Important Takeaways:
- For the better part of six decades, Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) CEO Warren Buffett has been one of Wall Street’s most-revered investors. Overseeing a cumulative return of more than 5,650,000% in Berkshire’s Class A shares (BRK.A) since becoming CEO has earned Buffett quite the following, as well as the nickname, “Oracle of Omaha.”
- But sometimes Berkshire’s quarterly operating results, or Form 4 filings with the Securities and Exchange Commission, can tell a more thorough story — even if it’s an unpleasant one.
- Recently, Buffett has been a somewhat aggressive seller of Bank of America (NYSE: BAC) stock. Between July 17 and Aug. 30, Berkshire’s stake in BofA has declined by about 150 million shares, equating to roughly $5.4 billion.
- This $5.4 billion in selling activity is a pretty clear warning to Wall Street and investors.
- The fact that Buffett has dumped nearly 15% of his company’s stake in Bank of America in a span of just over six weeks suggests clear worry about the U.S. economy and stock market. Like pretty much all bank stocks, BofA is cyclical.
- The other issue is it puts Berkshire Hathaway on track for its eighth consecutive quarter of selling more securities than it’s purchased.
- Collectively, Warren Buffett has overseen $131.6 billion more in securities sold than purchased between Oct 1, 2022 and June 30, 2024.
- But the bigger story is what price dislocation will attract Buffett next. Following the financial crisis, Buffett invested $5 billion into Bank of America preferred stock. This helped to shore up BofA’s balance sheet at a time when banks were Wall Street’s chopped liver. More importantly, it gave Buffett access to warrants entitling him the right to buy 700 million shares of BofA stock at $7.14 per share, which he did for Berkshire Hathaway in mid-2017.
- Periods of emotion-driven selling, while brief, have historically been Warren Buffett’s time to shine. With stocks at one of their priciest valuations in history, Buffett’s selling activity foreshadows both the peril and promise of what’s to come.
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Important Takeaways:
- Warren Buffett has raised the alarm on AI, warning it threatens to supercharge fraud by making scams more convincing than ever.
- “Scamming has always been part of the American scene,” the famed investor and Berkshire CEO said during his company’s annual shareholder meeting on Saturday.
- But Buffett said that images and videos created using artificial intelligence have become so convincing that it’s virtually impossible to discern if they’re real or not.
- “When you think of the potential of scamming people … if I was interested in scamming, it’s going to be the growth industry of all time,” he said.
- Buffett also likened the advent of AI to the creation of the atom bomb, echoing comments he made at last year’s Berkshire meeting.
- “We let the genie out of the bottle when we developed nuclear weapons,” he said. “That genie’s been doing some terrible things lately. The power of the genie scares the hell out of me.”
- “AI is somewhat similar,” Buffett added. “We may wish we’d never seen that genie.”
- The billionaire, who touted AI’s enormous potential years before ChatGPT’s release, emphasized he’s no expert in the nascent tech.
- “I don’t know anything about AI, but that doesn’t mean I deny its existence or importance or anything of the sort,” he said.
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Important Takeaways:
- Warren Buffett Selling $28.7 Billion in Stock Rings Alarm Bell Over Economy
- Warren Buffett’s firm Berkshire Hathaway sold $28.7 billion of stock in the first three quarters of 2023 in a move that some economists have interpreted as ringing alarm bells for the American economy.
- According to the company’s earnings, the Nebraska-based firm of the legendary investor and billionaire, known as the Oracle of Omaha, sold a net $10.4 billion of stock in the first quarter of the year. In the second quarter, it sold close to $13 billion of shares and bought less than $5 billion. In the third quarter, it sold about $5.3 billion worth of stocks.
- But it’s also, crucially, a sign “that a recession is right around the corner,” Hanke told Newsweek.
- “The money supply of the United States, broadly measured [M2], started contracting in July 2022, and has been falling like a stone,” Hanke said. “Since last year, the U.S. money supply has contracted by 3.3 percent.”
- According to Hanke, there have been only four periods in U.S. history—in 1920-21, 1929-33, 1937-38 and 1948-49—in which the money supply has had significant contractions.
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Revelations 13:16-18 “Also it causes all, both small and great, both rich and poor, both free and slave, to be marked on the right hand or the forehead, so that no one can buy or sell unless he has the mark, that is, the name of the beast or the number of its name. This calls for wisdom: let the one who has understanding calculate the number of the beast, for it is the number of a man, and his number is 666.”
Important Takeaways:
- Ominous Omen From ‘Oracle of Omaha’? Buffett Unloads Billions in US Stocks, Warns of AI ‘Atom Bomb’
- The 92-year-old financier has a penchant for sniffing out financial trouble, and has made it his hedge fund’s business to seek out opportunity in times of hardship. With US markets on edge over the prospect of more bank failures and Congress arguing about the debt ceiling, Buffett has issued fresh warnings about America’s possible economic future.
- Buffett said he was not surprised that the US has been facing a string of bank failures recently, given how complex the banking sector has become, and the “dumb” decisions made by some bankers.
- “The American public doesn’t understand their banking system – and some people in Congress don’t understand it anymore than I understand it,” the tycoon, whose company began a selloff of US bank stock from 2020 onward, but is holding on to a 13 percent share of Bank of America and a 2.8 percent share in Citigroup, said.
- Buffett also warned that bank runs are becoming easier in the modern world thanks to technology, with the speed at which information travels and the opportunity to withdraw deposits virtually meaning that nowadays, “you could have a run in a few seconds.”
- Buffett also offered a grim warning about the rise of artificial intelligence capable of replacing human beings in many roles, comparing the technology to the atomic bomb and saying it cannot be “un-invented.”
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