Some investors build their reputation by being loud. Others build it by staying quiet for years and then saying exactly one thing that everyone remembers. The investor who correctly called the 2008 housing crash before almost anyone else belongs to the second group, and he just broke his silence on a company he has watched for decades.
For years, that company was treated as close to untouchable, a conglomerate built on discipline so consistent that even skeptics gave it the benefit of the doubt. That reputation is now being tested in public, and the man raising the doubts has a track record that makes him hard to dismiss.
Michael Burry on Berkshire Hathaway and the fat pitch warning
Michael Burry said his biggest worry about Berkshire Hathaway was that Warren Buffett‘s eventual successor would lack the patience to wait for the right opportunity, an investing idea Buffett described as waiting for the perfect pitch. “My biggest fear for Berkshire Hathaway was that when Warren finally stepped down, the successor would be too old and otherwise not Warren, so would not have his patience for the fat pitch. I believe this fear has come true. I do not find Berkshire an attractive investment going forward,” Burry wrote in his Cassandra Unchained newsletter on August 10.
The phrase Burry used traces back to Buffett himself, who borrowed it from baseball legend Ted Williams to describe an exceptionally clear, low-risk and high-return opportunity worth waiting for rather than swinging at anything close. It has functioned for decades as shorthand for Berkshire’s entire investment philosophy: patience over activity.
Related: Michael Burry just sent a fresh signal to stock market investors
Burry’s comments carry weight because his own recent calls have been landing. His bearish positions against Tesla, Caterpillar and a major semiconductor fund had already moved in his favor as the broader AI trade pulled back this summer, as TheStreet reported.
On August 6, he added new short positions against Oracle and neocloud company Nebius, extending his bearish AI bets. That pattern has made Wall Street pay closer attention to whatever he says next.
The timing of Burry’s post also lines up with fresh numbers. Berkshire ended its second quarter with roughly $365.5 billion in cash and Treasury bills, down from a record $397.4 billion at the close of the first quarter and marking the company’s first sequential decline in cash in about four years, according to CNBC.
Buffett’s Alphabet call and Abel’s buybacks drive cash lower
That decline in cash reflects a real shift in behavior. Berkshire repurchased approximately $4.5 billion of its own stock during the quarter, a sharp jump from $235 million in the first three months of 2026. It also became a net buyer of equities for the first time in 14 consecutive quarters, purchasing approximately $23.5 billion in gross equity securities while selling $3.7 billion, for net purchases of nearly $20 billion, according to Fortune.
Much of that buying was anchored by one name. Berkshire invested $10 billion in Alphabet in a private placement priced more than 6% below the market, with Alphabet now joining Berkshire’s five largest equity holdings alongside American Express, Apple, Bank of America and Coca-Cola. Notably, Buffett himself said he initiated the Alphabet investment after consulting with Abel. The quarter also included the closing of Berkshire’s $6.8 billion acquisition of Taylor Morrison Home Corp.
Net income more than doubled year over year to $25.67 billion, powered largely by $12.68 billion in investment gains including $10.9 billion tied to unrealized gains on equity holdings. Berkshire noted that investment gains in any given quarter are typically not indicative of business performance, as CNBC reported.
Just one quarter earlier, the picture looked almost the opposite. Berkshire had been sitting on a record $397.4 billion cash pile at the end of 2025 and remained a net seller of stocks, choosing to park capital in short-term Treasury bills rather than buy equities at prices leadership viewed as too rich.
BRK stock performance gap vs S&P 500 under Greg Abel in 2026
Despite that shift toward action, Berkshire’s stock has not caught up with the broader market. Shares of BRK.B were up about 5% for the year as of August 10, compared with a roughly 13% gain for the S&P 500 over the same period, a gap that has persisted even as Abel accelerated capital deployment.
UBS analyst Brian Meredith offered a counterpoint, saying the bank “continues to view Berkshire as an attractive defensive investment, supported by a strong balance sheet, upside to earnings from operational improvements, and deployment of excess cash into accretive acquisitions and/or share repurchases.”
Part of what makes Burry’s skepticism notable is that Berkshire’s own cautious capital allocation comes as the widely cited valuation gauge comparing total U.S. stock market value to GDP sat roughly two standard deviations above its historical trend earlier this year, a level that has historically preceded below-average forward returns. That backdrop is exactly why Burry’s fear about patience matters.
If Berkshire’s own data suggested caution was still warranted, deploying capital as aggressively as Abel did this quarter is either a sign of real conviction in specific opportunities like Alphabet, or a sign that the discipline Buffett was famous for is loosening under new leadership.
What Michael Burry’s Berkshire warning means for BRK investors
Buffett handed Abel the CEO title at the start of the year, telling CNBC at the time that Berkshire had a better chance of enduring another century than almost any company he could name, a statement meant to reassure shareholders that the culture would outlast any single leader, as TheStreet reported.
Burry’s post suggests at least one closely watched investor is not fully convinced that culture has survived the transition intact, even as the underlying business keeps producing strong operating results.
For long-term Berkshire shareholders, the question is no longer whether Abel will spend the cash. He already has. The real question is whether he can find fat pitches as reliably as Buffett once did, or whether this quarter’s activity was simply too much cash chasing too few great ideas at once.
Related: Michael Burry sends loud signal to stock market investors
