Berkshire Hathaway tops $1 Trillion Dollar market cap as Warren Buffet sells almost $1 Billion worth of Bank of America shares. He’s refusing to speak on it at this time…Does he know something we don’t? 🤔

TRANSCRIPT:

00:00
Hi everyone, thank you for being here. Concerning news this week regarding big banks and the stock market: in case you missed it, Warren Buffett, CEO and chairman of Berkshire Hathaway, sold almost a billion dollars’ worth of Bank of America shares, reaping $982 million. Now, is this an alarm bell for what’s to come? Is Bank of America in trouble? Is this indicative of something moving in the stock market? I don’t know, but there are a lot of clues we can look at, especially when we consider Warren Buffett’s history with Bank of America.

00:33
His positions in banks historically and his recent moves come together to weave a story. Now, he himself has been quiet on the reasoning why, refusing to say, which I think says something in and of itself, especially given the fact that he has always been very vocal in his support of Bank of America. In fact, he is good friends with Bank of America’s CEO and has said that he would hate to ever have to sell his position. So, does he know something that we don’t? That’s the question on everyone’s minds, and we’re going to get into it.

01:07
What can we learn from this? Well, I found an article here that starts with when he first invested in Bank of America. It says the recent moves are notable because of Buffett’s long history with the bank. He injected $5 billion into Bank of America in 2011 as the lender struggled to overcome the wreckage of the subprime housing meltdown that caused the 2008 financial crisis. So, he has been involved with Bank of America for the last 14 years. But it’s interesting because he hasn’t always been so favorable about banks.

01:38
In fact, between 2018 and 2022, he exited giant stakes in JP Morgan, Wells Fargo, and Goldman Sachs, some just months before the banking system upheaval that began in mid-March 2023. By the banking system upheaval, this is of course referring to the fact that we had multiple bank failures last March. So, right before the bank failures happened, he moved his position out of the banking sector, which again raises the question: coincidence, or did he see the writing on the wall? Did he know something? I don’t know.

02:15
Now, this move to offload Bank of America shares is not the first time he’s done this. In fact, he has been continuing to offload these shares. And it’s not just Bank of America, either; it’s also Apple. In July, he sold almost 400 million shares of Apple. I’ll be the first to say it: Apple, after he sold those shares, hasn’t crashed. Apple has actually rebounded, right? Tech is doing just fine, for now. The interesting thing is that Warren Buffett historically hasn’t always gotten out of something right before it crashed. Sometimes, there was some runway in between.

02:44
In fact, the last time he had as much cash as he does now, which is a couple hundred billion dollars’ worth of cash, was in the two years leading up to the great financial crisis. Interesting coincidence, or did he see the writing on the wall and knew to get out beforehand? He said he’s never been afraid of leaving some money on the table if it means that you get out before everything goes south. In fact, I actually think a lot of his philosophy aligns really well with something that we talk about here at ITM Trading.

03:13
Obviously, I focus a lot when I talk to you about wealth protection—preserving your wealth, right? Making sure that you are protected from the incoming crash and reset, what’s coming next, so that when you get on the other side, you can maintain your standard of living. But it’s not just about maintaining; there’s so much more to it, right? What Warren Buffett has done here, what he did before 2008, was to make sure that he was in a position where he had wealth so that when asset prices dropped, he was able to come in and accumulate more wealth.

03:43
And that’s something that we work with people on too—opportunity positioning. If you make it through the reset with your wealth intact, protected, safe, and secure, you’re not only maintaining your standard of living, but you are also creating opportunities for your future self. A lot of people we worked with in 2008 did the exact same thing. Housing prices dropped—what did they do? They were able to swoop up real estate at low cost. They were able to actually increase their wealth on the other side of the great financial crisis.

04:11
And that’s what we want for people with the coming reset as well: to do the exact same thing. It’s interesting because I have a feeling here—you don’t just acquire a couple of hundred billion dollars in liquid capital for no reason. I found a quote that I thought was interesting too from him: “Be fearful when others are greedy and greedy when others are fearful.” So, he’s obviously not being greedy right now, so you know he’s being fearful because others are being greedy.

04:39
Which is interesting, especially again bringing it back to this Bank of America. The reason it caught my interest too is that Bank of America was making headlines just earlier this year for all of their massive unrealized losses from their held-to-maturity bonds. Again, these bonds that they could not sell, and if they did, they would have to sell them at a loss, effectively tying up all of their liquidity and putting them in this Catch-22 position. It’s not unique to Bank of America; of course, most banks across the country are struggling with these unrealized losses in the form of their held-to-maturities.

05:07
We’re talking about the treasury bonds here or commercial real estate loans that we know are bad investments that if they were to actually sell, they would lose money on. Or if the defaults that should have been happening on those happened, they would lose money. But of course, they’re just extending and pretending for as long as they can kick the can down the road. But that’s why Silicon Valley Bank failed—because of their unrealized losses. At the end of the day, if they needed liquidity, if they needed to have access to that, they had to sell at a loss. And then it became clear just how little these banks actually have.

05:33
So, is Bank of America next? I don’t know. Is it happening tomorrow, next month, or next year? I don’t know. But all I do know is that this man has a proven track record, and I just think it’s interesting that someone who has been so vocal and such a supporter for so long is suddenly selling a ton of his position in this bank and in tech in general. I think we all can feel that things are happening faster. Time is moving quicker. I’ve said it before, but a crash, a crisis, a reset—it’s not always an event; it’s a process.

06:00
And it’s a process that we all know we’re in. So, as time continues to move more quickly, I just urge you, I hope that everyone has a strategy in place, that you are protected outside of the system. Because when all of this comes crashing down, I would hate for you to wish that you had done something sooner. So, if you are concerned about any of this, if you are nervous that the strategy you have in place isn’t right, or you want a second opinion, talk to one of our expert analysts.

06:28
That’s what they’re here for—that’s what they do. They help people protect themselves with physical gold and silver outside of the system, and it’s completely dependent on you, your goals, your concerns, because everyone is different. Yes, they are experts in all of this—in resets, in financial landscapes, in the twists and turns—but depending on what your goals are and what your specific concerns are, they will work with you to make sure that you are set up, that you are prepared for what’s coming next.

06:57
And in the meantime, we’ll see what comes next. Keep your eyes on Bank of America, on Warren Buffett—we’ll see what happens with the stock market. I am sure there’s going to be a lot more to talk about in the coming days. But as always, in the meantime, I appreciate you being here with me. I’m Taylor Kenny with ITM Trading, your trusted source for all things gold, silver, and lifelong wealth protection. Until next time.

SOURCES:

https://www.bloomberg.com/news/articles/2024-08-28/warren-buffett-sells-more-bofa-shares-reaping-982-million

https://finance.yahoo.com/news/berkshire-hathaway-tops-1-trillion-market-cap-for-first-time-as-buffett-accelerates-bofa-stock-sales-145441665.html

https://www.nytimes.com/2024/08/03/business/berkshire-hathaway-buffett-earnings.html

https://www.barrons.com/articles/bank-of-america-stock-bond-losses-97bf300e

https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/us-banks-unrealized-bond-losses-climb-in-q1-2024-82075274

https://www.businessinsider.com/63-problem-banks-517-billion-unrealized-losses-fdic-interest-rates-2024-6

https://www.nytimes.com/2024/06/24/business/commercial-real-estate-loans.html