AP Photo/Nati Harnik, File

Warren Buffett this morning told CNBC that the stock markets continue to climb, in large part, because of low interest rates:

Interest rates are gravity.

Context: The Federal Reserve cut the federal funds rate to effectively nothing in December 2008, as a response to the financial crisis. It has since climbed to 1.25%, but that's still well below historic norms and not nearly enough to push yield-hungry investors out if public equities.

More from Buffett:

  • Waiting game: "Everybody expects interest rates to change, but they've been expecting it quite a while."
  • Future math: "If three years from now interest rates are 100 basis points higher, then the stocks-- stocks will still look cheap at these prices. If they're 300 or 400 basis points, they won't look cheap."
  • Taxes: "It'd be kinda foolish to have a gain now and pay 35% tax on it if by waiting a few months you were likely to pay 25%.

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Updated 6 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Global: Total confirmed cases as of 9 a.m. ET: 19,128,901 — Total deaths: 715,555— Total recoveries — 11,591,028Map.
  2. U.S.: Total confirmed cases as of 9 a.m. ET: 4,884,406 — Total deaths: 160,111 — Total recoveries: 1,598,624 — Total tests: 59,652,675Map.
  3. Politics: Trump floats executive action even if stimulus deal is reached.
  4. Business: U.S. economy adds 1.8 million jobs in July — Household debt and credit delinquencies dropped in Q2.
  5. Sports: The pandemic's impact on how sports are played.
  6. 1 🎮 thing: Video gaming growth soars.

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