Buffett was on CNBC’s Squawk Box this morning to talk about his Wrigley (WWY) deal, but what caught my attention were his comments on the economy (his comments on the economy start around the 7:40 mark):
On retail: “Gotten a little worse.”
On housing: “No uptick at all.”
On the economy: “My general feeling is that the recession will be longer and deeper than most people think.”
“My feeling from what I see in the economy is that this will not be short and shallow.”
So, while Bill Miller and others believe the bottom is in, the Oracle of Omaha appears less bullish*.
* It’s a little more complicated than that as the stock market anticipates the economy and is therefore a leading indicator. So, Bill Miller thinks there is more pain in the economy but that financial markets have bottomed. Buffett made sure to be clear that he was talking about the economy and not the stock market. Nevertheless, if he is right about the recession being deeper and worse than most expect, I think it follows that that is not priced in and he is more cautious/less bullish than Miller and others.