Yahoo Finance Warren Buffett is unfazed by news of deteriorating US-China trade talks
“We’re buying the same stocks now that we’d buy last week,” billionaire Warren Buffett said on CNBC on Monday morning. “We’re buying them because they’ll be good businesses 10 years from now.”
Ahead of the market open on Monday, Dow futures were down by more than 500 points (YM=F) following President Donald Trump’s threat to put into effect massive tariffs on hundreds of billions of dollars worth of Chinese goods.
“If you look at stocks as businesses you own little pieces of, why in the world should you sell it based on headlines of any sort?” Buffett said. “It’s nonsense to get feeling good or bad about what stock prices do in a day... unless you have extra money and they go down and then you feel better because you can buy more cheap.”
While Buffett acknowledges that tension between the U.S. and China — the world’s two largest economies — would be “bad for the whole world,” he’s nevertheless optimistic that the two will work something out.
“I think that China and the United States absolutely are destined to be the superpowers, beyond my great-grandchildren’s lives, and will always be competitors,” Warren Buffett said in an interview with Yahoo Finance. “We just have to make sure that competition doesn't get us to a point where we don't realize that the best world is one in which both the United States and China prosper.”
During Yahoo Finance’s U.S.-China Investor Forum in Omaha on Friday, business leaders and experts shared Buffett’s optimism. And despite the rocky talks, they were encouraged by the fact the two countries were engaging each other.
“There was not really a great mechanism for the two countries to discuss issues,” Peking University Professor Jeffrey Towson said at the forum. “This past year, I think what we've seen is the two countries learning to talk to each other about meaningful issues for the first time. And I think this is going to go on for the rest of our lives that these two countries are going to learn to deal with their issues.”
For now, investors and traders will have to deal with some bumps.
“I don't think conflicts are unavoidable,” Buffett told Yahoo Finance, warning that conflicts in the past have sometimes evolved into wars.
“You just got to be sure things don't escalate.”
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Sam Ro is managing editor at Yahoo Finance. Follow him on Twitter: @SamRo
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