Let the sun shine in the sun shine in let the sun shine let the sun shine in the sun shine in good wednesday morning welcome to squawk alley. Im Carl Quintanilla with john brennan and post morgan. At this hour the cairline ceos are meeting with the president this hour. We will give you updates as we get them and the rally, pretty impressive here stocks back in the green after the surprise fed cut rate tuesday. Steve milanovich joins us, tech strategist at World Research and the director of global mack affordability. I have been watching your tactical calls over the last week or so theyve been pretty sharp. You said you expected a rally this week. The question is now, what do we do with it yes, the markets remain in sort of a price discovery mode its unknown whether the low that was last friday, interday low at 29. 50 or so or whether its lower these are unknowable things because its a fastmoving development. But i do think friday we got to an oversold point and rally too, 3,100 was fairly predictable, typical tracement. And i didnt want to read into too much yesterdays lack of response on the feds 50 basis point cut because the markets are too erotic to drop that linear line to so were discovering where we are and how deep and how long is this supply shot and to what degree will the policy response be able to build sort of a bridge to the other side in terms of offsetting the tightening financial conditions that obviously is happening right now. Who knows . I think we have to have big impulse down, we have to sharply trace the movement monday rally and we have to back phil, and that could take a couple months probably i want to get to steve on analysis, but quick, yirian, the market because of all of this volatility will have players squeezed by cash flow issues rather than making fundamental decisions. How much of a danger is that well, i mean we saw that on friday, right . Gold was down like 60, 70. A safe haven turned into a source of liquidity, just like it did in 08. I dont want to draw parallels to 08 because i think were in a totally different environment. The margin of players who get margin calls or collateral calls, they end up selling what they can and not necessarily what they want i think friday we saw a strong whiff of that. The stocks you would think would have done welldidnt maybe there are other waves coming but friday we saw the crescendo of selling and gives me hope that maybe that worse impulse is behind us but you never know when markets run as long as they do, you never know where the hidden pockets of leverage are where once the margin call starts, the whole thing becomes a cascade. Sure. Im heartened by the fact on friday we saw a lot of it already. Steve, lets talk good how u. S. Assembled Shopping Lists given everything jirren just said as he pointed out, we were set up for a bounce. Tech got oversold, rsi under 30. Very close to its 200day moving average. The question is where do we go from here . The coronavirus is somewhat encouraging in china talking about getting money by the end of march, cook and apple sounds positive. At the same time we have Semi Conductor and Computer Companies really cutting back about 5 on earnings typically we may still have more to go we have overweight services and software we put together a little Shopping List based on Companies Whose stocks oversold to have good return on capital, near the 200day average and good momentum names like accenture, western union, booking, match. But it will take time to play out here i point out the tech has been very narrow. Its been a market forward the last year. Its been the big Platform Companies like apple, microsoft, google that outperformed nine of the top ten top tech stocks are platform name and we still feel comfortable owning those. Speaking of those, steven, and foxconns call that they will be able to meet at least the slower season capacity by the end of the month after that its still unclear and we did just yesterday good a cancellation of googles major platfo platform event of the year, google io. Questions about apples wwtc, which are usually around the staple time. What happens when these big launches dont happen . When you dont have full capacity ready at the midpoint of the year when these manufacturing facilities are gearing up when you dont have developers getting together and understanding the new operating systems that these devices are going to be running on, what are the consequences we do tend to have a lot of gettogethers and conferences from facebook, google and then finally apple at wwdc. The general, those have become a little less important nermz of new features here. I dont think we lose too much there. The good news this is a lighter time of year with demands for smartphones. Apple is not flying a lot of people to china so there could be a delay in products but the installed base is growing, retention rate is high. I think at this point investors feels whatever problems apple is having, its morally a deferral of demand and likely to make this up late this year or early the next fiscal year as long as opening the plants in virus doesnt reaccelerate the virus, i think we will be in relatively good shape as we go into the second half. I imagine we will talk to both of you gentlemen in the coming days, probably sooner than later thanks, guys. Thank you meantime, Hp Enterprise down sharply after posing revenue below consensus benefits and cutting its free cash outlook for the year, citing constraints due to the coronavirus among other things were now on the corner cnbc exclusive. Antonio, good morning. Good