IMPORTANT POINTS:
- Robert Kiyosaki said that both investors are convinced that Wall Street will soon contract.
- Warren Buffett has been hoarding plenty of cash while slowing his pace of share buybacks.
- Michael Burry, on the other hand, has directly bet against the US stock market.
The author of “Rich Dad Poor Dad”, Robert Kiyosaki, anticipated that the stock market will soon crash and that even two big-name investors like Warren Buffett and Michael Burry are preparing for it.
“Buffett is on the sidelines with 147,000 million dollars, his money is in short-term Treasury bonds”, argued the writer.
“I see these guys waiting for the market to crash and then going back in. It’s a lot of money sitting on the sidelines right now.”Kiyosaki.
The Oracle of Omaha, for example, sold $8 billion of net shares and slowed its buybacks in the last quarter. In addition, it increased its cash by 13% and owns Treasury bonds worth 147,000 million dollars, which marks a record.
Specifically, Berkshire Hathaway has sold $33 billion worth of stock so far this year, as well as hoarding $38 billion of cash.
Kiyosaki cited Michael Burry as an example.
The founder of the Scion Asset Management fund directly bet against the US market.
The businessman has put options against 2 million shares of the SPDR S&P 500 ETF Trust, the fund that tracks the S&P 500 index, worth close to $886.6 million.
In addition, he also has another bet against 2 million shares of the Invesco QQQ ETF, which tracks the Nasdaq 100 Technology Index. These puts have an approximate market value of $738.8 million.