MENU

Warren Buffett on President Trump and What to Do Next

Warren Buffett is widely regarded as the best investor of our generation.

As the chairman of the American conglomerate Berkshire Hathaway, Buffett has produced a compounded annual gain of 19% in the company’s book value between 1965 and 2016. Shareholders who stuck with Buffett’s company through that period would have turned every dollar invested into almost two million dollars.

Investors who are looking to learn a thing or two from Buffett are in luck. Recently, the Oracle of Omaha shared his views on a number of topics during an interview with CNBC.

The Trump effect

Donald Trump took the world by surprise when he won the election to be the President of the United States in late 2016.

Buffett had been backing Hillary Clinton for the election. But when it comes to investing, this doesn’t matter as much to Buffett as to who won the votes. He said in the CNBC interview:

“Last year at our annual meeting, you know, it was clear I was for Hillary, but I got asked a question about the market based on who got elected.

And that does not – and I said, America’s going to do fine under – in terms of economically under – under either candidate as president. People who mix their politics up with their investment activities I don’t think that makes sense. I’ve watched it all my life and obviously probably half the time, my adult life, I’ve had a president other than the one I voted for. But that has never taken me out of stocks.

I mean, the American economy, you know, we’re up to number 45 or so and we’ve done awfully well. If you mix your politics with your investment decisions, you’re making a big mistake.”

In other words, Buffett has a clear separation between his political beliefs and his investment decisions. Over the last five decades or so, Buffett has continued to invest even when the presidents who were elected were not the candidates he voted for. And, Buffett’s results speak for themselves.

The SPDR STI ETF (SGX: ES3), a proxy for Singapore’s stock market barometer, the Straits Times Index (SGX: ^STI), has delivered total annual returns of around 7% from its inception in 11 April 2002 up to the end of January 2017. Along the way, the US has had different presidents and the global economy had taken its fair share of shocks (some examples include the Great Financial Crisis and the Eurozone debt crisis).

But businesses – in the US, Singapore, and elsewhere – continue to chug along and Buffett continues to invest across multiple U.S. Presidents.

For more investing insights and to keep up to date on the latest financial and stock market news, sign up for a FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore

Also, like us on Facebook to follow our latest hot articles. The Motley Fool's purpose is to help the world invest, better.

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong owns shares in Berkshire Hathaway.