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Warren Buffett sold big before the crash
The stock market legend is accumulating money - has 2,900 billion kroner
David Peterson
Updated 21.26 | Published 21.21
After the broad stock market crash - then many marvel at financier Warren Buffett's timing. The 93-year-old's company now has a record amount of money outside the stock market.
- He has an awful lot of experience, says savings profile Mohammed Salih.
Quick version
At the end of last week, there were big headlines in financial newspapers when the giant American conglomerate Berkshire Hathaway released its quarterly report. The stock market legend Warren Buffett's company turned out to have continued to sell shares in the second quarter and now sits with a record cash equivalent of just over SEK 2,900 billion.
- Maybe Buffett thinks that we are entering a recession, by increasing the cash he can get ready to buy companies cheaply in the future, says Jim Awad, head of Clearstead Advisors, to Fortune.
93-year-old Warren Buffett stated earlier this year that Berkshire Hathaway chose to sell off the shares due to tax reasons, after making large profits. But he also said that a lot of money is good to have in case something "goes wrong".
"Become a myth"
Apple is still the company's largest holding, but after large sales in the second quarter, Buffett's holdings in the technology giant have almost halved, according to a calculation from CNBC. But the question is, could Buffett have anticipated the stock market crash of the past few days?
- Old is, of course, oldest, and here Buffett shows that he has an awful lot of experience. At the same time, all research shows that it is not possible to time the stock market. So it's probably more about luck than timing, says savings profiler Mohammed Salih, who also works as communications manager at Lannebo Fonder.
Warren Buffett has been described as one of the most successful investors ever. Under his leadership, Berkshire Hathaway has grown into one of the world's most valuable companies.
- Many believe that Buffett has always been long-term, but he is a good allocator and moves capital more than many think. It has become like a myth that he just sits on his holdings for many decades, but if you look more closely at his strategy, you see that he changes the holdings, says Mohammed Salih.
Headache for the Fed
When the American stock exchanges opened on Monday, at 3:30 p.m. Swedish time, the stock market rout continued. The broad S&P 500 falls around 3.5 percent, while the technology-heavy Nasdaq is down close to 5 percent.
The focus is now, among other things, on how the American central bank, the Fed, will act. Last week, Fed chief Jerome Powell chose to hold off on cutting interest rates, a decision that may come under criticism.
- I think the Fed is scratching its head a little and thinking that they should have lowered. Now things suddenly look pitch black and recession worries are spreading all over the world. Then you have to have respect for the fact that they have been there before and know what they are doing. But it was probably a miscalculation and they are learning to increase the pace of reduction now, says Mohammed Salih.
The last few years have been volatile on the stock market. But the biggest cases have previously occurred in connection with events that directly increased anxiety in the world, such as the corona outbreak in 2020 and Russia's invasion of Ukraine in 2022.
- I think many experts and investors have been a bit taken aback by the reactions. Many people are confused that macro numbers can set it up like this. At the same time, you have to bear in mind that the stock market has done extremely well recently, says Mohammed Salih.
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