Costco inver go in to any week. 27 this week alone. Travel stocks hitting hard getting hit hard. It is pain in the sector of the market. Scarlet lets check in with our reporters to get more insight on what they were watching heading to the close. Abaco, get uss, started. The s p 500, this is the last three weeks back and correction on the coronavirus. As for the uptick, volatility i am told it had to do with corporate buybacks and that is when corporations come in here we see a little bit of that but we are still down and technical damage done suggesting more selling probably ahead for the s p 500. This the fiveyour chart in relationship to the 200 week moving average fiveyear chart in relation to the 200 week moving average. Back in 2015, once the s p 500 went below the 100 week moving average, it cuts down to the 200 week moving average heard a similar situation in 2018. Last week going below it and this afternoon touching off of it. Bearishthe inside candle suggesting volatility and had. I am looking at the bloomberg since index, worse week 2018, shrugging off payroll numbers. What it is focused on is the plunging treasury yields and expectation of easing and the coronavirus. Missing the dollar advance for the first two months of the year. And then everything changed after the expectations of a fed rate cut. Today, the dollar is low against all but one of the major havens. We are seeing the end and the swiss bank getting a bid. It is cruz stocks the hardest hit your time talking about royal caribbean, carnival and norwegian, all sliding on the day. Carnivals grand princess is being held off the coast of california while some are tested for coronavirus. President donald trump set all 5000 people aboard will be tested. Royal caribbean will allow of ships to cancel up to 48 hours before sailing. And on a whole it is said that cruz pricing could drop at least ruise pricing could drop at least 10 on the whole. We have our reporters with us. Anthony, i want to go out to you because something i am trying to figure out is amid all this volatility, do we really see anxiety, panic, a desire to get out of the market from the retail buy and hold longterm investors . In your view, is this starting to shape the face of the people who for the last decade have been told the best way to deal with volatility is to stick with their plan . A great i think that is question and something we have leaned down over the last week with all of this volatility. I think diversification is working very well right now. It is doing what is supposed to do. We have told our clients that your portfolio is not the s p 500, nasdaq, or dow. When you see the volatility, your portfolio is likely doing better. When you look at a conservative or a moderate portfolio that has a mix of stocks and bonds and alternatives in cash, those portfolios are down. A conservative portfolio is up with all the cash and bonds they have in their portfolios. This is really at the time that you lean on diversification. If you are a longerterm investor, this is an opportunity. If you are retired or have a near term goal, then you need to be a little more careful in this environment. I would say that going forward, this is the time just to stand back and let the volatility after the over time, panic of selling and buying, there will be an opportunity for you to reassess the situation. I want to focus on the volatility playing out. We know there has been a limitation on the number of cases being tested. We will get an updated number of infections in the u. S. In the coming days. How headline sensitive will we be next week when we get the numbers showing a spike perhaps in the number of cases and spike in cool school closures. Has that been priced in or will we still be reacting to each of those headlines. Anthony we will continue to react to headlines. The testing kits will be important. As we get more into the general public, we will get a better gauge on how the virus is spreading in the u. S. In terms of the investor are the behaviors changing . Will people stop traveling on airplanes, stop going to restaurants, stop going to movie theaters, theme parks, sporting events . A part of will have a larger impact on economic growth. Our view still is that it is a temporary issue but i believe the markets will be volatile and will react to the headlines you. Ee in terms of viral outbreak lets talk about that volatility. In has it tamped down from when we said the coast was clear . I think it is hard to say with the debt things are calming i think it is hard to say that things are calming down. There is definitely still a panicky, jittery edge to the market. That will not go away anytime soon. We will see the number of cases rise nationally. It is hinged entirely in china and then around the developed world. That will be a huge factor next week. Seenthony, do you expect to more policy response . I think that it was earlier in the week we got the 50 basis point cut by the fed. Would you expect to see in the next week more action out of washington to stabilize this economy and stabilize the market . Anthony i think we depend it depends. If we see more volatility in things shake more, we could see a fiscal response. The fed and their action in response was very muted by the market behavior. Futures