Rietveld points out that Buffett’s strategy of increasing cash positions has often preceded market turbulence. This occurred ahead of the 2000 dot-com bust, the 2008 global financial crisis, and the 2022 bear market.
The rapidly changing Investment Strategy of XRP has recently garnered traction from retail to institutional investors alike. In both scenarios, Buffett conservatively stayed out of the markets, which allowed him to re-enter at a discount and outperform large indices over time as they fluctuate over extended durations.
With the often-quoted ‘Buffett Indicator,’ or the ratio of total U.S. market cap to GDP, sitting at about 200%, Rietveld thinks equity valuations are excessive today. Though Buffett does not publicly suggest where he thinks markets are heading, his capital allocation could be a mostly silent indicator of uncertainty ahead.