This exactly as we should. Sends shockshowdown waves around the industry. This is a huge amount of Money Airlines will lose. In the u. S. Politics super , tuesday shakes up the race for the democratic president ial nomination. This is a big night for joe biden who beat expectations. The economic base is strong, the fundamentals are strong. He said job one is to listen and learn. Its important for me to know transparency what is going on down to our employees. It is all straight ahead on bloomberg best. Hello and welcome. This is bloomberg best. Your weekly review of the most important Business News, analysis and interviews from Bloomberg Television around the world. Lets start with headlines. With cases of coronavirus mounting and equity markets coming off their worst week since 2008, investors were already on edge. Weak Economic Data from china did not help. Investors racing for more market turmoil. Chinacturing activity in falling to the lowest level on record in february. Pmi data way worse than we were expecting. Records tumbling in china. 40. 3 was the number we got. Lowave never seen that since we started. In the official number we got saturday, that also came in well below the estimates. Nonmanufacturing, so services 29 services and construction, 29. 6, another record low. The worst rout showing a bit of science prompted by optimism that Central Banks will once again saved the day. Save the day. Buyapan the boj offered to 4. 6 billion of sovereign debt. Aare saying as recession is likely. Certainly, the financial markets, turmoil of last week in what you are seeing is Central Banks is that signal alert. It looks like we are going to get a meeting tomorrow. There may be monetary action as well. There is nothing that cheaper money can do to cure any of us from a virus, but we have had an asset price shock. Banks can attempt to address that and the and they probably should. Quite a rally in the market the 4. 6 on four more patients have died in washington. A disease expert says the coronavirus is likely to become a pandemic. Faces itseconomy greatest danger since the financial crisis. The reserve bank of australia cut rate five. 25 . Bikes g7 finance leaders to discuss the response to the coronavirus impact, promising to act if necessary. Comparedittle happened to market expectations. The g7 came out and said they would use all appropriate policy tools to achieve sustainable growth. Not say whatid those tools are. In a market that had come into the morning expecting some announcement of rate cuts for he promised to cut rates is disappointed. The fed made an emergency benchmark rate cut of 50 basis points and says virus poses evolving risks. We are now seeing positive markets. What prompted this rate cut . We have a combination of a supply and demand shock here. The best thing is to throw strong medicine at it. You might as well do a bigger step rather than a smaller step. We have seen a broader spread of the virus. We have seen it spread here in the United States. We saw a risk to the outlook for the economy and chose to act. I think the market was going to do what was going to do or not the fed acted. I see a decline from where we are. When i turn to the bond market, i believe that our target of 25 and 1 on the long bond are inevitable at this point. U. S. Treasury 10 year yields following below for the First Time Ever on those fires fears. Virus fears. Market thanks you have 10 year yields below 1 and equities falling off a cliff. Joe biden performing well on super tuesday. Islands when puts him in a fight with Bernie Sanders. Bidens when puts him in a fight with Bernie Sanders. This is a big night for as President Joe Biden who was able to pick off texas in the super tuesday prize. It is not over yet. This fight becomes a twoperson race. We have Michael Bloomberg the founder of bloomberg lp, he is pulling out. And he is addressing joe biden. We have seen since South Carolina the coming together of the democratic establishment, the center of the democratic srty rallying around biden campaign. One week from now a lot of big states and this endorsement will help a great deal. The bank of canada following the u. S. Said cutting Interest Rates by half a percent as the coronavirus darkens the economic outlook. Officials saying they would act again if necessary. This is a traumatic reversal. Of the few central bankers who did not cut Interest Rates last year but clearly the concerns around coronavirus, the concerns around outlook have now begun to outweigh any Financial Stability concerns. Hill negotiators have agreed on a 7. 8 billion spending bill to fund the response to the coronavirus outbreak. The bill provides much more funding than President Trump requested last week. Spending bill and stimulus. Theks rally, bonds rally on hope the government will fight the coronavirus. Havent we seen this movie before . Up 4 today. On balance, we are higher than we were on friday, but it has been a bumpy ride. It is going to remain a bumpy ride. There is still so much uncertainty out there. I find it difficult to credit we are going to ascend. Ministers conclude their meeting in vienna, agreeing to a production cut. Russia not get on board. Wanted a half million barrels. One and a half million barrels. The kuwaitis, the morales have been shouldering the burden. Well the russians come on board . The russian minister arrived tomorrow. Maybe that is when