Warren Buffett has backed a winner in Alphabet, and there's a bigger worry than AI stocks crashing, veteran investor Tom Russo says

Company Insights - Warren Buffett's Berkshire Hathaway has made a significant investment in Alphabet, purchasing 17.8 million shares valued at $4.3 billion as of September 30, which surprised many given Buffett's historical aversion to technology stocks [2] - Alphabet's stock price increased nearly 40% in the three months ending September 30, rising from under $180 to $244, and has continued to climb another 17% to over $285 [3] - Despite the recent stock price increase, Alphabet is still trading at a "below-market" price-to-earnings ratio, indicating potential for further growth [3] - Alphabet's long-term investment strategy, which may constrain short-term profits, is viewed positively by analysts, highlighting its capacity to endure market pressures [4] - The company is recognized for its substantial investments in research and development, which are seen as essential for future profitability [5] Industry Context - The U.S. national debt has nearly doubled in the past decade, now exceeding $38 trillion, which could lead to significant financial disruption beyond just a potential collapse in AI stocks [10] - The pressure to service this growing debt and threats to the U.S. dollar's status as the world's reserve currency may result in a weaker dollar, impacting global economic stability [10][12] - Analysts suggest that financial disruption could occur in bond and currency markets, as well as in broader macroeconomic and political contexts [11]