‘Berkshire is not getting ready for rescue infusions as of now’, Munger

There has been ongoing speculation about Berkshire Hathaway’s Warren Buffet regarding what the top investor is up to during the current coronavirus crisis. Among numerous rumors, some are expecting that the “Oracle of Omaha” will make a massive cash infusion by buying unsettled companies that look promising in the long run, vice-president Munger clarifies the stance during the current recession.

All this has been denied to happen any time soon by the long-time business partner of Warren Buffet Charlie Munger. He said that Berkshire is not being bombarded by the struggling companies’ executive for such a rescue. He believes that this is an uncertain time, as no one actually knows what will happen next due to the coronavirus crisis.

Everybody’s just frozen. And the phone is not ringing off the hook,” said Munger, Berkshire Hathaway’s vice chairman said. “Take the airlines. They don’t know what the hell’s doing.”

Berkshire has a shareholding in major aviation companies like Southwest and Delta. Airline stocks have to take a massive hit in stock performances since the industry is completely non-functional right now and many people are closing their positions on airline stocks all over the world.

“They’ve never seen anything like it. Their playbook does not have this as a possibility,” Munger said.

Munger said that major investors are looking to be conservatives during this time as the situation is very unusual and the exact damage is not yet certain.

“We’re like the captain of a ship when the worst typhoon that’s ever happened comes,” Munger told the paper. “We just want to get through the typhoon, and we’d rather come out of it with a whole lot of liquidity.”

International Monetary Fund has announced that the current economy will dive into the biggest recession since the great depression and into one even larger than the global economic crisis in 2008. IMF has also projected that most of the Nations will see a negative GDP growth for FY21. Munger, however, remains positive that the economy will get back and the possibility of a depression is less likely to take place.