconomic environment or backed by strong fundamentals, renowned value- investor, Warren Buffet believes that stocks still have “good value”.
Speaking to CNBC’s “Squawk Box”, the Chairman of Hathaway Berkshire said that he was still buying stocks although prices have risen.
“Anything I bought at $80 I don’t like as well at $100. But if you’re asking me if stocks are cheaper than other forms of investment, in my view the answer is yes. We’re buying stocks now. But not because we expect them to go up. We’re buying them because we think we’re getting good value for them,” said Buffet while speaking to CNBC’s “Squawk Box”.
Commending Berkshire’s new portfolio managers, Ted Weschler and Todd Combs, Buffet said that it was “highly unlikely” he will hire another portfolio manager, adding that he was fairly happy with these two and soon they will be getting additional $1 billion in their portfolio.
When asked about his views on the spending cuts, Buffet said that he was not all that concerned since the sequester, according to him, will not impact the U.S. economy grievously.
“We’re continuing to see a slow recovery….It hasn’t taken off, but it hasn’t stopped either,” said Buffet.
Buffet said that spending cuts or sequester will continue “for quite a while”; however he also added that once Americans fell the impact of the “meat ax” approach then the pressure could mount on the lawmakers to mull over deep spending cuts.
Buffet is favor of taxing wealthy Americans as opposed to deep spending cuts on entitlements.
However, Buffet is confident that lawmakers in Washington will find a way out to increase revenue and trim nation’s deficit.
“We’re going to bring down spending. We’re going to bring up revenues. We may get there in fits and starts. And everybody may scream each time we do it. But the deficit is going to come down. It needs to come down,” said the billionaire investors to “Squawk Box”.
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