Investing

Billionaire Warren Buffett Is Stashing Cash, Investors Need To Worry About Doing The Same

Austin Smith

Published: November 28, 2024 9:05 am

Key Points:

• With $325 billion in cash at his Berkshire Hathaway, Warren Buffett’s cautious approach is clear.
• Buffett’s lack of major purchases likely signal a major market downturn, up to 20% or more.
• Boeing (NYSE: BA) could be an acquisition, but is high-risk with so many unforced errors recently.
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Transcript:

[00:00:00] Doug: Up end of the quarter. How much money, how much cash does Buffett have right now? Three 25 billion. And his tendency is clearly to be a seller. Part of that may be his belief of what the tax system is going to look like going forward under the new administration. I am still puzzled why he is not a buyer of anything meaningful.

[00:00:24] Doug: I don’t consider a pizza chain a meaningful purchase.

[00:00:27] Lee: No, but again, like, like, like we thought, or like I was propositioning, I think he thought Kamala Harris would win and capital gain. Trump isn’t going to increase capital gains taxes. He’s not gonna do it. if anything, he may lower them there.

[00:00:44] Lee: There was a better than 100 percent chance that a Democrat administration would raise them. So the only other thing it points to is he thinks a serious correction is coming our way and not just, 5 or 10 percent quick dip and then, back to the races. I think he’s thinking it’s going to be 20, maybe even bigger percent.

[00:01:05] Doug: We’ll see if, if the market crashes sometime over the course of the next three or four months, he’ll look like a genius again.

[00:01:14] Lee: Well, again, I mean, there’s plenty of big, there’s plenty of entities that are right up his alley that, should be attractive at this level. Boeing should be attractive at this level.

[00:01:27] Lee: It’s the, one of the biggest defense companies and aircraft companies in the world, but you know, like their CEO recently said.

[00:01:34] Doug: Listen, I’ve seen companies go out of business that were some, some of the most iconic to me, Boeing is what I call a Sears play. There was a point, well, listen, Sears didn’t happen overnight.

[00:01:50] Doug: It took a long time, but they, eventually they couldn’t cut it.

[00:01:53] Lee: I agree. But I mean, at least with Boeing and even, even their CEO admitted it. They can’t, they can’t have another unforced error. Like the ones they’ve had, or you’re right. They’re in big trouble.

Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.