August 5: Warren Buffet shows Stock collapse imminent, Companies Showing recession, Bigger War coming Middle East? (Recap ep287)

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In today’s Recap Marcello shows us how Warren Buffett is signaling trouble ahead, with Berkshire Hathaway’s cash pile hitting a record $276.9 billion as he sold off major stocks, including half its stake in Apple. This marks seven straight quarters of selling, shedding over $75 billion last quarter alone. Meanwhile, FedEx is cutting daytime flights by 60% to save money, McDonald’s is seeing a drop in same-store sales for the first time since 2020, and Chevron is moving from California to Texas. On top of that, the assassination of Hamas leader Ismail Haniyeh in Iran is raising fears of a bigger conflict in the Middle East.

Berkshire Hathaway’s cash pile swelled to a record $276.9 billion last quarter as Warren Buffett sold significant portions of the company’s stock holdings, including half of its stake in Apple. Berkshire has been a seller of stocks for seven consecutive quarters, with the selling accelerating in the last quarter, resulting in over $75 billion in equities being shed.
U.S. markets plunged lower on Thursday. Weakening employment, manufacturing & construction data pushed 10 year Treasury yields below +4% & prompted a broad selloff in stocks. Investor fears over a recession have resurfaced. New data showed that U.S. manufacturing activity contracted for a 4th straight month. An ISM (Institute for Supply Management) index slid to 46.8 last month from 48.5 in June, to an 8 month low, moving further away from the 50-plus level that signals expansion.
Oil fell to the lowest price levels in nearly 7 months on Friday, as concerns about demand in the world’s 2 biggest economies which overshadowed heightened geopolitical risk in the Middle East. Investor sentiment in the oil market has deteriorated as factory gauges in both China & the U.S. showed contractions this week, signaling further weakness in manufacturing. Losses for futures deepened after US payrolls data failed to meet expectations as unemployment reached 3 year highs.
Formerly the world’s largest chipmaker, U.S. based Intel has gotten beaten by rivals in recent years & is far behind in the AI race. The stock had its worst day in 50 years on Friday down -26.06%at $21.48, to a level not seen since 2013. Intel reported a big earnings miss & announced a mass restructuring that includes cutting 15% of its workforce. Intel expects Q3 revenue of between $12.5B & $13.5B, well short of analysts’ expectations of $14.3 B The company reported earnings per share (EPS) of $0.02 on revenue of $12.8 B Analysts were looking for EPS of $0.10 & revenue of $12.9B. The company saw EPS of $0.13 on revenue of $12.9B in the same quarter last year,The stock is -57.25% in 2024 & -38.87 y/y. market cap of $91.44B.
Chicago Mercantile Exchange (CME) cattle futures have plunged sharply, with back-month feeder cattle contracts setting new lows, as signs of a weakening U.S. economy spurred market participants to unwind long positions. Cattle futures are dropping as a falling stock market prompts worries that consumers will pull back from high-priced beef. Sales of steak typically increase when equity markets rise & with stocks selling off after a weak US jobs report, prices for cattle are tracking the downturn. The volatile trading began after the U.S. Labor Department reported the U.S. unemployment rate had jumped to a near 3-year high in July, heightening market fears that the economy was vulnerable to a recession.
The United States on Thursday recognized Venezuelan President Nicolas Maduro’s opponent & opposition candidate Edmundo Gonzalez as the winner of Venezuela’s disputed presidential election, rejecting Maduro’s claim of victory. The country’s opposition says its tally of about 90% of the votes shows that Gonzalez received more than double the support of the incumbent president, in line with independent polling conducted before the contest.The opposition has released detailed tallies on a public website, while the government has so far not shared any information beyond a national total of votes for each candidate.
The UAE to be the world’s top wealth magnet for the 3rd year running, At the same time, the U.K, already the source of many of the UAE’s expatriates, is projected to see its millionaire population drop by 17% by 2028. High-net-worth individuals are in many cases leave, as costs & taxes rise in their home country. The trend is likely to accelerate in the wake of the landslide election victory for the U.K.’s Labour Party in June. The UAE is set to see a record net inflow of 6,700 millionaires from around the world by the end of 2024, which was released in June. That’s nearly double the 2nd-ranked country on the list, the U.S., which is expected to welcome a net inflow of 3,800 millionaires in the same time frame.

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