94-year-old Warren Buffett's Berkshire Hathaway continued offloading Bank of America shares this week. Since Buffett started dumping BofA stock in mid-July, total sales have now topped nearly $7 billion.
Bloomberg explains:
In the latest round of transactions, disclosed in a regulatory filing Thursday, his Berkshire Hathaway Inc. liquidated $760 million of the stock since Tuesday. Still, Berkshire remains Bank of America's top shareholder, with a roughly 11% stake valued at $34.7 billion, based on the latest closing price.
If Berkshire keeps selling, its stake in the second-largest US bank could soon slide below the 10% regulatory threshold that requires his conglomerate to disclose transactions within a few days. Once he controls less than that, Buffett may wait weeks to reveal transactions — typically offering snapshots after every quarter.
Berkshire Hathaway remains BofA's number one shareholder, with an 11% stake valued at $34.7 billion.
Buffett and/or Berkshire Hathaway have not explained the reason for the abrupt selling.
As we've previously noted, Buffett could be dumping for several reasons, if that's due to looming recession threats and the Federal Reserve's interest rate-cutting cycle, which could begin in just a few weeks. Or perhaps the 94-year-old billionaire has increased cash reserves to record levels because of elevated stock valuations amid the artificial intelligence bubble.
Whatever keeps Buffett and Berkshire Hathaway up at night has intrigued institutional desks, FinTwit X, and financial media outlets. Some believe this could be a critical market signal.
Besides the mounting macro and political risks, we asked a week ago if the selling stems from the risk that a US regulatory probe into anti-money laundering surrounding fentanyl cash laundering at Toronto-Dominion Bank could expand to other banks.
In a conversation with Sam Cooper, an investigative journalist behind the Substack "The Bureau," and David Asher, a former senior investigator for the State Department, Asher revealed, "And most of what we're seeing is coming from this TD Bank case, and there's a lot more. We'll see which one of the big four US banks gets named next."
Whatever the reason for the selling, Buffett and Berkshire Hathaway traders are undoubtedly concerned about something.
