Buffett sees dollar weakness

By Angela Moon

DAEGU, South Korea (Reuters) - Billionaire investor Warren Buffett said on Thursday he expected the dollar to weaken further, adding that South Korean stocks offered better value than other world markets.

Buffett, worth $52 billion according to Forbes magazine in March, said his Berkshire Hathaway (BRKa.N: Quote, Profile, Research, Stock Buzz) company is still on the hunt for bargains as the U.S. subprime mortgage crisis plays out.

"We are still negative on the dollar. We bought stocks in companies that are earning their money in other currencies," he told reporters during a visit to Berkshire's Korean cutting tool maker subsidiary, TaeguTec.

Berkshire Hathaway, which owns more than 70 businesses and has some $100 billion of stock and bond investments, has a stake in only one listed South Korean company, the world's fourth-biggest steelmaker POSCO (005490.KS: Quote, Profile, Research, Stock Buzz). Berkshire said in March it held a 4 percent stake in POSCO as of the end of 2006.

"We are gaining foreign currency exposure that we like," said the veteran investor, known as the "Oracle of Omaha" for his astute investments.

The U.S. currency has lost 23 percent against the South Korean won since the end of 2003, hit by accumulating current account surpluses in South Korea and a steady inflow of portfolio investment into the country's financial markets.

International Monetary Fund Managing Director Rodrigo Rato said on Monday the U.S. currency was still overvalued and that there was room for further depreciation.

SUBPRIME EFFECTS