Warren Buffett, the Bitcoin Sceptic, Now Warns of US Dollar Instability, Inflation

Warren Buffet have always had harsh words for bitcoin. In the 2018 annual shareholder meeting for Berkshire Hathaway, Buffett called the digital currency Bitcoin “probably rat poison squared.”

Buffet failed to see bitcoin as a hedge against inflation, but now, he is clearly calling out the reckless fiscal policies that are causing inflation.

Buffett Cautions Against Erosion of US Dollar Value

Billionaire investor Warren Buffett has issued a stark warning about the US economy, cautioning that reckless fiscal policies could erode the stability and purchasing power of the US dollar.

In Berkshire Hathaway’s latest annual letter to shareholders, Buffett emphasized the risks of excessive government spending and poor monetary policies, stating:

💬 “Paper money can see its value evaporate if fiscal folly prevails. In some countries, this reckless practice has become habitual, and in our country’s short history, the U.S. has come close to the edge.”

He also warned that fixed-coupon bonds offer no protection against inflation or a weakening currency.

Capitalism Under Stress, But Still the Best System

Despite raising concerns about economic mismanagement, Buffett reaffirmed his belief in capitalism, though he acknowledged that the system has suffered from increasing levels of abuse and inefficiency.

📌 “Capitalism has its faults and abuses – in certain respects more egregious now than ever – but it also can work wonders unmatched by other economic systems.”

He pointed out that, while scammers and financial manipulators have always existed, American capitalism has consistently delivered long-term prosperity—even through periods of economic turbulence and intense competition.

Buffett Prepares to Pass the Torch at Berkshire Hathaway

At 94 years old, Buffett also hinted at his impending retirement from Berkshire Hathaway, signaling that Greg Abel is set to take over as CEO.

🚀 “At 94, it won’t be long before Greg Abel replaces me as CEO and will be writing the annual letters.”

Buffett praised Abel’s investment approach, highlighting his ability to seize rare market opportunities, a quality that defined Buffett’s own legendary career alongside the late Charlie Munger.

What’s Next for the US Economy?

Buffett’s concerns about fiscal irresponsibility echo broader fears of rising national debt, inflation, and economic instability. His message suggests that investors should remain cautious, focusing on assets that can withstand currency devaluation and economic downturns.