already pricing in 50 basis points. The response on the banker side is limited at this point. What you need to see is there is a fiscal response and if markets week, into quake next that develop over the course of the next week or so. Scarlet we want to thank our panel. That does it for the closing. We will look at why the u. S. May already be in a recession. This is bloomberg. Worlde from bloombergs headquarters, im romaine bostick. Here is how stocks closed. The dow, s p and nasdaq selloff on the day but higher for the week. The question is, whatd you miss. Falling to the lowest level. I am looking at the anatomy of a global selloff. It started with asia and then european trade and there is the big line down when the u. S. Began trading. We have come back a long wait in the final hour of trading. Huge move today. Lots of focus on stocks. Look at the 30year yield. People have never seen anything like it. The 30 year yield 1. 29 . There you go. Now, the u. S. Labor market, amid all this, so far continuing to chug along despite the spread of the coronavirus. A stronger than expected 273,000 workers in february. Joining us now is martha gimble, managing director of Economic Research at schmidt futures. Thank you for joining us. I dont not remember a job stay ever where the jobs report got so little attention. Nonetheless, it is real, it is numbers, it is something. In your view, precoronavirus, how strong is the labor market . The labor market is doing well. In a world where we didnt have coronavirus, we would be talking about an astonishing number. Is not been seen since mid2016, which is astonishing. Wait the labor market is strong could be leaving us open to more struggles if a coronavirus pandemic actually hits. Romaine what does that mean when you say struggles . Martha 50 has come from education and services and leisure and house hospitality. If we do hit a pandemic of those could be really impacted. Obviously in very different ways. Education and services very difficult what will happen, but leisure and hospitality if people feel like they dont want to leave their homes or buy food from someone they dont know, those of the sectors that could struggle. Scarlet we are already starting to see that with the airline seeing that perhaps people can take time off and reduce schedules. You are seeing the beginning of that. How low will it take to show up in the data . I know this is unfolding for our eyes, but will it show up weekly . Martha i think that would be unlikely. We do have insurance claims coming out and they have not shown a big jump in layoffs. That being said, this is a moving target and we will see what happens. Joe one of the things prior to the virus hitting and we have heard a lot is the labor market is tight, Companies Finding it hard to find workers. They have been saying that for years but nonetheless, if the perception is the labor market is tight and hard to find workers, does that make companies more reluctant to lay off while they wait to see if this is sustained . Lets say in a few weeks are in a month, the worst of the virus and are they saying it is a tight labor market and i wish i would have held onto my workers . Martha it is said that it may be a good idea to evaluate headcount. If people are still going and buying coffee in the morning, someone has to serve that so they wont want to let go. Romaine when you start looking ahead and you look at job numbers specifically, are there other numbers to look at that will give us insight into what we can expect when we get the report in the beginning of april and may and so forth . Martha it will be interesting to keep track of what is happening, not only in the goods producing sectors but also transportation and warehousing. That is a sector that is adjacent to the goods sectors and has also been continuing to struggle. If you have those areas of the economy that have been in a little bit of trouble for a while and then getting hit harder and then starting to lose that support from that private Service Sector that has been keeping the job market afloat, that could get scary quickly. Scarlet someone who looks at Economic Data all day, i wonder what you haves you have thought about what we have seen with the markets. The plummet in stocks and then the sharp recovery at the end of trading today. Our investors overreacting or does this make sense to you . Martha i am a labor market person but i think this shows the way in which everyone is feeling scared right now. And when you are scared, you flee to safety. It is hard to tell. Not although you are Financial Markets person, we live in this hyper financial financialized economy and would like to think that the market reflects with the economy does but it can go in both directions. Do you worry that volatility could exacerbate whatever anxiety people have . Martha people see the plunging stock market and think maybe they know something and we need to cancel trips and pull back on spending. That being said, we have seen volatility in the stock market not lead bleed into the labor market. Romaine his labor market sensitive to sentiment, are people making hiring decisions, pay decisions on fear or are they just sitting down and being more pragmatic about it . Martha on the point of how the labor market will respond to sentiment you have a labor market not just on the hiring side but on the demand side driven by what consumers want. If Company Start seeing consumers pulling back, that will make them more conservative in hiring. Both sides looking at each other and playing off each other. Arthur gimble, manager of Economic Research at schmidt futures. Gimble,u martha manager of Economic Research at schmidt futures. Thank you for joining us. The boeing 737 max sensors penalty covers the max model aircraft. We are waiting for the faa to recertify this jet. Cannot fly until it is recertified. They are talking about a 19. 