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Buffett Might Have Advice for President Trump

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Warren Buffett

Previously in this series, we discussed some key takeaways from Berkshire Hathaway (BRK-B) chairman Warren Buffett’s 2018 annual shareholder letter. Buffett is known for expressing his views on geopolitical topics. Last year, Buffett appeared optimistic about the US-China trade relations. He said, “I don’t think either country will dig themselves into something that precipitates and continues any kind of real trade war.” However, President Trump had different ideas. In his annual letter, Buffett seemed to take shots at President Trump without naming him.

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Taking credit

More than two years into his presidency, President Trump has sought to take credit for everything. He also said that the markets would crash if he wasn’t the president or if he was impeached. In his shareholder letter, Buffett said, “It is beyond arrogance for American businesses or individuals to boast that they have ‘done it alone’.” Buffett also said, “The tidy rows of simple white crosses at Normandy should shame those who make such claims.”

China

President Trump has tried to take credit for China’s slowdown despite companies like Apple (AAPL) and NVIDIA (NVDA) blaming China’s slowdown for their lower earnings. In his annual letter, Buffett said, “Americans will be both more prosperous and safer if all nations thrive.”

Optimism about the US-China trade talks has boosted the markets (QQQ) this year. All of the FAANG stocks including Facebook (FB), Amazon (AMZN), Netflix (NFLX), and Alphabet (GOOG) are in the green. Micron (MU), Advanced Micro Devices (AMD), Intel (INTC), Microsoft (MSFT), and General Electric (GE) have risen 34.2%, 32.0%, 12.6, 9.7%, and 34.4%, respectively, this year based on their closing prices on January 22.

Chinese stocks (TCEHY) have looked good too. Alibaba (BABA), Baidu (BIDU), JD.com (JD), and NIO (NIO) have risen 29.0%, 5.4%, 24.0%, and 28.3%, respectively, during this period.

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