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Warren Buffett: Heaven Help Us

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Billionaire Warren Buffett is getting anxious. Congress has to get a serious bailout decision on the table, and fast, or "heaven help us," he says.

"We are looking over a precipice in terms of the economic condition of the country for the next few years," Buffett said during an interview on the Fox Business Channel. "If Congress doesn't help us on this, heaven help us."

Buffett says there's no engineering the past. What's done is done, and there will be plenty of time to lay blame after a deal is passed. Congress must act, and act quickly, he says.

"I understand where they're very mad about what's happened in the past, but this isn't the time to vent your spleen about that," Buffett told CNBC.

"Last week we were at the brink of something that would have made anything that's happened in financial history look pale," Buffett says.

"Thank heavens that (Treasury Secretary) Paulson had the imagination to step up with something that is of the scope that can really do something about it."

All the major institutions in the world are simultaneously trying to deleverage, Buffett points out — and the U.S. government right now is the only entity in the world that can leverage up.

"I am, to some extent, betting on the fact that the government will do the rational thing here and act promptly," Buffett says, referring to his recent $5 billion investment in Goldman Sachs.

"It would be a mistake to be buying anything now if the government was going to walk away from the Paulson proposal."

Buffett believes that Paulson's $700 billion plan is "absolutely necessary" to keep the economy from going over a precipice. "A collapse of the kind of institutions that were threatened last week, and their inability to fund, would have caused industry and retail and everything else to grind to something close to a halt."

His admiration for Paulson notwithstanding, Buffett is adamant that Treasury should buy junk securities at market prices, not carrying value, and that doing so will make money for the government.

"People who are buying these instruments in the market are expecting to make 15 to 20 percent," Buffett notes.

"If I could buy a hundred billion of these kinds of instruments at today's prices, and borrow non-recourse $90 billion, I would do that with the expectation of significant profit."