<div id="readability-page-1"><div>Submitted by QTR's Fringe FinanceFor the better part of the last year, Wall Street has behaved like a teenager who just discovered Red Bull and leverage at the same time. Anything remotely tied to artificial intelligence has soared into the financial stratosphere.Startups with no revenue, no profits, andoccasionally no actual productare raising millions or billions because their founders can say the words “large language model”. Public company CEOs now jam “AI” into earnings calls with the same shamelessness that “trendy” gastropubs have when being the 4th “new” place on the block to not just offer a good ole’ fashioned cheeseburger, but the breathtaking innovation of atruffle aioli smashburger.Meanwhile, looming over all of this market hysteria was Berkshire Hathaway and its absurd cash pile. More than $390 billion sitting on the sidelines while markets rocketed higher. The question became an obsession. What were Warren Buffett and his successor Greg Abel waiting for?Surely this cash hoard was being preserved for some grand masterstroke. Maybe Berkshire would make a massive AI acquisition. Maybe it would take a huge stake in some futuristic robotics company whose product sounds vaguely dystopian. Maybe Buffett would emerge from Omaha wearing a black turtleneck and announce BerkshireGPT.Nope. None of these. The filing arrived yesterday and Wall Street discovered that the answer wasMacy’s:a company most people associate with buying last minute wedding gifts and wandering through perfume fog thick enough to qualify as weather.In an era when investors are paying breathtaking multiples for companies promising that AI will revolutionize enterprise workflows, Berkshire appears to have strolled calmly into a department store hoping to get harassed by the Vancome lady.<img width="500" height="277" src="https://imageproxy.pbkrs.com/https://files.zhedge.com/cdn-cgi/image/width=1920,quality=75,format=auto/https://assets.zerohedge.com/s3fs-public/inline-images/Screenshot%202026-05-19%20at%2008.03.15.jpg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://files.zhedge.com/cdn-cgi/image/width=1920,quality=75,format=auto/https://assets.zerohedge.com/s3fs-public/inline-images/Screenshot%202026-05-19%20at%2008.03.15.jpg"/>It is notable to write about because it feels so aggressively out of sync with the cultural moment.Right now entire hedge funds are building investment theses around the possibility that artificial intelligence may someday help your refrigerator compose emails and then there is Berkshire, quietly behaving like an investor that ignores market spectacle and focuses instead on underlying value. While others chase whatever appears most exciting in the moment, Berkshire tends to concentrate on businesses and assets that are durable, understandable, and often overlooked.Berkshire likely was attracted to Macy’s because it combined several characteristics long associated with Buffett-style investing:a deeply discounted valuationtrading near book value and at a low forward earnings multiple, substantialunderlying real estate assetsincluding the flagship Herald Square property, strong cash generation and shareholder returns through free cash flow and dividends, and a credible turnaround strategy focused on closing weaker stores while reinvesting in stronger locations.Berkshire also likely recognized the enduring value of Macy’s higher-performing brands, particularly Bloomingdale’s and Bluemercury, which provide growth and profitability beyond the traditional department store business. In fact, a lot of the reasons Berkshire bought Macy’sremind me of another retail stock that I think is similarly as attractive to own right now.And this isn’t to say Berkshire is anti-technology. The company increased its stake in Alphabet and clearly understands where the economy is headed. But Berkshire has spent decades avoiding one of the central mistakes in modern investing: confusing a compelling narrative with a compelling investment. A transformative future does not automatically justify any price. Investors learned that during the dot-com bubble, when companies with weak earnings and questionable business models were treated as inevitable paths to wealth. Many eventually discovered that enthusiasm alone is not a substitute for sustainable economics. Theywill learn this again with the AI bubble.<img width="500" height="320" src="https://imageproxy.pbkrs.com/https://files.zhedge.com/cdn-cgi/image/width=1920,quality=75,format=auto/https://assets.zerohedge.com/s3fs-public/inline-images/Screenshot%202026-05-19%20at%2008.03.50.jpg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://files.zhedge.com/cdn-cgi/image/width=1920,quality=75,format=auto/https://assets.zerohedge.com/s3fs-public/inline-images/Screenshot%202026-05-19%20at%2008.03.50.jpg"/>That is what makes the Macy’s move so interesting. It suggests that Berkshire still sees value in businesses the market has largely dismissed as boring, outdated, or finished. Macy’s possesses valuable real estate, broad brand recognition, and consistent cash generation — qualities that can become easy to overlook in markets dominated by growth narratives. Perhaps most importantly, expectations surrounding the company have become so low that stability itself can exceed investor assumptions.That may be the broader lesson for investors. Markets often become fixated on whatever appears revolutionary while overlooking companies that quietly generate profits in less glamorous industries. Investors naturally want exposure to the future, but there can also be opportunity in businesses that continue to serve enduring consumer needs and produce reliable cash flow.Investors should also be careful about dismissing Berkshire Hathaway simply because it appears old-fashioned in an era defined by speed and disruption. Yet Berkshire has continued to compound wealth across market cycles while many trend-driven strategies have struggled to deliver lasting results.