Buffett’s record tax payment and his request to spend it wisely

Warren Buffett’s latest letter to shareholders offered only brief comments on the stock market while noting good investments are scarce.

The much-awaited letter on Saturday also noted Buffet’s record tax payment of $26.8 billion—5% of all the corporate taxes the IRS received—and indirectly advised the Trump administration to “spend it wisely.”

Berkshire’s investment approach
Buffett stated that Berkshire Hathaway remains neutral between controlling businesses with at least 80% ownership and acquiring stock market holdings.

However, he noted that attractive investments are scarce, and most outstanding businesses are rarely available for full purchase.

Berkshire’s cash reserves and Treasury bills now exceed $320 billion—larger than most US companies’ market values.

The conglomerate sold much of its Apple and Bank of America stock in the past year and now holds $334.2 billion.

Despite the cash pile, Buffett struggles to find worthwhile investments due to record-high stock prices and historically high valuations.

Takeaways from Berkshire’s 2024 earnings
Berkshire’s operating earnings rose 71% for Q4 of 2024, driven by insurance business growth. Operating earnings for the full year rose 27%.

With stocks near record highs, Buffett’s insights remind investors to remain patient. He advises focusing on business value rather than speculation, as overpriced stocks can lead to long-term losses.