Announces he has canceled his Airline Investments and thats not all. Warren buffett revealed this weekend, which was nothing like you are seeing on the screen, it was a virtual Berkshire HathawayShareholder Meeting with just buffett and one other person on the stage. Our expert buffett panel is here to read between the lines of what buffett really said. Wall street, as we look at this, it has happened. A National Store chain has succumbed to the coronavirus. J. Crew filed for bankruptcy protection, leading us to ask whos next. Major Industry Groups are now banding together by asking congress to prevent another one from going bankrupt. One of the biggest retail lobbyists is here on why the trump tariffs must be suspended if retail is to survive. And as restaurants, oh, boy, we know how tough its been for them, across the country take baby steps to reopen, weve got one of the bestknown star chefs of the world here. Celebrity chef Rocco Despirito on how to put out the massive corona fire consuming your favorite restaurants right now. Are video gaming stocks the play of the future . Let the games begin. An hour to the closing bell so lets start the claman countdown. Liz folks, we are just getting this breaking news at this hour. Senior u. S. Treasury Officials Say that the United States is borrowing more in the Second Quarter than all of last year. Lets go to Edward Lawrence. Edward, you have a breakdown of these numbers which are now just being released. Tell us. Reporter yeah, this is a huge we knew a huge amount of numbers. We are talking about huge figures here. We knew the coronavirus would be expensive. Now we know or are getting a glimpse in just how expensive it would be. In all of last year the federal government borrowed 1. 28 trillion. In this quarter, in the Second Quarter, the u. S. Treasury expects to borrow 2. 99 trillion. A swing for them in the estimate of 3. 05 trillion because they were planning this quarter on paying down the debt by 50 billion but that swing obviously, because the coronavirus spending package as well as a senior treasury official saying reduced revenue coming into the coffers. For the third quarter, the u. S. Expects to borrow 677 billion but again, this quarter, really seeing the impact of all the stimulus that has gone through. Almost 3 trillion is what the u. S. Will borrow. They will have 800 billion in cash on hand. Now again, the last record for the Second Quarter borrowing was 344 billion back in 2010. This blows away any record related to that. Back to you. Liz blows away any record. Just keep churning out the money. Edward, thank you very much. Edward lawrence. You know, what the government has done, whether thats the Federal Reserve or treasury or congress, is something that Warren Buffett said he thought was fantastic right now. The oracle of omaha owning up to some of his own investing errors during his first ever virtual annual Shareholder Meeting. Warren buffett saying if you are an investor in any Oil Production company, you will join me in having made a mistake so far in terms of where oil prices went. This was an answer to a question about his 10 billion preferred investment in Occidental Petroleum which has just been disastrous. All right. This weekend, though, was the stark contrast to what you are seeing on the screen just a year ago. Thats this video from when team fox business went to omaha, nebraska to see thousands of berkshire shareholders lining up predawn, sometimes freezing outside omahas Chi Health Center arena, waiting for their chance to see and learn from Warren Buffett himself. In years past, we take you to the inside of what happened. They have mobbed him as he walked through the Convention Center floor ahead of the long hours, long Shareholder Meeting. This time, he sat in the arena, emptied by the coronavirus fears. Also new, vice chairman and possible successor, greg abel at his side, as buffett dropped some pretty big bombshells on the investing world. Here to pull out the most important ones is our buffett panel. Larry cunningham, who has written, what, no fewer than five books on buffett and berkshire investor bill smead who says buffett revealed, in bills opinion, hes lost his mojo when it comes to investing optimism. Good to see you both. All right. I want to begin with bill, because thats a pretty dramatic statement. Whats your headline here . Because he went on and on talking about how it is best never to bet against america, it was a very patriotic speech, yet he jucst dumped all his airline stock. Whats your headline . The headline is never bet against america but dont own american airlines. What i meant was, he started his History Lesson telling you about 1929 to 1954, when his teacher amassed a great track record in Value Investing in an era where the dow jones index went from 380 in 1929 to 380 in 1954, and the irony of his talk and the reason that we think he might have lost his mojo is he did not mention that ben graham would be thrilled with the current circumstances. Because theres loads and loads of small to midcap bargains in the bargain bin, but buffetts company is too large to take advantage of that. Liz well, larry, let me get to you. During the meeting, Warren Buffett said that he didnt know, regarding the airlines, whether two to three years from now, this is a direct quote, whether people will fly as many passenger miles, commercially, as they did last year. What do you decipher here . Whats the hidden message of the Bigger