Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
Gold Price Trend Validation - 22nd Aug 19
Economist Lays Out the Next Step to Wonderland for the Fed - 22nd Aug 19
GCSE Exam Results Day Shock! How to Get 9 A*'s Grade 9's in England and Maths - 22nd Aug 19
KEY WEEK FOR US MARKETS, GOLD, AND OIL - Audio Analysis - 22nd Aug 19
USD/JPY, USD/CHF, GBP/USD Currency Pairs to Watch Prior to FOMC Minutes and Jackson Hole - 22nd Aug 19
Fed Too Late To Prevent US Real Estate Market Crash? - 22nd Aug 19
Retail Sector Isn’t Dead. It’s Growing and Pays 6%+ Dividends - 22nd Aug 19
FREE Access EWI's Financial Market Forecasting Service - 22nd Aug 19
Benefits of Acrobits Softphone - 22nd Aug 19
How to Protect Your Site from Bots & Spam? - 21st Aug 19
Fed Too Late To Prevent A US Housing Market Crash? - 21st Aug 19
Gold and the Cracks in the U.S., Japan and Germany’s Economic Data - 21st Aug 19
The Gold Rush of 2019 - 21st Aug 19
How to Play Interest Rates in US Real Estate - 21st Aug 19
Stocks Likely to Breakout Instead of Gold - 21st Aug 19
Top 6 Tips to Attract Followers On SoundCloud - 21st Aug 19
WAYS TO SECURE YOUR FINANCIAL FUTURE - 21st Aug 19
Holiday Nightmares - Your Caravan is Missing! - 21st Aug 19
UK House Building and House Prices Trend Forecast - 20th Aug 19
The Next Stock Market Breakdown And The Setup - 20th Aug 19
5 Ways to Save by Using a Mortgage Broker - 20th Aug 19
Is This Time Different? Predictive Power of the Yield Curve and Gold - 19th Aug 19
New Dawn for the iGaming Industry in the United States - 19th Aug 19
Gold Set to Correct but Internals Remain Bullish - 19th Aug 19
Stock Market Correction Continues - 19th Aug 19
The Number One Gold Stock Of 2019 - 19th Aug 19
The State of the Financial Union - 18th Aug 19
The Nuts and Bolts: Yield Inversion Says Recession is Coming But it May take 24 months - 18th Aug 19
Markets August 19 Turn Date is Tomorrow – Are You Ready? - 18th Aug 19
JOHNSON AND JOHNSON - JNJ for Life Extension Pharma Stocks Investing - 17th Aug 19
Negative Bond Market Yields Tell A Story Of Shifting Economic Stock Market Leadership - 17th Aug 19
Is Stock Market About to Crash? Three Charts That Suggest It’s Possible - 17th Aug 19
It’s Time For Colombia To Dump The Peso - 17th Aug 19
Gold & Silver Stand Strong amid Stock Volatility & Falling Rates - 16th Aug 19
Gold Mining Stocks Q2’19 Fundamentals - 16th Aug 19
Silver, Transports, and Dow Jones Index At Targets – What Direct Next? - 16th Aug 19
When the US Bond Market Bubble Blows Up! - 16th Aug 19
Dark days are closing in on Apple - 16th Aug 19
Precious Metals Gone Wild! Reaching Initial Targets – Now What’s Next - 16th Aug 19
US Government Is Beholden To The Fed; And Vice-Versa - 15th Aug 19
GBP vs USD Forex Pair Swings Into Focus Amid Brexit Chaos - 15th Aug 19
US Negative Interest Rates Go Mainstream - With Some Glaring Omissions - 15th Aug 19
GOLD BULL RUN TREND ANALYSIS - 15th Aug 19
US Stock Market Could Fall 12% to 25% - 15th Aug 19
A Level Exam Results School Live Reaction Shock 2019! - 15th Aug 19
It's Time to Get Serious about Silver - 15th Aug 19
The EagleFX Beginners Guide – Financial Markets - 15th Aug 19

Market Oracle FREE Newsletter

The No 1 Gold Stock for 2019

Where the U.S. Economy Is Heading According to Buffett

Economics / US Economy Mar 30, 2015 - 05:20 PM GMT

By: Investment_U

Economics

Marc Lichtenfeld writes: Many investors like to follow the “smart money.” And it doesn’t get much smarter than Warren Buffett. So it’s worth examining what stocks Buffett is buying and selling, not just for individual names, but to gauge his overall comfort with the market.

