Warren Buffett is (Very) Bullish On United States Equities
I've come to expect a few things from Warren Buffett. Fantastic annual Berkshire Hathaway shareholder letters. Incredibly consistent returns. Cautiousness when it comes to investing in equities. Even more cautiousness when it comes to telling others what they should be investing their money in.
That's why I was more than a little surprised when Buffett published an op-ed piece in the New York Times titled "Buy American. I Am." In the letter, Buffett proclaimed that he had been buying American stocks for his own personal account. He said that his personal, non-Berkshire Hathaway net worth was originally nothing but United States government bonds, but that if "prices keep looking attractive", it will be 100% United States equities.
He made a few points in the letter, including:
-the best time to buy equities is when people are fearful, and people are certainly fearful right now
-most major companies will be setting new profit records in 5-20 years
-the US stock market has suffered through many different ailments and has always come back
-the stock market will turn higher before sentiment or the economy does. If you wait for the economy to improve before jumping back into the market, you will be too late
-stock market news over the long-term will be good
-cash is a terrible long-term asset
-equities will "almost certainly" outperform cash over the next decade
I agree with everything that he says. It's hard for Warren Buffett not to make a persuasive argument - I mean, he IS the greatest investor that has ever lived.
I still find the article a bit strange. It's one thing for Warren Buffett to mention in his annual letter to Berkshire Hathaway shareholders that he feels that US equities are a great investment. But to write an op-ed piece for the New York Times? I get the feeling that someone has asked Buffett to speak out on the future of US equities in order to (hopefully) move some people from cash and back into the stock market. What do you think? The link to the op-ed piece is below:
Source: NYT - Buy American. I Am.
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