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Berkshire Hathaway’s Cash Reserves Reach Record High
Warren Buffett’s investment firm, Berkshire Hathaway (NYSE: BRK.A, NYSE: BRK.B), reported it is holding over $380 billion in cash, the largest amount in its history, comprising roughly one-third of the company’s market cap. This increase in cash reserves indicates Buffett’s difficulty in finding attractive investment opportunities.
The S&P 500 index currently trades at approximately 32 times earnings, a valuation level only surpassed during major market downturns such as the dot-com crash and the 2008 financial crisis. Historically, the average valuation has hovered between 15 and 25 times earnings, further complicating Buffett’s investment strategy amidst rising asset prices.
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