Big-time investor Warren Buffet just sold $28.7 billion worth of stock of his Berkshire Hathaway in the first quarter of the year. He also sold about $13 billion of shares and $5.3 billion worth of stocks. In the second quarter, he bought less than $5 billion.
How Buffet moves his money has always been observed by fellow investors and economists as a predictor of where the Berkshire Hathaway chairman thinks the American economy is going.
The Oracle of Omaha’s moves could be a sign “that a recession is right around the corner,” said Steve Hanke, a professor of applied economics at John Hopkins University.
He added, “[Buffet’s] recent lightening up on stocks and accumulation of a pile of cash — $157 billion — is consistent with the fact that stocks are relatively pricey right now.”
Hanke, who also served as President Ronald Reagan’s Council of Economic Advisers, also noted that “the money of supply of the U.S. started contracting in July 2022 and has been falling like a stone.”
In 2022, the money supply has contracted by 3.3 percent.
The professor shared that according to U.S. history, there have only been four periods where the money supply had significant contractions — 1920-21, 1929-33, 1937-38, and 1948-49.
“Each of those four episodes was followed by a serious recession.”
For Hanke, Buffet’s actions “are classic Buffet.”
Buffet had a record of making big bucks in the past years by loaning and “rescuing” troubled financial businesses. The investor is waiting for the perfect time to deploy his cash hoard.
“He loves to fish in troubled waters [Buffet],” observed Hanke. With the current rate the Fed is going, a troubled economy is expected.
However, some economists are more careful in reading Buffet’s actions. Some relate to this as mere housecleaning.
In the third quarter of 2023, Berkshire sold its 22 million remaining shares in General Motors. The investor also cleared his portfolio on Procter & Gamble and Jonson & Johnson, as well as in Mondelez, United Parcel Service, Celanese, and Activision Blizzard.
He reduced his holdings in Chevron by 10.5% or 12.8 million shares. He also decided to trim his stake in Formula One Group, Amazon.com, Aon, HP, Markel, and Globe Life.
In 3rd quarter of 2022, he took over a large portion of stock in Taiwan Semiconductor but sold his shares the very next quarter. Economists noted that this move is highly unusual as Berkshire and Buffet are known for dealing with long-term investments.
Buffet also seemed to continue to veer away from bank stocks as he fully divested his position in Wells Fargo, as well as U.S. Bancorp and Bank of New York Mellon.
Aside from stocks, Berkshire also owns a broad assortment of companies, including Geico insurance, BNSF railroad, several major utilities, and manufacturing and retail businesses like Dairy Queen, See’s Candy, and Helzberg Diamonds.
What was stated above is not too encouraging. But when one considers that neither Biden, nor Harris, nor Elizabeth Warren, nor Chuck Schumer and especially Bernis Sanders have never spent even one day in their lives. Have never been spent working in the American Free-Market Capitalist Economy. Consequently they are, through their ignorance destroying the American economy.
Recession is coming? No, the total worldwide financial collapse is coming before the next presidential election. The world wide financial collapse will usher in the one world currency and government, and one religion.