Very early on if you look at all of the countries to date, the mortality is higher at the beginning because youre diagnosing the sickest. The ones that came in quite ill. I want to remind the American Public that the risk for serious illness and the majority of americans are low. Cantat does not mean you transmit it to a higher risk group. That is why we are asking for all americans to take responsibility. You are seeing mortality or deaths today from infections that occurred 23 weeks ago. The other thing you are seeing is the dramatic and very difficult impact of this virus in nursing homes. On the why very early president and Vice President had just come out and put the strict rules in place. Everybody thought we were being too strict in keeping loved ones away from family. If we are going to solve this with a lower death rate, we have to protect the elderly. If there percent is much higher groups. The other age reporter there is a report that the federal government has a plan that shows this coronavirus outbreak could last as long as 18 months. Are you seeing we are not seeing those numbers. Reporter theres is at least one white house official who flu. He term kung is that wrong . Are you worried about this being talked about as a chinese do you know who said that . Reporter im not sure of the person. Say the term again. Reporter a person at the white house what was the term . Reporter kungflu. Do you think that puts Asian Americans at risk . Not at all. I think they would probably agree with it. It comes from china. There is nothing to disagree with. Reporter switching gears to a larger question, using before the pandemic they were americans already alienated. We saw despair through suicide and now with these individuals in rural parts of the country they are self isolating. What is your message to those individuals and what do you Hope Communities and churches will do to reach out . My messages to all americans but those that are going through a lot, we love them, we are with them, and we will not let them down. Hank you all very much you have listened to the Coronavirus Press conference. A lot is going on in the markets. Ago we hit thees 7 down limit on the s p 500. That means we stopped trading for 15 minutes. This happened twice last week, it happened monday, it is happening today. It is time to get the Circuit Breakers some time to get liquidity, find a floor, stake out where the price levels are. I went to recap the headlines from that press conference. President trump is going to invoke a defense act to fight the coronavirus. Hud will suspend foreclosures through the end of april. Airlines will be number one for virus aid. The u. S. Will allow doctors to work across state lines according to Vice President pence. I want to bring in more market reaction. Bloomberg dollar index soaring to an alltime high. Leinz. Ined by kailey i kept hearing today the dollar index is all that matters. People just want the dollar because it is the reserve currency. What is your take . It is all about dollar demand. The rapid nest with which rapidness with which this is happened, this is the best rally since 2005. We are surpassing the highs we saw back in 2017 and it underscores how much demand there is. When we talk about all of these liquidity measures Central Banks are taking it ties directly into the dollar. Alix a lot going on with the treasury market. We are going to get a credit analysis. Earlier this morning we had a rally left. That seems to be reversing. How is liquidity been within the treasury market . That has been the primary concern in the market, these liquidity issues. Limits thisitalian morning and now we are down. That is a 70 point swing in one session. With all the stimulus we are getting from governments on the around the world. If we take a look at breakevens, those are continuing to go down. Inflation continues to be rated lower as we are seeing levels level out. People need to find cash somewhere. Alix i know the control was going to kill me because im going to make them do this and live time. This terminal im showing inside my screen here all about the limits we keep hitting on the s p 500 well trading has been suspended. Were hitting key moments where we are below the 200 day average. What are some of the other lows that we are looking at through december 2018 going back to the longterm trend lines of 2009 . We want to see if we can come off the 7 level and if we do see loss steepen to 13 because again we would see another circuit breaker. At any point we drop with a 20 trading will end for the day. As for other levels to watch,2351 was the closing low. Were still waiting for trading to open up and it will be another five minutes or so. We were at 2351. Are down 8 10we of a point. Alix we always think kailey leinz for her analysis. Extraordinary first days of this week. We talk about the equity market being closed and we also go to credit. This is the worst credit market since the Global Financial crisis began and it is spreading and threatening everything from mortgage debt in australia to local governments here in the u. S. Toublanus is dominique from b. N. P. Paribas. Great to have you. Wanted to take a look at this chart i am showing which is the great spread and the highyield spreads. I keep hearing there is a lot of 1000 that this could go to basis points over treasury. What is your take on the capitulation we have seen within these credit markets . Thank you for having me. Capitulation is taking place. You can see that in the valuation. You can see that in the flows. If you look at highgrade altogether, 250 business points as the recession level. 