The stock market is hitting highs, and Berkshire Hathaway is building a cash tower. That momentum tells investors something important about where we are in the cycle.
James Early, founder of Curia Financial and longtime Buffett fan, attended Berkshire Hathaway's annual meeting in Omaha earlier this month. What he saw left him more determined to diminish his position than to add to it.
Berkshire's Money Bunch Is Sending a Signal
Berkshire Hathaway Today
- 52 week interval
- $455.18
▼
$520.30
- The P/E ratio
- 14.16
- Target Value
- $524.50
Berkshire Hathaway NYSE: BRK.B it sits at about $347 billion—about 40% of its market cap.
The company also repurchased about $200 million of its own stock last quarter, but that's a rounding error compared to such a cash pile.
Meanwhile, Greg Abel, who took over as CEO three months ago, is conducting his first annual meeting leading one of the most watched companies in the world.
At first he describes Abela as strong but not electric. “You can't replace the irreplaceable,” he said of Buffett and the late Charlie Munger.
But the most pressing question is not who is running the meeting; that's why so much money sits idle while the market keeps going up.
Buffett gave one telling outline at the meeting: the market has always been a mix of church and casino, and recently the casino side has been getting more traffic. That's not a prediction—it's a way of standing. And Berkshire's actions back it up.
The Unemployment Gap Is Real—And the Reason Matters
Over the past decade, BRK.B has trailed the S&P 500 by about 2.6 percent per year. In the past year alone, that gap has exploded to nearly 39 percent. That's not the sound. It's a story.
Price chart of Berkshire Hathaway Inc. (BRK.B) for Saturday, May 9, 2026
The original answer is not clear: The Magnificent Seven.
The market has used nearly twice as many gains in mega-cap tech compared to the rest of the S&P. And not because earnings growth is so different, but because investors have surprisingly high valuations.
Berkshire, with its railroads, insurance companies, and energy assets, is not in that trade.
The historical parallels are uncomfortable but instructive. In 1999, Buffett looked lost. The headlines pointed out that he had lost his creativity. Then the dot-com bubble burst, and he was certified within 18 months. You've done this before: grab the money, wait for blood on the streets, get on the way down.
The question Early can't answer with certainty is whether the same playbook works in 2025.
AI Is Where Berkshire Is Biggest Exposed
The technology gap within Berkshire's private equity portfolio is clearer than most investors realize.
Greg Abel admitted at the meeting that Burlington Northern Santa Fe is about a decade behind Union Pacific. NYSE: UNP in the adoption of technology. GEICO is facing a similar issue against Progressive NYSE: PGRwhich was among the first insurers to sell policies online in the late 1990s and has never looked back.
A hard read of Abel's words early on: about 80% of his AI commentary focuses on risk, not opportunity. That is not a company that depends on time. He is the one who watches it go by.
On the social equity side, Berkshire has made progress. an apple NASDAQ: AAPL has been its biggest driver of returns, and the portfolio has added Alphabet NASDAQ: GOOGL and Amazon NASDAQ: AMZN in recent years. But those moves came from portfolio managers Todd Combs and Ted Weschler, not Buffett himself—and Combs is gone.
The Contrarian Case of Constellation Software
Constellation Software Today
Constellation Software
As of 05/8/2026 03:54 PM Eastern
- 52 week interval
- $1,612.70
▼
$3,998.72
- Dividend Yield
- 0.21%
- The P/E ratio
- 80.89
Early on, it's not worth investing in value. You update it. His current conviction is Constellation Software OTCMKTS: CNSWFthe company described it as “a Buffett-like way to play the SaaS selloff.”
Founded by Mark Leonard, Constellation has quietly acquired between 500 and 1,000 direct-market software companies over its history—small businesses, with long-term contracts, founder-led cultures, and high customer retention. Leonard recently stepped down from the day job due to health reasons, Mark Miller is now president.
The stock is rooted in the fear of AI: the thought that large language models will simply replace the specialized software provided by these companies. Early thinks that logic has gone too far.
Even if AI replicates 90% to 95% of what an integrated software company does, a missed 5% can create catastrophic risks for the businesses that rely on it. That's not a relationship you give up for a vibe-coded alternative.
That risk/reward setup—a quality software asset priced in an AI apocalypse that may never come—is exactly the kind of miscalculation Buffett is always on the hunt for. The difference? Investing in Constellation is more about technology hunting than avoiding technology altogether.
What This Market Season Is Really About
Early draws an analogy to the early days of the Internet: companies that launched websites in 2000 look ridiculous in retrospect. AI may carry more long-term weight. The hype cycle will adjust—it always does—but fundamental change is almost always underestimated on any ten-year horizon.
Berkshire's risk isn't just underperformance. It is that the railways may be disrupted by private trucks. That insurers without AI-driven underwriting are losing the world forever. Holding onto money while waiting for a crash means missing out on a combination that is already happening elsewhere.
Early still holds his Berkshire shares; he just doesn't come. And for what it's worth, you're thinking more about Consellation Software instead.
The market will eventually sort out what has fair value and what doesn't. The setup to watch: whether Berkshire's cash pile becomes a weapon—or just a record.
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