On the barrons round table, ben leveson, jack howe. Ben, we saw stunningly horrible economic numbers last week, really unbelievable, but the market actually was higher on the week. What is happening . Yeah. I mean, this data was just terrible. Retail sale, industrial production, empire state manufacturing, you name it, it was probably the worst ever on record. Unemployment, the jobless claims continued to rise another 5 Million People lost their jobs. I mean, its just bad. But we knew it was going to be bad, and theres also two rays of hope out there. One was a new set of treatments that gilead is working on for covid actually might be work. We dont have all the data on it yet, but that provided a boost for stocks x. Then theres talk of reopening the economy, and thats also helped too because it signals perhaps there is a light at the end of this tunnel. Jg jon so, jack howe, i know youre looking at valuations, and as ben pointed out, there is light at the end of the tunnel, but still stocks look a Little Pricey given what we do know, no . They do. I mean, look, jobs matter most right now, and im hopeful that this stimulus will get the economy going again. Look at the s p 500, its now 17 times last years earnings. I dont know many people who expected us to bounce back to last years earnings level right away. I think you have to hold them for the long term. Im saying is anyone worried that the stimulus will have a faster and strongerfect on the stock market effect on the stock market than it does the economy and before long well be talking about new highs, meltups, maybe bubbles. Jack so, ben, tell us whew why the s p 500 is a little different from other global indexes. Yeah. I think its not to confuse important not to confuse the s p 500 with the economy. Its got tech and health care really working now. Big tech, the fangs are back, amazon and netflix hit new highs earlier this week. Theyre both up more than 10 . And then you have, and then you have health care which is doing great as well. And then you have this little middle area, banks and industrials and energy, that if the economy does start to do better, theyre going to do okay. So the s ps up 2 or so this week, maybe a little bit less, but the small caps in the u. S. Are down 3. So if you look everywhere else, theyre not saying great things. Its really about the composition of the s p 500. Jack you mentioned health care. I know, carlton, youve taken a look at health care. Barrons is doing a big package on health care. I know theres some sort of Second Derivative effect. Of course, theres the search for a cure, but theres more than that going on. Absolutely. And i urge everyone to pick up a copy or to read it online, so, of course, while gilead is getting a lot of attention, you need to look at the broader base, and thats what were doing this weekend. You look at the managed care companies. A not of elective procedures are not happening, you know, the knee replacements, things like that, United Health cares, humanas, youre going to see lower costs for them. This is going to be a tricky spot because we do have the Election Year going, so companied tend to face headwinds in those sorts of situations. But outside of the gileads, you want to look at the other pharmaceutical companies. Were examining potential opportunities in your mercks, your pfizers, eli lilly. They make most of the u. S. stock of tylenol i should say the sup is element, not supplement, but generic, excuse me. And other generics that people are using right now as theyre treating or potentially stocking up on. And then finally youve got to look at the teledoc space. Its kind of like the zoom for medicine. People arent going to the Doctors Office right now. Theyre seeing their doctors remotely, and theres also some plays to be making for some of these medical device companies, some of these monitoring devices so people can still get Health Care Even if its not safe for them to go into the Doctors Office or hospital. Jack like a lot of things were seeing right now, theres a decent possibility that this has changed for good, that even after this crisis passes, we may very well see more teledocs and seeing your doctor virtually rather than literally. Exactly. And i think this has kind of accelerated that dynamic. Telemedicine has existed, but it was always more of a curiosity. And i think now were going to see that acceleration to a new normal for certain types of issues. Jack so, jack howe, you have taken a look at a very different industry, the automobile manufacturers. What do you see there . Well, the business is so important to employment, i mean, millions of people work in this industry. We want these people to remain employed as much as possible. But the business is going to change going forward. I mean, were looking at whats going to be different. I think youre going to see consolidation among dealers, thats inevitable. It could help some of the larger chains like auto nation. There may be more digital and Touchless Service offered by the car dealers and the service stations. You can actually see a