The Best One Yet
💰 “Warren’s Biggest Trade” — Buffett’s cash crush. Tropicana’s carafe controversy. Bluesky’s alt-Twitter.
Thu, 21 Nov 2024
Warren Buffett’s biggest trade of the year? Cash… The world’s top investor ain’t into stocks right now.Tropicana sales fell 20% because it changed its bottle… again.The #1-downloaded social media app right now is Bluesky… by copying the OG Twitter.Plus, would you buy canned Lake Como air from Italy for $11?... Because one business is selling it.$PEP $KO $BRK.B🧢 The TBOY holiday merch drop ends today Thursday 11/21: Shop now @ www.tboypod.com/shop🎙️ Check out the latest episode of our new weekly deepdive show The Best Idea Yet: The untold origin story of “Levi’s 501s… The World’s 1st Jeans” 👖Wondery.fm/TheBestIdeaYetLinks —-----------------------------------------------------GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/ Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
What is Warren Buffett's biggest trade this year?
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For our third and final story in our T-boy holiday hoodies, Warren Buffett is not buying stocks right now. Warren Buffett is selling. At a moment of stock market euphoria, we're looking at the one investor who is waiting for a dip. Warren Buffett, the dip diva.
But yeties, Jack and I jumped into the numbers, T-boy style, and we can quantitatively say that Warren Buffett is the best investor of all time. Yes, we can, because for 58 years, he has been managing money at Berkshire Hathaway. And Jack, what is Warren's return every year on average over those 58 years? 20% per year. That's how much he grows the money he controls. Not too shabby.
That is twice as good as the S&P 500, the basket of the 500 biggest stocks on the stock market. We repeat, over 58 years, Warren Buffett has done twice as well as the rest of the stock market. And that is why Warren's fund, Berkshire Hathaway, is now the largest non-tech company in America. So when he speaks, we listen. We'll have what he's having. And all year, he's been having... Selling. Yeah.
Yeah, he's been selling. He's been selling. That's what we're trying to say. He's been selling. Warren Buffett's Berkshire Hathaway has sold $133 billion worth of stock this year. On the other hand, he's bought almost no stock this year. He's basically bought zero stocks. Right now, everyone is buying stocks, right, Jack? Stocks and crypto are both at record highs, but Warren Buffett is selling.
He's not buying. In fact, Warren Buffett right now is sitting on a pile of cash that is bigger than any pile in his life history. He's got $325 billion of cash that's not in the stock market. Jack, I'm going to have to ask you to sprinkle on some fantastic context to $325 billion in cash. That's enough money to buy Disney easily, to buy two McDonald's actually.
Berkshire Hathaway could purchase Nike three times with that cash. Okay, Jack, I wanted to surprise you, so get these numbers. Berkshire Hathaway has enough cash to buy all the fast food stocks in America, each and every one of them. And I actually think he loves fast food, so he might actually do that. At this point, Warren Buffett has enough cash to buy Denmark, no joke.
But yetis, before we talk about why Warren Buffett is holding so much cash, we should talk about what he's actually doing with it. Because that $325 billion, it's not doing nothing in a bank account. It's actually generating interest, a lot of interest. Because Berkshire Hathaway bought $300 billion of US government bonds this year. That's his version of a high-yield savings account.
And assuming Warren is getting 4.5% interest rates on those bonds, then Berkshire Hathaway made $13 billion on interest on those accounts. Just on interest on his cash, he's brought in $13 billion this year. Now, we should point out the stock market, it's returned a lot more than 4.5% this year, right, man? The stock market's up four times as much.
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