Warren Buffett Joins the Chorus of Billionaires Warning of a Stock Market Crash

  • Warren Buffett is selling once again despite the stock market’s 20% fall.
  • His actions fall in line with peers who’ve been outspoken about the potential of a stock market crash.
  • Data shows investor greed is at a multi-year high.

Today’s stock market is unlike any other in history—Warren Buffett said as much during Berkshire Hathaway’s first-quarter earnings release.

The novel coronavirus first caused an epic stock market crash, but Fed stimulus and hopes for a quick recovery have pushed the Dow Jones Industrial Average more than 20% higher in just two months. But analysts have been warning that this looks like a short-term bear market rally and this week investing legend Warren Buffett joined their chorus.

Buffett revealed that he offloaded $16.3 million worth of U.S. Bancorp (NYSE:USB) stock on May 11-12. The sale brought Berkshire Hathaway’s overall stake in USB to under 10%, meaning he is no longer required to disclose his trading activity outside of typical quarterly results.

Warren Buffett Is Battening Down the Hatches

Warren Buffett is selling now because he sees downside risk. | Source: REUTERS/Rick Wilking

This isn’t the first time Buffet sold off a substantial holding since the coronavirus pandemic hit. He also unloaded $30.9 million worth of Bank of New York Mellon (NYSE:BK) stock back in April.

On top of those two significant sales, BRK was sitting on a record $137 billion worth of cash at the end of March. That’s one heck of a war-chest for someone who typically gobbles up cheap stocks when the market is down.

As it turns out, the Oracle of Omaha is standing alongside fellow billionaire investors who’ve been pounding the panic button in recent weeks.

Billionaires Advise Caution

Buffett’s pessimism about the market falls in line with investing heavyweights Stan Druckenmiller and David Tepper, both of whom consider today’s market to be vastly overvalued. But that’s not all. Investing legends Carl Icahn, Paul Tudor Jones, and…

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