NEW YORK, Apr 1: The billionaire investor, Warren Buffett, has said he would not raise interest rates if he was in charge of the US Federal Reserve.
The Fed has kept rates at a record low of 0% since the financial crisis.
“Things are working pretty well,” he told an audience in New York, acknowledging that the US economy was “remarkably steady”.
A significant increase in interest rates “would throw a big monkey wrench into things,” the 84-year-old added.
Mr Buffett was recently involved in the merger of Heinz and Kraft Foods, creating what the companies said would be the third-largest food and beverage firm in the US.
Many market watchers worry that an interest rate hike would be bad news for US firms, who have been able to borrow cheaply for many years, and have benefited from increased consumer spending due to easy credit.
But Mr Buffett, whose company Berkshire Hathaway owns approximately 70 US businesses, said that he did not take interest rates into consideration when making investment decisions.
“If Janet Yellen [chair of the Fed] came up and whispered in my ear what she was going to do for the next two years, it wouldn’t make any difference to what we do.”
He added: “We don’t want to get out of the game based on what we think somebody might do.”
However Mr Buffett admitted he was concerned that raising US interest rates while the European Central Bank’s rates are at rock-bottom could send Europe into “more of a tailspin, or make the dollar too strong”.
‘Keep customers happy’
These developments could in turn harm the US economy, he warned.
Yet his advice for assembled business owners at the Automotive Forum in New York was to focus on how they run their firms, rather than the Fed’s actions.
“People will forget it all three years from now, five years from now, or 10 years from now,” Mr Buffett said, referring to interest rates.
“You want to just keep doing things that make sense, you want to keep customers happy, and if you are in a reasonably good business, you are going to do fine over time”.