I was asked to comment on Berkshire Hathaway’s quarterly earnings release. It was an uneventful quarter - but the headlines said it all this week - Buffet’s $325 BILLION cash pile. I get it. Since I was in my 20s I’ve been hearing about how the cash pile just gets bigger. Bigger than last year. Biggest in history. Never been bigger ever, even in past big years. The law of large numbers and specific investment mandates (called having some discipline on valuations and types of things you buy and don’t buy) prevent the speedy reinvestment of all that cash that gets created - and this quarter billions more of profits off his Apple position were cashed out.
From the value persepctive, all of this makes sense. His value stocks have not performed like the momentum tech shares of the MAG7. But that is not what he is doing, right? Look at OXY. For several years it’s been doing nothing. Why not keep cash earning a risk free treasury rate instead? I say good move. Nobody knows what exactly the plan is - but you should listen to what the people that own and run the company are saying. They are saying they had some big winners.
Some profits are being taken. Nothing out there looks great at a good valuation. That’s it.