morning. Starting off, give us a view of whats going on out there from the enterprise perspective. We had palo alto respective missed on sale issues as they tried to switch to cloud putting. We talked to pat gelsinger, their mix more towards saas. How is this cloud transition affecting you and your hardware sales . Good morning. Thank you for having me on the show this morning. Let me correct the quarter and i can put that in context. I thought we had a mixed quarter, obviously, because renk knew was down 7 on the back of a soft compute performance however, we actually made tremendous progress on the key strategic areas where we saw continued growth on the service. We continued to gain momentum, one aspect of how we provide cloud experiences, where we saw 48 growth, on our consumption based model. And the last quarter we had a key metric up 19 . We continue to make great progress in all of the key focus areas where we drive innovation for our customers. Whether its High Performance compute, hyper converge or big data storage but also what i was really pleased about is the growth we saw in an intelligent edge we believe intelligent edge is the next big opportunity where the cloud has to move where the data is created. That business is up 4 but we grew in all geography double digits. We saw an impact on our supply chain given by commodity restraints and also weaker because of the coronavirus but that said our compute performance was in line with what we saw on the market, or actually better, because our performance was better than some of our competitors we have to get through this period of time, and then obviously continues to drive the hpe Platform Service experiences that customers have demanded. I hear that but im hoping you could give me a clearer view on both the pluses and minuses of this transition similarly, Palo Alto Networks was incentivizing its sales force to chase new cloud business, which is good. But at the same time its core business suffered. Im wondering how much thats a similar story line to what you are seeing you talk about those strategic areas where youre looking for growth, thats happening but at the same time as that same cloud transition, a big part of whats hurting your core business perhaps, a little bit more even than its helping the growth area . Well, let me put this in perspective. We had solid demands we couldnt shape everything we had in our books in and a larger backlog than anticipated theres no question the crowd growth is growing but we see the other Service Models and Significant Growth as well on the edge ultimately we live in a hybrid world and customers want a hybrid set of solutions and thats why our green lake offer provides them solutions from the edge to the cloud, including offbrand solutions. And thats included how we go forward. We have not seen tremendous impact on the demand outside china and thats why were confident on our ability to deliver the guidance we gave at the beginning of the year on eps. Antonio, i want to go back to the supply chain constraints at the moment given the fact the company is exposed to china in part through its supply chain, how are things playing out in terms of coronavirus and the impact there . And given the fact were talking about an outbreak on the heelgz of all of the trade war dynamics that played out last year, are you considering changes to your supply chain in general . Yes, obviously, the coronavirus is having a shortterm impact and were working with each of our suppliers to navigate through this period. I have to say all of our suppliers are back online. Some of them way above the 50 mark some are continuing to improve but the good news is that all of our suppliers are back online. Lets remind ourself this is a very lengthy supply chain. Even our supplier chains are dependent on all suppliers, sometimes we call tier two or three suppliers. But we have a Global Supply chain. To give a perspective, morgan, we ship three servers every ten seconds. When you go through an impact like this, it takes a little bit of time to reenergize, reactivate that supply chain but we saw movement on the momentum we have to work with them, the in and out, and we have plans to get through it and also with our footprint were able to move production and products across our global footprint. Thats helpful perspective on the supply side. Finally, tell us about demand. You did say that there was some trouble closing in deals and maybe that was coronavirus related. You said just now that you dont see tremendous impact on demand outside of china, but give us some color on what kind of impact you are seeing and what, if anything, you can say you expect to tip those customers over to the side of going ahead and signing the deals. One i am uncomfortable about, as i said earlier, we had what are called stated demands in our q1 and unfortunately we couldnt fill all of the demand in q1 and thats because of the back log we had not anticipated for now still steady we see the demand continue because of the month of data we are creating every single day, we see significant momentum in ai, machine learning, big analytical Type Solutions as well as Connectivity Solutions thats why our robo portfolio is so powerful, you can provide connectivity on the edge and right type of computing on the edge as well we feel pretty good about that we will see what happens the next few weeks but so far, so good in china, a little bit of a different story, as you said at the end of q1 we saw the outbreak of the coronavirus and back up in the fact they were on chinese new year, Lunar New Year vacation, we expected a little shorterterm impact there. But we have a unique advantage in china, our joint venture with a partner in china whos done very, very well. And thats why in q1 we recorded recordbreaking earning interest i feel pretty good eventually our partners will get back to where three need to be so far we dont see a tremendous impact on the rest of the work because of the data and because of the needs on this visual transformation journey the customers are going on. Antonio, we appreciate every little piece of data youre able to give us on this complicated and just confounding situation that continues to unfold antonio neri, ceo of hewlettpackard enterprise. Thank you where do we stand nearly two hours into todays trade stocks are bouncing back dows up about 2 . S p up 1. 