the real nittygritty is begun to discuss. How much will the russians be prepared to do . Theyve got to do something large in size and substance. Stocks resume their slide, bonds continued to bounce strongly. The 10 year yield, 12 basis points lower. Evacuated itsally london offices. Cases globally continue to rise. There is no certain amount of money you can spend on the fiscal side or Interest Rate cut you can do on the monetary side that was off this problem. , getis more needed is those test gets out there. Ands do the blocking tackling that government is supposed to be good at. Government needs to act like government when there is a crisis, not just sprinkling money here or cutting Interest Rates over there. That you have it. We are closing with losses of more than 3 on the dow. What are people moving into . Are they moving out of the market . What is the price action telling us . People are selling everything that is not nailed down and going to treasuries. Everything is going to get dumped. Treasury yields heading deeper into uncharted territory. Investors left reeling. Payroll report does little to reset expectations. Extent. Tters to one it tells you about the underlying resilience of the economy. It doesnt tell you what normally job reports tell you, which is what is ahead. It tells you ultimately about resilience. Economic base is strong. He fundamentals are strong we are going to see some issues coming up from the coronavirus. I think for the United States this is going to be a temporary problem. We have seen the rate cuts. What is the Administration Working on . We are looking for targeted measures that will do the most good in the short. Of time. In a short period of time. And have no permanent impact on growth. We want to help folks as much as we can in a targeted way. Crude is also getting crushed. Russia is said to oppose the saudi led plan to cut production. Work is continuing, i can assure you. Joint, but has been work is continuing. Go on the record saying we are. When you move the markets entire confidence on the profit outlook for this year, it is like you have a house of cards and you took out a bottom car. Bottom card. Ahead, Robert Kaplan and james on what comes next for the fed. Plus, an exclusive conversation with the new ceo task to turn around nissan. More of the weeks top headlines. The imf creates a 50 billion fund to help nations deal with coronavirus. And hopes it will set the stage for a coordinated response. We must do more than do less than what is necessary. Is bloomberg best. Lets continue our global tour of the weeks top stories. The brexit saga opened this week as the u. K. And e. U. Began talks to define their future trade relationship. Reddish and european officials will start hashing out a postbrexit trade deal as negotiations on the future partnership formally opened in brussels. Raised concerns that red lines on both sides could put the chance of an agreement to danger. No one is surprised to hear the Prime Minister says he can get a canadian style deer. He doesnt see a full need for convergence. Is when he says will be the deadline. He is prepared to walk away without a trade deal. They seeve said this as a full package. Turkey says upon not stand in the way of refugees. It is igniting fears another wave of migration which is already grappling with the spread of the coronavirus. We have heard a lot of rhetoric on both sides. And some classes on the border. The turkish side is saying that up to 100,000 refugees have left the country. Of course, it is unknown other are they have managed to enter the border with greece and bulgaria. Or whether they are stuck in no mans land. Erdogan has been threatening , saying it can no longer left after such a high number of refugees. Turkey is home to 3. 6 million refugees. More coming around across the border. The imf held a News Conference earlier today on its projections of economic fallout from the coronavirus. Saying outcomes remain uncertain but it has seen what he calls a shift to a more adverse scenario. Besides the News Conference this morning you also had a conference call. The top central bankers and finance ministers. ,hat includes Steven Mnuchin mark carney from the bank of england. What was the tone on that call . Serious. Commitment to take actions in a coordinated manner. Collectively with a great degree of consistency. Fiscal measures that are well targeted. A great deal of attention on liquidity. Wasmessage from the call active. Better to do more than to do less than necessary. South korea has joined italy and hong kong in announcing an economic aid passage. Flurry of new a activity across asia and korea is just one that is newsworthy today. This budget is being rolled out on top of an annual budget that was already the biggest on record. Thisare planning to fund stimulus with new government bonds. It looks like what others have already rolled out. Targeted Financial Support for the medical response as well as a package for businesses. And separately for households. Governments around the world have pledged more than 54 billion in the budget support. Europes spending is confined to italy which has been hit hardest. We also see increases in france and belgium. We are seeing coordination but at this point he to individual nation is doing its own testing. We are not seeing a coordinated response, at least not on the physical front. Fiscal front. There is