What was your biggest buy during this Covid-19 and Circuit Breaker Period?
It’s clear.
Covid-19 has left strong companies weaker, and weak companies dying.
However there will always be the few great companies and individuals that will rise to the occasion.
Sometimes, taking action can be seen as a bold move. And occasionally, not taking action may not be a weak move too.
👋WHAT ABOUT YOU? 😊
What was the biggest ticket item you purchased this week?
Was it stuff that you could feel good, like electronics, and clothes?
Or was it assets so that your money could work harder on?
Let’s take a look at what some corporations and individuals did.
📊THE HIGHLY UNUSUAL CASE OF BERKSHIRE HATHAWAY 📈
At Berkshire Hathaway’s recent annual meeting, Warren Buffett shared that he hasn’t made any big investments, “We don’t see anything that attractive”.
This is highly unusual for Buffett as he has used previous price drops to buy companies at a discount or take partial ownership of companies. Buffett made special investments in companies such as Bank of America and Goldman Sachs during the 2008 financial crisis.
Berkshire’s quarterly earnings revealed that the conglomerate had a record $137 billion in cash and equivalent instruments on its balance sheet at the end of the first quarter.
Buffett also shared a word of caution when discussing the U.S. economy at the start of the meeting, warning that the possibilities “are still extraordinarily wide” given the coronavirus crisis.
Prior to the AGM, the International Monetary Fund (IMF) warned the world of a “Great Lockdown” recession. If the Covid-19 outbreak pushes the world into a L-shaped market, the global economy may contract more than 3%.
🛒 THE REVENGE SPENDERS 🛍
But this news clearly didn’t bother some shoppers. After all, Amazon is registering one of its strongest growth in months.
You may have also heard of the “revenge spending” shoppers in China who contributed to a one-day single store record sale of $3.8million in Hermès’ Flagship boutique store in Guangzhou!
At the same time, there are also companies which are seizing this chance to purchase other companies.
🥛 MEIJI BUYS INTO AUSTASIA 🐄
Love Meiji milk and yoghurt? You may have heard of this popular Japanese brand ya?
Recently, Meiji co. ltd, acquired a 25% stake in AustAsia Investment Holding Pte Ltd, which operates dairy farms in China. Austasia is a subsidiary of Singapore-listed Japfa.
What would Japfa do with this money worth $254million?
Well, they would pay down an existing loan of about $361million, so that they can focus on active expansion. After all, the production of chicken, pork and milk have not been affected.
👋WHAT’S YOUR NEXT MOVE?😊
If you feel like you want to hold your cash, and not spend on assets, do remember that Buffett is sitting on $137 billion, not you. You have no buffer (no pun intended)!
If you feel that you want to invest somewhere in the markets, there are still discounts available. Just stay informed.
if you feel lost, do not worry, just do a quick check with the financial practitioners.
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