Berkshire Hathaway’s Recent Investment Strategy

I am quoted in this Business Insider article:

The Berkshire boss also painted a picture of airlines suffering steep losses and incurring rising debts, repaying government loans out of their earnings and handing over equity in exchange for aid, and issuing shares to raise money at the cost of diluting existing stockholders. 

“The outlook for that industry at that time was very grim,” David Kass, a finance professor at the University of Maryland, told Business Insider. “A full recovery would require a safe and effective vaccine, and it was unknown how long that would take.”  . . .  “Investors also feared the US Treasury would dilute the equity of the major airlines by requiring the airlines to issue warrants in return for loans or grants, and at least one major airline was viewed as a bankruptcy risk,” he added. 

Meanwhile, Berkshire has more than doubled its money on its Snowflake bet already, but it’s too soon to assess whether it’s a sensible long-term investment, experts said. In any case, the Barrick and Snowflake wagers show Buffett and his team aren’t afraid to break from tradition and experiment with new types of investments. “Combs and Weschler have substantially extended Berkshire’s ‘circle of competence,’” Kass said, invoking Buffett’s famous strategy of only investing in what he understands.