Buffett dishes on gold, China and the economy

The legendary investor sits down with CNBC for hours to share his opinions about the financial world.

By Kim Peterson Mar 2, 2011 2:20PM
Credit: (© Jason Reed/Reuters file)
Caption: Warren BuffettWould you rather have all the gold in the world, or all the farmland in the United States?

That's a no-brainer for Warren Buffett, who likes investments that produce and deliver returns. With gold, he told CNBC today, all you can do is hold on to it and hope that people become more afraid.

All the gold in the world is worth about $7 trillion, he said on CNBC. You can take that same chunk of change and buy seven Exxon Mobils (XOM) and still have trillions left in "walking-around money," he said. "The problem with commodities is you're betting on what someone will pay for them in six months," he added.

We have lots of videos of Buffett speaking about his investment strategy, his likes and dislikes, and about how he just lost an acquisition to another suitor. The videos will start playing below -- or, you can click here to specifically catch Buffett's take on gold vs. Exxon Mobil.

Post continues after video:
Here's a rundown of some of the other Buffett videos that came out of the extended interview:

On the economy. America gets off the track from time to time, Buffett said, and that was particularly true in the fall of 2008. But you cant stop this country, which has survived more than a dozen depressions of some sort.

"It'll sputter from time to time in the future, but you don't want to get too concerned about it," he said. "We have great soil for this country, metaphorically. It works over time." The railroad business is about 60% of the way back from the bottom, Buffett said. His company, Berkshire Hathaway (BRK.B), spent $34 billion on railroad giant Burlington Northern Santa Fe in 2009. Click here to see the video.

On China. China will grow faster than the U.S. is growing because China comes from a lower base, Buffett said. The U.S. cannot grow at the same rate as China.

"We ought to be happy that they're doing well," he said. "It's not a zero-sum game in the world. We do not want to be an island of prosperity among 7 billion people." But expect to see America's overwhelming dominance in the world diminish. Click here to see the video.

On the auto industry. Americans haven't lost their love affair with cars, Buffett said. People want to buy more cars, and the economy is coming back. There is an expected number of cars on the road for the American population, he said. We fell below that number recently but now we're coming back. Click here to see the video.

On schmoozing. Sucking up to Berkshire investors is not important, Buffett said. "What you want is people that understand you and your business and what you're about," he added. "The idea of trying to cultivate new people all the time, you know there's only so many seats in the church." Click here to see the video.

On insider trading. There's a fair amount of trading on inside information in Wall Street, Buffett said. "You can't make a deal without a certain number of people hearing about it," he added. That's why he keeps Berkshire acquisitions very quiet and he likes to get them done fast.

Buffett said he doesn't even tell his board of directors much about an acquisition until it happens. "I'm paranoid about the idea that if we have 20 people that know about something, one of them is going to tell somebody." Click here to see the video.

On railroads. Buffett has only visited the offices of Burlington Northern once since Berkshire bought it. Over the last year, he said, he is more appreciative of the competitive advantages of the rail industry versus a sector like trucking. Click here to see the video.

On electric cars. Buffett has invested hundreds of millions of dollars in BYD, the Chinese battery company that is looking at ways to power electric cars. Battery technology is an evolving and tough game, he said. "There are a lot of smart people working on battery technology."  BYD lost more than 60% from its peak. Click here to see the video.


8Comments
Mar 3, 2011 12:08PM
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Am constantly amazed at the people who whine and complain about the Buffett's and TB Pickens types in the world, and how they seem to have an agenda in everything they do.  Well children, they do have an agenda.  That agenda is to make money in the ways that they have always made money.  Buffett has never claimed to want to do anything else.  He has been at it since he was a kid, and he will be at it until he is no longer able to lift a Coke bottle.   What amazes me is that folks vilify him and  folks like him for skewing the game.   Most of you are reading these things ( investor pages ) because you want to make money, but you don't have the focus or the patience that WB has.  When is the last time you spent two days on pure research before you made a stock purchase?   How many stocks have you held for years?  How prepared are you to lose 30 percent of your portfolio value, and then invest more at that low point, because you have faith in your companies?  Folks, that is how Buffett got so rich.  He didn't have to be a crook, he was simply patient, and confident.  Try it for a change.  You too will make money if you choose good companies, and after 60 years or so, maybe people will be bitching about how you are a "huckster", have an empire, are easy to dislike, and are manipulative.

Good for Warren Buffett.  
Mar 3, 2011 4:33PM
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What I'm hearing is a lot of envy and sour grapes. WB looks at industries and opportunities and selects companies that can be bought cheap(er) (remember buy low sell high?) and he is very good at it. Starting with a bankrupt company called Berkshire he has bought companies where he saw value and committed to turning them around often with the same management and employees.

 

Sorry you didn't buy BRK.B or BRK.A and other people did and stayed with it for great returns? Go find another shoulder to cry on for your lack of foresight.

Mar 3, 2011 4:09PM
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If I had the same "inside" information I could make a killing too. Those who have their buddy's at the Federal Reserve know who's being propped up with OUR MONEY months before the rest of us. In a true free market that didn't involve government intervention Buffett and company wouldn't have $hit.
Mar 2, 2011 10:22PM
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tis not wise to tug on the whiskers of one who controls more money than you.  he may swat at you and miss, but the draft will give you a concussion you will long remember.  Bernanke and all of DC are but the puppets, and they DO protect their masters.  Cutting the strings only means dead puppets. 

 

Of course the game is rigged, if it weren't, why would they bother to play?

Mar 3, 2011 8:52AM
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it seems like a smart guy like buffett could do math. if you run gas up two bucks in two months thats a 900 million dollars a day being removed from all economic actitivy almost 1 billion a day thats nearly 1/2 a trillion dollars a year being sucked out of the economy and deverted to oil dudes. its not rocket science what the effect on the economy will be, its called a depression folks, where will be buffetts railroad in a depression 
Mar 3, 2011 9:45AM
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When they write the History of the Fall of our Economy, surely Bankster-Buffett will be front and center with his "special financing deals".  This guy isn't all nice and innocent, but rather sneaky and guilty.  Take a look underneath the covers and you'll see the game is rigged in no small part my the banksters such as Wicked Warren.
Mar 3, 2011 10:20AM
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I saw this doddering old huckster on CNBC this week. He rambled on endlessly. Warren never makes a move even if to go on TV unless he and his company can benefit from it. He has been a brilliant investor but when you have plenty of other peoples money to invest you are a market mover and maker. Yes he has given a lot of money away to the needy but in the end Warren is all about getting what Warren wants......it is about the power....he just sells it differently than most investment types. Warren has been front and center at manipulating and taking advantage of companies backed into a corner all to gain for his empire. He is not the nice old man he appears to be.
Mar 2, 2011 8:17PM
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Who listens to this crook and friend of Banksters?  He only profits because he has rigged the game.  Wanna see him in charge of Wisconsin Public Labor Unions??  Ho-Ho, the crook is exposed.  Hang him, then Geithner, then Bernanke.   Then we can put Tiger Woods in charge, and we'll all get ncrewed.
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