Warren Buffett on Friday said Berkshire Hathaway will continue to invest in the economy even as the company prepares their first ever share buyback program.
Speaking during a CNBC interview Buffett said Berkshire will continue to make acquisitions and spend on infrastructure for their portfolio of companies.
The announcement to purchase back their own shares stunned many analysts in the market and led some investors to believe the company could be undervalued by 30 percent or more, making the buyback program a smart move for the “Oracle of Omaha.”
After the company’s announcement Berkshire Class A shares were down 0.9 percent at $108,202 in afternoon trade on Friday.
Speaking about the economy Buffett says he still supports Bank of America for whom he purchased a bunch of long-lasting warrants and received a lucrative dividend.
Speaking about the Bank he said they have a “fabulous business, but it’s got a lot of problems from the past.” Buffett acknowledged that CEO Brian Moynihan will need years to fix his company’s problems.
In the meantime BofA will cut 30,000 jobs during their “New BAC” program while shedding various assets needed to raise capital which is needed to meet industry standards that will go into effect in 2013.
If I could buy back part of my multi-billion dollar company for pennies on the dollar I would probably be feeling pretty good about the economy as well.
Do you feel as confident about the U.S. economy as Warrent Buffett does? I’m pretty sure Bank of America employees being fired under the “New BAC” plan don’t feel the same way.