Warren Buffett has blunt warning on Venezuela 'gambling'
Legendary investor Warren Buffett has stepped away from the role of the CEO at Berkshire Hathaway (NYSE: BRK-A, BRK-B). But he is still glued to the latest trends in the market and has a blunt warning to share.
During the company’s annual meeting on May 2, he sat down for an interview with CNBC’s Becky Quick and warned against emerging “gambling” trends in the market.
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Buffett warns of ‘casino’ and ‘gambling’ trends
Buffett compared the current market to a “church” with an attached “casino.” People can visit both places, but the casino has increasingly become more “popular” among traders, he warned.
“If you’re buying one day options, or selling them, I mean, that’s not investing, it’s not speculating, it’s gambling.”
He highlighted the case of the Polymarket trader in particular who made $400,000 by betting on the U.S. operation in Venezuela earlier this year.
Polymarket is the world’s largest prediction market. It lets traders predict events like future Bitcoin price, geopolitical events, election results, government shutdown, etc., by paying with cryptocurrency.
The individual Buffett referred to during the interview is a U.S. Army soldier, Gannon Ken Van Dyke, who was recently arrested last month for allegedly using non-public information to wager on the abduction of former Venezuelan president Nicolas Maduro.
Van Dyke “was involved in the planning and execution” of the military operation and bought 13 Polymarket contracts, such as U.S. forces landing in Venezuela, Maduro’s abduction, and the invasion, as per the allegation.
When the soldier entered the plea during a hearing in Manhattan federal court last week, he pleaded not guilty to using classified information to profit.
During the interview, Buffett expressed concern about the large number of people getting attracted to such trends.
“So we’ve never had people in a more gambling mood than now,” he warned.
U.S. President Donald Trump made a similar analogy when he was asked about insider trading on war-related prediction markets. “The whole world, unfortunately, has become somewhat of a casino,” he said, but added he wasn’t in favor of it.
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Buffett turned Berkshire Hathaway from a struggling textile manufacturer to a global conglomerate. With a market capitalization of over $1 trillion, it is the world’s 13th-largest company.