Picture from the fact that he cant even see two to three years out . Does that mean that maybe one of these airlines, because they own four of them, the biggest ones, might not exist in the future . Its a pretty good signal to that effect. He made clear the reason he was sharing his views on those companies wasnt a prediction about the stock market but effectively a prediction about the industry. We have excess capacity, declining future demand, thats other than temporary, and all four airlines, borrowing significant amounts of money. Its pretty clear to see one of them is going to be in serious trouble and this is not entirely new. Warren has had an infatuation with airlines going back probably to his childhood, certainly in the 90s he made quite a bad investment with usair that led him to funny quotes from the airline industry. Another one thats getting hammered is the European Aviation company, Virgin Atlantic run by richard branson, a wealthy fellow who was once asked how do you become a millionaire and he said its easy, start as a billionaire and buy an airline. So its a tough industry. Its always been tough. It will just get tougher. Liz gordon gekko never liked it either. I have to say, too, i thought this was interesting. He brought up boeing. Of course, under berkshires umbrella, he has precision cast parts and some people questioned the value of that Gigantic Company which became one of the biggest expenses for buffett. He in essence said the likes of boeing and airbus cutting production, what does that mean for precision cast parts . He was pretty clear in saying, you know, its going to have an effect and it wont be a good one. Its going to hurt a lot and the other point he made is that berkshire is vast and sprawling. Its got arteries in every part of american industry, so some of the companies are going to be hammered, like precision. Others might not do so poorly. Net jets, for example. Private aviation. Buffett made another smelling the tea leaves, he said private aviation may be a different story. Net jets may come out of this quite well. But for commercial aviation and the manufacturers, its going to be a disaster. Liz yeah. And those stocks are getting hammered right now. Boeing is down about 2. 6 . Bill, buffett heaped lavish prays on jerome powell, head of the Federal Reserve, for inserting the feds power and muscle the minute things got ugly, and in fact, he said i salute the fed because fear is the most dangerous disease ever, it makes the virus look like a piker. We came very close to a total freeze. He then said you know, the government really financed things in a huge way to stop any kind of insolvency but if you look between the lines here, buffett did not buy any stocks, really, to speak of during this time, whereas what a difference between now and 2008 when he was scooping up just about everything in sight, because it was at such a discount. Did he miss his window . Well, i dont think he missed his window. You have to understand where we are from a historical perspective. Growth stock investing has been as popular in the last ten years as any ten years in u. S. History. Buffetts modus operandi is to buy whole companies if offered and when prices are high hes not interested in those offers and secondarily, Value Investments have been in the dumper, in the bargain bin, and are small and his massive capital base requires, for him to invest 10 billion in a company, its probably going to have at least a 100 billion market cap. So buffetts biggest problem is hes capital constrained, number one, and then the second problem hes got is, and i felt bad for him when he said this. When he talked about the airlines he says well go back to flying but in my case it might be private. Just think how arrogant that sounds. Its like bill gates said we should all [ inaudible ] for six months on the economy, then bought a 43 million mansion in san diego. How does that look to the average person . Thats furloughed and would like to have access to that 43 million . Liz well, i want to know how it looked to the average shareholder. Its pretty exciting, larry, when he shared the stage not with his longtime Business Partner and vice chair, charlie munger, who is 95 years old and it wouldnt have made sense for him to make the trip to omaha, but he shared it with greg abel, a vice chairman and also ceo and head of Berkshire Hathaway energy. There is greg on your screen with me about a year ago. I got to tell you, i thought it was very interesting, abel answered some questions but he also disagreed a little bit with buffett, when buffett defended share buybacks as a way of distributing cash but abel said you know, when you use Financial Engineering like the airlines did, he didnt say the airlines but i think that was sort of the subtext here, its a little extreme, quote, and too cute instead of using their Balance Sheet to leave a cushion, they neglected to build a cushion. Do you think, because succession did not come up, that that was the underlying meaning that had greg abel onstage, hes the one . I think geography played a role, too. He was able to drive down from des moines without needing to involve lots of other people but i do think to gregs credit, he has Berkshire Hathaway in his blood. I think the point you just made showed that. He stressed the importance of capital allocation, the commitment to berkshire culture, to buying carefully, to owning forever. I think he would be an excellent successor. He would be an