a new Prime Minister the one who abruptly resigned last week. He gained power with the support of the party of x Prime Minister , who has been prosecutor over the 1mdb scandal. See out of the picture . He has never really out of the picture. In fact, he says he has the support of the government. He says he has got 114 people that back in. That is two more than you need in the parliament. He wants a noconfidence vote called when parliament convenes. Taken aback by the kings decision. Whether that means he goes to the king and says i should be Prime Minister or whether malaysia has snap elections, that is where this thing looks like it is heading. Elizabeth warren ending her president ial campaign today. Speaking with reporters outside of her home in cambridge, massachusetts. Developmentant particularly where her supporters go. It is unclear who she will endorse. It is also unclear where her supporters will go. With her out of the race it becomes a twoperson race between Bernie Sanders and joe biden. You are watching bloomberg best. Ceo machida sat down with Reed Stevenson for his First Exclusive interview since taking over the troubled automaker in december 2019. Hehita says she plans plans to unveil a turnaround plan. He is focusing on cost cuts. When i look at the individual nissan ability, it is much more than what i know today. I am saying that once you have very Good Companies working directionally how we can set up properly, the result will be much better than what we are wing in terms of in terms of cost cutting, what sort of investment to you think needs to be made . There are many kinds of areas. For instance, for our human assets. When we talk about the new business and what direction nissan, the competency has to be enhanced. As you consider everything that is happened over the past 18 months, it is not an easy challenge for any executive. You have just come on at the end of 2019. Can you tell us about how you whether itnge and has changed your view on whether success is reachable . It is probably going to be absolutely necessary, but was there anything that surprised you about the scale of the challenges facing you and the company . My first time to be a ceo. There were a lot of challenges that were unexpected. To by day, i would like further discuss with our employees to understand how they are feeling. It is important for me to know, transparently, what is going on from the older executives down to our employees. After having those united believe, then i would the power would come from there. Strengthave internal that would be deflected external. On bloomberg best. Hong kongs financial secretary explains why the government is handing out cash. Bankead of ndrs central says he has policy space to combat further shocks from the virus. And what a week it was for the fed. Perspective from two insiders up next. This is not about positions now. It is not about the current stock market. We can move it any time in this kind of situation. Mikes this is bloomberg. This is bloomberg. Welcome back to bloomberg best. Hong kong got another dose of gloomy Economic Data this week. Retail sales in january declined for the 12th straight month. Falling more than 21 by value. That comes days after the government announced it will give cash handouts to all adult citizens and permanent residence in a bid to stimulate the economy. We spoke with hong kongs financial secretary paul chan about those exceptional budgetary measures. Exceptional measures in exceptional circumstances. People are suffering, businesses are suffering. So, given still we have a pretty handsome fiscal reserve, i think spending some of the reserve to help people is in line with the expectation of the people. With a cash handout of this size, what will stop people from saving it in a bank or spending it overseas . People will spend depending on their circumstances. But we would encourage them to come out and spend, and encourage the business sector to come out with inventive programs to attract people to come out. What do you say to economists that say, this cash handout is not targeted enough, that it is a drop in the ocean for many and you could have used the same amount of money to help people in need . What do you say to people with that view . The people of hong kong like thisve choice and given difficult situation, i think the individual circumstances vary. By encouraging people to come out and spend at businesses and encouraging businesses to have incentive programs to accompany this initiative, i think people would, of course depending on their own personal circumstances, would support us and hong kong. As a Central Banks around the world consider policy responses to the coronavirus, the governor of the reserve bank of india spoke exclusively with bloomberg this week. He told Stephanie Flanders that he expects to work with other Central Banks on a coordinated action in coming months, and also believes the r. B. I. Has room to cut rates if Indias Economic situation warrants it. In a situation like we have today, coordinated policy action has become that much more important. One of the things we might be looking at is inflation coming down quite sharply from the relatively high january number, maybe even falling by a full percentage point between january and february. Does that take some of the pressure off and give you more room to respond . The Central Banks response will be