Warren Buffett Just Dropped His Loudest Warning Yet: Berkshire’s Cash Position Hits All-Time High

Warren Buffett sold more stock than he bought for 13 quarters before Greg Abel came in. The result sits on Berkshire’s balance sheet as a number that functions like a flare. Roughly $397 billion in cash (but mostly Treasury bills!), at an all-time high, accumulated while the S&P 500 trades at record highs.

Buffett’s career is a long record of building cash when he cannot find anything he wants to own at a price he wants to pay, then deploying it violently when markets dislocate. He did it before 2008. He did it before the COVID drawdown, though he was slower to deploy that round. His successor keeps doing it now under his guidance, in size, and Buffett’s silence is doing the talking.

What the cash pile actually says

Berkshire Hathaway (NYSE:BRK-B | BRK-B Price Prediction) is running a portfolio that looks increasingly like a barbell. On one end sit the operating businesses, including insurance, BNSF, Berkshire Hathaway Energy, and the equity stakes in Apple (NASDAQ:AAPL) and the big banks. On the other end, a Treasury bill book larger than the GDP of most countries, currently earning 3.64% to 3.82% across the curve. That functions as an option.

The optionality has a real cost. Over the past year, BRK-B is down 5.5%, and down 3.2% year to date. SPY, meanwhile, has returned 25% over the past year and 8.5% YTD. Holding Berkshire while the index rips is the price of admission for whatever Buffett thinks is coming. Investors who own BRK-B are, functionally, paying Greg Abel to wait.

And he is waiting at somewhat modest valuations on his own stock. Berkshire trades at a price to earnings of 14x. Even under Buffett it has traded in this range on average.

Asymmetry, not prediction

The $397 billion reads better as a stance than as a forecast of a crash. Abel is constructing maximum optionality. If markets correct meaningfully, Berkshire walks into a sale with the largest dry powder pile in corporate history and a track record of acting fast when prices are right. If markets keep ripping, Berkshire underperforms and shareholders eat the opportunity cost. Both outcomes are survivable. Only one is interesting.

Prediction markets are quietly aligned with the defensive read. Polymarket traders currently assign the S&P 500 only a 30.5% probability of being 2026’s best-performing asset versus Bitcoin and gold, the lowest of the three, even after a 16% one-month rally. Q1 2026, for what it is worth, has been quite positive for the index.

What to watch from here

The trigger to watch is the cash line on the next 10-Q. If the pile keeps climbing, the message is unchanged. If it shrinks meaningfully, Abel has found something, and you will probably know what within a quarter. Until then, the loudest thing Berkshire has said about this market is the number sitting in Treasury bills.

Greg Abel will be continuing down Buffett’s path, because nothing fundamental has really changed. Chasing stocks in the current environment means chasing AI or chasing some other stock that Berkshire does not deem of good value right now. Berkshire was never known for chasing speculative equities, so I would count AI as mostly out of the picture for now.

Thus, I only expect contained buying activity over the next few quarters, barring a significant correction. You will likely see Buffett guide Abel through trimming the portfolio more and scooping up some discounted stocks opportunistically. It’s not a bad thing to do since Treasuries are yielding ~5.2%.