Warren Buffett Says He's Still Making Investment Calls at Berkshire—and Just Made a Mystery Buy

$373 billion in cash, cash equivalents and short-term investments at end-2025; Berkshire bought about $17 billion of U.S. Treasury bills this week. Warren Buffett, now 95 and no longer CEO, continues to come into the office daily, makes major investment decisions, speaks with the director of financial assets each morning, and declined to disclose a recent purchase. He characterized the recent market sell-off as 'nothing to get excited about' but said Berkshire will deploy capital if there is a large market decline.

Analysis

Buffett remaining an active decision-maker materially reduces near-term governance transition risk for Berkshire and preserves its optionality as a large, patient acquirer. That matters because counterparties and auctions re-price when a deep-pocketed buyer signals willingness to deploy in drawdowns — sellers demand a premium knowing one bidder can move quickly, which compresses acquisition spreads for outsiders over the next 6–18 months.

From a market-structure lens, the obvious second-order effect is liquidity re-allocation into very short-duration sovereign paper at the margin: large, repeat demand for T-bills pulls front-end supply and can flatten or invert the curve transiently, raising the opportunity cost for marginal equity buyers and pushing some long-duration assets to de-rate. The optionality engine inside Berkshire (large cash buffer + low cost of capital) behaves like a long-dated, deep-pocketed put seller to convex equity sellers — it cushions systemic drawdowns and reduces the pool of genuine “forced” sellers during stress.

Investor behavior consequences are fertile for alpha: retail and momentum players who try to emulate headline-driven buys create compressible short-term moves in names perceived as “Buffett plays,” presenting mean-reversion shorts or spread opportunities. Tail risks include a faster-than-anticipated macro shock that forces deployment into subscale deals (execution risk) or a disorderly credit event that forces revaluation of insurance-linked liabilities — both would flip Berkshire from optional buyer to liquidity manager and compress its premium over peers within weeks.

Key Decisions for Investors

• Long BRK.B vs SPY pair (relative-value): Buy BRK.B (target 3–5% portfolio weight) and short SPY equal notional. Timeframe 6–12 months. Rationale: capture outperformance if value/insurance optionality re-rates; expected relative upside 8–12% vs SPY, stop-loss if BRK underperforms SPY by 10% (cut to neutral).
• BRK.B 9–12 month call spread (bullish, capital-lite): Buy 12-month BRK.B ATM call and sell 30% OTM call to finance cost. Entry within 2 weeks while implied vol is depressed; directional payoff if management announces deployment or market rotates. Max loss = premium paid (~limited); max gain = spread width less premium (~4–6x expected premium if catalysts hit).
• Pair trade: long BRK.B / short high-duration growth (QQQ or NVDA) 1:1 notional, rebalanced monthly. Timeframe 3–9 months. This expresses value vs growth de-risking; target absolute IRR 15% if rotation occurs, with initial hedge reducing beta to market; trim if BRK shows sustained underperformance of 15% vs growth in 60 days.
• Event-driven arb: Monitor wide take-private / distressed sale candidates in insurance, regional banking, and industrials where Berkshire could be a marginal buyer; build small option-sized long positions in 3–9 month OTM call spreads on likely targets (size 0.5–1% each). Rationale: win large asymmetric payoffs if Berkshire deploys capital; downside limited to premium outlay.