Sunday, May 01, 2005

Wastin' away again in cash-ville.

Warren Buffett has $45 billion in cash, and believes that there is little value in the market right now, but there should be a big opportunity in the next few years.

So what are you doing with your money?

Read more from Berkshire's annual meeting here, including that Buffett and Munger are worried about hedge funds and deficits, their speculations on the possibility of a real estate bubble, and their thoughts on the valuations of drug stocks.

Doom Doom and Doom Report.

Marc Faber is a member of the Barron's Round Table. Though I don't know his performance record, he's always interesting. He's been nicknamed "Dr. Doom" for his often pessimistic pronouncements, but a large part of successful investing is avoiding losses, and if he can help you do that, he's useful.

He's feeling gloomy [pdf] and thinks that for the next six months cash is the best place to be. His view is that as the US Fed raises it's key rate to possibly 5% to head off rising inflation, consumer spending and corporate profits will suffer. As a result, asset markets in the US will also suffer and this will likely ripple through to other parts of the world, especially since China also appears to be slowing down.

Longer term however, he likes Asia, which has been generally his focus for a while.