Here's a story that will brighten up your day and make you feel completely confident in the house of cards which is our national financial system.
Yup, Berkshire Hathaway now owns more Treasury bills than the U.S. Federal Reserve. Sounds like satire, but it's not.
The Omaha-based conglomerate held $234.6 billion in short-term investments in Treasury bills by the end of the second quarter, while it owned more than $42 billion of cash and cash equivalents that included T-bills with maturities of three months or less, according to its quarterly financial report.
Buffett scooping up those bills like:
That compared to $195.3 billion in T-bills that the Fed owned as of July 31. The central bank held $4.4 trillion in Treasury securities that include notes, bonds and inflation-linked securities. The Fed was a big buyer of the government's debt during the pandemic and is always one of the biggest holders of Treasuries as part of its effort to keep liquidity in the markets.
Buffett and Berkshire Hathaway famously sold off much of their Apple holdings earlier in the year, "shedding more than $75 billion in equities in the second quarter," and now they're the holders of $234.6 billion in Treasury bills.
(For a little context on that number, China holds about $770 billion in U.S. Treasury notes.)
Treasury bills are an extremely safe investment, being backed by the U.S. government, so I wouldn't hesitate to call this a bearish move by Mr. Buffett.
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