During a recent appearance on CNBC's 'Squawk Box,' Greg Abel addressed the impact of Japan's 10-year bond yield reaching a 30-year high, stating that it is manageable for the major trading companies in which Berkshire Hathaway holds significant stakes.
He emphasized that none of these firms view the rising yields as a fundamental challenge, noting that Japan's yields, while historically high, remain low compared to global standards. For context, Japan's 10-year bond yield is just above 3%, whereas the U.S. 10-year Treasury yield recently surpassed 4.8%.
Berkshire Hathaway owns over 10% of five of Japan's largest trading houses—Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo—which are involved in diverse sectors from energy to consumer goods. Abel's visit to Tokyo included discussions with these firms, and he expressed confidence in continuing to invest in yen despite the high yields.
He also highlighted the strong relationships Berkshire has built with these companies since its initial investments six years ago, which have yielded substantial returns. Abel's comments suggest a long-term commitment to these investments and an optimistic outlook on future opportunities in Japan and beyond