The Playbook Interview: Warren Buffett by Daniel Lippman and Jake Sherman via Politico
The Sage of Omaha didn’t want to talk politics, but he shared his thoughts with Politico.
Below is a brief excerpt – what we found most interesting is his comments on housing and newspapers – without looking can you guess which he is very bearish and which he is bullish on? Also Buffett recommends reading The Making of the President’ by Theodore White]check out excerpt below
Housing is his hot sector now:
“I would say that housing came back very late after the panic in 2008 and ‘09, and it’s starting to … it has showed continuing growth and momentum. But it didn’t come back as fast as I initially thought it would. And it’s been getting progressively stronger, particularly in the last year. That continues to this day. Household formations fall off a lot in recessions. People double up and move in with their in-laws, but eventually hormones win out. [laughter] And our population growth translates into new housing starts. Now, the one trend is people are moving more from living in single-family housing into rental. Sixty-two and a fraction percent now are in owner-occupied homes as opposed to rental. So there was more of an apartment development going on but now it’s translated to pretty good housing statistics, and we’re in a lot of areas that touch on that. We’re seeing a lot of strength there.”
Buffett is bearish on newspapers:
“Newspapers are going to go downhill. Most newspapers, the transition to the internet so far hasn’t worked in digital. The revenues don’t come in. There are a couple of exceptions for national newspapers — The Wall Street Journal and The New York Times are in a different category. That doesn’t mean it necessarily works brilliantly for them, but they are a different business than a local newspaper. But local newspapers continue to decline at a very significant rate. And even with the economy improving, circulation goes down, advertising goes down, and it goes down in prosperous cities, it goes down in areas that are having urban troubles, it goes down in small towns – that’s what amazes me. A town of 10 or 20,000, where there’s no local TV station obviously, and really there’s nothing on the internet that tells you what’s going on in a town like that, but the circulation just goes down every month. And when circulation goes down, advertising is gonna go down, and what used to be a virtuous circle turns into a vicious circle. I still love newspapers! You’re talking to the last guy in the world. Someday you’ll come out and interview me, and you’ll see a guy with a landline phone, reading a print newspaper.”
See the full article here on Politico