_{FINANCIAL NEWS}

Is Warren Buffett Bracing for a Market Collapse?

Warren Buffett, the world's most-followed investor, is sitting on a staggering $325 billion in cash, signaling a potential storm on the horizon. While he remains invested in American companies, Buffett's move to slow new investments, slash holdings in Apple and Bank of America, and halt Berkshire Hathaway stock buybacks is a chilling sign of caution in the face of frothy markets. Historically, Buffett has pulled back when he sensed danger, as he did before the global financial crisis and in 1969, suggesting he believes we may be nearing another precarious tipping point.

This unprecedented cash hoard implies he's bracing for a major market downturn or eyeing a seismic acquisition amid looming volatility. Current market conditions are flashing warning signs, with stretched valuations and predictions from Goldman Sachs and Vanguard forecasting dismal returns for the next decade. The once-ever-optimistic Buffett seems to be sounding the alarm, pointing to turbulent waters ahead.

For individual investors, this caution is a red flag. Buffett's wariness, coupled with dire projections of meager returns for large U.S. stocks, suggests we may be standing on a precipice. The "Buffett Indicator" is flashing red, with stock market valuations outstripping the U.S. economy at levels not seen since the tech bubble peak. As the markets teeter, Buffett's readiness to hold back may foreshadow painful disruptions ahead.

As Berkshire Hathaway's size limits its growth prospects, even Buffett acknowledges that the old rules no longer apply. He might eventually have to return cash to shareholders as new opportunities become scarce. For now, he sits atop a fortress of cash—perhaps waiting for the next crisis to unfold. Read More.

_{ECONOMIC NEW}

Is US Inflation Set to Surge?

In the U.S., inflation is heating up again, with the Federal Reserve’s recent 0.25% interest rate cut raising more questions than answers. Economists are bracing for a slight uptick in consumer prices, with core inflation staying stubbornly high at 3.3%. President-elect Trump’s looming trade tariffs and tax cuts could inflame inflation even further, potentially trapping the Fed and destabilizing the economy as 2025 approaches.

The U.K. is also grappling with its own economic fears. GDP growth has slowed to a meager 0.2% in the third quarter—a blow to the Labour government’s pro-growth agenda. With household incomes under pressure despite wage growth, the Bank of England faces an uphill battle to control inflation. The sluggish growth raises fears of a potential economic backslide, even as the BoE cuts rates again. Governor Andrew Bailey's assurance of gradual rate reductions feels cold comfort in the face of this slowing economic momentum.

Meanwhile, the eurozone is staring down a perilous path. The euro’s steep decline against the dollar could accelerate, with analysts predicting parity. Trump’s election victory has sent shockwaves through global currency markets, and looming U.S. fiscal policies could push the euro further to the brink. The European Central Bank’s weakened economic data and interest rate strategies offer little resistance to the dollar's strength, raising fears of a harsh economic divide. With Europe's political backdrop deteriorating, the outlook seems bleak, and the risk of a currency crisis looms large. Read More.