2002,s what you got in 2011, 2015. In 2002. 0 basis points valuations now a recession level. You can estimate the market is pricing Something Like a recession with 7 default. Youveation in the flows seen the liquid product coming down quite a bit. Think about the positioning there. If you look at the highyield etf, 10 or 12 coming out very quickly. That is what you reach if you look at the previous setoffs it started to effect the bond. Alix the selloff was fun to work up earlier this week and get the note that said this is a buying opportunity. If im brave enough to get my toes in the u. S. Credit markets, where are you looking . I am looking at the safe response. The selloff in basis Points Per Minute has been the fastest ever. Situation that happened only a few times in the last 800 years. Withnk you want to start the same company like verizon that is quite safe. With noncyclicals because they will be able to withstand this liquidation. Cash is king right now so whoever has enough to whether through the problem, that is a good buy. Alix other concerns about the market are fallen angels. Im showing a chart which is the b debt. Of triple b what are the odds we get these fallen angels . Cant hold highyield and they are forced to sell. Wheres the buyer and the other end of that . Great question. That is something highlighted by many who are part of the Market Driven by the jthe low yield. From a natural reaction issues in gendreau. In themes the problem recession. One, the narrative around the virus should be temporary. Whatll depend a lot around ratings are going to do. If they are conservative, there are going to be a few downgrades. We could go through a quarter or two quarters that will be very difficult for companies. Even if they decide to downgrade, that will be a problem. There is a lot of debt outstanding. A big others will be chunk to absorb from the highyield market and we know t we are in a recession yield is not high. That will be a problem if we get there. Alix i want to let our viewers know trading has resumed with the s p 500. We have been paused for about 15 minutes because we hit the 7 lower bound. We are at 6. 85 . The market appears to have found a floor. Dominique, let me come back to you quickly. Explain again to our audience why think credit spreads are not widening because we think there is recession but a recession could be coming because credit spreads are widening. That is absolutely right. You get into a situation with a negative feedback flow between the economy and the rest of the way it works is we have a shock in the economy. Credit conditions deteriorate and if they do so enough, the lines are increasing. Growth and you get back into the shock. You need to have credit feeling good so that condition, financing conditions, are there for companies to finance themselves and you can have a thriving economy. That is where we are. The risk of default might impact everyones financing cost and that affects growth. Alix much more on credit markets. We will move up into full facing credit. Thank you to dominique toublan, head of u. S. Credit strategy at bnp paribas. We have resumed trading. That means the stock index down on the 10 transportation. Weve done 12 for the day after delta could be cut to junk by moodys. The dollar index at a alltime high. Ith is king and that means is all about the safe havens, dollaryen, and strengthening yen by 6. 6 . This is bloomberg. Markets. S is bloomberg nations unveiled Spending Plans of more than 1 trillion to fight the coronavirus crisis. I want to bring in our Bloomberg Intelligence strategist and he joins us from princeton, new jersey. A, what a bloomberg dollar index. What does this mean for the treasury market . I think it shows that even though the dollar is going up and you are seeing a global bond selloff in longterm security there is still clearly you look at risk assets and even gold is down over 2. 5 as we speak. I do think there is a fight of quality. The dollar is still a safe haven currency. The dollar will continue to do good. For treasuries, that means we can outperform other debt because when people by dollars, the put them to work somewhere. The place to do that is still in the u. S. Where you have yields that are still 120 basis points above that of a lot of negative yielding debt. Taylor what are the markets telling us about how we are going to fund unlimited deficits . [laughter] i dont know if there unlimited. The challenges always been is you want to have deficits growing at a slower pace over the long term than your gdp growth. It is ok to have deficits year after year as long as you are growing the economy faster than that. The problem is that with the crisis like this and this is unique this is different than any of the last five recessions we have had. You have to have a physical response because Monetary Policy alone, even with the bond buying, even with the buying of reserves, is going to help because that money cannot find its way into the hands of the people that need it most and the people who are the consumers, the people who would keep the economy propped up, are not going to be getting a paycheck. If they do, they are going to be reduced. You need to have fiscal spending. Usually it is the economy that matters in one of the things