<hr/>🔥50% OFF FOR LIFE:Using this coupon entitles you to 50% off an annual subscription toFringe Financefor life:Get 50% off forever<hr/>The lesson is not that investors should rush to buy Macy’s. It is that when disciplined long-term investors begin allocating capital to areas the broader market has written off, it is worth paying attention. Wall Street is often drawn to what is new and exciting. Berkshire has historically succeeded by identifying value where others stopped looking.Another lesson is that patience remains one of the most underappreciated advantages in investing. Modern markets reward constant activity, rapid reactions, and short-term narratives, but Buffett’s track record has repeatedly demonstrated the power of allowing investments time to mature. Companies facing temporary pessimism or cyclical weakness are often abandoned long before their underlying economics can recover. Berkshire’s approach suggests that long-term value is frequently created not through constant trading, but through disciplined conviction and the willingness to endure periods of unpopularity.There is also a lesson about temperament. Successful investing is often less about predicting the future perfectly and more about avoiding emotional decision-making when sentiment becomes extreme. During periods of market excitement, investors can feel pressure to chase momentum and follow consensus thinking. Conversely, when industries fall out of favor, fear and pessimism can create opportunities for investors willing to evaluate businesses on fundamentals rather than headlines. Berkshire’s history reflects an investment philosophy grounded in rationality and discipline rather than market emotion.Finally, Berkshire’s strategy highlights the importance of understanding the difference between a good company and a good stock at a particular price. Even strong businesses can become poor investments when expectations become unrealistic, while unpopular companies can sometimes offer attractive risk-reward profiles if expectations fall too far. The broader lesson is not that every overlooked stock represents hidden value, but that investors benefit from questioning consensus assumptions. Markets are highly efficient much of the time, but periods of excessive optimism and excessive pessimism continue to create opportunities for patient, disciplined capital allocators.Now read:<ul><li>Under The Chaos, One Stock Still Looks Cheap</li><li>The Fed Will Invent New Inflation Numbers Out Of Thin Air</li><li>Your Retirement Is Being Used To Buy Wall Street's Toxic Sludge...Again</li><li>Bonds Are Screaming &#34;Something's Wrong&#34;</li><li>This Rally Ends In Panic</li><li>Time For Rate Hikes</li></ul><figure>--</figure>QTR’s Disclaimer:Please read my full legal disclaimeron my About page here.This post represents my opinions only.In addition, please understand I am an idiot and often get things wrong and lose money. I may own or transact in any names mentioned in this piece at any time without warning. Contributor posts and aggregated posts have been hand selected by me, have not been fact checked and are the opinions of their authors. They are either submitted to QTR by their author, reprinted under aCreative Commons licensewith my best effort to uphold what the license asks, or with the permission of the author.This is not a recommendation to buy or sell any stocks or securities, just my opinions. I often lose money on positions I trade/invest in. I may add any name mentioned in this article and sell any name mentioned in this piece at any time, without further warning. None of this is a solicitation to buy or sell securities. I may or may not own names I write about and are watching. Sometimes I’m bullish without owning things, sometimes I’m bearish and do own things. Just assume my positions could be exactly the opposite of what you think they are just in case. If I’m long I could quickly be short and vice versa. I won’t update my positions. All positions can change immediately as soon as I publish this, with or without notice and at any point I can be long, short or neutral on any position. You are on your own. Do not make decisions based on my blog. I exist on the fringe. If you see numbers and calculations of any sort, assume they are wrong and double check them. I failed Algebra in 8th grade and topped off my high school math accolades by getting a D- in remedial Calculus my senior year, before becoming an English major in college so I could bullshit my way through things easier.The publisher does not guarantee the accuracy or completeness of the information provided in this page. These are not the opinions of any of my employers, partners, or associates. I did my best to be honest about my disclosures but can’t guarantee I am right; I write these posts after a couple beers sometimes. I edit after my posts are published because I’m impatient and lazy, so if you see a typo, check back in a half hour. Also, I just straight up get shit wrong a lot. I mention it twice because it’s that important.</div></div>

BRK.A

BRK.B

Berkshire Hathaway has made a surprising investment in Macy's, diverging from the current trend of high valuations in AI-related companies. This move reflects Buffett's focus on underlying value rather than market hype. Macy's offers a discounted valuation, strong cash flow, and valuable real estate, suggesting that Berkshire sees potential in overlooked businesses. The investment serves as a reminder that stability and consistent profits can be more valuable than chasing trendy narratives in the market.

- Wall Street's recent fascination with AI has led to a surge in investments, often disregarding underlying business fundamentals in favor of hype.  
- Berkshire Hathaway's unexpected investment in Macy's highlights its strategy of focusing on undervalued companies with solid fundamentals rather than chasing trends.  
- This move suggests that patient, disciplined investing can reveal opportunities overlooked by the market, emphasizing the importance of evaluating businesses on their economic merits rather than market sentiment.

Berkshire Trolls The AI Bubble By Buying Macy's