Patients. The university of oxford saying they might have a vaccine as early as september. More than half of states have begun or will soon begin allowing more businesses to operate again according to strict safety guidelines that. s vital to get the economy moving. The initial reading of Gross Domestic Product in the first three months of this year showed that the economy sank at an annual rate of 4. 8 , the biggest quarterly decline since the big recession, and economists believe the numbers are going to get worse. Federal reserve chairman jay powell believes the unemployment will soar, saying that we cant worry about the massive amount of debt piling up on the federal ledger right now. This is not the time the act on those concerns. This is the time to use the great fiscal power of the university to do what we can to support the economy and try to get through this with as little damage to longer run productive capacity of the economy as possible. Gerry even the most fiscally conservative economists recognize its important for governments to spend heavily during a financial crisis, and thats certainly the case today. There are no atheists in foxholes, they say, and there are no fiscal conservatives in a pandemic. But the u. S. At least with its large and vibrant economy, low Interest Rates and a so far manageable debt burden can probably handle this financial cost without too much longterm pain. But many other countries around the world are less equipped to deal with the recession and the debt explosion that will follow. The effect on the Global Economy could produce a really nasty jolt for u. S. Financial institutions that have already been weakened by the pandemic and the economic shutdown. Global Financial Markets are going to face a rocky period. And just as they have in the past, the financial weaknesses in emerging Market Countries could come back to haunt us. So what can be done to ease the debt burden and cushion the blow here and around the world . Here to discuss is david a malpass, president of the world bank. He joins me from washington d. C. Thank you very much for joining me. Great to be on. Gerry lets start with a look at the Global Economy. We are clearly in a recession, deepest recession at least since the Great Recession of ten years ago and possibly much worse. In your estimate, from the banks perspective, how bad historically is this going to be . I think for many countries its worse than 2008. So that means that their economy actually shrinks materially, a big shrinkage, and the problem is some part of that will be lasting. It might be a shrinkage that takes years to recover from. So one of the things the world can do is try to have the advanced economies reopened as quickly as they can. The impact on the poor countries of the shutdown in the develop economies is severe because their livelihoods depend on being able to interact with the developed world. Gerry and even in the developed countries, United States as we said reported a gdp decline of maybe 5 in the first quarter, its going to get worse in the second quarter, the genuinely global problem. And as you say, economies are going to start to reopen, we hope, very soon. But theres going to be a lot of pain still to come. Thats right Commodity Prices are way down. A lot of emerging markets, developing economies depend on selling commodities. Its hard they try to move up the value chain and participate more in the Global Economy, but the reality is a lot of it is based on commodities. So the, a challenge is to keep some parts of the private if sectors private sectors operating in these countries. That means working capital, for example, and so the bank is trying to do that. Our First Priority was to address the Health Crisis. So im very pleased with how fast we were able to move. We have programs now up and running in nearly a hundred countries which is we started on, in the middle of march. And so thats a Fast Response thats providing things like personal protective equipment for Health Care Providers in even the poor ifest countries. Gerry how quickly, david, do you think we will be able to recover from this . People have talked about a vshape recovery, once people get back to work well see a pretty significant, strong bounceback. Other people worry that, actually the, theres going to be longterm damage here. Whats your view . There are a lot of unknowns on the science, the virus itself. We dont know how quickly that could be overcome. If the advanced economies can end the shutdown and really start allowing some operation of their economies, thats going to shorten the base to a global recovery. And its really powerful. A big chunk of the world withs gdp comes out of the u. S. , comes out of europe, japan, china, and all had a real slowdown. So i think another critical factor is how does each country respond to the crisis in terms of settling the losses and getting on with their new production. Many of the assets are still there. That means the buildings are there, the peoples knowledge how to farm, how to, how to build things, thats all still existing. So once they reopen, i think we might be able to recover quite a bit of the worlds output. One final point is that internet and the technology, Digital Economy has been in some ways strengthened by this even in the poor ifest countries. So that poorest countries. So that will be a sense of strength going forward. Gerry tell us about what the banks are doing. The u. S. , obviously, has been able to implement a 3 trillion fiscal stimulus, an extraordinary amount of money. The u. S. Had the ability to do that and to borrow. A lot of countries if they need to make a similar kind of effort, theyre going to parttime huge amounts of debt, and thats going to have tremendous implications for the performance of their economy. How is the world bank helping them teal with this crisis deal with this crisis and the debt theyre going to incur . And ill add to your point that the Market Access has closed for a lot of cub countries meaning they cant borrow at all, much less borrow more. What the world bank is doing is, first, the Health Crisis itself. I mentioned the 100country programs. Thats within powerful. Thats been powerful. And as we have just on may 1st started a, this is a debt moratorium for the bilateral payments that the poor countries would have had