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Welcome back to Yahoo Finance. Berkshire Hathway CEO Warren Buffett is not panicking about the long-term impact of the coronavirus on markets . Look at what Buffett said this morning on CNBC. How can this be bad news if you don't have to sell the stock? So , if for some reason you have to sell them, you will be worse off than if you didn't have to sell them.
I mean, someone could come in and give you a price quote on your house today and it could be 2% less than what they offered you yesterday, but if you like the house, it doesn't really matter to you. Does this mean Berkshire will buy shares today? Well, we definitely won't sell. And yes, we can easily buy something.
You heard it first. We definitely won't sell. Buffett said that the virus outbreak is, quote, a scary thing, but from a market perspective, he's bullish on the long term , which is certainly not surprising, guys. This fits his thesis: always buy and hold for the long-term vision of large, blue-chip American corporations.
Uh , that's also a bit comforting on a day like this, I think, for some people. Perfectly. I mean , I would say that's exactly the case for people looking at these headlines who are long-term investors, that you're not a trader. You are looking at your 401k retirement plan. This is not something you should worry about.
Even in Warren Buffett's letter published on Saturday morning, he talked about stocks potentially falling 50%. We don't know what will happen to stocks tomorrow. And he was sure, wasn't he? We had no idea. And so we fell 1,000 points. But nothing fundamentally changed in the last 24 or 48 hours for the long-term investor.
So to hear these words, read the letter if you are a little worried, the main thing is that you are set for the long term. Good. But to be fair , he also noted that in the long run, we're all going to die too. And that's kind of the end, is n't it? So he is very pragmatic. Yes. I mean, you know, he says, "Look, we're all going to die someday anyway, right?" So he has a bit of a sense of humor.
He is a realist. He is very pragmatic. But he also says that the market is reacting as it should . That when you look at industries, even if we all decline, the ones that should be affected now will be affected. So the market is acting very pragmatically in terms of who is actually suffering right now.
It's tourism, airlines, the ones you expect to be affected. Well, just anecdotally, we're talking about the comfort, uh, from these words of Buffett. I heard from a few friends today, you know, regular people who don't work in technology or finance, who were like, "Oh, well, what do I do with my stocks?" And it's like nothing.
Although I am not a financial advisor, nothing . These are the days when people, uh , wake up. This crosses the threshold. It jumps from one species to another. Someone is starting to pay attention to Twitter trends, which is a good indicator of our business. Yes. They are starting to pay attention.
They didn't pay attention to what they didn't pay attention to on the way up here in January. Many days were boring. We were kind of in range. Oh, okay. You reach all-time highs in one day. This is great. You don't need to call your broker or advisor about this . But you see the Dow Jones drop a thousand points and you start thinking, “Oh, I better make a call.
What's the plan? Yes. But 401k is bought, right? I mean, it's fine if you're for the average person. The Dow Jones index is trending. And also ask if Warren was trending when he talked about Warren Buffett. Buffett's comments came just after Birxher's quarterly earnings report, as well as its annual letter to shareholders.
Some of Berkshire's largest holdings in 2019 include American Express, Apple, BFA, and Delta Airlines. And of course, some of these names are very sensitive to China. Let's leave Apple aside for a moment. We'll talk about that later. Uh, we know Buffett loves banks. He recently tried to buy a lot more BFA.
Remember, he wanted the rules changed so he could buy even more. And he liked banks. Of course, airlines have been hit hard by the coronavirus. But, as you said, Jen, when you look at the sectors that are the most affected, these are the ones that should be affected. And similarly, when you look at individual companies that have warned about the coronavirus, those are the ones where it makes sense, where the supply chain is, and they may have a lot of revenue from China, Nike, Under Armour, Starbucks, Lucken.
Yes. I mean, a lot of the obvious culprits would be there . It's interesting when you look at the back basket of his top 15 assets. Sometimes you forget how overloaded this basket is with finances. I mean, even if you get to, you know, your BNY cabbage rolls, they're there. And sometimes we forget that he finally made it to JP Morgan Chase Goldman.
Uh, you know, the stakes are low here. And if you look at what's happening with Treasury bonds, there's no inflation on the horizon. If there is no inflation and global demand slows, do we expect another rate cut in April? CME seems to be predicting a little over a 50% probability. You know, this is a tough business for banks.
That's why we're seeing significant consolidation there. And Buffett is just the one who's into it, and he doesn't budge from the financial front at all. Absolutely not. And it also looks at insurance segments within the insurance industry, different segments, who is really suffering and who is currently in a favorable position.
Um, so he really, I think, echoes your point, Dan, he really wants to calm the market and take a very sensible approach to all of this, reminding people that in a couple of months we're going to look back on this and say, you know why we were losing our minds over this? Right?
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