Amid Inflation Fears, Warren Buffett Shifts Funds From US And Here Is Bitcoin's New All-Time High Expected

Warren Buffet And Berkshire Hathaway

Reducing Berkshire Hathaway’s dependence on the US economy, Warren Buffet has made another major investment shift. With some predicting that the price of the cryptocurrency will soon reach an all-time high, this news followed the Federal Reserve’s policy announcement to push up inflation seen as bullish for bitcoin.  

How Is Buffett Reducing US Dependence?

Having invested over $6 billion in Japan’s five biggest trading houses is Warren Buffet’s, Berkshire Hathaway. In the following companies, they have a 5% stake: in Itochu Corp., Marubeni Corp., Mitsubishi Corp., Mitsui & Co. Ltd., and Sumitomo Corp. The company said on Sunday, Buffet’s 90th birthday that the stakes could rise to 9.9%. 

Further described by Reuters is in the last quarter it contracted the most in at least 73 years as the Covid-19 pandemic took hold as the investment will help reduce Berkshire’s dependence on the US economy. 

The publication explains to surprising market players as trading houses have long been far from investor favourites as Buffet’s choice in Japan. 

Pointing out that it is un-Buffet-like to buy into all five companies rather than selecting a few according to Tokyo-based NorihiroFujito, the chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities. 

The operating businesses in most of Berkshire are American. Investing in dozens of companies, like the American Express Co., Bank of America Corp., and Coca-Cola Co, the company owns more than 90 businesses outright. Accounting for about 43% of its total portfolio, Berkshire has a roughly $125 billion stake in Apple Inc. 

Why Are Investors Keen On Bitcoin?

About two weeks ago when it invested in Barrick Gold, Berkshire already made a surprise investment move. It was observed that crypto exchange Gemini founder Cameron Winklevoss was tweeting on Sunday saying, 

You know he knows something‘s up that is inflation is coming when Buffet buys a stake in the gold mining company. In a decade he will find Bitcoin. To find APPL it took him until 2016, whereas now it is the biggest investment ever. 

Pointing out that Buffet is already 90 so it will be difficult for him to find Bitcoin during this lifetime, many people joined into the discussion. With some believing that the Berkshire CEO will eventually buy bitcoin while others say he will never do so in his lifetime, the overall opinions are split. 

Global macro investor and Gold Bullion International co-founder Dan Tapiero was seen to be tweeting, that he wasn’t sure if Buffet was ready to wade into Bitcoin just yet. It may be so for his younger deputies, whereas BRK as a public company comes to be difficult for them to take too many non-equity outlier positions. It’s possible they could allocate in 2-3 years. 

Repeatedly saying that he will never own bitcoin calling the cryptocurrency rat poisoned squared as he doesn’t see any value in it, is the Oracle of Omaha. Tron founder Justin Sun gifted him a bitcoin in February during a dinner that Sun won for $4.57 million at a charity auction. Immediately regifted to his charity was all the cryptocurrencies gifted to him as Buffet said later. 

About the prospect of Buffet investing in Bitcoin, some people are more optimistic. For example, believing that Buffet will panic-buy bitcoin at $50k just like gold bug Peter Schiff as well as veteran investor Jim Rogers will do is the popular television personality and bitcoin proponent Max Keiser. He tweeted on Monday, commenting on Buffet’s new investments in non-US companies as,
Confirming he’s getting out of USD bigly, with bitcoin-gold-silver making a new ATH in the near term as Buffet moves into Japan along with his gold investment. 

Buffet anticipated that inflation was coming to make the investment decisions he did, as many people on social media believe. Thereby announcing a major policy change last week to push up inflation was the Feds. Expecting bitcoin to benefit from this policy shift as well as from the weakness of the US dollar and the political uncertainty surrounding the US presidential election were several experts. 

Finally Concluding The Discussion 

Believing that bitcoin will break out this year, as reported, was Devere Group CEO Nigel Green. The founders of the Gemini Exchange explained how bitcoin will ultimately be the only long term protection against inflation responding to the Fed’s inflation policy shift potentially driving the price of the cryptocurrency above $500K. 

Several companies have already begun reducing their cash holdings and moving their reserves into bitcoin to hedge against inflation. Here we find the Nasdaq listed MicroStrategy that is recently moving $250 million into Bitcoin, as well as the Canadian restaurant chain Tahini’s that is moving all of the cash reserves into the cryptocurrency thereby.