The Most Bearish Buffett Can Be
The Berkshire Hathaway meetings are pretty dull these days. Warren faces the same questions ā whereās the economy going, why isnāt he investing more, and he offers the same answers – donāt speculate, think long-term. This one was different!
The markets tuned into a virtual press conference from Omaha, Nebraska, to hang on his every word. These are unprecedented times, and everyone wants to know the Oracleās take. Heās participated in every trading session since 1941, and his record speaks for itself.
He started by explaining why he wasnāt investing at these lows. “The Federal Reserve acted quickly and aggressively, fleeting any opportunity” to get a deal done. He also canāt predict the future. He admitted he didnāt know what businesses will look like coming out of this lockdown, and therefore he isnāt buying. Actually, he was a net seller!
He sold his entire airline stock, emblematic of how he has dipped in and out of the industry for decades with varied success. He joked a few years ago that if he ever thought of purchasing an airline stock, heād call an āaeroholicsā hotline and have the people on the other side talk him down!
It was an unsettling meeting, leaving the bulls wanting. He reinforced his optimistic belief in America to fill an awkward silence at the end, but reading between the lines, this wasnāt the short-term gee-up markets need for Monday’s session.
The Berkshire meetings are best when theyāre boring. Buffett invests such large sums of money that his deals are cut off-market, so while he concerns himself with only the most giant conglomerates that will move his needle, heās reluctant to give broader market views because he doesnāt believe in speculation.
He also knows his words carry weight, but he didnāt mince āem this time. If you could ask the Oracle one thing, what would it be?