6 8 Million Dollars civil penalty over the sensors. We will coming up next, talk about why the central bank may lack Lending Programs needed the most, as concern of the economic fallout from the virus to news. This is bloomberg. Romaine targeted lending. The fed has more room to cut Interest Rates, it lacks programs that have been directly used to promote bank lending such as longerterm finance and operations as well as lending facilities available to the bank of japan. Our economics reporter in washington knows this stuff more than anyone else. When we talk about the toolkit, we talk about the fed pose ability to stem and im fallout. K to us as to why targeted and stem any fallout or talk to us why targeted is rick they are limited in sending these to direct lending towards a particular sector except if it is a real emergency and then it has to go to the treasury secretary and ask for permission to set one up and it also has to set one up. It does not have one in place. Unlike the European Central bank and the bank of japan, it is a bit paradoxical. We think of the fed having more room to move the economy and they certainly do because the Interest Rates here are positive and not negative. When you look at targeted steps, the fed is at a disadvantage compared to other central banks. Romaine what we have heard so far is, we dont know if we are going into a recession or not obviously, but we know some sectors on the economy are under extreme stress. All you have to do is look at Certain Energy companies or airlines or other things related to going out and travel, extreme distress by looking at stock rises. One might say, this is a good time for a special Lending Facility allowing them to keep liquidity so when virus related fears and, they dont have to liquidate in the worst possible scenario. If we were to set something up, the fed right now can do that unilaterally. Richard it cannot do that unilaterally. They would be loath to do that. It is not their job to direct credit to one section of the economy over another or to favor one part of industry over another. The job ofat is congress and the administration to do that. Legallyally and sort of , there are roadblocks to them taking such action like you suggest. Scarlet so the feds hands are tied in the white house in congress has more room to targeted funding. His congress and the white house aware of that . Is congress and the white house aware of that and knowledgeable in working with . Richard there was a small portion of the emergency spending bill passed by congress and signed by the president today that included basically 1 billion in subsidies for the Small Business administration to subsidize 7 billion in lending to Small Businesses. In a 20on dollars is trillion less economy is a drop in the bucket. I was just talking to an economist who said they should have done 10 times that. Romaine when we talk about the fed not doing targeted but using the broad hoping that it fans out. We heard a speech earlier today and talked about the fed should at least be allowed to buy a wider range of assets. They were specifically talking about assets that dont have the direct link to the treasury what you think about the push for this and i assume it would take an act of congress . Richard janet yellen, when she was fed chair, raised this possibility in one of her speeches at jackson hole where the fed gets together annually to talk about Monetary Policy and other issues. It was a huge push back when she broached the possibility, especially from republicans, who said that we dont want the fed like the bank of japan buying stocks are like the European Central bought bank buying Corporate Bonds of general motors. They should just stick to their knitting. The fed Bank President is resurfacing the idea, but i suspect there will be pushback from congress about that. As you say, the fed would need to get congressional approval to be able to do that. Scarlet nothing happens in washington quickly. Bloombergs miller, thank you. Lets check the latest is this flash headlines. The coronavirus could delay the launch of apples 5g iphone according to bank of america, who spoke as an expert on the supply chain. The delay could be more than a month. Some factors and china are just coming back. Reduce produce the German Airline says it has had drastic declines in bookings and numerous flight cancellations. Hedge fund manager steve cohen is raising a new fund that will invest in private companies. Lumbar has learned that he plans to raise 900 million and will make venture and private investment in the entire Artificial Intelligence sector. That is your business flash update. From new york, this is bloomberg. Witham