Berkshire Hathaway has more cash on hand than ever before, but nowhere to spend it.
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Despite holding so much cash — "far beyond" the level that Buffett and Vice Chairman Charlie Munger prefer — the company has struggled to make any major acquisitions since 2016, citing asking prices that are too high.
In May, Buffett, known as the “Oracle of Omaha,” told FOX Business’ Liz Claman that the cash pile expands by about $100 million per business day. At the time, he said he was scouring the world for different investment opportunities.
“In terms of size, there are probably a dozen countries in the world that should have some companies that we would be interested in,” he said.
Last year, Buffett, in his annual letter to shareholders, blamed the hefty prices on subordinates who want enlarged domains and increased compensation levels cheering on the CEOs. And once a CEO has a deal and asking price in sight, it’s difficult to sway their opinion, he said, comparing them to oversexed teens.
“Why the purchasing frenzy?” Buffett, 88, wrote in 2018. “In part, it’s because the CEO job self-selects for 'can-do' types. If Wall Street analysts or board members urge that brand of CEO to consider possible acquisitions, it’s a bit like telling your ripening teenager to be sure to have a normal sex life.”
Berkshire’s financial reach extends to almost every corner of the economy, and it owns a number of marketable blue chip stocks that are valued at $170 billion (excluding the company’s shares of Kraft Heinz). Notable stocks include Apple, the Coca-Cola Company, Goldman Sachs, Southwest Airline and the General Motors Company.