Berkshire Hathaway Inc. Deputy Chairman Charlie Munger made a startling comment about the ongoing banking crisis in the USA during a recent interview.
in a (n interview With the Financial Times published on Sunday, Munger warned that a storm is brewing in the US commercial real estate market, with American banks “full of bad loans” as house prices fall.
“A lot of real estate isn’t that good anymore,” Munger told the publication. “We have a lot of troubled office buildings, a lot of troubled malls, a lot of troubled other properties. There’s a lot of agony out there.”
“Every bank in the country is much tighter on home loans today than they were six months ago,” he added.
While noting that the current market isn’t as bad as it was in 2008, Munger said, “Problems happen in banking just like anywhere else.”
Munger’s warning came recently from federal authorities asked banks about their takeover bids for Bank of the First Republic.
Berkshire has a history of supporting U.S. banks during periods of financial instability, but has distanced itself from it Silicon Valley Bank And signature bank Collapse.
“Berkshire has made some bank investments that have performed very well for us,” Munger told the Financial Times. “We also had some disappointments from the banks. It’s not that damn easy to run a bank intelligently; There are many temptations to do the wrong thing.”
Now read: Charlie Munger’s 3 word advice helped Warren Buffett and it might help you too
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