excellent choice. The Silver Lining to me in that otherwise sad absence of charlie and absence of all gathering together was it gave him a chance to introduce himself to the berkshire shareholder group. Liz okay. Gentlemen, we have to run. Bill, one last question. I need it to be one word. Are you going to shed your shares of Berkshire Hathaway, yes, no, maybe . In our work, with a concentrated portfolio, we have to make what we call sophies choice. Very difficult choice among things that we like. Based on what buffett said, if our impression that we bounce back better than he seems to be assuming, we might have to do that. Liz bill smead saying he might have to sell his shares after holding them for quite some time. Good to see you both. We do appreciate it. One last point, folks. If you invested in Berkshire Hathaway back in the 80s, you would be up 91,000 . Thats why buffett has such a reputation of being the greatest investor. All right. We have the closing bell ringing in about 46 minutes. Dow jones industrials have pared even more losses. We are now down just 51 points. S p has turned positive, up three points. Nasdaq better by 71. Womens apparel chain francescas getting thrown into the return pile, the retailer warning it may not be able to go on as the Coronavirus Crisis ravages sales and cash flow. That stock, now 2, is down 17 . For j. Crew, ye of the preppy barn jackets, the situation is even more dire as it waves the white flag. Coming up, what the retail industrys biggest names are saying right now to congress to keep your Favorite Brands from falling victim to the covid19 retail apocalypse and maybe even your favorite investment. Countdown coming right back. There are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Confident financial plans, calming financial plans, complete financial plans. Theyre all possible with a cfp® professional. Find yours at letsmakeaplan. Org. Many of lifes moments in thare being put on hold. Are staying at home, at carvana, we understand that, for some, getting a car just cant wait. To help, were giving our customers up to 90 days to make their first payment. Shop online from the comfort of your couch, and get your car with touchless delivery to keep you safe. And for even Greater Peace of mind, all carvana cars come with a sevenday return policy. So, if you need to keep moving, were here for you. At carvana the safer way to buy a car. Our Retirement Plan with voya gives us confidence. We can spend a bit now, knowing were prepared for the future. Surprise we renovated the guest room, so you can live with us. Im good at my condo. Well planned, well invested, well protected. Voya. Be confident to and through retirement. Daddy, i found you good job. Now im gonna stay here and you go hide. Watch your favorites from anywhere in the house with the Xfinity Stream app. Free with your xfinity service. Now any room can be a tv room. Stream live tv, on demand shows and movies, even your dvr recordings. Download the Xfinity Stream app today to stream the entertainment you love. And now for their service to the community, we present limu emu doug with this key to the city. [ applause ] its an honor to tell you that Liberty Mutual customizes your Car Insurance so you only pay for what you need. And now we need to get back to work. [ applause and band playing ] only pay for what you need. Liberty. Liberty. Liberty. Liberty. Liz say it aint so, j. , as in j. Crew. J. Crew is now the First National retailer to fall even as we see the s p 500 jump five points at the moment. J. Crew of course, the coronavirus pandemic is just destroying them. Known for its chinos and bar jackets, the apparel chain founded in 1947 has filed for bankruptcy protection. That doesnt mean its going away forever. Its not liquidating. But bankruptcy protection doesnt necessarily mean you are saved. J. Crew may not be the last, even though its the first big national chain. Rumors have been swirling for weeks that jw pc penney, we tal about neiman marcus, they are facing perhaps their final doorbusters. Enter the cavalry. Industry lobbyist, the American Apparel and Footwear Association whose members include 3m, gap, target and under armour. We bring up these names because they have actually shifted their Assembly Lines to create personal protection equipment. Well, they have joined forces with other fashion associations in sending a letter to congress on friday filled with requests to keep the industry alive. One of the authors of that letter, steve lamar, joins us now. Steve, the recommendation in your letter that jumped out at me involved tariffs and what you said was quote, we recommend the extension of the freeze on tariffs to cover imports made during may and june, and possibly additional months if the crisis persists, and expand the program to defer the due dates for all duties and fees. How damaging are the tariffs right now . Well, they are very damaging, liz. Thank you for having me on the show. You know, we are trying to save american lives and american livelihoods and its hard to do that when we face this crushing tariff burden. Last month, we paid about 1. 5 billion of tariffs and its really hard for companies that are trying to support u. S. Jobs, companies that are trying to repurpose their factories, their supply chains, to rush desperately needed items of personal protective equipment, things like masks and gloves, to hospitals and doctors. Its hard to do that when they have to face these tariff burdens.