INSUBCONTINENT EXCLUSIVE:
Authors: JordanLegendary investors Warren Buffett and Charlie Munger will begin their address to Berkshire Hathaway shareholders at 7.30 pm
Indian Standard time on Saturday.
Buffett always has a quote to address every dilemma in financial markets, and his followers swear by them
Investors the world over will watch the event closely, as Buffett and Munger have traditionally used the occasion to give their views on
global economic trends, besides sharing their years-long wisdom from the world of investing
Here are five things investors around the world would keenly look forward to:
Big cash pileAt last count, Buffett firm’s cash pile
amounted to a whopping $116 billion
In February, Buffett noted that Berkshire’s goal is to substantially increase earnings of its non-insurance group
For that to happen, he said, Berkshire needs to make one or more huge acquisitions
"We certainly have the resources to do so
This extraordinary liquidity earns only a pittance and is far beyond the level Charlie and I wish Berkshire to have
Our smiles will broaden when we have redeployed Berkshire’s excess funds into more productive assets," Buffett had said in February.
Will
he drop any hint on potential acquisition targets or timelines
Portfolio reshuffleShares of US-listed Apple hit an all-time high in
overnight trade Friday after reports that Buffett-led Berkshire Hathaway bought 75 million shares of the mobile giant in March quarter
Recently, Berkshire sold out its entire investment in IBM Corp
There are concerns over Berkshire's big holding in Wells Fargo, which is all but in negative news
The company on Friday said it would pay $480 million to resolve a securities fraud lawsuit related to a sales scandal that surfaced in 2016,
Berkshire's top five stock investments were valued at $111 billion in February
It’s total stock holdings exceed $170 billion in value
Buffett believes in 'buy and hold' but not 'buy and hold forever', Raamdeo Agrawal of Motilal Oswal told Tanvir Gill of ETNow in an
Is a portfolio reshuffle on the cards is a billion-dollar question!
Views on US economyDuring Berkshire's 2017 annual results, Buffett had
said equity investors in America have the wind at their back
In its 2017 annual results note, Buffett, who has 90 per cent of his company's investments in the United States, said America’s economic
In an interview to CNBC on Thursday, the billionaire investor said the US economy was growing faster than 2 per cent
"The last seven or eight years have averaged 2 per cent roughly," he told CNBC
"It's stronger than that right now," he said.
Correction in stocks!In February, Buffett said ample availability of extraordinarily cheap
debt fuelled purchase activity in 2017
A high-priced deal will usually boost per-share earnings if it is debt-financed, he argued
“At Berkshire, in contrast, we evaluate acquisitions on an all-equity basis, knowing that our taste for overall debt is very low," Buffett
said.
Buffett has spoken about the fact that markets are probably in that part of the cycle where there has been a spree of cheap
debt-filled acquisitions and he does not want to participate in that,” said Gautam Sinha Roy, Fund Manager at Motilal Oswal AMC
“If you read between the lines, he is waiting for a correction in the market and spiking yields will give him that opportunity to deploy
the huge money that he is sitting on," Sinha said.
Bond yieldsInvestors are looking forward to hear what Buffett has to say about rising US
bond yields and its impact on equities globally
US bond yields recently hit the 3 per cent mark
Can the yield rise to 4-5 per cent levels and derail the equity boom That will become a large discussion, says Raamdeo Agrawal.
"You cannot
look back and say 3 per cent yield has happened in the past and this phase will be temporary
Somewhere oil is playing that nasty role
It has moved up very quickly from $60 to $75 a barrel
That is feeding all the commodities and is clearly pushing the inflationary expectation
I do not know whether inflation has gone up or not, but inflationary expectation is going up," Agrawal said.