younger fleet of cars. Adam jonas at ohio Morgan Stanley is calling for a cash for clunkers program, we might get one thats more than three times the size of the one we saw during the great recession. Im going to call that clunkers humonkers until i find a better name jack try to find a better name. [laughter] ill work on it. Weve got a tblut of used cars, so we have to find a way to get people to buy cards. I did speak with jim hackett at ford, and he said ford learned a lot during that downturn. Lets have a listen. Remember, ford didnt take any bailout money. It was able to manage itself. It was really tough and a big challenge, but it did it. Well, think of that influence that said if you ever face a challenge again, you really want to be ready. We are really ready this time. And, jack, jim hackett even said i found this interesting he talked about how ford is exploring new material for vehicle interiors that can kill viruses on contact. Jack wow, thats interesting. And, you know, i do think on a consumer note we are going to see deals in used cars. I dont think thats taking advantage of the situation. Anyone spending money will be good for the economy right now. Coming up, the fed taking extraordinary measures to keep the economy afloat, but are we helping the right people . Former fdic chair sheila bair weighs in. There are times when our need to connect really matters. 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How the Federal Reserve may be able to help, is that the right move . Joining me now, former fdic chair sheila bair. I want to make sure viewers know your track record. Way back in 1992 you warped against loosening rules a decade later, enron proved you right. And just a year ago you warned that during the next cats few, we have to focus catastrophe, we have to focus on main street rather than wall street. So so here we are. Tell me . Here we are. I think theyre trying. I think theyre trying. I think theyre absolutely trying. But the problem is theyre just not equipped to do this. Theyre a big bank and they lend to other big banks. Thats how theyre set up. Even when they try to get money to main street, theyve got to use the banks to be their intermediary, and that creates a lot of issues. You know, theres some issues with some of the facilities theyre setting up. I think the wall street journal has rightly called them out on imposing more conditions on the smaller businesses and the large corporate and large Financial Institutions who are also being helped. So i do think they need to make sure that the restrictions and programs are consistent and even across the board, and its not clear thats being done. Jack you told my colleagues that you thought maybe the money was actually going to the wrong people. What did you mean by that . Yeah. Well, that was a very early on conversation because initially when this started, they just pumped a lot of money into the banks and the primary dealers, and that was the playbook in 2008. Just pump a lot of liquidity into the big banks, and that doesnt work. Bailing out wall street does not help main street. I think that was the key lesson of the 20082009 crisis. So since that time theyve launched which gives authority to nonbanks, nonregulated banks, and theyve tried to theyve announced interventions in the corporate debt market. I think thats necessary, frankly, just to keep credit flowing and keep the larger employers funded. I think thats important though, again, these programs should come with restrictions, i think particularly buybacks and dove depends. Dividends. Some companies are fine, but the one withs that are needing help i think they should be restricting capital distributions. They should be putting their capital into operations and payroll right now. It would be nicer to see the restrictions apply across the board. But again, the fed is trying to get more money into nonfinancial employers large and small, but the way its doing it is uneven, and i think its kind of plugging up the works for the smaller employers and businesses. Jon jon just to be clear, so when the banks reported earnings, some of them made a point of, hey, we can afford these dividends, but youre saying, no, banks should not pay dividends right now. No, i dont think so. We dont know how bad this things going to get. Theyve said theyre so highly capitalized, the fed said theyre so highly capitalized, but theyve been providing all these reductions in their capital minimums, so i wonder why thats necessary if theyve got so much capital. [laughter] we dont know how bad this thing is going to get seriously, we dont know how bad its going to get. They need capital to absorb losses and keep lending, so at the same time tells us they can go ahead and pay dividends just doesnt make any sense. They should be conserving that capital. If im wrong and it turns out they didnt need capital, fine, they can invest it later. There respect many shareholders, but the ones that need the cash, they could sell the shares on the secondary market. It doesnt compromise your Balance Sheet or weaken your Balance