Saddle Up To The Buffet

"Warren Buffett's $168 billion cash pile signals he expects stocks to slide and a recession to strike"says top economist Steve Hanke (msn.com)

https://www.msn.com/en-us/money/savingandinvesting/warren-buffett-s-168-billion-cash-pile-signals-he-expects-stocks-to-slide-and-a-recession-to-strike-says-top-economist-steve-hanke/ar-BB1j2SNc?ocid=00000000&cvid=a9dcaf858113466f8f968b44f735bcd5&ei=25

Ok, maybe, maybe not. Yes Warren Buffet and his conglomerate investment vehicle Berkshire Hathaway brk.b

"Hanke anticipates an eventual slide in stocks and an economic slump, in contrast to many Wall Street experts who expect cuts to interest rates this year to extend the current boom and forestall a recession." Steve Hanke (msn.com)

or maybe not ....

The Stock Market Is Only 50% Through Its Current Bull Rally: NDR (businessinsider.com)

So who is right? The fact is, it doesn't matter to Warren B. as he doesn't play the stock market ups and downs and doesnt recommend you do eather, but look at what he is doing. He is rebalanceing his portfolio to hold cash at a high point in the stock market. And yes looking at the markets as a whole, excluding the artificail dip caused by the Pandemic, we have had a bull run for 15 years... what does that tell you?

Logid, not market analysys tells us it will not keep going forever... Is it different this time? No, probably not. Greed always gets in the way to push values past a logic norm, and eventually some event will trigger a market collapse. The question is when will this happen? Who knows, but at some point in the future, 2, 5, or maybe 10 years from now, opportunities will exist where you might wish you had some capital to rebalance into.

"What if I miss out this next big market Bull like many are talking about" well the truth is, minus a few tech stocks, most large companys are not doing that great. Markets have only climbed back to where they were 2 years ago, further showing the Pandemic was a temporary disruption, and not an economic drought. The problem it created was too much stimulus and free cash in the system, triggering massive inflation. But this is in our favor, as all that cash you are hording, should be producing about 5% in garunteed certificates, and T-Bills, i you followed my advice.

So if the total average of a market since the beginnign of time, is only 7% (and it is) 5% sounds pretty good, doesn't it?

Yes, Warren Buffet has a lot of cash, but its only becasue he can't find anywhere to spend it. Doesn't mean he is betting a crash is coming. It just means he is smart, and knows how to invest for long term.