Berkshire Hathaway Inc.'s (BRK.A, BRK.B) chief executive officer Warren Buffett Thursday said at a CNBC-sponsored event at Columbia University in New York that 'the financial panic is behind us.' Meanwhile, Microsoft Corp. (MSFT) co-founder Bill Gates, who also took part in the discussion, blamed the economic downturn on excessive use of borrowed money.
Both billionaires were answering questions posed by the Univesity students on a variety of topics. According to Buffett, the country's economy was sputtering and it is still sputtering some. Gates said that a marketplace-driven system with investments in education and infrastructure for long-term is continuing.
Reasoning his investment in railroad company Burlington Northern Santa Fe Corp. (BNI), Buffett said that railroads are tied to the future prosperity of the country. According to him, railroads are the most environmentally friendly and cost-efficient way of moving goods.
"You have the situation where overall they use 1/3 less fuel, they put far fewer pollutants into the atmosphere than trucks will. One train will supplant 280 trucks are so on the road. So the rails are in tune with the future," he stated. He was responding to a question about his key motivation behind increasing exposure to the railroad sector at this time.
Berkshire has acquired Burlington Northern for $26 billion, the biggest purchase of Berkshire. Buffett said that he is willing to bet a lot of money, $34 billion to be specific, on the fact that there will be more and more goods being moved by rail in future. "It will be better for the shareholders of the Burlington Northern," Buffett noted.
Buffett, who protected Omaha, Nebraska-based Berkshire from the recession by supplying $44 billion of cash and avoiding risky mortgage investments, also said that looking at what is happening in the economy and deciding whether to buy or sell stocks is a 'terrible mistake'.
While attending a question on his overseas investments in companies like BYD, Buffett said that there are more opportunities in the U.S. than anywhere else. He also stated that the country should demand greater sacrifices from the heads of any institution that has to go to the federal government for a bailout.
According to Gates, energy, healthcare and IT will be the industries with the most potential going forward. When asked about Apple's (AAPL) Chief Executive Officer Steve Jobs, Gates praised him, saying "he showed more inspiration and he saved the company." Attending a question on Google (GOOG), Gates said that "they have gotten into the lead position in search, which is incredibly profitable to be number one in that."
In response to a question on what worries him, Gates identified that the education system is not improving as much as it should, and that needs a lot more attention.
Gates also said except for a few outliers like terrorism or a pandemic, the rest of the system, including the financial system, has a lot of self-correction built into it.
Buffett and Gates also answered questions on ethics and the role of luck in their life and profession.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.