we put out this morning notes the bond yields tend to follow economic momentum far more than it cares about the market and supply. Taylor i have got a crash course on the health of the banking system. Here on my a chart terminal. It is rising and showing funding but nowhere near the levels we saw in 2008. Is this measure not a good gauge of the health of our liquidity in our Financial System . The way i am describing this and i have been speaking with Bank Analysts at Bloomberg Intelligence and nonbank finance analysts, so the shadow banking, and there does not seem to be stresses in funding. A lot of people are trying to declare this is similar to 2008 or 2009 and this is a significantly different environment. This is based on most solely on real economy and the consumer. This type of recession we have not had for 40 years. We cannot use the playbook we did from 20072008. Credit spreads are wider and Corporate Bonds are wider more in industrial corporations and financials. When you look at that you say, the Financial Sector can fund itself. Still cheap levels overall. The fact spreads are widening a eir profit th margins get squeezed. We are not talking about a Large Financial Company going out of business on a moments notice in creating chaos. This is much deeper and much more fundamental in terms of the economic outcome. I would not look at that and worry about it. What i would look at his industrial corporations, highyield market, that is with the stress will show up. Taylor deficit treasury dollar oflysis thanks to ira Bloomberg Intelligence. I want to get a check on the markets. We are extending the losses before the first lower down limit at 7 . Is going to be 13 . Airlines american bearing the brunt of the selloff. We just spoke about the dollar index at a record strength. You are seeing a flight to quality of both the yen getting stronger. This is bloomberg. Taylor i am taylor riggs. Oil prices are tumbling below 22 a barrel for the first time in 18 years. Saudi arabia ramps up the global price war. Mplx is down within 20 . Joining us is jay jacobs, head of research and strategy at Global X Management. It is over 2 billion in management and owned lpm x. It would be great to get your thoughts. War or theprice Global Demand issue, what is getting worse for you at this moment . It is being impacted from both sides and that is the biggest issue. On one hand, you have people not traveling around the world. Airline usage of fuel is about 5 of oil demand. People are not driving as much so that is half of oil demand. You cut off the supply, that is a major issue. On the other hand you have saudi arabia and russia pumping as much as they can. Why is a two factor reason oil prices are being hurt so dramatically. 21. 76 a barrel. Russia enough for and saudi arabia to have a conversation . This has less to do with them having a conversation and the other opec members that will feel the pain. If you look at other producers like nigeria, libya, countries like brazil that are in the opec , they are going to feel the pain. Costsave higher baseline of extracting energy. Forceddi strategy has the other people into a position of weakness so they can come to the table enforce russia and saudi to create a bigger agreement. Taylor we have 3040 seconds, who in the u. S. Emerges . That is a great question. I think we are going to see the stronger players eat the weaker players. I think private equity could be a big factor. There is some dry powder in equity funds. They could pick up distressed assets pretty cheaply. We will see a lot of consolidation as we start to see the longterm impacts. Taylor my thinking to jay jacobs, head of research and strategy at Global X Management covering all etf. Whether you are in the Office Working from home you can watch us live using the function tv. You can catch up on all interviews and join the conversation through the link on the page. It is for bloomberg subscribers only. Inyou are nice, you can type and ask a question. Take a look at those markets. We closed at the top of the hour for 15 minutes. Trading resuming and on the s p 500 but off at the lowest of 7. 5 . 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. Mark i am Mark Crumpton. President trump will invoke an act to address the cranberries. It gives the government more latitude. Mr. Trump did not say how we would use the authority that would sign the act in case we need it. He said he will expand the nations Testing Capacity and deploy a Navy Hospital ship to new york city. The United States and canada are closing the border to nonessential traffic. That will prevent further spread of coronavirus. President trump said trade between the two nations will not be affected. One official calls it a ban on tourism and vacations. Japan is tightening its borders in an attempt to combat the coronavirus. The Prime Minister says japan will propose an entry band for people from parts of italy, spain, and iceland. The World Health Organization says europe is now the epicenter of the pandemic. Japan will also step of quarantines for visitors from 30 countries including most of the rest of europe as well as a wrong and egypt. Iran nd egypt. Italian Authorities Say too many people violating the National Decree allows people to leave home to go to work, buy food or other necessities, or for brief strolls. Police have cut tens of thousands of people going out without valid reasons. In paris, Officials Say hundreds of people