July
Portfolio: 100% cash (VBIL).
Portfolio: 100% cash (VBIL). July was an interesting month. Early on, it was announced that David Tepper’s Appaloosa Management was running an average of about 40% cash and that Terry Smith’s Fundsmith had pivoted toward momentum. A few weeks later, news broke that Leopold Aschenbrenner’s Situational Awareness was down 67% for the month and facing margin calls after running 4x leverage. Before the blow-up, Situational Awareness generated more than 1,000% in net returns after fees since its 2024 inception.
“So I am very conscious of never turning investments at Berkshire over to someone that I think might have this tiny fatal flaw. Make all kinds of money most years, but if you take the numbers 28 -- we'll talk percentages -- 28 times 33, times 17, times 22 times zero, the answer is zero. You can't have a zero in there. And I have seen a lot of people put up a lot of good numbers, and then they stuck a zero in there.” — Buffett (5/10/2007)
In a 2014 interview, CNBC’s Becky Quick relayed a question from an audience member to Berkshire investment managers Todd Combs (now at JPM) and Ted Weschler: “If you could pick any investment manager besides the ones you’re sitting with to have a similar split, who would you pick?”
September 18, 2025 — Tepper was on CNBC. The S&P 500 closed at an all-time high of 6631.96.
“It's a tough market. Like I said, because of the valuations for us. You know, on the other hand, we own these stocks because they're moving because of the Fed.”
“We're having a really good year. And I'm so miserable for having a really good year because I still own the market, and I can't stand that I own the market. You understand what I'm saying? I don't love the multiples, but how do I not own it? With an ease, you know, I'm not ever fighting this Fed, especially when the market's telling me have I don't know what it is today, but 1 in 3 quarter more cuts, you know, before the end of the year. So that's a tough thing not to own.”
“How do you not stay around for some of this party? I don't have to be as big, but you've got to stay for some of the party because the punchbowl is still there. They haven't taken it away yet, but when they take it away, that's what gets tougher.”
The Fed cut rates 3 times in 4 months to round out 2025 and has held rates at 3.50%-3.75 % so far in 2026. The market is currently assigning a 100% probability of at least one hike by December, betting the punch bowl will be gone for sure, yet the S&P closed at 7,736.52 yesterday, an all-time high — 8000 is now just a 3.4% pop away.
Tepper couldn’t stand owning the market at 6,631.96 last September — and the S&P 500 is up about 16.7% since then. He’s averaged a 40% cash position this year, while Buffett sits at roughly 30% cash and the average fund manager is under 4%.
If you were managing a $1B book, would you still be 100% in TBIL?