BECKY: What do you like that you see in the proposals for national financial reform right now and what do you think is missing?
BUFFETT: Well, I think the hard part is to restrict leverage. I mean, leverage is what gets people into trouble. And the trouble is you can’t measure it by a single ratio. There’s all kinds. I mean you can have a lot of leverage on government bonds and then you can do other things where 2-for-1 leverage is too strong. I think you do need a regulator that can draw up some kind of sensible regulations as to different kinds of instruments, and maybe prohibit some in terms of the activities of commercial banks.
BECKY: You need a new regulator or the existing ones?
BUFFETT: I think I would trust the Fed.
BECKY: You would trust the Federal Reserve? But there are a lot of movements in Congress right now, both from the right and the left, to go after the Federal Reserve and strip some of its powers.
BUFFETT: I think that’s a mistake. I think that an independent Fed is incredibly important to the economic future of the country.
BECKY: Ben Bernanke is looking for this reconfirmation. They say a vote could come as early as this Friday. Should he be reconfirmed?
BUFFETT: If I could vote twice, I would. He should be, I mean, he did a magnificent job over this period. Now, everybody can do it somewhat better. We could sit here and armchair quarterback him, but when I look back at particularly September and October of 2008, he took some extraordinary actions that, if they hadn’t been taken, willingness to act like that, and even stretch his authority some. But he did what you do, and we talked about it being an economic Pearl Harbor, he did what should have been done in response to that Pearl Harbor. And I think he’s done a stellar job.
Source: Warren Buffett’s ‘Stock Split’ Interview, 20 Jan 2010