Kirk's Market Thoughts Message Board

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Non-Tech : Kirk's Market Thoughts

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1:14 PM EST

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To: Kirk © who wrote (9652)	5/4/2020 1:58:13 PM
From: Sun Tzu	Read Replies (2) of 26478

From what I remember from the meeting, Buffett is keeping cash for 3 reasons: (1) As a safety cushion so that he doesn't have to rely on anyone for funding. (2) As a reserve for his insurance business. (3) So that he can enter big deals (primarily in insurance). Absent from that was that he is going to go on a shopping spree. Of course, he would not tip his hand as to what he thinks of the markets or where he thinks value resides. He wants it there for himself. But I came out with a distinct impression that he thinks that the market is neither grossly overvalued nor grossly undervalued. What he does think is that there are a lot of risks out there that he has not figured out yet. One interesting comment was re the mega tech corps like Apple. He didn't think that they were overvalued as they ran up. He said that when you look at them in terms of return on capital and growth rate, they were good companies that were worth the money. He said that it is not impossible for him to invest in Amazon or Google, but he refused to say if/when he will. I got the impression that they are not trading at a deep enough discount for him to invest in them. Though he clearly ponders about where that value is.

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