U.S. bank woes are "poetic justice": Buffett

By Wojtek Dabrowski

The head of the Berkshire Hathaway Inc group of companies also played down worries about a credit crunch by saying that recent interest rate cuts mean low-cost funds are readily available.

Buffett, one of the world's wealthiest people, appeared to see irony in the fact that many of the banks who marketed complex investments which have now crashed are bearing much of the fallout.

Buffett, a legendary investor who has amassed a huge fortune through plays in a wide range of industries, has bet against the U.S. dollar in the past.

Buffett said on Wednesday in Toronto that the turmoil that has rocked the U.S. economy in recent months has imbued the markets with a healthy degree of caution, while the rate-cutting response from central bankers has ensured that cheap money remains available for borrowing.

He added: "What has happened is a repricing of risk and an unavailability of what I might call 'dumb money,' of which there was plenty around a year ago."

Buffett tends to favor companies with relatively simple businesses, strong management, consistent earnings, good returns on equity, and little debt.

($1=1.01 Canadian)