Warren Buffett has created another major investment shift, one that reduces Berkshire Hathaway’s dependence on the US economy. The news followed the announcement of the Federal Reserve’s “raising inflation” policy, which is seen as a booming for bitcoin, with some predicting that the price of cryptocurrency will soon reach an all-time high.
Buffett reducing US dependence
Warren Buffett’s Berkshire Hathaway has invested more than $ 6 billion in the five largest trading houses in Japan. The company has taken a 5% stake in Itochu Corp, Marubeni Corp, Mitsubishi Corp, Mitsui & Co Ltd, and Sumitomo Corp. The stakes could rise to 9.9%, the company said on Sunday, Buffett’s 90th birthday. Reuters description:
The investment would help reduce Berkshire’s dependence on the US economy, which had contracted the most in at least 73 years in the previous quarter as the Kovid-19 epidemic gained momentum.
According to the publication, “Buffett’s choice in Japan surprised market players as the trading houses had long been investors’ favorites.” Mitsubishi UFJ Morgan Stanley Securities chief investment strategist, Tokyo-based Norihiro Fujito, reported that “it’s more like buying at all five companies rather than selecting a few.”
Most of Berkshire’s operating businesses are American. The company owns more than 90 businesses and invests in dozens of companies, such as American Express Company, Bank of America Corp and Coca-Cola Company. In addition, Apple Inc. near Berkshire. (APPL) holds approximately $ 125 billion. It has about 43% of its total portfolio.
Berkshire had already made a surprise investment move two weeks ago when it invested in Barrick Gold. Cameron Winklevos, founder of crypto exchange Gemini, tweeted on Sunday:
When Buffett buys a stake in a gold mining company, you know he knows something … inflation is coming. He will discover bitcoin in a decade. It took him until 2016 to find APPL, but it is now his biggest investment.
Many people joined the discussion, pointing out that Buffett is already 90 years old, so it would be difficult for him to find bitcoin during his lifetime. Overall, opinions are divided, with some believing that the Berkshire CEO will eventually buy bitcoin, while others say he will never do so in his lifetime.
Last week, Global Macro Investor and Gold Bullion International co-founder Dan Tapiero tweeted, “Surely Buffett is not yet ready to break into bitcoin.” “Maybe he has a younger sister.” Free [Berkshire Hathaway] A public company is so difficult that it is difficult for them to take too many non-equity outlier positions. In 2-3 years, I think it is possible that they can allocate. ”
The Oracle of Omaha has repeatedly stated that it will never own bitcoin, calling the cryptocurrency a “rat poison”, as it sees no value in it. He was gifted a bitcoin during a dinner by Tron founder Justin Sun in February, which Sun won for $ 4.57 million at a charity auction. However, Buffett later stated that all the cryptocurrencies gifted to him were immediately returned to his charity.
Some people are more optimistic about the possibility of Buffett investing in bitcoin. For example, popular television personality and bitcoin proponent Max Keizer believes the Buffet gold bug will scare Bitcoin at $ 50K like Peter Schiff and veteran investor Jim Rogers. Commenting on Buffett’s new investment in non-US companies, he Tweeted Monday:
Buffett’s move to Japan, with his gold investment, confirms that he is running out of massive USD … bitcoin – gold – silver will create all-new ATH [all-time high] In the near future.
Many on social media believe that Buffett speculated that inflation was coming to make the move that reduces his company’s dependence on the American economy. The Federal Reserve last week announced a major policy change to “increase inflation”. Many experts hope that bitcoin will benefit from this policy change as well as the weakness of the US dollar and political uncertainty about the US presidential election.
Nigel Green, CEO of Devere Group believes that bitcoin will break this year, according to the news. Bitcoin.com reported. In response to the Fed’s policy of inflationary policy, the founders of Gemini Exchange explained how bitcoin would ultimately [become] The only long-term protection against inflation, ”possibly driving the price of cryptocurrency above $ 500K.
Meanwhile, to hedge against inflation, many companies have already started reducing their cash holdings and transferring their reserves to bitcoins. Among them is Nasdaq-listed MicroStrategy, which recently raised $ 250 million in bitcoin, and Canadian restaurant chain Tahini, which transferred all of its cash reserves to cryptocurrency.
Do you think Buffett will ever buy bitcoin? Let us know in the comments section below.
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