have been fined for nonessential movement around town. Four people were keeping nonessential businesses open. Global news 24 hours a day, on air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am Mark Crumpton and this is bloomberg. Taylor live from bloomberg im shery ahn. Here are the top stories we are following from around the world. U. S. Stocks erasing gains and triggering a trading halt before reopening minutes ago. The Trump Administration like the groundwork for a stimulus plan to counter the effects of the coronavirus proposing two rounds of checks to americans with 5 billion. This is global case is continuing to spike. Europe reporting more infections than china. The u. S. And canada agreeing to shutdown the border. Lets get a check on the markets. Thisntinue our way down even after trump came out saying airlines and cruises and hotels would be supported. Levelp 500 at the lowest since april of 2017. Every sector in the red falling at least 4 . Energy being the biggest decline or. We have seen the lowest on record in more than a week. Take a look at the dollar. We are headed for a record high. We are at a threeyear high despite the dollar funding market is showing some signs of easing. This amidst force by Central Banks to inject liquidity. Lets get a look at the markets with kailey leinz. Have beenbump we talking about for the past three years is gone. It has been absolutely of a serrated. Im looking at the dow well below 20,000 and approaching the 19,000 level. That means it has given back all of the gains since president trumps inauguration. That is not welcome news for a president that has socially his so closely tied success to the market. You have a number of stocks lowered between 20 and 30 among them American Express which is customers pulling back on spending. The United Technologies down by about a quarter. Boeing is also down 30 . This getting hammered after it asked for 60 billion in eight. Aid. This is the worst day for boeing in many many years. It is trading at its lowest since 2013. I know there is no easy answer but a lot of investors are asking what is it going to take to stabilize the markets . We have seen the federal reserve, the most powerful central bank, take extraordinary measures. With donald trump talking about brokering up to 1 trillion in stimulus. Or maybe just bridging the gap to the other side. We dont seem to be convinced. I made a come in earlier that this was the opposite of abe market of a market. Hing seems just deck nothing seems to stick. No matter what governments do until we see some kind of progress on the Actual Health crisis, until the number of cases start to go down, we start to lose the hysteria around the coronavirus, i do not think you are going to meaningfully see that Risk Appetite come back. Thank you for that. Policymakers are doubling down to fight the impact of the global pandemic. Do whatever it takes to support our economy. I do not have to look at history to do what it takes. I really would like all of us to join forces. We are ready to adapt and do whatever we have to. You will see prompt action again when we need to take it. The republican be assured of that. We decided that swift action for the fiscal year was needed. Our fight against the virus and outside forces beyond our control that is wreaking havoc around the globe. We are up for the fight. The measures we are announcing will provide up to 27 billion in direct support to Canadian Workers and businesses. Billion to meet liquidity needs of canadian businesses and households through tax deferrals to help stabilize the economy. Billion inis 82 support represents more than 3 of canadas gdp. A pledge is being made and that is bringing quincy krosby. 1. 4 trillion in assets under management. Let us try to make sense of these markets. Halt athad a trading more than 7 . The market has been going from one technical level to another. Once you come to a technical level and you reach that it is like opening a trapdoor. That said, it feels as if the market is moving toward its exhaustion level and we will get there. But there are some ingredients i think are going to show us when we should start looking to come back into the market. Starting with the credit markets, tried to get those spreads in and watching the credit default. Telling Us Industrial needs there were me of the financials back in 20082009. During recessions we normally see an average fall on the s p 500 of around 30 . We are already there. What is next for markets and how do you trade if you see a recession coming which is what most economists seem to be agreeing on right now . Exactly and there are recessions and then there are recessions. Whether we have a shallow one and the consumer comes back to that is the point is, what the market is telling us, that they see a recession. You got between 20 and 30 down from the high which we are there. Is and this recession that is the question. And allds on the virus of the work the fed can do and the government can do is predicated on how this irish migrates virus migrates. The backbone has to stop spending. We cannot literally leave our houses. Quincy, that leaves a lot of questions unanswered but when i think about the reason we buy stocks, we are willing to pay multiples. Madeere an argument to be if we continue to have days like this, weve just gone too far . No doubt it is predicated on panic. We are seeing indiscriminate selling which is panic. People are forced to