Buffett Tells CNBC U.S. Economy Shows No Bounce

[Bear and Bull]

By Erik Holm and Andrew Frye

June 24 (Bloomberg) -- Billionaire investor Warren Buffett said a recovery in the U.S. economy will take time as hes not seeing signs of a rebound at his businesses spanning retailing, manufacturing and energy.

In terms of the economy coming back, it takes a while, Buffett told CNBC. Everything we see about the economy is weve had no bounce. Buffett is the chairman and chief executive officer of Omaha, Nebraska-based Berkshire Hathaway Inc.

The U.S. gross domestic product plunged in the first quarter, dropping at a 5.7 percent annual pace, the Commerce Department said May 31. Buffett, who oversees candymaking, energy and manufactured-housing units, reported Berkshires first loss since 2001 in the first three months of the year.

Industrial demand is down like weve never seen it, Buffett said. A recovery will happen but it hasnt happened yet.

Separately, he told Fox News that he intends to keep his Goldman Sachs Group Inc. warrants. The New York-based bank said in September it would sell $5 billion in preferred stock to Berkshire. Buffett gets a 10 percent dividend, or $500 million a year, and gained warrants to buy $5 billion of common stock at $115 each over the next five years.

I think well make a lot of money, he told Fox.

Buffett, 78, ranked the worlds second-richest man by Forbes magazine, spoke to the cable channel in advance of a lunch with Zhao Danyang, manager of the Pureheart China Growth Investment Fund in Hong Kong. Zhao bid more than $2.1 million last year to win Buffetts annual charity auction, which supports San Franciscos Glide Foundation.

To contact the reporters on this story: Erik Holm in New York at [email protected]; To contact the reporter on this story: Andrew Frye

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