Warren Buffett’s Berkshire Hathaway sold bank stocks to buy a gold mining company, which will indirectly boost the price of Bitcoin, investors say.
Berkshire Hathaway, the $503 billion conglomerate led by Warren Buffett, sold Goldman Sachs for a Canadian goldcompany Barrick Gold. Max Keiser, the founder of Heisenberg Capital and an early Bitcoin investor, says it could help buoy BTC to $50,000. The quarterly shareholder filing of Berkshire Hathaway shows Buffett trimmed his position on most major banks, Fortune reported on Aug. 15. The firm sold a substantially large portion of its shares in JPMorgan Chase, Wells Fargo and PNG.
These is What Buffett’s decision to enter a gold position over banks shows about Bitcoin
Buffett’s decision to completely close Berkshire’s position on Goldman Sachs follows the bank’s second-ever highest quarterly trading revenue of $13.3 billion. It suggests Buffett is not comfortable in betting big on the banking industry in the long-term.
Instead, Buffett purchased a single stock in Barrick Gold, whose stock has reflected that of gold in most of 2020. The firm is a gold mining company based in Canada, which recorded a 45% increase year-to-date. Following Berkshire’s investment, the stock rose by 8.11% in after-hours trading.
Max Keiser, an avid Bitcoin investor who has invested in companies like Krakenand Bitfinex, believes Buffett’s gold investment could benefit Bitcoin. He said the positive sentiment around gold implies a higher valuation for Bitcoin, which some consider as “digital gold.” Keiser said:
“Global $100 trillion fund management biz is less than 1% invested in Gold. With Buffett now moving into Gold. Expect global allocation of 5% AU min. Implies $5,000 Gold. Expect a 1% BTC global allocation ($1 trillion). This implies $50,000 for Bitcoin Expect PTJ ups to 10%.”
A former L/S equities portfolio manager and Ikigai Fund founder Travis Kling echoed a similar sentiment. Referring to Buffett’s skeptical statement in 1998 around gold saying it doesn’t have utility, Kling said:
“Today it was announced Berkshire Hathaway just bought its first gold stock ever. The reasons are self-apparent at this point. Just in case you’re wondering what the coming years are going to look like for Bitcoin, this was Buffett on gold in 1998.”
hope thes update was usefull