decisions which are outside Monetary Policy. That is outside of the Interest Rate cut. We have said it very clearly, we want a policy committee. Ive also said it in my minutes. There is space for another rate cut. That is one option available. Another option is in terms of supporting the markets by liquidity, creating confidence, or using various other tools or and instruments to deal with emerging challenges. The r. B. I. Is ready. Perhaps the most consequential news of the week was the feds decision to cut rates by 50 points. A few weeks before the next scheduled fmoc meeting. Officials talked with bloomberg about the unusual move and the path ahead. Lets talk with the Dallas Federal Reserve president , Robert Kaplan. If you had asked me two weeks ago, i was saying publicly, lets see how this unfolds and i will make a judgment at the meeting. It is too early to comment. What happened once the virus got to south korea and then to italy and it was clear there were diagnosed cases in the u. S. , for me at least, the probability of a material deterioration in the u. S. Economic outlook, the probability of that increased to a point where i came to the view we were going to need to take action at the fmoc meeting. Then i felt that the situation was changing so rapidly that i thought it would be wiser, and i will explain a little bit why, to act now and boldly where it could make an impact. Here is what i mean by that. It is not going to help with the number of diagnosed cases. It will also not get people to want to go out. It will not do anything about the containment reaction if the diagnosed cases spikes. What it will do though is if we enter a. Where we have a severe slowing in the economy that lasts for some. Time, a Company Accompanying that is likely to be tightening in financial conditions. What Monetary Policy can do is if we go into this with somewhat easier conditions, i thought and i still believe, it will help to moderate or mitigate some of that inevitable tightening of financial conditions that will happen as a result of this spike in cases and the containment. So the judgment about the wisdom of this is more looking ahead to what is going to happen in the next 68 weeks, not what is going on right now. In that regard, i feel as confident today that we did the right thing as i did on tuesday, and i will say one other thing a number of people had a reaction because the market on the day we did it sold off. I will tell you, if the market had gone up that day, he would that would have given me no comfort whatsoever that we made the right decision, and by it selling off, it did not make me feel it was not the right decision. This is not about conditions now, it is not about the current stock market. It is about mitigating a tightening of financial conditions that will likely happen some number of weeks from now, and increasing the likelihood that as we come out of this situation we can come out more strongly. The markets have done a lot since your 50 basis point guard. The s p down by 2 , 40plus downward move on the 10 year. Anything changed for you since four days ago . Obviously theres a lot of volatility in markets. Not surprising. Everyone is trying to get a handle on how to price in trillions of dollars of stuff all around the world. I think we are all struggling to understand what the effects of the coronavirus are. So i am not surprised by volatility in markets in that kind of situation. As jay powell said, cut to restore, not to be rude, but you failed. Is there anything a central bank can do to save face out there . I think we correctly positioned the policy rate given what we knew as of the mondaytuesday timeframe. Everything is on the table. We are willing to do more but we are monitoring the situation. We can meet at any time and move at any time in this kind of situation. So, i feel like we are playing this exactly as we should. There is Downside Risk to growth and we will see how it plays out. It kind of seems like the market is pricing in the very worst case, ok, but we will take that on board and monitor this day by day. Have you ever had less visibility on an economic outcome and you do right now . There are times of uncertainty you can point you in the past that are similar to this. We have had viruses in the past. H1n1, sars, ebola. There are precedents, and i would prefer to stick to those precedents for this case and not make the jump over to other types of crises we have gone through in the past. Youre watching bloomberg best. Lets resume our roundup of the weeks Top Business News with a focus on companies and industries. Airlines are taking a big hit from the coronavirus as companies restrict Business Travel and consumers put off their leisure trips. Carriers around the world are feeling the pain. Ryanair is cutting some shorthaul flights, mainly to and from italy. It has seen a significant drop in bookings in the late march and early april period. It is just the latest airline to warn over the effects of the virus outbreak. British airlines owner says it can no longer given earnings forecast for this year. Luka doncic says it will cut up lufthansa says it will cut up to 25 of shorthaul flights in the coming weeks. Some of the developments in the last couple of months have demonstrated some airlines are disappearing. I think airlines will definitely fail. It will accelerate the demise of a number of weaker carriers. All