7 , 30. 53 the level there. Higher for the nasdaq as well. All of the sectors in the s p are in green, led by health care s s pp pp so you can quickly check the markets . Yeah, actually im taking one last look at my dashboard before we board. Excellent. And you have thinkorswim mobile so i can finish analyzing the risk on this position. You two are all set. Have a great flight. Thanks. Well see ya. Ah, theyre getting so smart. Choose the app that fits your investing style. Wenot the exception. Sh food being the global norm, at emerson, when issues become inspiration, creating a better world isnt just a result, its a responsibility. Emerson. Consider it solved. 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 ] value fs tech oven thinks he found the next tesla. David is joining us with some highlights. Its an interesting story and one we would be talking about a lot more if not for the obvious conditions nicola corporations is saying theres a Global Initiative in Transportation Solutions they will be making a lot of trucks and Hydrogen Fuel cells that power them and places they will be able to stop to refuel those cells. Thats the plan. The company merged into a stack of veiq. Other spring funds, fidelity, contributed over 500 million, 525 million in a pipe of private investment and public equity at 10 a share. They raised a lot of money they have a lot of partners taking a different approach, as tesla, which makes all of its things in house. I did ask the companys ceo trevor milton, about that approach. What teslas done is done everything inhouse themselves nikola took a dirpt aetch pro i didnt have tens of millions of dollars to do everything myself so we went out to the biggest players in the world, access to tens of billions of dollars. I said look, this is what we need, we will share the ip with you. We went to barb and nell and all of these different groups and said lets build this stuff. Lucky enough when we first started it was a science project in 2015, 2016, when people didnt believe zero emission will work. All of these people jumped in saying we want to promote zero emission but we dont know if it will work. So we gained actual across the board on that. If you do that today, nobody would sign up because they know the Technology Works so we have a piece of all of the ip and biggest suppliers paying for our research and development so we dont have to spend tens of billions of dollars. But these guys are late, theyre way behind especially how fast were pricing carbon and Emissions Regulation trevor is way ahead with the first zero emission, Hydrogen Fuel cell, 100 electric drive train core, which can work on large trucks and small trucks. But youre splitting your ip with these very large companies. Conceivably you would have to be the leader because at some point if someone comes along, the technology will be available to them. Were an Energy Technology company. People say, wow, you build these beautiful trucks it is true we have the most beautiful advanced semi trucks in history. But were an Energy Technology company, and why is that important . As you scale up, these people will dump billions of dollars into trucking. We didnt want to just be selling a product where someone can come in and build it cheaper. Our moat or essentially what sets us apart from everyone is were setting up the Largest Hydrogen Network in the world, 700 stations every truck sold by our competitors will fill at our stations thats what is important i hope everyone sells Hydrogen Trucks and competes and builds trucks cheaper than we do. The first move is were amortizing the cost of building the network with the trucks on order. Once we build these stations, it will be interesting to see if theres an overbuild at all. In the first move advantage is we have the higher infrastructure so thats different than just selling trucks. What do you view youre a longterm investor, having known you for many years how long do you expect the value, the spring fund to be involved what do you see in terms of gestation period, getting to preterm cash flow positive and when you would potentially invest in it i mean, this is 100 billion company. 