When the S&P 500 fell by 9% earlier this year, Warren Buffett didn’t flinch.
Many people assumed that, since stock prices had fallen, Buffett would take advantage of a few value opportunities
He did not. In fact, the former chairman of Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) didn’t even seem particularly moved by the pullback. In an interview earlier this year, Buffett said of the U.S. stock market: “Three times since I’ve taken over Berkshire, it’s gone down more than 50%.
This is nothing.” Buffett sees no value in U.S. stocks The implication is clear. Stocks might have been lower than they were compared to their highs a couple of months earlier. But they were still very expensive on a long-term basis, and Buffett wasn’t going to budge until stocks got much cheaper.