of my experience suggests this will be a reasonably shortlived phenomenon. There is a little bit of hysteria at the moment. The International Air transport association warned that the virus could cost 113 billion in revenue this year. Regional Airline Flight be entered into administration. We are seeing a customer demand crisis for the airline. We have been tracking it and a lot of European Airlines have done this already and now we are seeing it in the u. S. United saying theyre going to ash domestic flights by 10 , and International Flights by about 20 . A lot of it has to do with transpacific flights. Jetblue is cutting capacity 5 . Southwest is cutting the revenue view. They are saying they are seeing a decline in customer demand. The air Transportation Association bracing for 113 billion in lost revenue. Just two weeks ago that was 30 billion. This is a huge amount of money the airlines are going to lose 42020. In a surprising move boeing is apparently going on a hiring spree in anticipation of the return of a seattlebased factory. Boeing is hiring in anticipation of a resumption of 737 max production . That is exactly right. Boeing has made a big point of not laying off its 737 max workforce. It turns out that not only are they not laying anyone off, they are adding people. Theyve brought in about 737 730 machinists in the middle of december. The Company Thinks it will have a lot of work on its hands the next few months. It has said it will start max a couple the of months before the end of the grounding. At the same time it will have about 400 planes in Company Storage that need to be delivered to customers as well as roughly another 400 in the hands of airlines that need to be prepared for flight. General electric is warning investors and will take a hit from the coronavirus. Ge just came out with adjusted firstquarter profit forecast that misses estimates and sees about a 2 million cash flow from the industrial division. What we know relative to the First Quarter is we are going to roughly 300 million of headwind, and then operating pressure from the effects of the coronavirus, potentially into andrincipally in aviation into our health businesses. Hna group was the poster child of chinas rise in the world stage, stepping up stakes in everything. The government has stepped in to take charge to help the repay h h repay debts of about 75 billion. What does this mean for hna . The end of an era, really. The beginning of the end, as we have known it. They can no longer manage the big pilot that they have. Over the weekend the government stepping in and saying they are going to form a working group with the company to better manage the financial liquidity of the company. A big challenge ahead of hna but it remains to be seen if they can steer the boat. U. S. Laboratory equipment maker Thermo Fisher making a 10 billion purchase. I think coronavirus is the link. Is there a lincare . There absolutely is, scarlet. Coronavirus helped this deal happen. The companies were in talks late last year when we broke the story, and they came out and said we are not reaching an agreement we like so we will call off the talks, call off the process. That was on christmas eve. You can imagine that ruined a lot of peoples holidays. Shares tanked. Then thermo went back to them in recent weeks and reengaged. One of the reasons the deal is happening now, the ceo said uncertainty helped the parties get to a price that was in between and helped get the deal done. Shares of twitter surging today. Bloomberg reported at the weekend that Elliott Management is pushing for changes after taking a 1 billion stake in twitter. Those changes could include replacing the cofounder and ceo, jack dorsey. How much of this is about jack and how much is about the product itself . I think it is quite a bit about jack, actually, and part of the reason i think that is because it has been brought up that he has two jobs right now, and being a huge issue and one of the reasons elliott is taking the stakes. Jack dorsey runs twitter but he also runs square and is splitting his time between two publicly traded companies. There is some believe that if someone were to be a fulltime ceo at twitter, they could capitalize more on the business and usage growth they are seeing right now heading into a really important year. Twitter is in a position we have looked at quite some time. We have a lot of respect for elliott. The governing structure at twitter, having a ceo that is the ceo of two Different Companies is highly unusual. Is jack dorsey special enough to be the highly unusual ceo . He might be. Jp morgan says Ceo Jamie Dimon is alert and recovering well after emergency heart surgery yesterday. He suffered an acute aortic dissection, a potentially fatal condition involving a tear in a large blood vessel. Felt chest pains before work and checked himself into a hospital. It may have saved his life, and investors were concerned, especially given the fact that we have Turbulent Times right now. Jp morgan shares fell. Pintompany says it placed and smith in charge as dimon recovers. Edward jones analysts said the bank is in capable hands, adding that jp morgan has perhaps the deepest bench in north american banking. Jack welch, former ceo of general electric, has passed away at age 84. At one point he was the epitome of managerial excellence. He was a personification of six sigma. Decisions he made