US billionaire investor Warren Buffett said yesterday that problems in the US subprime mortgage market will likely weigh on consumers for up to two years, but that the US economy will weather the storm.
The subprime problem "is having an impact," Buffett said on his first visit to South Korea. "It will have more of an impact."
recession fears
Rising default rates among US mortgage holders with poor credit histories have rattled global credit, stock and currency markets since August and raised concerns about a possible recession in the US economy, a major export market for Asian companies.
"In the next six months, one year, two years the problems in the mortgage market can cause a lot of problems with consumers and hurt buying power in the United States," he said at a press conference after arriving earlier in the day from China on his private jet.
However, the US economy has often had to face various difficulties and the present was no exception, Buffett said.
"Overall the economy will make progress," he said.
Buffett came to Daegu, located about 300km southwest of Seoul, to inspect Iscar Korea, a subsidiary of Iscar, the Israeli industrial tool manufacturer that his company, Berkshire Hathaway Inc, purchased last year for US$4 billion, its first overseas acquisition.
Buffett also expressed pessimism on the US dollar.
"We still are negative on the dollar relative to most major currencies," he said.
The US dollar has fallen against the euro, British pound, Japanese yen, Indian rupee and many other Asian and European currencies this year.
The euro, for example, has gained 8 percent against the US dollar this year.
Buffett spoke highly of South Korean stocks, including steelmaker Posco, saying he first became attracted to them years ago because he saw that they were far too undervalued.
He said he feels that currently South Korean stocks in general are valued at prices that "are no higher and probably somewhat less" than stocks in the US.
Buffett said that Berkshire Hathaway owns the equivalent of 3.4 million shares in Posco.
Posco purchase
In March, Buffett said in his annual letter that Berkshire last year bought 3.49 million shares, or 4 percent, of South Korean steelmaker Posco. Berkshire spent US$572 million on the Posco shares, which were worth US$1.16 billion at the end of last year.
That would be worth considerably more now as Posco have more than doubled this year.
A subsidiary of a Hong Kong-based company that has lost control of two critical ports on the Panama Canal said it is seeking US$2 billion of compensation in damages from Panama over its “illegal” takeover of the ports. Panama Ports Co, a unit of Hong Kong’s CK Hutchison Holdings (長江和記實業), on Friday said in a statement that it is demanding the sum under international arbitration proceedings that it had already started. The Panamanian government last week seized control of the Balboa and Cristobal ports on each end of the Panama Canal, after the country’s Supreme Court declared earlier that a concession allowing
DETERRENCE: With 1,000 indigenous Hsiung Feng II and III missiles and 400 Harpoon missiles, the nation would boast the highest anti-ship missile density in the world With Taiwan wrapping up mass production of Hsiung Feng II and III missiles by December and an influx of Harpoon missiles from the US, Taiwan would have the highest density of anti-ship missiles in the world, a source said yesterday. Taiwan is to wrap up mass production of the indigenous anti-ship missiles by the end of year, as the Chungshan Institute of Science and Technology has been meeting production targets ahead of schedule, a defense official with knowledge of the matter said. Combined with the 400 Harpoon anti-ship missiles Taiwan expects to receive from the US by 2028, the nation would have
POSSIBILITIES EMERGE: With Taiwan’s victory and Japan’s narrow win over Australia, Taiwan now have a chance to advance if South Korea also beat the Aussies Taiwan has high hopes that the national baseball team would advance to the World Baseball Classic (WBC) quarter-finals after clinching a crucial 5-4 victory over South Korea in a nail-biting extra-inning game at the Tokyo Dome yesterday. Boosted by three home runs — two solo shots by Yu Chang (張育成) and Cheng Tsung-che (鄭宗哲) and a two-run homer by Stuart Fairchild — the triumph gave Taiwan a much-needed second victory in the five-team Pool C, where only the top two finishers would advance to the knockout stage in Miami, Florida. Entering extra innings with the game tied at four apiece, Taiwan scored
MISSION OF PEACE: The foreign minister urged Beijing to respect Taiwan’s existence as an independent nation, and work together to ensure peace and stability in the region Minister of Foreign Affairs Lin Chia-lung (林佳龍) yesterday rejected Chinese Minister of Foreign Affairs Wang Yi’s (王毅) comments about Taiwan, criticizing China as a “troublemaker” in the international community and a disruptor of cross-strait peace. Speaking at a news conference on the sidelines of the Chinese National People’s Congress, Wang said that Taiwan has always been a territory of China and that it would be impossible for it to become its own country. The “return” of Taiwan to China was the natural outcome of the Chinese people’s resistance against Japan in World War II, and that any pursuit of independence was “doomed
RSS