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

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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.

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