Buffett has now been selling more stocks than he’s buying for about three straight years. Berkshire keeps unloading billions in stocks quarter after quarter and the cash pile keeps climbing to new highs.
Buffett doesn’t sell because he needs the money. He sells when the price doesn’t make sense.
That is the hidden signal.
It says valuations in the market right now are not offering fat returns. Stocks are not cheap enough to give him the future upside he wants. And because short-term interest rates are still pretty attractive, he can sit on T-Bills and earn solid returns while waiting for better opportunities later.
Buffett trimming Apple is the perfect example. He still loves Apple. But he’s been reducing it. That means the math isn’t as attractive as it used to be at today’s pricing.
All of this tells you something bigger about the economy and the cycle.
We’re not at crash territory. We’re at a late stage, slower expected return type of cycle. Profits are still solid across many sectors, but the payoff from future upside is getting thinner. And with interest rates still high, the risk-free return on cash competes against stocks in a meaningful way.
Real growth is still out there, but it will likely come from fewer businesses, with pricing power and real cash flows. Not hype, not story stocks.
In environments like this, M&A gets harder because the cost of money is up, but sellers still want big multiples. So deals slow down until one side gives. That’s another reason Buffett is patient.
Eventually prices will correct, or rates will fall, or a forced seller will show up. When that happens, Buffett will deploy capital again very aggressively.
Until then, him sitting on mountains of cash is basically saying: “returns from here are okay, but not great, so I’d rather wait for a better pitch.”
This is not doom. It is discipline.
Buffett is signalling that this stage of the market is not about chasing every move and trying to time peaks. It is about staying liquid, being logical, and letting the market come to you.
That is the lesson for the broader economic outlook right now: this is a patience environment, not a hyper-growth environment.