Buffett Says Berkshire sitting on $335 billion in cash, waiting for ‘fat pitches’

Warren Buffett (File)

Warren Buffett defended Berkshire Hathaway Inc.’s historically high cash pile, saying the firm is staying “very, very, very opportunistic” and won’t force capital deployment just to appear fully invested.

The company now holds more than $300 billion in cash and short-term investments—about 27% of total assets—compared to a 25-year average of 13%, a shareholder noted in a question posed by CNBC’s Becky Quick. Buffett said the reserve was not part of any noble plan to ease the eventual transition to Greg Abel.

“I wouldn’t do anything nearly so noble as to withhold investing myself just so that Greg couldn’t look good later on,” Buffett said. “Now, if he gets any edge when I leave, I’ll resent it.”

Buffett said Berkshire came close to deploying $10 billion recently, and wouldn't hesitate to spend “$100 billion” when the right opportunity came along. “Those decisions are not tough to make. When something is offered that makes sense to us and that we understand, and offers good value and where we don’t worry about losing,” he said.

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“But the one problem with the investment business is that things don’t come along in an orderly fashion, and they never will,” Buffett added. “It would be nice if every day you got four opportunities or something like that… but we’re not running that kind of a business.”

He said Berkshire generates roughly $40 billion a year in cash and currently sits on $335 billion. “If you told me I had to invest $50 billion every year until we got down to $50 billion, that would be the dumbest thing in the world,” he said. “Things get extraordinarily attractive very occasionally.”

Buffett emphasized that no one, including Abel or Vice Chair Ajit Jain, can predict when such opportunities will arise. “Nobody knows what the market is going to do tomorrow, next week, next month. Nobody knows what business is going to do tomorrow, next week, or next month,” he said. “But they spend all their time talking about it because it’s easy to talk about. But it has no value. I’ve never found anybody I wanted to listen to on the subject.”

Instead, he pointed to the long and patient search for ideas. “Leafing through things like that big Japanese book that I can’t read anymore, that’s a turnaround. And every now and then you find something,” he said.

Buffett did assure shareholders that such moments will return. “Occasionally, very occasionally, but it will happen again,” he said. “It’s very unlikely to happen tomorrow… but it’s not unlikely to happen in five years. And then the probabilities get higher as you go along.”

“It’s kind of like death,” he said. “If you’re 10 years old, the chances that you’re going to die the next day are low. You get to be 115 or something like that, it’s almost a cinch. Particularly if you’re a male. I mean, all the records are held by females in terms of age.”

He ended with a nod to Charlie Munger’s longevity. “I tried to get Charlie to have a sex change so he could touch top,” Buffett joked. “And he did pretty well for being a male, I’ll put it that way.”

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