What Warren Buffet Need To Know About Cash Weight.

First, Buffett does not make short-term market forecasts.

He has said that he does not make short-term forecasts at every shareholders’ meeting. Buffett does not use market timing strategies.

Second, there are no stocks to buy or the stock market is overvalued.

Berkshire’s share buyback volume has also decreased, which certainly means it’s not an attractive segment

Third, what’s important to Buffett is long-term expected returns

Even if the stock price is high right now. If it is a company that can earn high compound interest rate in the long term, it can be a proof that there is no such company.

Fourth, getting ready to buy new stocks.

Because when it’s the size of Berkshire, there’s a lot of sleep. Piling up cash in advance, setting the stage for acquiring stocks or companies at no significant cost.

Fifth, the US short-term bond yield is 5%.

It’s better than holding a small amount of stocks. A section with high government bond yields. Treasury bond rates are expected to decrease in the future

Sixth, the cash earned by Berkshire itself.

In addition to investing in stocks, it could be cashflow from Berkshire’s diversified business.

We don’t know if Buffett actually thinks the market poorly. Because Buffett did that, it could be a wrong choice to sell everything.