Buffett sees signs that recession is getting worse; also says inflation is a worry.

06/25/08 -  Billionaire Warren Buffett has already said he thinks the U.S. economy is in a recession, and now he says the economy is getting worse.  Everything connected with construction and with consumer, I see weakness, and if anything, it's accentuating a little bit." Buffett also said he thinks inflation is picking up, especially in steel and oil, so it should be a concern for the Federal Reserve.  But Buffett said he would have been surprised if the Federal Reserve were to announce a rate cut Wednesday afternoon.  Buffett also said he believes supply and demand, not market speculation, is what's driving oil prices to new heights.   "In my adult lifetime, up until the last year or two, there's been a huge amount of excess supply available," Buffett said. "We don't have excess capacity in the world anymore, and that's why you're seeing these oil prices."  Buffett said he doesn't think it makes sense to impose a windfall tax on oil companies that have benefited from the high price of oil when other commodity prices have also increased. Steel, corn and soybean prices are all up significantly.

 

 

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