Tools for Technical Analysis
Warren Buffett now owns more T-bills than the Federal Reserve.
It’s true: Buffett’s investment firm, Berkshire Hathaway, owns $235 billion worth of T-bills; the Fed owns $195 billion worth. Of course, most of the Fed’s money is in other government-guaranteed debt. Buffett’s is mostly in stocks. Still, his current cash holdings are about twice the average for the previous five years. How did he accumulate so much cash? By selling stocks in this heady environment.
Most stock market investors get fooled at major price turns. Why? Because a bottom never feels like a bottom and a top never feels like a top – how many bears could you count in 2007, right before stocks tanked and the Great Recession followed? This idea was embodied by the quote attributed to Barron Rothschild, an 18th-century member of the Rothschild banking family. He said that “the time to buy is when there’s blood running in the streets.”
