OMAHA — Billionaire investor Warren Buffett doesn't know how the economy will recover from the coronavirus outbreak shutdown, but he remains optimistic in the long-term future of the United States.
Buffett said Saturday at Berkshire Hathaway's online annual meeting that there's no way to predict the economic future right now because the possibilities are still too varied. Berkshire's meeting was held without any of the roughly 40,000 shareholders who typically attend.
"We do not know exactly what happens when you voluntarily shut down a substantial portion of your society," Buffett said, because it has never been done. He said it may take several years to understand all the economic implications of the coronavirus outbreak, but it hasn't changed his long-term view because the country has endured wars and depressions before.
“I remain convinced ... that nothing can basically stop America,†Buffett said.
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All of the events surrounding the annual meeting, including a trade show where Berkshire companies sell their products, were canceled this year because of the coronavirus pandemic, and Buffett will have a different partner for the question session.
Instead of sitting next to business partner Charlie Munger in an arena filled with shareholders, Buffett was joined this year by Berkshire Vice Chairman Greg Abel, who oversees all of the company's non-insurance businesses, to answer questions in front of a Yahoo Finance camera.
“It's certainly a break with years and years of tradition with Buffett and Munger,†said Andy Kilpatrick, a retired stockbroker who wrote a Buffett biography and has attended every annual meeting since 1985.
The fact that Abel is appearing alongside Buffett will add to speculation that he could one day succeed the 89-year-old billionaire as CEO, but it likely also reflects the fact that Abel is based relatively close to Omaha, in Des Moines, Iowa. Abel and fellow longtime executive Ajit Jain, who oversees Berkshire's insurance businesses, are seen as the two most likely successor candidates although Buffett has no plans to retire.
Omaha will miss out on the profits that come from all the out-of-town visitors attending the meeting. Local economic development officials estimate that Berkshire Hathaway's annual meeting normally provides a $21.3 million boost to the area.
Buffett and Abel likely will be asked about the nearly $50 billion loss that Berkshire reported Saturday morning and the huge pile of cash the company is holding.
Berkshire said it lost $49.7 billion, or $30,653 per Class A share, during the first quarter. That's down from last year's profit of $21.66 billion, or $13,209 per Class A share.
The biggest factor in the loss was a $54.5 billion loss on the value of Berkshire's investment portfolio as the stock market declined sharply after the coronavirus outbreak began. The year before, Berkshire's investments added $15.5 billion to the company's profits.
Buffett has long said Berkshire’s operating earnings offer a better view of quarterly performance because they exclude investments and derivatives, which can vary widely. By that measure, Berkshire’s operating earnings improved to $5.87 billion, or $3,617.62 per Class A share, from $5.56 billion, or $3,387.56 per Class A share.
Analysts surveyed by FactSet expected operating earnings per Class A share of $3,796.90 on average.