Warren Buffett said he would buy US stocks in the event of World War III – and warned against holding on to cash.
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Geopolitical uncertainty rises slightly in 2026.
As of March, there are 46 active conflicts in 76 countries, according to the online Global Conflict Map (1). The Persian Gulf crisis takes the spotlight, but conflicts like the Afghanistan-Pakistan war (2), and US strikes in Ecuador fly under the radar (3).
If you think the growing tensions could spill over into World War III, you’re not alone. The majority of respondents to a Politico survey from the US, Canada, France, Germany and the UK said that global war is more likely than not in the next five years (4).
“I think we are very close [WW3],” Ben Rhodes, former deputy national security adviser to President Obama, told Wired magazine in a recent interview (5) Rhodes estimates that we are already two-thirds of the way to world war, with the possibility of China attacking Taiwan representing the last third.
Although it is difficult to predict the future, many investors may not know what to do in the event of a global conflict. According to the famous investor Warren Buffett, the answer is surprisingly simple: “I’m still going to buy stocks,” he told CNBC during a 2014 interview, referring to the stock market (6).
That’s why the Oracle of Omaha chooses its favorite asset class even at unprecedented times.
In general, global tensions tend to reduce investors’ appetite for risk, which tends to push investors away from stocks and bonds, and into assets such as gold and cash.
However, Buffett says this is the wrong approach.
“You will be much better off having productive assets,” he explained. Buffett pointed out that the American stock market rose during World War II, which is a clear sign that the number of productive enterprises is strong enough to withstand the pressure from world conflicts.
“In the five months following the attack on Pearl Harbor – which ushered the United States into World War II – the S&P 500 fell nearly 17%,” said a Standard & Poor’s report published shortly after September 11, 2001 (7). But by the time the war ended in 1945, the index had improved by 62 percent from its level on December 7, 1941.”
This remarkable endurance is not limited to stocks. Farms, real estate or any other asset class that delivers tangible returns, Buffett believes, may be good for parking money during a global downturn.
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To be fair, past performance isn’t exactly an indicator of future returns, and it’s hard to know how stocks, real estate, and other productive assets will behave during the hypothetical Third World War.
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Moby’s custom reports can help you become a smart investor in just five minutes. Meanwhile, Buffett says the smartest thing investors can do during a potential global war is to avoid one asset class: cash.
By definition, global conflict can increase volatility and unpredictability. However, there is one thing Buffett believes investors should expect under such conditions: inflation.
“One thing you can be sure of is that if we go to a very big war, the value of money will go down,” he told CNBC. “That happens in almost every fight I know.”
If you are not risk averse, finding another good way to earn money is not easy. Fortunately, you don’t have to make these decisions alone. Advisor.com can help connect you with a professional near you for free.
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Navigating a volatile market, especially during a global crisis, is never easy. But with the right advisor on your team, you can make smart money moves with more confidence.
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We rely only on vetted sources and reliable third-party reporting. For details, see our editorial ethics and guidelines.
Map of World Conflicts (1); Council on Foreign Relations (2); New York Times (3); Politics (4); Wire/YouTube (5); CNBC (6); Common and poor (7).
This article provides information only and should not be construed as advice. Offered without warranty of any kind.
