Finance figures warn on US economy

Famed financial figures Warren Buffett and Alan Greenspan have both issued warnings over the state of the US economy. In an interview with the New York Times, Buffett said: "We are not out of problems yet. We have got to get the sputtering economy back so it is functioning as it should be." Meanwhile Greenspan told the BBC that there would be a renewed financial crisis as a result of "human nature."

After buying into companies like Goldman Sachs and General Electric in the downturn 79-year old Warren Buffett  has benefited from the market recovery, in the wake of what he called the financial equivalent of Pear Harbour. However he has been investing less money in shares in recent months and putting his money into company and government debt, indicating his worries that problems in the financial system are not yet over. He has also been reducing his stake in ratings agency Moody's, seen by some as an increasing sign of concern.

Meanwhile Alan Greenspan, the 83-year old ex-US Federal Reserve chairman, said: "The crisis will happen again but it will be different." He also cautioned over the state of the US banking system, suggesting banks should raise capital levels to guard against further problems."

He added: "I think even in non-euphoria, non-crisis times, we need to have a larger buffer than we currently have." And he issued a further warning that injecting capital into the banking system could result in the rampant rise of inflation." ·