Warren Buffett Sells $3.2B US Bank Shares Amid Economic Uncertainty

Warren Buffett's Berkshire Hathaway has quietly sold over $3.2 billion in U.S. bank stocks during the first half of 2025, including significant reductions in Citigroup, Bank of America, and Capital One shares. This strategic move signals a cautious or bearish outlook on the banking sector despite recent strong profitability, with Goldman Sachs and Citigroup reporting earnings jumps of 22% and 25% respectively, and the KBW Nasdaq Bank Index nearing record highs. Analysts, including Larry Cunningham of the University of Delaware, interpret Buffett's divestments as a warning of potential challenges ahead for America's financial industry. Concurrently, Buffett is building a historically large cash position exceeding $350 billion and reallocating investments toward energy and consumer staples, such as Occidental Petroleum and Constellation Brands. The cautious stance contrasts with the positive current earnings environment and comes amid concerns that the economic trajectory under President Donald Trump's administration, including tariff policies, may impact Wall Street negatively in the latter half of the year. Buffett's history of prescient market moves, including warnings before the 2008 financial crisis and the 2020 COVID crash, lends weight to these recent portfolio shifts.