100 billion company . Because its solving the biggest problem, decarbonizing transport fuel thats the biggest problem honestly, thats the hardest thing to do. So the next 100 billion company will be this its going to be a capital intensive Energy Company that solves the biggest problem its not going to be doordash or snowflake. And it needs to consume a lot of capital to reach that kind of valuation. Right. Is it going to be there well, we just did a pretty good deal yesterday. Yeah, we did. One thing i think thats interesting is people look at the amount, how much these hydrogen stations cost to build. Its unique with nikola because we dont build them until the truck route is sold. Anheuserbusch placed a large order, 800 million order with nikola were about to announce orders many times bigger than that. What that means is well take a route, they will put 100 trucks on it and we will go build the hydro station for that money so the Million Dollars comes to us we sign a lease for a mile or 700,000 miles, depends on the application. We get 700,000 to 1 million on every truck we sell. Everyone else in the market only gets the cost of the truck, 100,000 daimler, 100,000. Thats all they get. We dont we get a million were an Energy Tech Company that is what sets us apart, were paying the infrastructure through the profits of the Oil Companies used to get. Spring fund is an early and active player in socalled sge a lot of questions unanswered here in terms of how the Business Model will evolve but they seem very excited and have the capital, at least for now, to take them where they seem to want to go its fascinating. Hydrogen is seen as hot in terms of one of those nextgeneration fuel sources we have to watch its also kind of interesting but theyre different from tesla but getting their name from the same place, knneek olah tesla. Thank you. And were currently under way with a meeting with the president and ceo of airlines. Doug steven is joining us now. Doug, thank you for being with us. Good morning. Im delighted to be here. Before we get into the details what you expect to be covered at the meeting today, first i want to get some context given you are an Airline Industry veteran youve been in key positions through 9 11, through sars, through the recession, back in 2008 2009. How would you expect this situation around coronavirus and what its doing to passenger traffic at the airlines, how would you expect this to unfold versus some of those previous crises youve been through well, i think the sars crises is the most applicable i think the one thing you have reasonable certainty with is there will be an end to this i think the uncertain issue is how long will the virus be outstanding and how far will it spread i think a good, positive, certainly if you look at the u. S. Large carriers that theyre all led by experienced teams that have been through crises like this. They know how to weather the storm. Airlines are high fixed cost businesses so theres not many levers you have at your disposal to expand and contract during periods where demand falls off but they know what to do and im sural theyll weather the storm. The expectation is that passenger tracking data is going to be a key topic at this meeting thats taking place at the white house right now. This idea that airlines could or potentially should the administration would like to see airlines provide Contact Information for passengers that have been traveling internationally on their flights. We know from reports theres been a lot of pushback on that how could that develop has there ever been a precedent set in terms of some of that data being shared before i dont believe we did that at the time of at the time of sars, and i think trying to put the airlines in a position of being the policemen, being the health care providers, i think is probably a mistake. I think if you look at what tsa and Border Control doug, i will interrupt you for a moment we want to get to President Trump, whos speaking now. I will let you give a little briefing as to what we just discussed. Thank you, mr. President. Grateful to have the opportunity to meet with the leaders of our Airline Industry today mr. President , you said from early on that we were going to have a whole of government approach but the truth is, as evidenced by all of these great industry leaders, its really a whole of america approach the American People deserve to know that according to all of our experts, the risk to the average American Contracting the coronavirus remains low. And thats largely owing to your decision, mr. President , to suspend all travel from china into the United States and quarantine all americans that are returning. Its also owing to the tremendous cooperation of this industry, the Airline Industry because in addition to suspending travel from china, recently made the decision to designate as do not travel certain areas of italy, certain areas of south korea but we also at your direction worked with this industry so that now, as of yesterday morning, all passengers on all direct flights from all airports in italy or south korea are being screened on multiple times before they board any of these airlines were grateful for that, mr. President. I know you are and everyone here should know that were going to continue to follow the facts and the data. Dr. Berks is working closely with all of our Health Officials to determine what additional screening might be required in the United States, or our partners around the world. But our airlines will play a key role, mr. President , in preventing the president of this disease. And even earlier today at your direction we met with leaders of our Nursing Home Industry to talk about the increased measures to prevent the spread of infectious disease. We sent new guidance out to nursing homes. We will be announcing later today new priority of inspections for infectiousous diseases were detailing that we complainexplained it to the y today. Also, mr. President , we will have a million tests today i spoke this morning that were grateful for the fact the changes you made this weekend through the fda now make it possible for state Health Clinics as well as universities around the