Sheet. If you let the cash out the door, it does. Jack youve written about what you feel is the overfinancialization of the economy. I suspect youre going to say we want to avoid that. We are. Obviously, were down on it now because this is what we do, we get in crisis e, we fault the fed. The fed pumps a lot of liquidity into the financial sector, and it creates a bigger financial sector, more debt. So i think the good news is that congress has [inaudible] funding certainly to households. The Small Business loans are forgivable if you support payroll, so i think theres a trend to get away from that model. But once we get past this going forward, we have got to get off this financialization carousel where we just, you know, we get boo trouble, we lower rates, the economy levers up. We never really delevered after the great financial crisis that just moved from mortgage debt to nonmortgage Consumer Debt and business debt and, of course, government debt. So its not sustainable. Debt is not a good way to drive your economy. Its not sustainable, and, you know, absolving companies, were doing that more now, its just a drag, and i hope we can break out of that after this terrible crisis is over. Jack this time i hope everyone is listening. Thank you very much, sheila. As the market tries to recover, which sectors are likely to come out on top . Investor strategist liz Anne Saunders joins is panel, thats next. If your gums bleed when you brush you may have gingivitis. And the clock could be ticking towards bad breath, receding gums and possibly tooth loss. Help turn back the clock on gingivitis with parodontax. Leave bleeding gums behind. Parodontax. Heres the thing about managing lefor your business. Sehind. 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And now xfi advanced security is free with the xfi gateway, giving you an added layer of network protection, so every device thats connected is protected. Thats a 72 a year value. No one else offers this. Faster speed, coverage, and free advanced security at an unbeatable value with xfinity xfi. Can your internet do that . Jack as the market makes huge moves in response to government stimulus and coronavirus news, which Economic Indicator should we be watching, and which sectors are likely to perform best . Charles schwab chief investment strategist liz and sawshedders liz and saunders joins the panel now. Weve seen economic numbers that are literally worse than anything weve seen in our lifetime. The market is kind of manicdepressive. Help us make sense out of all this first thing youre looking at, you say, health care. Well, absolutely. As much as the virus defines when and the magnitude of the shutdown, i think it will define how and when we open the economy back up which is paramount to understanding the depth of the economic hit here. We know some to have higher frequency Economic Indicators that are leading in nature pick this up first, notably initial unemployment claims and now continuing claims and four week average of claims now that we have about a months worth of call it postshutdown data. And i think those will still be very valuable metrics. But i think we need to focus mostly on the socalled High Frequency measures of growth. Not the backwards looking quarterly or maybe even monthly numbers, but some of these more [inaudible] to get a sense of the depth of recession were going to see. Jack what one or two of those did you like the most . In addition to claims, we can look at a number of other staffingrelated indicators, job openingrelated indicators. We can see the percentage when we get the next payrolls report of how many people have been laid off temporarily versus permanently. As of the most recent payrolls report, it was about 85 were temporary layoffs. For now thats good news, it means when we open the economy back up, most of them should go back on payroll. But i think we can also look at shorter term measures of Consumer Confidence and, in turn related to the stock market, measures of Investor Confidence as well. I would focus more on those daily and weekly measures. Liz ann, you spoke about what we do know, the data points like the job figures and things like that, what are some of the unknowns that maybe worry you right now . Well, certainly, as it relates to the virus when we will fully have the economy back open. The guidelines that have been put forth by the administration and the approach that states and localities are taking is to do it on a rolling basis, and then even within a particular state that might say, okay, were ready to start opening up, even there it will be done sort of industry by industry, segment by segment. So theres no moment in time where were going to have a sense of this. Were going to have to look at the data on a rolling basis, and i think the risks and unknowns, number one, are do we get a resurgence in incidence after the start of opening things up. That would be one kind of negative case scenario. The other one would be even if we dont get a resurgence in the virus, what is going to happen to demand. Are we going to see that