How Warren Buffett bet against the Trump trade and lost spectacularly
Donald Trump and many of his supporters did pretty well in the stock market after he won back the White House.Warren Buffett, it appears, not so much.That’s the recap of the post-election market frenzy, the impact of the so-called Trump Trade that has been producing some notable winners (among them, Trump himself) and if you can believe the trading-desk chatter, losers like Buffett.Buffett has been selling stocks like Bank of America and even market darling Apple, if you haven’t noticed, hoarding more than $300 billion cash and cash equivalents (T-bills) because he said tax rates were going higher, and he expected stocks to crater.In other words, Buffett watchers tell On The Money he was betting on a Kamala Harris victory, which would have reversed the Trump Trade in major indices and certain stocks (shares of Truth Social among them) that have found buoyancy on the possibility of a Trump victory and his promises of lower taxes, including on capital gains.Now that the possibility of Trump winning has turned into a reality, the famed Oracle of Omaha is looking more like the Knucklehead from Nebraska, some of these traders say.
Sure, shares of his holding company Berkshire Hathaway were up with the rest of the market after Wednesday’s massive Wall Street, but think of all the money he left on the table by sitting in as much low-yielding, short-dated treasuries as the Fed, and not having his cash in the roaring S&P.Even more, the rumor in the trading-desk world is that the famed value investor was actually hoarding cash to pounce when he saw value after a sharp decline in equities.How did that turn out with the Dow up over 1,500 points on Wednesday?As for Trump, he’s been making a few bucks over the past couple weeks on the stock of his social-media company Truth Social, which trades under the symbol of DJT, largely on speculation that the money losing outfit would somehow benefit with Trump in the White House (shares are up about 90% in recent weeks)....