Mark Crumpton bloombergs first word news. President trump has signed a coronavirus spending bill. Say congress will likely have to provide more emergency funding before the Virus Outbreak subsides. Theyre more than 200 confirmed infections in the united states. Democratic leadership in theington state is praising Trump Administration for providing billions to help the coronaVirus Outbreak. Met with jayt inslee and other officials dealing with the worst coronaVirus Outbreak in the country. They should be proud of of leadershipand local and first responders. The way you have come alongside families that have been impacted is really representative of the and all ofrd of care americas hearts are with the people of washington state. He said he was glad the federal government was sending more than thoughts and prayers. Reportedn state has 70 cases of the coronavirus. The u. S. Government is sending 150 military police to two border crossings to do with asylumseekers in case of a federal Appeals Court strikes it down. The ninth court of appeals shut down struck down the program while the cases wind through courts in the united states. Global news 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. The Unemployment Rate may be added 50 year low, but the coronavirus has many worried about the state of the economy and some are wondering if it cause for a recession. Definition of a recession . People assume it means bad times, red lines. It doesnt. It means we are off our peak and it is trending down, so anything less than Getting Better means you are Getting Better. Deborah rate was 3. 5 unemployment about as good as it gets. A lot of people have talked about a gardenvariety recession. Seen one,who have not the idea of a recession is incredibly scary. We are not talking about a spiralingcrisis with bankruptcy. We are talking about outside forces hitting the economy. , i dont think means youarm is done can just laugh it off. You talk about the industrial production, shape of the yield curve and put that altogether. The stock market is the fourth one and you look at where they are today and compare with how they work at different points in time of the past. Does this look like the configuration we have seen when the economy is doing well or. Hen it is tipping downward this monster jobs report. We note Consumer Confidence near and im nd we need to look at the mirror at what is going to happen. I dont think the coronavirus is going to go away. Are seeingutdowns we now will likely intensify, so if you think it is weaker now and will be weaker in april and may, that is a session recession. A live, slowmoving rightthat is unfolding now. We really dont know anything. Economists dont like to be or like a change really quickly, so it takes strong evidence to move them off, so a lot saying maybe 1 , but the fact is when you get down towards 1 , it takes only a all theit to push you way into recession territory. People are worried about jobs and the psychological part of the virus spills over. Thank you. According to larry summers, the federal government may have already played it and. Played its hand. I think when you have some any bullets, you have to be very careful and a weapon in reserve is more potent than a weapon fired off to no great effect. What they haveen done, they are likely to find it hard to avoid moving in the next meeting, but they are running themselves out of ammunition. You want to check out more of the interview on wall street week. This is bloomberg. Is larry kudlow says he asked the coronavirus to only have a temporary impact. He spoke a little earlier with bloombergs jon ferro. I dont want to put it out publicly. Ofwe have a moment of a lack confidence. This is not making people fearful of these things. Side, talk to me about the policies. Do we have a targeted Lending Program . We have made decisions on some of that. Tax cuts, we can debate the pros and cons, we have tried them in dont last. Ey think the basic do you iftemporary and targeted, so toh injections are needed help folks who are at home because of the virus one way or another, we want to help them. Businesses are dark and certain parts of the country, that can be true with farming, manufacturing, transportation and a lot of others, so to pull that trigger will not take much time and we would like to do it internally. 8 billion the package from congress. Back. Need to come we are in the planning stage and it reminds you, the g7 just had a very important Conference Call and all these big countries are making their own planes as things develop in those countries, so i dont this can all be done in a very timely way. With respect to the job report today which was a blowout number , that good income number with consumer spending, lets not assume the worst. Ou have many options here how itto wait and see plays out, the same is true of the actual medical reports. Lets just wait and see. You hope for the best and prepare for the worst. Lets talk about threshold. My bloomberg terminal is lining up. Lightening that,he market dictate what dictates that . That. H will dictate we have a lot of Market Experience in business experience. Hand, you have to watch the actual data, economic , the virusealth data related data, so we have to do that. That was larry kudlow speaking