country to be able to conduct coronavirus tests, but well also be meeting this afternoon with leaders of our commercial laboratories to make a coronavirus test more rapidly, more widely available for doctors offices, medical clinics and consumers around the country. So mr. President , as you said, it is a whole of government approach but in a variable sense whole of america approach. I have already expressed, and i know you feel a great deal of gratitude to our partners in the industry and in the Airline Industry for acting on your priority to put the Safety Health of the American People first. Mike, thank you very much i just want to add to mike and go a little bit further. The Obama Administration made a decision on testing that turned out to be very detrimental to what were doing and we undid that decision a few days ago so that the testing can take place in a much more accurate and rapid fashion that was the decision we disagreed with i dont think we would have made it but for some reason it was made but weve undone that decision also, when people come in from certain areas where doing checks not only at the site of takeoff but at the site of landing, so when they land in our country, were also do, if the planes are leaving from certain destinations i might ask, doctor, i would like you to say a few words. Youve been doing a fantastic job in just a short time we have not had much time but you have been doing fantastic. Please. Thank you before you came in, mr. President , we talked about which americans are most vulnerable. President trump invites president mike pence at the white house right now meeting with Airline Executives to talk about the latest in terms of prevention and safety measures, testing to try and prevent the spread of coronavirus. I want to bring Doug Steenland back in to continue the discussion here as we continue to monitor that event in d. C doug, the comments just now that airlines will play a key role in preventing the spread of this disease, i realize there are limits on travel to and from certain places so far, but in general what could that look like and just how much can airlines do to boost safety in this process and with it possibly confidence for potential travelers. Sure. I think this effort needs to be a fully cooperative, transparent effort with all of the Government Agencies and it needs to be really driven and guided by science and by the Health Care Professionals you know, airlines will put right at the forefront the safety of both their employees and their customers. Theyre not going to do things that will endanger either of those populations. And i think they will be guided by the professions in science and medicine as to what best they should do they will be influenced as to where they should fly. Obviously, therehave been suspensions of flights into china, into korea, and into italy. Well have to see whether that expands or not but the airlines are going to be guided and will be will want to cooperate to the utmost with relevant Government Agencies and with the medical and science professionals. Doug steenland, thank you for bringing us your experience and expertise on this topic. Just be taking a look at the Airline Stocks now, bit of a mixed picture. Deltas trading higher Everything Else is, again, under pressure as were getting additional sound from treasury secretary Steven Mnuchin on the coronavirus. Ylan moye has that from washington. The treasury secretary just wrapped up a hearing here on capitol hill after it was over i asked him given his confidence in commercial air travel, if companies were overreacting by canceling conferences and curtailing nonessential travel, he sidestepped that question but i did follow up by asking if we can expect any sort of specter specific subsidies heres what he had to say. One of the things we will be beginning to explore internally as to whether there should be regulatory relief from banks to Companies Impacted by this short term we will look at all of the economic tools the government has. So some of the potential options that treasury could consider could include waiving principle payments for small and mediumsize businesses, perhaps show term lowcost or nointerestloans to small and medium size businesses also some large banks are asking the fed to reduce Capital Requirements and ease the stress test so all of this being negotiated and clearly looked at at the treasury in washington to figure out the best way to respond to this outbreak. Thanks. Meanwhile, european markets just closing with quite a bit of dream on the map dom chu has the breakdown. Generally positive there. European markets moving high after the rekate from the federal bank they expect the European Central bank to announce coronavirus efforts of its own in the meantime were getting the first look at the virus in the form of composite pmis they raised in the early breaks of the outbreak but chief economists warn, quote, dig deeper into the data and there are signs problems lie ahead expofrts of goods and services are falling at an increased rate due to virusrelated downturns and demand and increasingly widespread delays threaten future production. So among the rallies you have the airlines like you were just talking about. Weve seen a growing slate of cancellations in and out of europe and asia. Today German Airline lufthansa told reuters theyre taking action and other airlines will take action on their own so airlines are focused not only that side of the atlantic but this side as well. Back to you. Lets get an update with sue herera at hg. Good morning, carl. Good