Buffett’s Letter: Don’t Bet Against the U.S. Economy

SMITH BRAINTRUST — Vexed politicians and Election 2016 voters might scoff. But investor Warren Buffett’s economic outlook, expressed in a letter and subsequent CNBC interview, is cautiously optimistic. Smith School finance professor David Kass, a close follower of Buffett’s investment strategy since 1980 and a Berkshire shareholder, says the view isn’t unexpected and meshes with Buffett's approach to investing. "Buffett does not predict stock prices in the short run, but (he projects) in the long run," Kass says.

Buffett’s long view is further reflected in Berkshire’s approach to its holdings. Kass quotes Buffett: Berkshire’s "appetite for either operating businesses or passive investments doubles our chances of finding sensible uses for Berkshire’s endless gusher of cash. Beyond that, having a huge portfolio of marketable securities gives us a stockpile of funds that can be tapped when an elephant-sized acquisition is offered to us." Go to Kass's blog for more takeaways from Buffett's letter and his Feb. 29 CNBC appearance.