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Buffett: Bank mortgage plan won’t solve crisis

Investor Warren Buffett on Tuesday told CNBC television that a plan by some large banks to create a fund to buy tarnished mortgage securities is unlikely to cure what ails financial markets.
/ Source: Reuters

Investor Warren Buffett on Tuesday told CNBC television that a plan by some large banks to create a fund to buy tarnished mortgage securities is unlikely to cure what ails financial markets.

“You can’t turn a financial toad [into a prince] by kissing it or by securitizing it or by transferring its ownership to somebody else,” he said.

On U.S. President George W. Bush’s plan to negotiate rate freezes on some mortgages at risk of default, Buffett said it was the right course of action but “not revolutionary.”

Separately, he said U.S. retail sales were “looking soft” following a post-Thanksgiving burst.