Warren Buffett Favors Geithner and Bernanke, Despises Bankers

 |  Includes: BRK.A, BRK.B, GS
by: Wall St. Cheat Sheet

Berkshire Hathaway (NYSE:BRK.A) Chairman and CEO Warren Buffett sat down with FOX Business Network’s Liz Claman to discuss all the fun things going on with the US economy and regulators. Although Warren’s tough stance on bank CEOs is admirable, I definitely do not agree with his review of Bernanke and Geithner.

Below are excerpts from the interview at FOX Business Network:

On the President’s new bank proposal:

“You’ll always have banks that are too big to fail. We can’t operate in this world without very big banks…If they are toppling the government will have to do something about it.”

“If I were running things if a bank had to go to the government for help, the CEO and his wife would forfeit all their net worth…I think you have to change the incentives. The incentives a few years ago were try and report higher quarterly earnings. It’s nice to have carrots, but you need sticks. The idea that some guy who’s worth $500 million leaves and only has $50 million left is not much of a stick as far as I’m concerned.”

“The CEO has to be the chief risk officer for a bank.”

On General Re settling in the AIG case:

“We did something wrong and we paid the price…It shouldn’t have been done, and there’s nothing inappropriate about the fine we paid, so I have no problem with it.”

On members of Congress who feel Ben Bernanke should not be reconfirmed:

“They ought to get down on their knees every night and thank the Lord that Bernanke was there through this. He took some unprecedented actions…He took the actions that were necessary to prevent panic from paralyzing this country.”

On whether he’s tempted to sell his Goldman (NYSE:GS) before 5 years:

“I’m not tempted at all. That thought doesn’t cross my mind.”

On what his thoughts were at the height of the housing crisis:

“I wish I’d been thinking a little harder. It looked a little crazy to me, but I should have done more about it than I did.”

“I would have been much more attune..if I would have really paid attention I would have been looking at some of those instruments and maybe shorting the companies that were big in the mortgage business or something of the sort. I wouldn’t be shorting but I would have looked for ways to protect myself from the bubble that was going to pop.”

On Secretary Geithner:

“I think he’s terrific.”

On the performance of Berkshire’s split shares:

“There’s been a little bit more action than is ideal today.”

“In the end, we hope we have shareholders who are in sync with us…We don’t want any day traders.”

On the future of Berkshire Hathaway’s business acquisition:

“We’ll keep buying businesses, as long as I’m alive we’ll keep buying businesses…we’ll try to buy them for cash, sometimes we may have to use some stock, but we’ll use as little stock as possible.”