Warren Buffett, the famed investor who runs the sprawling conglomerate Berkshire Hathaway, described tariffs as “an act of war” in an interview with CBS that aired on Sunday.
“Over time they’re a tax on goods,” Mr. Buffett said, responding to a question about their inflationary impact, suggesting that consumers will face higher prices as a result. “I mean, the tooth fairy doesn’t pay them,” he said.
The rebuke of President Trump’s tariff plans, a core part of his new administration’s economic policy, came just days before sweeping tariffs on Canada and Mexico were expected to go into effect. Mr. Trump said on Monday that tariffs that will add a 25 percent fee on all imports from Mexico and Canada, and an additional 10 percent for Chinese goods, would take effect on Tuesday.
Mr. Trump had delayed the tariffs on Canadian and Mexican imports for a month, and the apparent confirmation that they would be imposed this time sent stock prices reeling. The S&P 500 fell nearly 2 percent, its worst day of trading so far this year.
Berkshire Hathaway has recently built up a large investment in Treasury bills, government debt that’s a less risky alternative to corporate bonds and stocks. “You always have to ask that question in economics: And then what?” Mr. Buffett said in the interview. “Prices will be higher 10 years from now, 20 years from now, 30 years from now.”
He was also asked about his thoughts on Elon Musk’s involvement in Mr. Trump’s administration, but mostly deflected the question.
“I better not get into that,” he said with a laugh. “I’ve talked to Elon a few times.”
Content Source: www.nytimes.com