May 05, 2009
The world’s most influential investor said he is optimistic about the future of the Korean economy. The comments were made during a press conference held the day after the annual shareholders’ meeting of Berkshire Hathaway, the company he has long chaired.
Buffett said Korea has many good companies such as Posco and will continue to do well in the future. Posco, the world’s fourth-largest steelmaker, is among a few local companies Buffett has invested in. In February, Berkshire Hathaway said it raised its stake in Posco from 4.5 percent in 2007 to 5.2 percent last year. On Sunday, Buffett said he bought stock in one more local company last year and is currently looking at some other local firms with interest. He declined to name those companies. According to some sources, he is invested in around 20 Korean firms.
Asked about the Korean economy, he said Korea is doing well in dealing with the global economic crisis.
Korea’s current situation is tough, but Buffett said he believes the country will soon overcome it. Countries with smaller economies typically struggle more in downturns like this one, but Buffett did not count Korea among them. He said buying local stock at the proper price will make money.
Berkshire Vice President Charlie Munger also named Posco among the world’s best companies in terms of technology, quality of products, efficiency and management. He said his family invests in only three countries and Korea is one of them.
At the press conference, Buffett criticized the U.S. government’s bank policies, saying the stress tests of 19 large U.S. banks failed to account for strengths in lenders’ business models. He said he would add shares in three big banks to the portfolio of Berkshire Hathaway.
“The question is whether the people conducting tests have a bunch of markers” to write down assets, Reuters quoted Buffett as saying. “That is not a very sophisticated way of looking at it. To call those 19 banks too big to fail is wrong.”
By Nam Jung-ho [firstname.lastname@example.org]
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