Saturday, May 24, 2008

Buffet on derivatives trading wiping out "real economy"

marjorie says...

Warren Buffet, in an interview published in a German magazine, says the U.S. recession will be longer and deeper than most people think. Still, he says the world could be "falling apart" and he'd still invest in companies. Then he takes aim at derivatives trading:

Buffett also renewed his criticism of derivatives trading.

"It's not right that hundreds of thousands of jobs are being eliminated, that entire industrial sectors in the real economy are being wiped out by financial bets even though the sectors are actually in good health."

Buffett complained about the lack of effective controls.

"That's the problem," he said. "You can't steer it, you can't regulate it anymore. You can't get the genie back in the bottle."