Buffett: US banks won't cause problems for economy

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Associated Press

Posted on January 10, 2013 at 11:02 AM

OMAHA, Neb. (AP) — Billionaire Warren Buffett says American banks are stronger than they've been in years, and won't derail the economy.

Buffett, who is the chairman and CEO of Berkshire Hathaway Inc., told Bloomberg television that he guarantees "the banks will not get this country in trouble."

Berkshire Hathaway has large investments in Wells Fargo & Co., U.S. Bancorp and Bank of America, and Buffett pays close attention to their condition. Berkshire also holds warrants to buy $5 billion in Goldman Sachs shares.

Buffett says the banks have largely cleared out the bad assets that hurt their balance sheets. And the current low interest rates have helped them.

The country's 19 biggest banks are about to undergo the Federal Reserve's "stress tests" to see if they could withstand a severe U.S. recession.

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