"... the US Treasury team with private investors to buy the distressed mortgage assets at the centre of the controversial 700 billion dollar Wall Street bailout, and said the price tag of the rescue plan may have to rise," Buffett was quoted as saying by 'Fortune' magazine in an online report.

On Wednesday, the US Senate had approved the package with an overwhelming number of lawmakers favouring the passage of the bill. The modified rescue plan will now go for voting in the House of Representatives, which had rejected the original proposal this week.

Speaking at a summit organised by Fortune on Thursday, the billionaire investor who is the chairman and chief executive of Berkshire Hathaway warned described the problems faced by world markets as "unprecedented".

Buffett said the bill isn't perfect, but it's a crucial step in the right direction and warned it will take a while to work and that the economy is going to struggle even with its passage, Fortune said.

"It will cost more to solve this problem today than it did two weeks ago," Buffett was quoted as saying, referring to when Treasury Secretary Henry Paulson's first proposed that Congress help rescue Wall Street after Lehman Brothers went bankrupt, Merrill Lynch was sold to Bank of America, and American International Group had to be rescued.

"Buffett didn't estimate how much more money would be needed to buy enough toxic mortgage investments in order to create a more stable market and get credit flowing again," Fortune said.