Buffett Warns on Terror Attacks, Markets

NEW YORK — Billionaire investor Warren Buffett issued a pessimistic outlook on the world on Saturday, saying the war on terror could never be won — a potential problem for his insurance interests — and warning that returns from the stock market over the next few years look meager.

Buffett, known as the 'Oracle of Omaha' for his astute investments, also blasted executives for taking millions of dollars out of businesses even as they fare badly, a practice he said went far beyond Enron Corp. , the collapsed energy trader.

Buffett said that further terror attacks on the United States were possible, and must be accounted for by insurers.

"Fear may recede with time, but the danger won't," said Buffett. "The war against terrorism can never be won. The best the nation can achieve is a long succession of stalemates."

Working on that assumption, Buffett said his reinsurance operations, including General Re — the largest reinsurer in the United States — would only underwrite some coverage for terrorist attacks, including some third party liability coverage for airlines.

Buffett once again called on the government to back up insurers covering terror risks, though that seems unlikely after Congress failed to enact any legislation last year.