with Jonathan Ferro earlier today. Lets give you a check of the latest business flash headlines. She writes the coronavirus has sent a shockwave. Stocks have plunged the last couple of weeks. Made a tentative return to Global Markets this week. Outbreakavirus triggered a shutdown of lending activity. U. S. National Security Officials to lockdownnt trump companys an american and has substantial chinese revenue. That is your Bloomberg Business update. It has been a wild week for the treasury markets to say the least. Bonds produce total returns like stocks and the results have been nothing short of markable. Think it was up at one point over 6 . That would be a decent annual return for stocks. It is a great place for shortterm treasuries. The bonds themselves are really based on yield. You rode the rally although it on, you are looking at her we of more than 50 look at treasuries in terms of the yield. President trump is in atlanta right now with the centers of disease control. There was talk he would not do earlier, but the feds have changed. You wrote that it is hard to imagine the treasury yields continue to falling the past couple of weeks. We are talking 30 basis points , the speed did not catch people by surprise. People did not feel it would be this quick. You look at what happened overnight and we had the terminal earlier today that it showed that the 30 year Circuit Breakers in terms of futures trading. That does not happen often in the treasury market, so there were the prices that just kept going. Who knows how much momentum has played into this . I think people in the bond market, you are reading these 50 total returns, but also a little scary with the markets moving a little fast they are almost out of control. Itselfmarket structure is breaking in some way. We always talk about treasury yields. That is what it felt like. That, not quite get to of reale were reports liquidity, people not knowing what to do. When you see yields breakdown can it caused a breakdown in liquidity . Asked it is probably both. Right now, liquidity will become an even bigger issue. I dont think the Financial System is quite as honorable as the past. It is putting a lot of cash in the system and the question is pollsll this play a role. It will be interesting to see what sort of firm footing they have. At the cdc inrump atlanta. From an economic standpoint, when you look at where yields are, you look at how the markets reacted. Is this something that could have potentially maybe be some moreand maybe measures by the government to protect the economy . The interesting thing, you heard larry kudlow speaking earlier, saying we want to be careful about this. If the fed is cutting Interest Rates to zero, you cannot have that back unless the fed goes rates. Nd raises interest it goesi see it is really fast and the bond market is stuck. Thanks to brian. The health and Human Services 4 million coronavirus kids will be available the end of next week. From new york, this is bloomberg. Just to recap, President Trump is in atlanta touring the center of disease control. Alizes are did they 4 million testing kit will be available by the end of next week. As you know, the virus keeping some employees out of the office. They are saying companies should. End workers home we kind of see the evidence all around us. To me, the trains are a lot less crowded. Experts are saying this should be fewer people and if you can have your workforce work at home, they should be ready to produce less risk, but we are not seeing that, so theres a big question of why not . There are a few companies in seattle, but for the most part we have not seen it. And that is one thing these people advise, a lot of companies are doing that so it is a big question mark. I was thinking about this past week, we saw a lot of the grocery stores, everyone saying they wanted to stock up on soap and rice. It is like no one does it and everyone does it. I was speaking to an executive from your and america feels like it is a week behind. My kidsff is closed, are not in school. Do we have a sense here that most major corporations are able to do this . I talked to someone who said the infrastructure of the country probably could not withstand it and a majority of men of the majority of americans cannot work at home at all. Like 100 Million People so , we willings going on see how this plays out. Up, the next round of democratic primaries takes place on tuesday. I will be watching ecodata numbers come out on wednesday. Thursday, the ecb announcing its rate decision. Podcastnd to our weekly on itunes. For what youit missed. Bloomberg technology is next. Have a great weekend. This is bloomberg. Awesome internet. Its more than just fast. It keeps all your devices running smoothly. With builtin security that protects your kids. No matter what theyre up to. It protects your info. And gives you 24 7 peace of mind. That if its connected, its protected. Even that that petcamera thingy. [ whines ] can your internet do that . Xfinity xfi can because its. Simple, easy, awesome. [ barking ] i am emily chang and this is bloomberg technology. Week, u. S. A volatile. Tocks and a weekly bounceback the president signing an emergency spending bill as coronavirus cases top 100,000. Plus, inside the social network. We talkit