Warren Buffett says Berkshire managers were surprised by economic slowdown, earnings to decline

  • 📰 CNBC
  • ⏱ Reading Time:
  • 49 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 23%
  • Publisher: 72%

United States News News

United States United States Latest News,United States United States Headlines

Warren Buffett struck a pessimistic tone about Berkshire's myriad of businesses, saying he expects an earnings decline in light of an economic slowdown.

. Berkshire's railroad business, BNSF, along with its energy company did see year-over-year earnings declines last quarter.

The 92-year-old investing icon believes that some of his managers at Berkshire subsidiaries were caught off guard by the swift change in consumer behavior, as they put the Covid-19 pandemic behind them. This led them to overestimating demand for certain products, and now they will need sales to get rid of the excess inventory.

"It is a different climate than it was six months ago. And a number of our managers were surprised," Buffett said. "Some of them had too much inventory on order, and then all of a sudden it got delivered, and people weren't in the same frame of mind as earlier." The U.S. economy is grappling with a series of aggressive rate hikes, which partly triggered three bank failures in the span of just a few weeks due to mismatched assets and liabilities. The Federal Reserve just approved its 10th rate hikes since 2022, taking the fed funds rate to a target range of 5%-5.25%, the highest since August 2007.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 12. in US

United States United States Latest News, United States United States Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

7 stocks that fit Warren Buffett's buying criteria ahead of Berkshire's annual meetingCNBC Pro sought to identify names that fit the criteria Warren Buffett looks for when buying a company.
Source: CNBC - 🏆 12. / 72 Read more »