Buffett's latest financial report shows that Berkshire Hathaway continued to accumulate cash significantly in the third quarter while drastically reducing its holdings in Apple and other stocks, releasing several signals.

1. Cautious about the overvalued U.S. stock market

The overall valuation level of the U.S. stock market is currently high, especially with the significant growth of some tech stocks primarily relying on high expectations for the future, creating a certain bubble risk. According to the Buffett Indicator (the ratio of U.S. stock market capitalization to GDP), the current U.S. stock market has far exceeded the long-term average, indicating serious overvaluation.

2. Concerns about the macroeconomic outlook

The global economy currently faces various uncertainties, such as inflation, geopolitical tensions, and the Federal Reserve's interest rate hikes, which have affected corporate profitability, leading to cautious market sentiment. In this environment, accumulating cash is aimed at maintaining flexibility so that there is capital available to invest in quality assets during an economic downturn. This strategy also helps avoid being passively reactive to short-term market fluctuations.

3. Divergence regarding Apple and tech stocks

Apple has been one of Berkshire Hathaway's most important holdings in recent years, but from the perspective of reducing holdings, Buffett may not fully agree with Apple's current shareholder return strategy, particularly its focus on buybacks rather than dividends. While Apple’s stock buybacks have increased earnings per share in the short term, they have not directly provided cash returns to investors, which does not entirely align with Buffett's investment preference for stable cash flow. Furthermore, Apple's recent innovations, such as the Apple Car and Vision Pro, have not generated sufficient market appeal, which may also have affected Buffett's confidence in holding the stock.

4. Non-participation in politics and maintaining market neutrality

Recently, there has been attention on Buffett's political stance, but Buffett has publicly stated that he will not support any political candidates to indicate that he always maintains market neutrality. This position reflects Buffett's belief in sticking to value investing rather than being swayed by market sentiment or external influences.