Over the past five years, Warren Buffett’s returns have beaten the S&P 500 and the Nasdaq Composite even as Berkshire keeps hundreds of billions in cash and Treasuries.
In this podcast, Motley Fool analyst Jim Gillies and host Ricky Mulvey discuss:
- How Apple has driven Berkshire‘s performance.
- Disney‘s flat returns over the past five years.
- A jeans manufacturer that is smashing the market.
Then, Motley Fool personal finance expert Robert Brokamp and host Alison Southwick discuss why you should think about taking a financial health day.
To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. When you’re ready to invest, check out this top 10 list of stocks to buy.
A full transcript is below.
This video was recorded on March 25, 2025
Ricky Mulvey: Warren Buffett’s still got it. You’re listening to Motley Fool Money.
I’m Ricky Mulvey, joined today by Jim Gillies. Jim, how are you doing? Good to see you.
Jim Gillies: It’s good to be seen, Ricky. Thanks.
Ricky Mulvey: We’re five years away from the COVID time, and it’s time to check in on some of the cycles of long-term investments. I think Berkshire Hathaway is a good one to talk about. You were talking about it yesterday or a couple of days ago on the morning show, because there is something surprising for this business that is keeping about one third of its market cap in cash. Nasdaq up about 170%, S&P up a little less than 140%, Berkshire Hathaway, 200%, a three-bagger over this five-year time, outperforming the tech stocks, outperforming the broad index. Any reflections on that and maybe why the cash isn’t a drag here? You always hear about that cash is a drag on your investments, not the case at Berkshire Hathaway.
Jim Gillies: Sure. I found this little factoid, as well yesterday when I was going through the Globe mail over breakfast, and Berkshire tripled over the past five years. What? I went and looked and it has, which is interesting because it’s both my longest held stock as well as my largest personal holding, so it works really well when you just ignore your largest personal holding and let the magic continue happening. Now, I think, the cash, while significant, a lot of the performance, you can probably chalk up to how well the Apple investment worked out for Berkshire. A lot of that cash has been raised in the last year, as Buffett has dramatically scaled down the amount of money invested in Apple, though he’s still got a fairly significant piece there.
As well, you want to look at a few of the things that Buffett has been invested into that have not worked out because he’s done what I consider to be the Holy Grail and being perfectly blunt. It’s something I continue to work on myself, is when you’ve made a mistake or an investment that’s not working out, blow it out the door. Just be done with it. We saw that with the airlines during the COVID shutdowns. That may or may not have been a mistake, frankly, but I understand why Buffett got out of them, and as well, it would be very, very bad. It would be a bad look for them to have gotten bailout money when Buffett’s in all of them. I think he got himself out of the way of that, the IBM thing that wasn’t a great deal. I think that overall, you’ve got Buffett just saying, “Look, in this brave new world, we have tech stocks, growth stocks, AI, all this wonderful stuff.” Buffett has just provided a really good example of, “I’m going to stay within my circle of competence. I’m going to stay with reasonable valuation.” We’ve seen most recently is the five large Japanese trading houses that he’s been very enthusiastic about, as well as up to the ante there. The famous letter to investors, Buy American. I Am, reflecting that the American market is still, and I say this as a Canadian, the place to make money.
