At the market bottoms in the first half of 2020, Warren Buffett came under criticism for not investing in a major purchase of his beloved elephant gun. You will hear it from him at the annual Berkshire meeting.
Management Of Risk
He holds the risk level for Berkshire with buy-and-and-and-hold investing. He noted that the pandemic response was well handled in the United States. However, it was of critical importance that it was not be necessary. By intervening on March 23rd of 2020, he saw a crossroads. Before that, the phone was being picked up, support was not needed. The government’s response to the CARES Act was very helpful, too.
In Buffett’s opinion, things could have turned out even worse for investors. Early in his career, he was more focused on preserving his net worth and avoiding losses than increasing his profit potential.
In addition to looking after those finances, Buffett was particularly worried about airlines. The most significant business action undertaken by Berkshire in 2020 was the sale of its airline stakes. So Berkshire speculated that the government would have been less likely to fund the airlines had it remained a major investor.
Berkshire remarked that there has been an increase in SPAC crime, making it more difficult to find offers to begin with. Buffett is seeing this in the present, when more SPACs (short for special purpose acquisition deals) are on the market because of the economic downturn. This theory is referred to as “fee-based” money because the deals are done for commissions, not for the deals’ He said that he still has tens of billions of dollars of money he’s interested in investing.
there can be no doubt that Berkshire’s finest hour came as the COVID-19 pandemic swept through the globe It is emphasized that Berkshire returned large amounts of capital by the year 2020. It also appears that massive monetary policy intervention by the Fed and the increase in SPACs have contributed to recent disintermediation in Berkshire’s value.
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