morning, everybody. Heres whats happening at this hour the Italian Government is actively considering closing all schools across the country to fight the spread of the coronavirus. This would expand closures in effect in northern italy schools would stay closed at least until the middle of the month. Theyre also looking at banning Public Events and closing cinemas and theaters nationwide. Olympic organizers planning to scale back events around the Olympic Torch Relay because of the coronavirus outbreak attendance at some events would be limited the event is scheduled to arrive in northeastern japan march 20th the officials, however, say the games will start as planned in july heavy rains causing deadly mudslides in southeastern brazil at least 16 people have died, dozens more missing. State Authorities Say more than 5,000 people have been forced from their homes due to the recent storms. And greek forces firing tear gas and stun grenades at migrants trying to cross the border from turkey thousands tried to enter greece illegally since turkey opened its borders earlier in the week. Youre up to date. Morgan, i will send it back downtown to you. Sue herera, thank you very much the head of the imf is Just Moments Away as the markets continue to rally. Stay with us [narrator] at Southern New Hampshire university, were committed to making college more affordable. Thats why were keeping our tuition the same through the year 2021. [woman] i knew snhu was the place for me when i saw how affordable it was. [narrator] find your degree at snhu. Edu. Danafarber Cancer Institute discovered the pdl1 pathway. Pdl1. They changed how the world fights cancer. Blocking the pdl1 protein, lets the immune system attack, attack, attack cancer. Pdl1 transformed, revolutionized, immunotherapy. Pdl1 saved my life. Saved my life. Saved my life. What we do here at danafaber, changes lives everywhere. Everywhere. Everywhere. Everywhere. Everywhere. Dow is up almost 500 points. S p hovering around 30. 50. Brian jacobs joins us and jack caplan from Crescent Capital guys, thank you for the time always appreciate it. My pleasure. Jack, knowing the fed is at least on the case, whether you agree with that or not, how constructive can you be on days of strength . Yeah, i think the fed is on the case other Central Banks are on the case i think policymakers are just trying to build a firewall between a temporary economic downdraft and any spillover effect into the credit market. I think comments from u. S. Treasury secretary mnuchin were well received. Certainly im glad theyre on that they recognize that there are going to be some companies, particularly smaller companies, that will suffer as a result of a nearterm business downturn. And as long as that doesnt spill over in the credit markets, i think Equity Investors should be content to continue holding. So to hold or put fresh money to work, or is it more of a situation, brian, if you have the opportunity to reposition, to rotate, then maybe thats your game plan well, yes, and thats what were doing on our team. For the most part we manage portfolios according to client mandates oftentimes thats specialized targets of cash and a little buffer you can put to work when equity markets sell off. Weve taken it partly to do that we also rotate in Asset Classes opposed between them we still think treasuries, even though were 1 on the tenyear treesry, if not lower, they can still slow as a decent diversifier of an equity risk in your portfolio the correlation was around 9. 4 or so and that shows it has amplified diversification benefits we think yields could move forward. Were not making an outright bet on that. I think the key thing is look for opportunities within the Asset Classes and not necessarily mess too much within strategic allocation. Brian, we have to interrupt you here we want to go back to the president in the meeting with airline ceos, doing some q a heres the president. Where these people are flying, its safe to fly large portions of the world are very safe to fly we dont want to say anything other than that. Weve closed down certain e sections of the world, frankly, and they have closed them also they understand it better perhaps than anybody where he, its safe. Are american businesses overreacting cutting down on Domestic Travel and telling them not to fly inside the United States a lot of people are doing domestic business. Theyre staying in this country. They feel safe if you look at the percentage, we have a very, very small percentage and big percentage we have was brought in from 40 or so people from the ship. We brought them in and immediately quarantined them but youre adding that to the numbers which we had, which are very small now what we will do as people get better, because most of these people are getting better. Some are already released, some are going home some have a full 100 report we will take them off the list but we have a very small people in this country, we have a big country. The biggest impact we had is when we took the 40plus people. Theyre americans. I can say dont let them into the country but theyre americans and literally stranded it was very unfair we brought them back and immediately quarantined them you add that to the numbers. But if you dont add that to the numbers but were talking about very small numbers in the United States weve all done a very good job, all of us, and for the most part the media treated us very fairly, which i appreciated. I think its very important. Is there anything they should be doing differently since its safe to fly . If youre a passenger and get on that plane, weve been told wash your hands. Maybe dr. Burks, and then maybe you can say something. Were always saying the common sense of washing your hands, not touching your face and ensuring if you touched anything, you go and wash your hands again. 