In the quarter ending in December, Buffett’s Berkshire Hathaway (NYSE: BRK) sold all of its shares in Exxon Mobil (NYSE: XOM) and ConocoPhillips (NYSE: COP). It also reduced its holdings in National Oilwell Varco (NYSE: NOV) by about 18%. A lot of Buffett watchers have interpreted his reduced holdings in energy as bad news for the industry.


Buffett also sold his entire position (less than half a million shares) in Express Scripts (Nasdaq: ESRX). Sign of a coming collapse in healthcare? I doubt it.

What hasn’t been widely reported - probably because it doesn’t support the popular doom and gloom mentality - is that the Oracle of Omaha is loading up on stocks that suggest an economic resurgence in America.

In the fourth quarter, Buffett bought 17 million shares of Deere & Co. (NYSE: DE). He also picked up 8.4 million shares of Burger King/Tim Horton parent company Restaurant Brands (NYSE: QSR) and nearly 5 million Class A shares of Twenty-First Century Fox (Nasdaq: FOXA).

He added meaningfully to his holdings in Charter Communications (Nasdaq: CHTR), MasterCard (NYSE: MA), TV station operator Media General (NYSE: MEG), Precision Castparts (NYSE: PCP), Suncor Energy (NYSE: SU), Viacom (NYSE: VIA.B) and Visa (NYSE: V).

In total, Buffett purchased 4.6 million shares of stock in the fourth quarter. Not exactly a gloomy scenario.

Let’s take a closer look at what he added and subtracted and what it may say about the economy.

As noted earlier, Berkshire Hathaway reduced its holdings in the energy sector, selling a combined 41.5 million shares of Exxon Mobil and ConocoPhillips. More than 41 million of those shares were in Exxon.

Buffett sold an additional 11 million shares of Conoco at the beginning of this year. And he sold over 1 million shares of National Oilwell Varco, leaving him with 5.2 million shares.

But he hasn’t abandoned the oil industry completely. He bought close to 4 million shares of Canadian oil sands company Suncor Energy - upping his total to over 22 million shares. And he added another 6% to his holdings in Phillips 66 (NYSE: PSX), which now totals more than 6.5 million shares.

What’s most interesting to me is what nobody is talking about.

Buffett often states that he’s bullish on America, but right now he’s letting his money do the talking. He’s added to positions in several media companies, which are indirect beneficiaries of consumer spending. When consumers have more cash on hand, the businesses they frequent will advertise more, which helps media companies.

Additionally, Buffett bought stock in a fast-food chain, an industrial parts company, agriculture equipment and two credit card companies that directly benefit from consumer spending.

And he maintained his large positions in American Express (NYSE: AXP), Coca-Cola (NYSE: KO), Davita Healthcare Partners (NYSE: DVA), General Motors (NYSE: GM) International Business Machines (NYSE: IBM), Procter & Gamble (NYSE: PG), U.S. Bancorp. (NYSE: USB), Wal-Mart (NYSE: WMT) and Wells Fargo (NYSE: WFC).

So it looks like Warren Buffett isn’t exactly ducking for cover. In fact, it appears he expects consumers and businesses to spend. He has large positions in the three major credit card companies, which would be foolish if he thought the economy was headed toward recession.

Fast food... consumer products... autos... banks... these are all businesses that should do well during periods of economic growth.

Now, the permabears conveniently leave this last part out. They prefer pointing only to the sales of oil companies.

Buffett is widely regarded as one of the greatest investors that ever lived. So why would you instead listen to someone who always cries that the sky is falling?

In his 2014 annual letter to shareholders, Buffett wrote that he has always “considered a ‘bet’ on ever-rising U.S. prosperity to be very close to a sure thing.” He added, “Though the preachers of pessimism prattle endlessly about America’s problems, I’ve never seen one who wishes to emigrate.”

Warren Buffett expects to make money on a growing economy. How about you?

Good investing,

Marc

Source: http://www.investmentu.com/article/detail/44462/where-us-economy-is-heading-according-to-warren-buffett

http://www.investmentu.com

Copyright © 1999 - 2015 by The Oxford Club, L.L.C All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Investment U, Attn: Member Services , 105 West Monument Street, Baltimore, MD 21201 Email: CustomerService@InvestmentU.com

Disclaimer: Investment U Disclaimer: Nothing published by Investment U should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Investment U should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Investment U Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules