"Warren Buffett's 11-Quarter Selling Streak: What Insights Does the ‘Oracle of Omaha’ Have?"

20/08/2025

Newsroom

Warren Buffett may be selling stocks because he anticipates potential market turbulence, according to a well-known strategic analyst. This would not be the first time; the so-called "Oracle of Omaha" sold stocks before both the 2008 global financial crisis and the dot-com bubble burst.

Paul Dietrich of Wedbush noted that Buffett's company, Berkshire Hathaway, has been on a selling spree for 11 consecutive quarters, despite the markets reaching new highs during this period.

Specifically, Berkshire sold $212 billion worth of stocks while purchasing only $34.5 billion, resulting in net sales that exceeded $177 billion. As reported by Business Insider, this figure is larger than the market capitalization of BlackRock or Boeing.

Moreover, Buffett has also paused share buybacks for the past four quarters, indicating that he no longer views Berkshire's shares as cheap. This change is significant, as Berkshire's share buybacks had surpassed $20 billion in both 2020 and 2021.

As a result of the stock sales and the halt in repurchasing shares, Berkshire's available cash has more than tripled, reaching a record $344 billion.

The company has similarly increased its liquidity before major crises in the past, allowing it to make aggressive stock purchases when prices fell. For instance, liquidity rose from approximately $11 billion in 1997 to $35 billion in 1998, and net stock sales increased from $700 million in 1999 to $2.7 billion in 2000 before the collapse of dot-com companies.

Similarly, during the 2008 global financial crisis, Berkshire ramped up its liquidity to over $70 billion. This amount decreased to around $52 billion by the end of 2008, as Buffett executed a series of profitable deals during the crisis. Berkshire increased its net stock purchases from approximately $5 billion in 2006 to $11 billion in 2007, taking advantage of falling prices.

Dietrich observed that Buffett seemed cautious about the markets during Berkshire's annual general meeting in May. Before announcing his intention to step down as CEO at the end of the year, he expressed concerns about the lack of investment opportunities as asset valuations rise.

Indeed, Dietrich estimated that the "Buffett Indicator" may be signaling troubling trends, as the index comparing the value of the U.S. stock market to the size of the U.S. economy has soared to a historical high above 210%. Buffett has previously stated that anyone buying when this indicator approaches 200% is playing with fire.

The strategic analyst recalled Buffett's famous advice to "be fearful when others are greedy and greedy when others are fearful," suggesting that Buffett is preparing to make purchases once valuations decline to more attractive levels.

In this context, Dietrich estimates that Buffett will utilize Berkshire's liquidity to repurchase shares of Apple and other companies he sold at much lower prices when valuations settle to more reasonable levels.