20 seconds with soup, hand sanitizers also work but i was reassured to hear the Airlines Talk about their cleaning procedures and three levels of cleaning procedures, because i think that will be reassuring to the american public. And i havent touched my face in weeks, weeks i miss it. Mr. President , would you do anything to address some of the concerns of maybe travelers who booked their flight and they might be coming up on a trip and might have to make rearrangements doc, what would you say about that we just issued, put out a fair settlement reap thely book their travel in advance and if they find they want to change that later, we are figuring out ways to make sure theres flexibility. Oscar, how do you handle that you have a lot of people booked and now this is a time unprecedented in our history that we need to be absolutely understanding of peoples travel plans. Like doug and most of the airlines, we are taking all appropriate measures to make sure our customers get the best treatment. I think people will be very impressed with what the airlines do. Mr. President , you mentioned the obama era rule you had changed regarding this virus i didnt follow that. Lets talk about it go ahead. Bob redfield, you might speak about the last administration inserted fda jurisdiction over testing and development of tests like this. And bob changed that saturday so now as i spoke to several governors this morning, the states now have the ability to actually conduct the coronavirus test in state labs, universities laboratories and thats because of the change the president authorized bob, you just might quickly talk about the changing jurisdiction of that that freed up more available testing. Thank you, mr. Vice president. In the past we used to be able to have laboratories that would develop what we call Laboratory Developed test and be able to apply them for clinical purposes in the Previous Administration that became regulated so now for someone to do that, they had to file with the fda that is the president doing some q a, the Vice President as well, with Airline Executives over the coronavirus our apologies to jack and brian. We really needed to get there for the latest from the president. And we will have them both back on soon. Meantime, our sara eisen joins us back here post nine and along with the managing director of the imf from washington. And welcome to kristalina georgieva, the managing director of the imf good to see you. Thank you for having me, sara. Fresh off that News Conference where you and World Bank President talked about a coordinated response to coronavirus. You said theres a serious threat to people and Economic Growth what are you at the imf doing about it at the imf we have mobilized our Financial Capacity to respond to this emergency in a very fast manner we have about 50 billion that are available to lowincome countries and to emerging market economies that can get access to this money without a program with the funds, in other words, immediately. We are also bringing together the membership for coordinated global response. We recognize the criticality to Pay Attention to the weaker countries, those were Health Systems are not tuned to respond to that emergency. And we are mobilizing with the world bank to create the global coordination mechanism, so as we necessary protective equipments and give a chance to poor countries to be better equipped, that Production Capacity to come up with the masks and the respirators is geared up so the the demand and the supply can match. So, i just want to underscore this 50 billion because this is new. You are breaking this with us. So tell us exactly where that money is going who has asked for it, if any countries have asked for it, and how it will be received. So at this point, the 40 billion is for countries that are middle income. And they can approach and receive the funding immediately. More important is the 10 billion that are accessible for lowincome countries because most of this money is interestfree. We have signaled to the membership and what we are doing right now is reviewing country by country what are the financial needs and engaging with this country to make sure that they are aware of this resource and we can immediately respond to them. So we are in an early stage of engagement, but i can assure you that we will attack very quickly as requests come what the countries would use the money for, we would like very much to see them prioritizing first and foremost urgently beefing up their Health Service capacity so lives are saved and suffering is reduced and secondly, to use it for fiscal measures that are well targeted to households, businesses that are most directly impacted by the crisis. Do you think we need to see those fiscal measures, stimulus here in the United States . We believe that all countries should look seriously into the urgency to beef up Health Systems response and, yes, that would be money very well spent everywhere and we also think it is now the time to put in place precautionary measures should the outbreak become more severe. In other words, do we have credit lines for are we thinking of funding workers that cannot go to work because their kids are at home and these are not measures that we should come with later. We should be prepared now. In the meantime, weve got some