Smaller
Bites – Connecting the Dots: Warren Buffett, Apple & Soros Funding
Buffett's
Cash Pile Rises by $2 Billion
Newsmax
By
Lee Barney | Monday, 08 May 2023 07:24 AM EDT
https://www.newsmax.com/finance/streettalk/buffett-cash-stock-valuations-banking/2023/05/08/id/1118958/
Warren Buffett’s Berkshire
Hathaway dumped
billions of U.S. stocks in the first quarter, as the conglomerate found few
good valuations in a volatile market, the Financial
Times reports.
Berkshire’s cash pile rose by $2 billion to $130.6 billion, the company
revealed Saturday at its annual shareholder meeting in Omaha, Nebraska. The
famed investor’s company sold $13.3 billion of stock in the first quarter,
putting only $2.9 billion of that back into the stock market and $4.4 billion
into Berkshire Hathaway stock repurchases.
Berkshire’s cash pile is now at its highest level since the close of 2021.
Berkshire Vice Chairman Charlie Munger said last month he foresees the economy
slowing as the Federal Reserve continues to raise interest rates, and
that investors
should expect lower returns.
Munger also warned that banks are loaded up with too many bad commercial loans.
“It’s not nearly as bad as it was in 2008—but trouble happens to banking just
like trouble happens everywhere else,” Munger told the Financial Times.
On Saturday, Buffett said the effects of the slowing economy were only just
beginning to be felt—though he did not depict a gloomy outlook for the
investment firm he founded 58 years ago, or the U.S. economy.
“It isn’t that employment has fallen off a cliff or anything, but it is a
different climate than it was six months ago,” Buffett said. “A number of our
managers were surprised. Some had too much inventory on order.”
While Buffett warned about higher interest rates for the general market, his
firm has benefitted from the lion’s share of his cash being invested in
short-term Treasuries and bank deposits—which generated $1.1 billion in
interest in the first quarter, up considerably from $164 million in the first
quarter of 2022.
Buffett also spoke about his $151 billion stake in Apple—nearly half of
Berkshire Hathaway’s entire stock holdings.
“It just happens to be a better business than any we own,” said Buffett, who
has praised Apple’s strategy and CEO Tim Cook.
Berkshire
reported a profit of $35.5 billion for the first quarter, $24,377 for Class A
shares, up from profit of $5.6 billion a year earlier.
Operating earnings, which are Buffett’s preferred performance measure, were up
12.6% to $8.1 billion.
Berkshire Hathaway stock is up 4.9% year to date.
Buffett was asked about his outlook for the health of the U.S. banking system,
as well as the national debt. The Oracle of Omaha disparaged the handling of
recent tumult in the banking sector and said a debt ceiling showdown could
bring "turmoil" to the world’s financial system.
Buffett
criticized how politicians, regulators and the press have handled the failures
of Silicon Valley Bank, Signature Bank and First Republic Bank, saying their "very poor"
messaging has unnecessarily frightened depositors.
"Fear
is contagious" and "you can't run an economy" when people worry
if their bank deposits are safe, he said.
As for Berkshire’s bank investments, Buffett said billions in deposit
withdrawals from these and other regional banks have made him more cautious
about investing in banks—a sector Berkshire Hathaway has shorn up in previous
crises, most notably the Great Recession of 2008.
Berkshire has been quick to support U.S. banks during periods of instability,
investing $5 billion in Goldman Sachs in the 2008 financial crisis and plowing
another $5 billion into Bank of America during the U.S. debt-ceiling crisis of
2011. Both stocks are now core Berkshire Hathaway holdings.
Asked about Activision Blizzard, which Berkshire bet heavily on after Microsoft
said it would buy the video game maker, Buffett declined to say whether he was
cutting the position. Ever since UK regulators said they were going to block
the takeover, Activision shares have tumbled.
Berkshire Hathaway continued to increase its stake in Occidental Petroleum in
the first quarter, filings with the Securities and Exchange Commission showed.
Buffett repeated his claim that his company is not planning to take control of
the oil giant.
Other filings show Berkshire sold a sizeable stake in Chevron in the first
three months of the year.
Other Holdings
Another key holding, Geico, swung to a $703 million underwriting profit in the
quarter after six consecutive quarters of losses.
Berkshire warned that declines in residential real estate sales would continue
to weigh on modular home manufacturer Clayton Homes and other housing-related
positions.
Buffett set a lighthearted tone at the start of the meeting Saturday by joking
that King Charles III’s coronation was a “competing broadcast.”
Connecting
the Dots:
Warren E. Buffett is
the chairman & CEO for Berkshire Hathaway Inc., a life trustee
at the Urban Institute (think tank) and an adviser at
the Nuclear Threat Initiative (think tank).
Foundation to Promote Open Society was a funder
for the Urban Institute (think tank) and the Carnegie
Endowment for International Peace (think tank).
George Soros was the chairman for
the Foundation to Promote Open Society and a friend of Michael
Douglas.
Michael Douglas is
a friend of George Soros and a director at the Nuclear
Threat Initiative (think tank).
Ted Turner is a
co-chairman for the Nuclear Threat Initiative (think tank) and
the founder of CNN.
Carnegie
Endowment for International Peace (think tank) was a
funder for the Nuclear Threat Initiative (think tank).
Foundation to Promote Open Society was a funder for the Carnegie
Endowment for International Peace (think tank) and the Center for
American Progress.
George Soros was the chairman
for the Foundation to Promote Open Society and a supporter for
the Center for American Progress.
Apple Inc. was
a funder for the Center for American Progress.
Timothy D. Cook is
the CEO for Apple Inc. and a VP for the Compaq Computer
Corporation.
Thomas J. Perkins was
a director at the Compaq Computer Corporation and is a partner
emeritus for Kleiner Perkins Caufield & Byers.
Kleiner
Perkins Caufield & Byers was a donor for The Climate
Project.
The Climate
Project is a merged organization with the Climate
Reality Project.
Foundation to Promote Open Society was a funder
for the Climate Reality Project.
George Soros was the chairman
for the Foundation to Promote Open Society.
Lee M. Thomas was
a director at the Climate Reality Project and an administrator for
the U.S. Environmental Protection Agency (EPA).
Resources:
Past Research
Warren
Buffett Worried Over Nuclear War, Pandemics — Not Stocks (Connecting the Dots:
Warren Buffett, Berkshire Hathaway Inc, Nuclear Threat Initiative & Soros
Funding, All Networking) (Past Research on Warren
Buffett)
SATURDAY,
APRIL 22, 2023
https://thesteadydrip.blogspot.com/2023/04/warren-buffett-worried-over-nuclear-war.html
Apple
CEO Tim Cook: Global Warming Skeptics Should Dump Company's Stock (Past Research on Tim Cook & Apple Inc.)
MONDAY,
MARCH 3, 2014
https://thesteadydrip.blogspot.com/2014/03/apple-ceo-tim-cook-global-warming.html
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