Wednesday, April 29, 2020
Volume 1, Issue 19


In Today’s Issue:

  • Berkshire Hathaway Annual Meeting
  • Bill Gates discusses the current pandemic
  • Permanent Equity COVID-19 Impact Survey
  • Bill Ackman Interview
  • Farnam Street “Pop Up” School

To read last week’s newsletter please click here.


Berkshire Hathaway Annual Meeting

Berkshire Hathaway will hold its 2020 Annual Shareholders Meeting on Saturday, May 2 at 3:45 pm central time, as previously scheduled. However, due to the pandemic, shareholders will not be allowed to attend in person. The only managers who will be present will be Chairman and CEO Warren Buffett and Vice Chairman Greg Abel. The annual meeting will be webcast on Yahoo! with a pre-meeting show beginning at 3:00 pm central time.

Shareholders will not be able to ask questions directly during the meeting but can submit questions to berkshirequestions@cnbc.com. Becky Quick of CNBC will select questions to ask during the Q&A session.

I decided to submit three questions for consideration. The questions appear in a new article posted on The Rational Walk yesterday.  

There have been four other recent articles on The Rational Walk regarding Berkshire that could be of interest to those planning to watch the annual meeting:

Larry Cunningham has written an interesting opinion article for MarketWatch regarding how Warren Buffett has handled the COVID-19 pandemic so far. Cunningham is the author of several books on Berkshire Hathaway and Warren Buffett, with Margin of Trust, which I reviewed on The Rational Walk in January, being the most recent release. Cunningham is hosting a webinar on Friday, May 1 at 3:00 PM Eastern Time to discuss the annual meeting. 


Bill Gates Discusses the Pandemic

Bill Gates published The First Modern Pandemic on April 23, a long memo covering the exponential growth that led to the current crisis, an assessment of our reaction to the pandemic, and what we have learned so far. He then goes into a detailed discussion of potential treatments and vaccines, with some sobering thoughts on the length of time that might be required to develop such remedies. He describes how society can safely open up again and hopefully achieve a “semi-normal” state:

Most developed countries will be moving into the second phase of the epidemic in the next two months. In one sense, it is easy to describe this next phase. It is semi-normal. People can go out, but not as often, and not to crowded places. Picture restaurants that only seat people at every other table, and airplanes where every middle seat is empty. Schools are open, but you can’t fill a stadium with 70,000 people. People are working some and spending some of their earnings, but not as much as they were before the pandemic. In short, times are abnormal but not as abnormal as during the first phase.

Gates advocates an assessment of the costs and benefits of various types of activities, weighed against the risks. As the United States slowly reopens in the coming weeks and months, policymakers will need to obtain the best possible information regarding risks and try to come up with the right balance between the risk of a second wave of infection and restoring some semblance of normalcy to society. 

Earlier this month, I published The World Has No Pause Button which concluded with the position that the restrictions should not be lifted until the risk of an uncontrolled second wave of infections is contained. The risk is going to vary widely in the United States given the size of the country and will mostly be decided at the state and local level in the coming weeks.


Permanent Equity COVID-19 Impact Survey

Economic modeling is no substitute for listening to the experiences of people and businesses actually navigating their way through the pandemic. Permanent Equity collected data from 336 business owner/operators from 43 different states and compiled a detailed report as well as a summary

The report confirms that the impact of COVID-19 has been widespread and severe. However, despite the massive challenges ahead, 77 percent of respondents say that they believe that their business will emerge from this crisis stronger than before. 

This is a very useful report to review in order to get a sense of how smaller businesses in the real economy are faring during the crisis. I also found this week’s interview of Permanent Equity CEO Brent Beshore on The Acquirers Multiple podcast quite interesting.


Bill Ackman Interview

Shane Parrish interviewed Bill Ackman, CEO of Pershing Square Capital Management, in this week’s Knowledge Project podcast. This ninety minute interview covered a wide range of topics including the role of short sellers, the very profitable hedge he made early this year due to concerns regarding COVID-19, the government’s response to the pandemic, and his thoughts regarding Berkshire Hathaway. 


Farnam Street’s Pop-up School

Farnam Street has created a “kid driven pop-up school” with guest lectures targeted to children in grades 4 and 5. So far, there are twenty videos covering a variety of topics including intellectual property, autonomous cars, marketing, investigative journalism, investing, running a business, physics, biology, yoga, meditation, and more. 

All of the videos are available for free from the link shown above and many of them look interesting. It might be worth a look if you have children at home with not enough to do.


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Copyright and Disclosures

Nothing in this newsletter constitutes investment advice and all content is subject to the copyright and disclaimer policy of The Rational Walk LLC. 

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