sell and you get the margin calls, you force the cell. Sell. Watching andare im watching very closely is to see on the days we move higher like yesterday. It is to that we could not keep that going. How many advances do we have . How broad is the move up . Yesterday was not particularly stunning. We will have a day when you start to see those advance in the breadth of the market. It will be ignited by something that just gets us to cover the short but that leads to a viable move in the market. We are not there yet but we are getting closer. Again, we need to see the spread come in. That is going to be one of the chief catalysts for the equity market. Not just highyield but some of those names in industrials. We had the financials under attack in 20082009 and now it is the industrials. Anything associated with energy, they need to start showing the spread coming in. Another thing we are looking at is that on the way up in america you dont worry about bad news. See this market shrugging off some of the bad news and accepting the good news. Thank you so much for your insight. We left plenty more coming up. This is bloomberg. I am sherry and new york. G i am greg burnell in toronto. Canada slowing the spread of the coronavirus as u. S. And canada shut the borders. Bruce. Joined by the largest undefended border and the world and now this shutdown. It is a lot to wrap your head around. Many americans do not fully appreciate the breadth of the canadau. S. Relationship we have almost 120 border crossings between the two countries and in normal times, a month or so ago, we were running 100,00 400,000 people across the border on a daily basis. Can you hear me . Greg we got you now. We have had conversations with you how important trade relationships are. We are not going to touch trade. This is all about nonessential travel. Much of our trade is both goods and services. When we talk about services we are talking about people crossing the border doing business together, human beings. We are going to have to learn how to do services remotely and through technology. Be a big change for americans and canadians. We are talking about 700 billion on an annual basis. It is not easy. Oil flow, yes. Food flow, yes. But we need to Work Together on legal services, architectural services, all types of Consulting Services that we use across the shared borders. This is the largest trading relationship in the world. When you take in goods and services, this is our best friend and neighbor. This is profound to shutdown the border. I think it is important i think the Prime Minister and president have done the right thing it is an Important Message to all of us that we need to stay home and we need to not move around and transmit this disease to others. The best way to do that is stay home. My guess is that most people were not traveling back and forth across the border over the last week or two. He is doing something already in place. Shery leading up to this moment we had already seen these trade relationships deteriorate, more protective measures coming up. We are now seeing reports the u. S. May turnback asylumseekers. His globalization coming to an end . Thathope not in the sense as we do things together, it only enhances the outcome. Weecially with canada as have supply lines that work across both borders. At the end of the day, we are a winwin for both economies but we are now being forced to try and find alternative means to operate within our own country where we had previously relied on other countries supplying intellectual property as well as product source. It is going to be a very complicated time. Now or homebound at least many of us the question is, when we come out the back end of this, what will these relationships look like . How do we restart that . How do we make the border function . Canada was the largest now,national airline and effectively, flying from canada into the u. S. What does that look like now and how do we restart that when this virus is calm down . Shery thank you very much for your time today. Lets talk about the markets and economy because investors are saying the response to the coronavirus pandemic might be too extreme. Theld guess to tweeting world has legit lost its mind. We are going into a global depression. I maintain what i said before, hysteria is worse than the virus. Our Portfolio Manager joining us on the phone. Michael gayed, great to have you here. We have not seen a moment in time in history where the whole world has come to a standstill. The biggest economy in the world, the United States, slowly shutting down. Butave the 20082009 crisis that came from advanced economies. Why do you think this is not a justified response . So, i have been telling investors in my neutral fund which went into treasuries before all this happened ive been telling subscribers and followers on twitter that this is a wildly disturbing time. But this is perversely good that we have an economy. I can assure you that if this truly is an economic depression, the fed and Central Banks around the world will most likely put dollars and get them to Biotech Companies to find a vaccine. When i look at the state of everything happening around us there is clearly severe devastation, clearly mass job layoff but at the end of the day you still have to be somewhat optimistic as a human race that we will fight out of this. This may also be a big overreaction. One of the things i have been addressing the very real