Warren Buffett has made another major investment shift, one that reduces Berkshire Hathaway’s dependence on the U.S. economy. This news followed the Federal Reserve’s policy announcement to “push up inflation,” which is seen as bullish for bitcoin, with some predicting that the price of the cryptocurrency will soon reach an all-time high.
Buffett Reducing US Dependence
Warren Buffett’s Berkshire Hathaway has invested over $6 billion in Japan’s five biggest trading houses. 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 described:
The investment will help reduce Berkshire’s dependence on the U.S. economy, which in the last quarter contracted the most in at least 73 years as the Covid-19 pandemic took hold.
“Buffett’s choice in Japan, however, surprised market players as trading houses have long been far from investor favorites,” the publication added. Tokyo-based Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities, pointed out that “it is un-Buffett-like to buy into all five companies rather than selecting a few.”
Most of Berkshire’s operating businesses are American. The company owns more than 90 businesses outright and invests in dozens of companies, such as American Express Co., Bank of America Corp., and Coca-Cola Co. Moreover, Berkshire has a roughly $125 billion stake in Apple Inc. (APPL), accounting for about 43% of its total portfolio.
Berkshire already made a surprise investment move about two weeks ago when it invested in Barrick Gold. Crypto exchange Gemini founder Cameron Winklevoss tweeted on Sunday:
When Buffett buys stake in gold mining company you know he knows something’s up