pentup demand meaning the recoverys going to happen a fatherly quickly, or is there going to be enough caution that the demand maybe doesnt come back as quickly as many hoped for. I think those are the unknowns and questions to which we just dont have answers at this point. So the fed moves really seem to have given investors a lot of confidence. Do you think thats a wellplaced confidence . Well, i think the combination of what congress and the fed have done, which is an extraordinary amount of money relative to the size of the overall economy just on the fiscal side its about 12 of gdp, and then you add what the fed has done, its clearly not the elixir for what ails us. Its not a vaccine or a treatment for the virus. It cant open the economy back up or cant sort of force demand to come back. It hopefully prevents an chick if crisis which were economic crisis from becoming a Financial System crisis. Jack lets talk about sectors briefly. At the top of the show, ben mention tech and health care. I think that aligns with your analysis of what might come out stronger. So health care is the one sector on which we have an outperform rating, and that was placed prethe economic shutdown. And sure during this period of time both on the way down and on the way back up, health cares been a relative leader. Some of the reasons are obvious given the focus by pharma, by biotech on coming up with treatments and vaccines or, you know, purchases of personal care. And i think within tech a focus on those companies that are high quality, dominant in their tries, have strong cash flows and earnings streams, and those are the factors that are going to perform well both in this environment and when we get back to some semblance of normalcy. Jack i know you guys are worried about small caps, we dont have time to talk about that now, so well have you back. Thank you so much for joining us, liz ann. Up next, round table members give their investment ideas for the coming week, so stay right there. Chase mobile app, chase mobile app, your bank can be virtually any place. 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Serious, sometimes fatal infections, cancers including lymphoma, and blood clots have happened. As have tears in the stomach or intestines, serious allergic reactions, and changes in lab results. Tell your doctor if youve been somewhere fungal infections are common, or if youve had tb, hepatitis b or c, or are prone to infections. Dont let another morning go by without asking your doctor about xeljanz xr. Muck if. Jack so, jack, as you shelter in place, i understand you are channeling your inner grease monkey. [laughter] its been a little while since i got under the hood, i got that tell you. I want investors to look at autozone and oreillys this week, these are auto parts chains. Earlier we talked about the possibility of a big cash for clunkers program, what if it doesnt work . What if we have clunker keeper es because people are feeling strapped for cash . That can work out well for some of these auto parts chains that cater to do do it yourselfers. Right now stores are closed, but once the economy reopens, i think these chains are going to be among the first in the car sector to bounce back. Jack as always, we want one actionable idea from carlton. Carlton, im going to start with you speak of channeling, though youre going crazy cleaning that house every hour. I really am. [laughter] and i have to admit, i do feel a little repetitive, but im looking at chlorox right now. A lot of people have bought into it recently, but even when we hook at reopening the economy, theres going to be a new normal, new standard for how offices and homes have to be maintained. So im looking at chlorox right now. Jack and, ben, im not going to make a joke here, goldman sachs. Why is it looking good to you right now . Well, carlton has a great article in this weekends magazine about the banking sector, and goldman really stands out to me. The earnings this week that all the big banks released earnings, they werent really taken very well. All the banks dropped. Goldman dropped less. Its got a lot of investment banking, a lot fewer loans to go bad. I think in this environment just with the trading going well, its just going to be ad good stock to own. Jack thanks, ben, jack, carlton. Great ideas with. To read more, check out this weeks edition at barrons. Com and follow us on twitter. Thats all for us. Wash your hands, wear your masks. See you next week on barrons round table. From the fox studios in new york city, this is maria bartiromos wall street. Maria and happy weekend. Welcome to the program that analyzes the week that was and helps position you for the week ahead. Im maria bartiromo. Coming up in just a moment, ins managing director joins me, then later secretary of state mike pompeo on chinas culpability in the covid19 pandemic. But first, the cracks caused by the covid19 shutdown are continuing to strain the economy. The Economic Data this week has been awful, now 22 Million People have applied for Unemployment Benefits in the last four weeks