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The Associated Press August 8, 2011, 11:28AM ET

Buffett says US debt should still be rated AAA

Investor Warren Buffett said Monday he still believes U.S. debt should carry the top credit rating because the country won't have trouble paying off its long-term debt obligations.

Buffett told CNBC that he disagrees with Standard & Poor's decision to downgrade long-term U.S. debt. The credit ratings agency on Friday cut the U.S. credit rating one notch from AAA to AA+ with a negative outlook.

Buffett's Omaha-based company is one of the biggest shareholders in S&P's main competitor Moody's Corp. with about 28 million shares. But the billionaire has long urged people to make their own decisions about an investment's prospects without relying on credit rating agencies.

Buffett said S&P's action doesn't change his view on the security of U.S. Treasury bills. Buffett said at least $40 billion of Berkshire Hathaway's roughly $48 billion cash and equivalents is in U.S. Treasury bills, and he wouldn't consider parking it anywhere else.

"If anything, it may change my opinion on S&P," said Buffett, who is chairman and CEO of Berkshire.

Buffett said America's leaders may have a hard time agreeing on the country's financial plan and the value of the dollar may decline, but that won't keep the world's richest nation from paying its debts. After all, he said the United States has a gross domestic product of about $48,000 per person, and the Federal Reserve can still print more money.

"Our currency is not AAA, and in recent months the performance of our government has not been AAA, but our debt is AAA," Buffett said to CNBC.

Buffett did not immediately respond to an interview request from The Associated Press on Monday.



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