WARREN BUFFETT: Stay The Hell Away From Long-Term Bonds

Warren Buffett

Photo: trackrecord

If Warren Buffett has one recommendation investors should follow, it’s this: stay away from long-term fixed-income bets in U.S. dollars — the dollar’s purchasing power is heading south.According to Bloomberg, the Berkshire chief said in India yesterday:

I would recommend against buying long-term fixed-dollar investments. If you ask me if the U.S. dollar is going to hold its purchasing power fully at the level of 2011, 5 years, 10 years or 20 years from now, I would tell you it will not.

I would much rather own businesses. It’s very easy to take away the value of fixed-dollar investments.

Buffett’s other pearls of wisdom? He’s suspicious of valuations of social-networking websites, and believes “most of them will be overpriced,” though he admits a few have what it takes to be gigantic successes. He said of Facebook, for example: “I wouldn’t buy them, but I wouldn’t short them.”

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