WARREN BUFFET BITES

This post is para-phrased from a CNBC interview broadcast this evening. Buffet Face to Face.

- Unemployment-will increase.
- US company sales are declining in major sectors.
- In February Ford revenues were down 7% and GM's were down 15%.
- Purchasing power will decrease as credit scores and family earnings decline.
- Gas is not in high demand as peoe are cutting back on travel. Yet gas prices are still increasing.
- Home listings are increasing dramatically. While home sales are still declining along with their value rapidly. Figures vary from state to state.

MY VIEW..we are in a recession even though the government has not formally announced this position. The impact of the above is yet to be seen.

The reality is that as people foreclose on homes their credit will be ruined. Equity in homes will be lost as the values have fallen under what they owe.

Families won't have credit or cash as expected - so they won't be able to put money down on a new home. This has a ripple effect. The result will be a major reduction in home sales, home furnishing, electronics, car, travel purchases and much more.

The fall-out in finance sectors, real estate coupled with the decline in retail sales and the US job market will definitely deliver a blow that will take 5 years to rebound from-if not more.