Warren Buffett, America's best-known investor, has plenty of cash. But the 88-year-old is struggling to spend it.
"It's very, very, very hard to make deals in a world where you've got $1trn-plus of money, plus just the normal animal spirits of corporate leaders and everything else, and accessibility to extraordinarily cheap money." Competition from profligate private-equity funds, rolling in cheap money, leaves fewer appealing opportunities for choosier investment vehicles, such as his own Berkshire Hathaway.
But the good times will return, says Buffett. "People get smarter, but they don't get wiser. They don't get more emotionally stable.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
All the conditions for... extreme overvaluation or undervaluation... exist, the way they did 50 years ago. You can teach all you want to the people... but when they're scared, they're scared." When they are, and money is short, Berkshire will be there. "We will get the calls again. This is a place that can commit $10bn or... $30bn, and it's done."
As well as this week's deal involving US oil giant Occidental's takeover of rival Anadarko (see page 10), Buffett has also spoken of spending more outside the US, and in the UK in particular despite Brexit (see picture). "We welcome the chance to put money out any place where we think we understand and sort of trust the system. We're never going to understand any other culture or the tax laws or customers as well as the US, but we can come awfully close in Britain."
-
What happens if you can’t pay your tax bill, and what is "Time to Pay"?Millions are due to file their tax return this Friday as the self-assessment deadline closes. Though the nightmare is not over until you pay the taxman what you owe - or face a penalty. But what happens if you can't afford to pay HMRC your tax bill, and what is "Time to Pay"?
-
What does Rachel Reeves’s plan for growth mean for UK investors?Rachel Reeves says she is going “further and faster” to kickstart the UK economy, but investors are unlikely to be persuaded
