Buffett's Berkshire Cash Pile Hits Record $382 Billion

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00:00Berkshire Hathaway's cash hit a record $381.7 billion last quarter as Warren Buffett stayed

00:09on the sidelines in terms of M&A. Operating profit jumped 34%, led by booming insurance

00:14results and unusually low disaster activity. Investors are paying closer attention as the

00:20company nears a new era, with Buffett handing off the role of CEO to Greg Abel at year end.

00:27Danny? Let's discuss those results further. Joining us now is Alex Rajmandari. He covers

00:32Buffett and Berkshire for Bloomberg News. Alex, it's the size of a cash pile equivalent to P&G,

00:38equivalent to Home Depot. Today underscores that deals are happening. There clearly is stuff out

00:42there to buy. Why is Berkshire Hathaway still on the sidelines? That's the big mystery. There's

00:47nothing in Buffett's eyes, it seems. He hasn't been buying any equities on the market. I mean,

00:52he has, but he's a net seller of equities of $6 billion. There's been a string of quarters

00:57like that. And he hasn't been buying by his own shares, even if, you know, the shares

01:01have been down 12% since he announced his retirement at the end of the year. I mean,

01:06he's stepping down as CEO. He will still be chairman. So that raises the question, like,

01:11is that a good thing? Really, the net investment income of the company has decreased quarter

01:16over quarter because of short-term interest rates falling over the period. So it's not really

01:20yielding more money for the company in terms of investment income. And it can raise the question

01:27I was talking to an analyst yesterday. She was saying, look, if they have so much money

01:31that's yielding less and they don't buy their own shares, why should you? Yeah, it seems to

01:36make the case quite well that their shares aren't at all undervalued, right? Otherwise,

01:41they would be buying them back themselves. And that the rest of the market is pretty fairly or even

01:48highly valued because otherwise they'd be playing in this M&A extravaganza that we're seeing.

01:53What is it? $4 trillion? Yeah, 3.8 at the moment this year. In yields this year. Yeah. So to be

01:59sure, Buffett has not done nothing in the past quarters. He's done, you know, he bought this stake

02:03in UnitedHealth for $1.6 billion. He's buying OxyChem for $9.7 billion. That's in the fourth

02:08quarter, though. So we need to see, like, in a few weeks, we're going to know exactly what happened

02:13on his investment in equities. But it's true that when he doesn't buy shares, it means that he thinks

02:18that the interesting value of the company is below what it's trading at. And he's been saying

02:23that he doesn't see a lot of opportunities on the market. And the markets have been growing

02:26even more since he made that comment.