monetary stimulus in the surprise double rate cut from the federal reserve. Theres a big question about whether it was the right time, whether it was the right move and whether it can actually accomplish anything when what we really need is treatment, vaccines, testing for this virus. Where do you come down on this debate where we come down is in terms of how we set priorities first, Health Systems and response second, fiscal measures to ease the impact on businesses and households make sure that we are thinking about it now third, liquidity we do want to be sure that credit lines will be available when they are needed and in that sense, this is the list of priorities we have outlined today to the whole membership what should the ecb do . If youre talking about global coordinated action and the fed made a move to cut rates, what would your advice be for your predecessor Christine Lagarde who is now running that institution . Well, christine has her hands on the wheel very firmly at the ecb. And so she actually brought up today at the call a very important issue, which is make sure that you have Contingency Planning for the functioning of the Financial System in case people stay home she is looking very carefully at the developments in the eurozone, and i am confident that as the situation evolves, she would make the right call. What kind of depth of economic weakness are you looking at you told reporters in the News Conference that 2020 looks to be weaker than 2019 how deep will this go . What we look at are more benign scenario and a more adverse scenario in a more benign scenario, the outbreak would be relatively short lived, and the impact would be felt primarily first quarter, Second Quarter followed by recovery. In a more adverse scenario, the outbreak would be a more profound it would go beyond the countries today. We have 75 countries impacted. It would become truly global there would be more retrenchment in a country the impact would look more like china than not. So where we would lend between those two scenarios, we are looking very carefully at the da data, and listen to the epidemiologists to get a handle on what projection we should make but they are so many things in between those to the more benign and really adverse in which we would have a long er drop in growth and a slower recovery verse u. S. A shorter drop and a faster recovery. We do need to exercise some and accumulate enough bottomup data from countries and also source more information from the experts, from the health community. Meanwhile, though, preparedness and action are absolutely critical its better to do more than not enough and focus has to be on people. And coordination, which is a big point of the imf always. Its a big point youve made with the world bank, with the finance ministers, the central bankers. Where its not happening is really with the leaders. We havent seen, for instance, President Trump and president xi in some sort of public way addressing this crisis together. Why is that not happening and does that concern you . I am actually concentrating more on what is happening and what is happening is this morning we had all ministers and Central Bank Governors united. And with consensus on coordinated action and i do believe that what we need to all focus on is to actually deliver on this urgency. Keep our eyes on that ball finally, you guys have a pretty good handle on whats going on in china. You have the lines of communication open there whats your expectation as to when were going to see those factories and supply chains back online in any kind of normal way . Well, there is some good news coming from china in that regard capacity is up to around 60 we heard today from the governor that they are aiming by the end of the month to go up to 90 of course, we have to caveat that subject to no revival of the epidemic as factories reopen, but at this point, the news from china is, there is a stepping up in production. There would be a negative impact on this years growth for china. The leadership there now, it is in our expectation, but a stepping up in china, good for china. Good for the rest of the world and finally, i know its early to assess the damage economically, but do you think this is the sort of thing that could tip the United States into recession, if the virus continues to spread here at this point, what we see are two pieces of relatively comforting news. One, the Financial System is holding. We are not seeing a all the investment weve done over the last ten years is paying off and, two, there is quite substantial gearing up on measures so we can slow down the impact and reduce it and that is, i think, our eyes have to be on what can we do to prevent a more adverse impact. And big part of it is actually confidence building by communicating clearly where we are, what we know, what we dont know and act on that basis. Lean forward we appreciate you doing that here with us today the imf managing director. Announcing, carl, that big rescue package she said in the spirits of doing what we can with the information we know 50 billion. Thank you, sara lets get to the judge carl, thanks once again, your money front and center today welcome to the halftime report. One day up, one day down thats what weve got again. Stocks surging on joe bidens big super tuesday win. Were focusing again on the impact of the coronavirus on this market. Here to help me do that are Investment Committee is here as always joe terranova. Welcome back john nijairian, steve weis, steve liesman, senior economics reporter i want to get right to the action