to make to the lenders, to the wealthier countries. And thats going to provide a lot of breathing space in terms of their fiscal policy. They can spend that on health, on restarting or on maintaining their economy and their families, keeping livelihoods going, how to do people actually how do people actually have an economic means to work and to get food and health care. So thats, thats going on. And then the world bank is looking out at the next step. Thats going to be transparency for the countries that can be a very powerful, positive. Also a better social safety net often based on digital meaning how do you get money to people that are extremely poor. And the third area is the Energy Subsidies that many countries had, were so costly. They would put, they would put a ceiling on the price of gasoline, and the government would pay the difference. That can wind down because of the low oil prices. So theres three areas where you can make quite a bit of progress for most developing countries. Gerry we need to take a very quick break. Coming up next, i want to ask you more about what the world bank is doing and what the role of major Financial Institutions is in helping cushion us against the effects of this crisis. Stay with this is an athlete, twenty reps deep, sprinting past every leak in our softest, smoothest fabric. Shes confident, protected, her strength respected. Depend. The only thing stronger than us, is you. Which is why when it comes to his dentures only new poligrip cushion and comfort will do. The first and only formula with adaptagrip cushioning technology. Choose new poligrip cushion and comfort. There are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Music gerry president of the world bank, david malpass, is my guest. The Global Financial crisis that weve seen in the past that have come to hit home in the United States have come because other countries is have got into tremendous debt trouble, the latin america debt crisis in the 1980, the Asian Financial crisis in the 1990s. A lot of these countries that are building up huge amount of debt as a result of this coronavirus crisis, if they are building up maasive amounts of debt and they owe to that Financial Institutions overseas, should we be concerned . How concerned should we be about the stability of the Financial System as those countries struggle to repay those debts . Gerry, its notable the change in the Financial System where it used to be banks that were owed most of the money, and now we have the euro bond market that is more spread out, and so that broadens the hit, and its not so focused on banks. Also china has become a big creditor for, with regard to countries that lend to, into africa, for example, china is half or more of that lending. And if so that means and so that means some of the burden, some of the inability to pay by the countries has to be borne by china itself. The moratorium started on may 1st which means the payment streams have, are changing. And i think thats an important source of stability for the developing for the poorest countries. But it also means that the relationship with the advanced world can be more balanced. I think wed like to come out of this crisis with a more balanced debt situation for the poorest countries. Gerry david, a lot of people, a lot of americans will be thinking, look, we have this massive crisis at home. Weve got tens of thousands of people have died, many people are sick, the economys probably going to face its worst recession since the Great Depression of the 1930s, why should we be u. S. A major contributor to the world bank, Financial Institution providing low cost lending to countries that are struggling. Why should the United States, why dont we have a world bank for the United States . Why should americans be concerned about providing help to countries around the world when america is is in so much trouble itself . There needs to be strong aid programs in the u. S. , and so i now work for the world bank, so i can speak for the world bank that the many shareholders of the world with bank have come together the world bank have come together and want to support poorer countries. I think thats in the National Interests of the u. S. , of europe, of japan. This is a combined effort, and it creates balance in the world. If you didnt have that, that anchor or that, that star to focus on, the world bank wants to, in many cases, give grants to the poorest countries at a time when theyre improving their system. A lot of the, a lot of the assistance is provided to improve government systems. For example, egovernment meaning countries having to, less inefficient systems. Its a critical part of addressing the health chi sis. Crisis. So i think i can say i think its in u. S. interests, also u. K. Interests, european interests, japanese interests [inaudible] gerry by helping ohs, we actually do help ourselves, is that right . Thats right. From a terrorism standpoint, an immigration, migration standpoint. But also simply from a human being standpoint. There are billions of people in the world that can do a lot better, and they can look at the values of the market economy, the openness, the freedom of speech that we enjoy and cherish, all of these are important things to convey. Gerry thank you. One more quick break, and then well talk about what will change as a result of this coronavirus. Stay with us. When you think of a bank, you think of people in a place. But when you have the chase mobile app, your bank can be virtually any place. So, when you get a check. You can deposit it from here. And you can see your transactions and check your balance from here. You can save for an emergency from here. Or pay bills from here. So when someone asks you, wheres your bank . You can tell them heres my bank. Or heres my bank. Or, heres my bank. Because if you download and use the chase mobile app, your bank is virtually any place. Visit chase. Com mobile. Jer im with World Bank President david malpass. David, china is a major recipient of world bank lending, has been over the years. Still is today. Its the worlds second largest economy, soon enough it may well be the Worlds Largest economy. Many people think its got a lot to answer for over this crisis in terms of the way it handled it. Do you think its time maybe to review chinas role in the world bank . And