Buffet Talking Sense

Buffett, the billionaire investor behind Berkshire Hathaway , fingered "exploding" inflation Wednesday as the biggest risk to the economy. "I think inflation is really picking up," Buffett said on CNBC. "It's huge right now, whether it's steel or oil," he continued. "We see it everywhere."

As I have blogged about in the past, lowering interest rates to 1% a few years ago was a bad idea ... lowering them to 2% recently was a repeat of that mistake.

Instead of having economic turmoil centered around mortgage lenders and overzealous home investors, the lower interest rates has, in effect, spread the contagion to the rest of the economy, via the weak dollar. Higher gas and food prices are the result.

The more the Fed attempts to boost an ailing sector, the more they multiply the negative effects on the whole economy.

And now, I will retreat back into my cave of obscurity, whilst the geniuses continue to ignore my seemingly prophetic words and suggestions.