Warren Buffett reveals why he hasn’t made any big investment despite sitting on $137 billion cash pile

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May 3, 2020 10:03 AM

Warren Buffett's Berkshire Hathaway hasn’t made any big purchase since 2016 when it acquired the industrial goods and metal fabrication company Precision Castparts for $37 billion.

Warren BuffettWarren Buffett suggested that the best way for investors to invest in a growing stock market over a period of time is to put money in the S&P 500 index fund.

Famed investor Warren Buffett is yet to come across an “attractive” company that could potentially be an acquisition target for his Omaha-headquartered Berkshire Hathaway that had $137 billion in cash reserve by the end of March quarter. “We have not done anything, because we don’t see anything that attractive to do,” The company hasn’t made any big purchase since 2016 when it acquired the industrial goods and metal fabrication company Precision Castparts for $37 billion. However, the company is “willing to do something very big,” said Buffet. “I mean you could come to me on Monday morning with something that involved $30, or $40 billion or $50 billion. And if we really like what we are seeing, we would do it,” he added.

The 89-year-old Oracle of Omaha began the 2020 shareholder’s meeting with remarks to calm down anxious investors and asked them to remain committed in stocks this year as market globally reel under the Coronavirus pandemic. Calling the Covid-19 situation “quite and experiment” for investors, Buffet said that the US prospered through such crises including the Great Depression, the Civil War etc. as the American “magic” he said would prevailed before and would do again. “I will bet on America the rest of my life.”

Also read: Warren Buffett recites history to prove ‘nothing can stop America’: Coronavirus can’t kill economy

Warren Buffett suggested that the best way for investors to invest in a growing stock market over a period of time is to put money in the S&P 500 index fund. “In my view, for most people, the best thing is to do is owning the S&P 500 index fund,” said. “If you owned the businesses that you liked prior to the virus arriving… nobody’s forcing you to sell,”’ Buffet said. Berkshire Hathaway reported a net loss of $49.7 billion for March quarter of 2020 vis-à-vis $21.66 in net profit for the year-ago period. However, the company’s operating profit grew from $5.5 billion in March quarter to $5.8 billion for this year’s period ending March.

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