Warren Buffett reveals the news no American taxpayer wants to hear as the ... trends now
Warren Buffett has said he expects the US government to increase taxes rather than reduce spending.
The declaration, delivered Saturday, comes as the US is hard-pressed to address widening fiscal deficits, and as the national debt recently topped $34 trillion - an amount nearly as big as the entire US economy.
More concerning is the fact the Fed and other money-minded officials have no plan in sight, paving the way for the Berkshire Hathaway boss's unsettling prediction. He aired it at his hallowed hedge fund's annual shareholder meeting in Omaha, attended by some of the top CEOs in the country.
There, the conglomerate reported that its collection of businesses generated some $11.2 billion of operating earnings, up 39 percent from the year before.
Despite those results being a sign of a relatively robust economy, the 93-year-old who is valued at more than $131billion said he believes a federal tax hike is on the horizon.
Warren Buffett has warned that he expects the US government to increase taxes rather than reduce spending. The 93-year-old is seen here Fortune's Most Powerful Women Summit in Washington, DC, in 2015
The declaration, delivered Saturday, comes as the US is hard-pressed to address widening fiscal deficits, and as the national debt recently topped $34 trillion
'I think higher taxes are likely,' he said, pointing to how the Congressional Budget Office has estimated in its latest long-term budget projections federal deficits will rise to 8.5 percent of GDP in fiscal 2054 from the 5.5 percent seen today.
'They may decide that some day they don't want the fiscal deficit to be this large because that has some important consequences,' he added.
'So they may not want to decrease spending and they may decide they'll take a larger percentage of what we own, and we'll pay it.'
The unprecedented problem comes as US budget deficits are expected to dissipate if and when tax cuts introduced in 2017 are renewed next year.
But given current market conditions, there rate cuts remain uncertain, and inflation also remains stubbornly high.
These factors led to Buffet's Berkshire reducing its stake in Apple, one of the many blue chip manufacturers, home builders, insurance companies or retailers in its stable.
As a result , Berkshire reported a $135.4 billion holding in the iPhone maker at the end of the first quarter, down from $174.3 billion seen in December.
The move quickly became a topic of discussion as the meeting unfolded in real time, with CEO Tim Cook one of the high-powered figures in the room.
More concerning is the fact the Fed and other money-minded officials have no plan in sight, paving the way for the Berkshire Hathaway boss's unsettling prediction. He aired it at his hallowed hedge fund's annual shareholder meeting in Omaha (seen here)
Shareholders find their seats for the Berkshire Hathaway annual meeting on Saturday, as thousands attended. Among them were prominent CEOs like Apple's Tim Cook, whom Buffet mentioned by name after explaining a recent $40billion sale in Berkshire's