more generally, the role that china plays in the World Economy . Yes. And thats happening. You know, theres an evolution of the role within the world bank, so im most familiar with that, where china had been a major borrower but is now a major donor to the world bank in the 2019 contributions china increased by 100 while most countries didnt increase at all. And so thats good because of the stage of development of china. So on the other hand, we have to recognize that this is a system thats different from the western marketbased economies. They practice a oneparty state with censorship, and so the interface is going to be challenging, one that we can all work on. And one other thing ill mention is in china our lending, the lending that we do continue to do, which is down a lot and will continue to fall rapidly, but its shifted toward Global Public goods; Marine Plastic es, for example, is a big problem because china has allowed its factories and farms to put plastic into the rhode river sy, and that gets into the ocean. So we have a big program to try to begin to reduce that. And chinas working with us well on that. Gerry do you think china needs to take more responsibility in the helping to run the Global Economy more smoothly, or do you think actually it might be a good idea, as perhaps some of in this administration think, that we disengage from china and become more focused on ourselves . I think more it should be an adjustment. Global supply chains became too dependent on china. Thats evolving. Thats changing pretty rapidly. Japan, for example, is giving aid to it companies if they relocate and pull back some. And i think thats a healthy, normal process. Chinas economy is so big and strong, it will operate for its own benefit, and other countries around the world to is same. Do the same. So were going to have to find a practical way to interact between different systems. China will continue to play a big role in the world bank, in the w. H. O. , in the united nations, and so on. Its the worlds second biggest economy. So lets be practical in finding ways to evolve the relationship. Rule of law becomes very important in that. How do you practice, how do you Practice Court systems, Property Rights and so on when you have different systems. Gerry very quickly, one final question. How is the world overall going to change, the World Economy going to change . On the one hand, we have seen this virus shows how interconnected the world is. Starts in china, kills thousands in new york. On the other hand, its made people nervous about Global Supply chains, is the world going to become less globalized, more focused on National Interests as a result of this . I think that is happening. And thats not all bad. I think weve gone too far in the idea of globalism, of global government, and so that is pulling back and being rethought. Maybe thats healthy. I think the economic challenges are really big. With tourism down, with Commodity Prices down, for a lot of countries theyre going to have to focus on providing safety, on providing health or, i mean, food systems that can actually survive the locust crisis in east africa, survive the pandemic. And if so i think therell so i think therell be a lot more work on prevention. Gerry david malpass, president of the world bank, thank you very much, indeed. Thank you. Gerri up next, why some Big Companies have gained even greater market power in this crisis and maybe what we should be doing a a a a a at Fisher Investments, we do things differently and other Money Managers dont understand why. Because our way works great for us but not for your clients. Thats why were a fiduciary, obligated to put clients first. So, what do you provide . Cookie cutter portfolios . Nope. We tailor portfolios to our clients needs. But you do sell investments that earn you high commissions, right . We dont have those. So, whats in it for you . Our fees are structured so we do better when our clients do better. At Fisher Investments were clearly different. Founder of times square churchid told mike evans. Number one New York Times bestselling author, mike evans, has written an astonishing book on it, called. For the full prophesy by David Wilkerson and the book by mike evans go to www. Foz. Org gerry its an uncomfortable thought during these harrowing times to remember some people are benefiting even as so many are suffering. While tens of millions of americans is have lost their jobs and thousands of businesses from restaurants to hair salons, to even large retailers are going under, its been a boom time for some of americas already largest and most powerful companies. On thursday, amazon reported sales soared 26 to more than 75 billion. Profits did fall because of costs of dealing with the virus. 175,000 workers since the crisis began, and it looks set to grow even larger. Its stock price finished the up april 34 for the year and 14 from the market peak in mid february even as the overall stock market was down by about the same amount since then. Netflix is another company thats made huge gains during the crisis has people really have nothing else to do but stay home, watch tiger king and endless movies. Other companies are still likely to emerge in extremely strong shape while so many damages will suffer damage. These Big Companies already dominate the economic and, indeed, the Cultural Landscape of this company, and the lockdown is strengthening their market power. Amazon especially is likely to gain from the elimination of tens of thousands of small Retail Businesses that have been or sadly soon will be swept aside by the shutdown. A key task for policymakers when all this is over will be to insure that our postpandemic world doesnt mean less competition and less choice for consumers. Thats it for us this week. Be sure to follow me on twitter, facebook and instagram. Ill be back next week right here on the wall street journal at large. Thank you for joining us. Jack welcome to beltway barrons round table, im jack otter. Despite dismal news in the economy, stocks posted their best monthly performance since 1987. Whats driving the disconnect, and the rally be sustained . An economic recovery will depend largely on consumers ability to start buying again. Once restrictions are lifted, where are americans likely to spend their money . Will government moves to keep