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Despite meltdown, titans of industry bullish on US economy
Mon, Oct 13, 2008
AFP

WASHINGTON, USA - Investors may be pulling their money out of US stocks in droves, but some of the world's richest and most influential business leaders remain bullish on the American economy - even in the face of an unprecedented financial meltdown.

Microsoft founder Bill Gates said in a television interview last week that in his view, the US financial crisis does not spell the end of capitalism, despite Americans' worst fears.

"It looks like the economy may go down somewhat, but nothing like a big recession or a depression," he added.

Gates, who last month topped Forbes magazine's list of the richest men in the United States with an estimated 57-billion-dollar fortune, said the future of the US and the global economies lies in the resilience and innovative spirit of businessmen and scientists around the world.

And speaking about some experts' misgivings about the US bailout plan, Gates said that in his view "it doesn't look like fixing these problems is going to derail the economy in some dramatic way."

Equally upbeat has been America's second-richest businessman.

Finance wizard Warren Buffett, noted for his investment acumen, has urged investors not to overreact during the financial crisis and has put his money where his mouth is, investing billions of dollars in US companies during the past month's credit crunch.

The avuncular Buffett, known for his home-spun, common-sense approach to investing, recently invested some five billion dollars in teetering investment bank Goldman Sachs, and billions more to shore up other companies like General Electric.

Buffett, chairman of the Berkshire Hathaway holding company, also last week was touted by both Democrat Barack Obama and Republican John McCain as a possible pick for future Treasury Secretary.

"He's already weighed in and helped stabilize some of the difficulties in markets and with companies in corporations, institutions today," McCain said.

One of the world's richest captains of industry, Mexican businessman Carlos Slim, was also bullish on American emerging unscathed from the crisis, although he said recently that China should lead rescue efforts for the US financial crisis, and that worldwide stock markets needed better rules.

"China is now the most important country to help responsibly in this crisis," Slim told journalists at a recent meeting in Mexico City.

"China has great liquidity, large resources, surpluses in its current accounts and a lot of capital flow," said Slim, the son of a Lebanese immigrant to Mexico who made his fortune in the 1990s after he bought fixed line operator Telefonos de Mexico (Telmex) in a privatization deal.

Slim, who has said the current crisis is the worst since the 1929 Wall Street crash, called for improved rules for world financial markets.

"Not more rules but better ones, not more regulation but better regulation," said Slim, whose fortune is estimated at 60 billion dollars, according to Forbes.

Another wealthy business tycoon who said better days were ahead was billionaire investor George Soros, who while generally upbeat on the economy, had some words of criticism for how the crisis has been managed so far.

He was especially critical about the 700-billion dollar bailout package, which so far has failed to quell roiling market.

Soros lobbed criticism Sunday at the US administration's "ill-conceived" handling of the global banking crisis, including Treasury Secretary Henry Paulson, the author of the Wall Street bailout plan.

"This 700 billion dollar plan, if it had been better constructed ... the damage would be less," Soros told CNN in an interview.

The Hungarian-born US citizen and fabled hedge fund manager also had criticism for the overindulgence of US consumers.

"We have gotten into the habit of consuming six to seven percent more than we are producing," he said.

"That game is finished."

 

 
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