Buffett’s $157 Billion Cash Pile Isn’t an Ominous Sign
Berkshire’s record cash and equivalents relative to its portfolio are in line with the firm's 20-year average. Plus, Treasury bills aren't the dead weight they used to be.
Warren Buffett (L) and Charlie Munger know how to play the waiting game.
Photographer: Johannes Eisele/AFP/Getty Images
Everything in the world is relative, including Warren Buffett’s cash position.
After Berkshire Hathaway Inc.’s third-quarter report on Saturday, investors and commentators made a lot of noise over the fact that Buffett’s cash hoard had ballooned to a new record of $157.2 billion, most of it in Treasury bills. For some, the development was a sign from the Oracle of Omaha himself that a global recession was nigh, with echoes of his cash hoarding before the financial crisis. For others, it suggested that the eminent 93-year-old investor had lost his knack for finding deals. In reality, it’s just Buffett being Buffett, exhibiting his usual restraint in a market without many bargains.