Posted on 03/06/2025 5:31:13 AM PST by SeekAndFind
It looks like it’s Warren Buffett’s turn to say, “I told you so.”
Late last year, the Berkshire Hathaway CEO was busy selling stocks when the S&P 500 logged more than 50 record closes, leading many market observers to scratch their heads.
Now, the answer looks much clearer.
The stock market’s 2025 slump proves Berkshire’s fourth-quarter trades to be prescient.
Buffett was at odds with the bullish sentiment that marked the end of 2024, according to Berkshire’s latest 13-F filing, which tracks its holdings. In the last three months of 2024, Berkshire sold some $5 billion of Bank of America and $3 billion of Citigroup shares, while also slashing its ownership in smaller names like Brazilian fintech NU Holdings, cable operator Charter Communications, and Sirius XM owner Liberty Formula One.
While Buffett left some of his high-profile holdings—like largest position Apple —untouched, spirits maker Constellation Brands was the only notable purchase in the quarter. Overall, Berkshire was a net seller in 2024. The upshot is that the firm now has more cash on hand than any other U.S. company.
After Berkshire’s 13-F release in mid-February, Barron’s Andrew Bary wrote that “Buffett has been out of step with the markets before, including during the internet bubble of the late 1990s. He was vindicated then and could be rewarded once again.”
It didn’t take long for that to happen: Since the 13-F filing’s Feb. 14 release, the S&P 500 has tumbled some 5%. In fact, the index has given up all the postelection gains it notched in the fourth quarter, and then some. As of the end of Tuesday’s trading, the index’s close was the lowest value since Nov. 4.
(Excerpt) Read more at barrons.com ...
The correct answer to every question a small investor may have is, go ask at Bogleheads.
I guess you missed this form the article:
Overall, Berkshire was a net seller in 2024. The upshot is that the firm now has more cash on hand than any other U.S. company.
Mitsubishi is one of his buys.
It wasn’t too hard to see that bank of America might drop significantly if they get investigated for bias agaisnt conservatives. Maybe he sold because he Predicts the Trump admin might investigate them?
YTD the F500 is -1.6%, not their cherry picked -5.9%.
Article is biased.
Yup—and 99% of the time a quick search of the forum will answer any question we can think of...
It is also great to watch the questions that are asked and the detailed analysis and answers that are given.
These folks are sharp—and don’t miss a beat.
5.0%.
What’s interesting, Buffett is against holding on to precious metals as it doesn’t create value. The same can be said about cash as what good is it if its not building value.
Based on his first four years, whatever made anyone think he would not follow through on what he said?
Berkshire Hathaway is probably the largest current owner of US Treasury TBills in the world currently.
They have stated that all of those Billions are invested in TBILLS which were paying as much as 5.3% last year.
So, is it better to make 5% or potentially lose 10-30% ?
"While Buffett left some of his high-profile holdings—like largest position Apple —untouched"
He still has a lot, but he sold a big chunk. It's an old-fashioned defensive strategy -- after a long term gain, sell enough shares to recoup the original investment, and let the rest ride.
Buffett used to say his ideal time to sell was never -- buy and hold is primarily a tax strategy -- but he hasn't lived by that.
RE: Based on his first four years, whatever made anyone think he would not follow through on what he said?
Most every stock investor thought that Trump was exagerrating with the exception of folks like Warren Buffet.
“It’s an old-fashioned defensive strategy — after a long term gain, sell enough shares to recoup the original investment, and let the rest ride.”
You just stole my casino strategy.
Lol.
Not sure if TBILLs and cash are the same but you bring up a good point as Buffet’s all about returns on investment.
The article says they are keeping the billions in cash.
What the “journalist” meant to say is they are keeping the money invested in TBills. Some short term. Some longer.
For example, I bought a TBill yesterday. It is a 4 week bill. The most recent auctions of this short term investment have been paying 4.3% interest.
However, 6-9 months ago you could lock in TBills and CDs as high as 5.3%. The most recent TBill auctions have been paying 4.2-4.3% anywhere from 4 weeks up to 52 weeks(one year). You can then lock in a reinvestment for up to 2 years generally.
here is the link:
https://treasurydirect.gov/auctions/announcements-data-results/
Interesting. Thank you for taking the time to share.
I love casino stories, “how’d you do?” “Won $2800!” “Great!” “Lost it all.” :^D
I was having a good year at the local casino—seemed pretty good at figuring out the times of day and days of the week when the slots paid out more than normal...
Then Covid hit and they shut down...
and I have not been back since.
He’s always buying and selling. It gives bloggers plenty of material for whatever they want to say.
In December he reduced banks and bough buying consumer and cyclicals
https://www.dataroma.com/m/holdings.php?m=BRK
For example, I bought a TBill yesterday. It is a 4 week bill. The most recent auctions of this short term investment have been paying 4.3% interest.
However, 6-9 months ago you could lock in TBills and CDs as high as 5.3%. The most recent TBill auctions have been paying 4.2-4.3% anywhere from 4 weeks up to 52 weeks(one year). You can then lock in a reinvestment for up to 2 years generally.
Is there a tax advantage to doing this? When I saw all that "sitting around in cash" as per the article, my first thought was "how much capital gains will he pay"?
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