Berkshire Trims Holdings - So Did the Politicians

Warren Buffet’s Berkshire Hathaway (BRK-B:US) just disclosed its quarterly position and its cash pile is now even bigger than before after it trimmed down its positions in multiple blue chip stocks. It now boasts $157.2 billion in cash.

It sold off its entire position in General Motors (GM:US) worth around $850 million at the end of June this year. It did the same for its investment in Activision Blizzard (ATVI:US), which was delisted in October after Microsoft completed the acquisition. 

Politicians in the recent past have also been selling General Motors. Daniel Goldman liquidated his position in GM this year in April after buying earlier in the year. Ro Khanna was also a net seller, with some of his sales coming near the 52-week highs. General Motors was in the limelight recently due to the UAW strikes, which have been given a political color by some with many jobs at stake. Clearly, investors want none of that, including politicians.

Buffet also trimmed down its position in Chevron Corp (CVX:US) by -10.45%. Chevron is another stock that has been struggling lately, down nearly 20% YTD. We already covered how Michael McCaul strategically shifted his position from Chevron to Shell (SHEL:US) and ConocoPhillips (COP:US). Buffet’s sale is just a stamp of approval for the strategic shift that has already brought McCaul a lot of profit.

Pete Ricketts, the Republican Senator from Nebraska, sold $100,000 to $250,000 worth each of Procter & Gamble (PG:US) and Johnson & Johnson (JNJ:US) in late September. Interestingly, Buffett completely sold off his position in these two stocks as well.

With high-interest rates and investors preferring to take advantage of returns on cash, it seems both Berkshire Hathaway and the US politicians agree that this is a good time to trim holdings. 

Market participants are already painting a doomsday scenario with Buffet’s record cash pile, but it is not the first time such events have been predicted. It remains to be seen whether the U.S. market will sustain its high valuations and prove everyone wrong, just like it has been doing for the past decade!