The Wall Street Journal writes "A $150 Billion Question: What Will Warren Buffett Do With All That Cash?" The piece states, "The mountain of cash at Warren Buffett's Berkshire Hathaway just keeps growing. Berkshire's tally of cash and equivalents has marched skyward for five consecutive quarters, reaching a record $157.2 billion at the end of September. Whether it finished 2023 at new heights is one question investors will look to answer when the Omaha, Neb., company releases its annual report Saturday.... [T]he tower of cash leaves Buffett equipped to pounce should he spot an attractive business to add to the Berkshire empire, which includes insurer Geico, BNSF Railway and Dairy Queen. The cash also helps maintain what Buffett described in a February 2009 letter to shareholders as Berkshire's 'Gibraltar-like financial position.'" It tells us, "Many shareholders say they aren't worried that so much investing firepower is sitting in cash -- especially since higher yields mean that money is earning much more than in the recent past. Berkshire had more than $125 billion in short-term investments in U.S. Treasury bills on Sept. 30. Yields on such short-term government debt rocketed higher as the Federal Reserve raised interest rates in a bid to tame inflation. The yield on six-month Treasury bills, for example, was 5.35% Thursday, up from 0.71% in February 2022, according to Tradeweb ICE closes. 'A while back, when you could only earn zero, the cost of holding that cash seemed like it was high,' said Bill Stone, chief investment officer at Glenview Trust ..., which holds Berkshire shares. 'Now of course we're going to see it boost quite a bit of earnings.'" The article adds, "Some observers note that the company needs substantial cash for more than investing. Berkshire's insurance operations include business that carries the risk of big losses.... 'If it wasn't for the insurance business, they wouldn't need to hold such a huge amount of cash,' said Darren Pollock, portfolio manager at Cheviot Value Management.... 'They need to be prepared for those events. That's a big reason why many of those billions of dollars are sitting there.'"