came under scrutiny, but he pushed ge into a variety of businesses, whether that was finance, media it was at one point the most valuable american company. Jack welch debt at 84 years old. At 84 years old. Dont forget, bloomberg subscribers can run the function on their terminals for our quick takes landing page. There you will find the latest headnes fom thbloomberg news room, and analysis on companies affected by the coronavirus. There are about 30,000 functions on the bloomberg and we enjoy showing you our favorites on Bloomberg Television. Maybe they will become your favorites. Here is another function you will find useful. It will lead you to our quick takes, where you can get important contacts and insight into timely topics. Here is a quicktake from this week. Decarbonization is a key factor in the fight against climate change. The goal is simple, to reduce Carbon Dioxide emissions around the world as soon as possible. Our planet cannot be saved unless we leave fossil fuels in the ground where they belong. Decarbonization requires a both Sweeping Change and incremental steps, working industry by industry, and every in every major country in the world. Sound expensive . It will be. But the Science Community agrees that to avoid global catastrophe, we have no choice but to mobilize and take on this monumental challenge. Renewable energy like Wind Turbines and solar panels as long now along with electric cars, are popular topics. There are other key sectors that are less discussed. Changes there are equally important for decarbonization the planet. Cement, steel, and agriculture. These sectors combined makeup almost 40 of Carbon Emissions in the world. What will it take to revolutionize these industries without bankrupting them . Cement is the most widely used manmade material in existence. When combined with water and aggregates, it can be poured into whatever shape is needed for construction. Cement has been used for millennia to build roman aqueducts, the pantheon, highways, and lots of parking garages. Globally, the production of cement accounts for about 7 of yearly co2 emissions, largely because of how it is created. The main ingredient requires limestone heated to high temperatures. Usually this heat is generated by fossil fuels. The chemical reactions inside the kiln release even more co2. Companies are trying to reduce the amount of clinker use. The drawbacks are serious. These new techniques come with a price tag that sometimes triple s the cost of the traditional process. Since cement is holding many structures together, alternative recipes make contractors or regulators uneasy. Steel is just as important, and as cities grow, demand is expected to rise by 50 between 2019 and 2050. Its process involves purifying iron ore in blast furnaces with a refined type of coal called coke. Just like cement this produces a lot of co2. In europe, furnace owners are Testing Hydrogen as an alternative way to take the carbon out of iron ore but it is way too expensive to go mainstream, about double the cost. There is one thing you can do with steel that you cant do with cement, and that is recycle. Instead of producing more steel in the first place, we can use what we already have. Increasing recycling is seen as critical to reducing Carbon Emissions. Agriculture requires a multipronged effort, as it is responsible for nearly 25 of global co2 emissions. The practice of controlled burns after harvest, the use of inorganic fertilizers, the destruction of rain forests, and flatulence all need to be addressed to put a dent in agricultures carbon output. Some hope can be seen in the u. S. As demands for beef products have dropped significantly. Additionally, interest in alternatives like beyond meat and impossible burgers have soared in recent years. For those who cant quit beef, scientists are developing cows with digestive systems producing less methane. Implementing these Solutions Globally remains an uphill battle, even as more people in the europe and u. S. Take on vegetarian alternatives. Increased meet demand meat demand means consumption is expected to rise 50 . You are the last, best hope of earth. We are in the beginnings of a mass extinction and all you can talk about is money and fairytales of eternal economic growth. How dare you. It will take policy makers and companies years of diligent work and collaboration to move industry away from its polluting methods. Each of these industries is working on answers. With some executives competent they can be green and show a profit. That was just one of the many quicktakes you can find on the bloomberg. You can also find them at bloomberg. Com along with the latest Business News and analysis 24 hours a day. That will be all for bloomberg best this week. Thank you for watching. This is bloomberg. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Brad he has spent almost his entire career as a finance chief, rising through the ranks at ge and then working at ebay for nine years alongside meg whitman. After overseeing the ebaypaypal split, he joined intel as cfo in 2016, and less than two years later, became interim ceo, following the sudden resignation of his predecessor, brian krzanich. He was then chosen for the role permanently after the chipmaker conducted an extensive search. Today, it is his job to protect intels stronghold on the market for computer processors and deliver on promises to fin