possibility is what if you do happen to get a vaccine . What if the virus does happen to slow down . What if the curve flattens out faster in the context of enormous fiscal and monetary stimulus, not just in the u. S. , but globally . You could have a very strong bounceback. The conditions in the shortterm are still facing risk off. The fact you are seeing yield rise, no new lows in the 10 year in u. S. Stocks making new lows suggests we may be closer to an ultimate bottom. I think we are in an environment i find it very hard to believe this is a crisis of proportions and that everything is going to change forever. I will remind any investors i am coming from the sample of somebody who got the decline right when calling for risk off in january. Im coming from the standpoint that progress comes from optimism. Day, februarythe 2009, people were seeing the s p push to 666. My response was if it is the end of the world, your money is worthless, you might as well buy guns and butter. I can make the same arguments where we are now given global leverage. If this thing does keep collapsing, Financial Markets your money is worthless. I choose not to live my life believing that is our future. Greg weve only got about one minute left but do you have a number in mind . The dow is breaking below 20,000, given your view, you think it is overdone. Do you think we have a fair value of this market . Everything i do is run conditions. The conditions were there in january and i completely avoided it. I think there is a set up here behavior,en treasury those two areas tend to be a leading indicator of volatility and risk. I coauthored four papers addressing the very real issue in terms of what indicators show you risk on and risk off. Bonds and utilities are getting to a point where they are starting to reverse. If you are not going to buy a low levels like this, you are not going to buy equities. I dont know when l2 one. We got so used to the idea of by high cell higher. Uy low, sell highs what you do. Greg thank you to michael gayed. This is bloomberg. Shery as we continue to see the market selloff investors wondering what else the economy. The chief u. S. Economist joins us on the line. Carl, we going to see the alphabet soup of acronyms we saw during the financial crisis . What else is out there . Thank you for having me on. I think we are going to see a considerable action from the fed. What they have done to this point is largely aimed at stabilizing the Market Conditions and trying to encourage some thawing of not only Credit Conditions the conditions in the treasury market. The 700 billion of purchases they announced sunday evening i think is going to be just the tip of the iceberg and we are going to see additional measures as they step into not only stabilizing the Market Conditions but trying to stability economy. Beyond that, the fed will engage in a host of new programs to support the commercial paper market, primary dealers, and other sorts of credit extensions. Veain, the fed does not h all the solutions but their priority is to keep markets trading and clearing. Greg we only have 30 seconds but i wanted to ask you, is the market appreciating with the fed has done so far . I dont think the market is appreciating what the fed has done. I think that means the fed is going to have to take further action pretty to really break Market Sentiment especially in risk asset we are going to need to have clarity over the size and scale of this crisis. Greg thanks to carl on this big day. We have the dow below 20,000 points. This is bloomberg. When you move homes, you move more than just yourself. Thats why xfinity has made taking your internet and tv with you a breeze. Really . Yup. You can transfer your Service Online in about a minute. You can do that . Yeah. And with twohour Service Appointment windows, its all on your schedule. Awesome. So while moving may still come with its share of headaches. No kidding. Were doing all we can to make moving simple, easy, awesome. Go to xfinity. Com moving to get started. Oh no, here comes gthe neighbor probably to brag about how amazing his Xfinity Customer Service is. Im mike, im so busy. Good thing xfinity has twohour appointment windows. They have night and weekend appointments too. Hes here. Bill . Karolyn . Nope no, just a couple of rocks. Download the my account app to manage your appointments making todays Xfinity Customer Service simple, easy, awesome. Ill pass. Mark i am Mark Crumpton with first word the Treasury Department wants to dedicate 5 billion to start issuing direct payments to americans to it is the centerpiece of one dollars trillion plan to stabilize the economy during the coronavirus pandemic treasure is proposing the first set of checks will be sent out april 6 and a second wave in midmay. The amounts would depend on income and family size. The treasury plan, which requires approval by congress, also requests 50 billion to stabilize the airlines, 150 billion for loan guarantees to the struggling sectors, and 300 billion for small businesses. And u. K. , Prime MinisterBoris Johnson is not ruling out imposing tighter controls on london as authorities there closes schools in the fight to stop the spread of coronavirus. Further measures intended to stop the virus spreading quickly across the country could include restricting the movement of people and london. A break the outbreak is edited vance stage in the capital and johnson has urged london residents