Lets get a quick check on the markets now. The s p 500 is not doing much, down just a point. Data,ing the disinflation the 10year yield at 70 basis points. Not much movement. Grubhub,ng a bid for according to people familiar with the metal. Restaurant brands international, the ceo just on tv making a bid for resuming business in china. Lets get a deeper dive into todays market action. Taylor take a look at the vix. You are seeing an extraordinary come down, down 17 points in the last month or so, now allow 827 handle, the lowest since february 24. We know that the fed will be buying etfs. With that, fear is leaving the market. I want to take a look at the balanced budget, or the lack of balance, that we will get around 2 00. We are looking at what could be the first april deficit since 2011. The tax deadline was extended to july 15, and all of the massive stimulus put in place will make what could be the first budget deficit that we will have in april, going back to 2011. You mentioned uber. Definitely a stock that we are watching. Dealmaking has not gone down because of this pandemic. They are said to be making an offer for grubhub. Grubhub will be seeking 2. 15 uber shares for every grubhub share. We will see if the deal goes through or not. Vonnie thank you. Bostonbased is a asset manager with 30 million under assets. Rmr also has several operating companies that collectively had 50,000 employees. The ceo adam portnoy joins us now. We spoke to you about a month ,go, talking about retailers also looking at your truckstop business. Lets begin with where you see the economy heading right now, what your base case is for your company. Adam thank you for having me on the show again. As you point out, the rmr group, we are a pretty large, diversified asset manager, and we have a good look at the economy given the size of our organization. Our Current Base Case on the maybe this is a little bit planning for the worst, hoping for the best. Our base case plan is we are in a recession and we stay in a recession through mid2021. Starting in the summer of 2021, we see real growth in the economy. That is our Current Base Case. That is the plan we are using as a backdrop as we think through the Capital Needs of our companies the next few years, what their operations need to be prepared for. Vonnie a pretty chilling statement. That gives us a whole year start to see a pickup. I know that you are in pretty good shape, but you have some challenges, including in your Senior Living business, which makes up a good portion of your portfolio. Explain the crisis that you see there. Adam thats a really good question, what is happening with Senior Living. Existential an question about the future of the business. In the shortterm, it is remarkable watching the employees, those in the industry, it has really responded remarkably to the challenge that they have been put in front of. Takinge in charge of care of our nations elderly, perhaps the most vulnerable to this virus, and they have stepped up to the challenge. I could not be prouder of the folks working every day to take care of those people, in what is a much more challenging and even dangerous environment. Longerterm, there are questions around the future of senility. The industry will not disappear, but there are questions around, at the end of this pandemic, the industry will look back and it will be was the person in in theme safer being community, or when they have been safer at home . I think the early read is they would likely be safer in these communities, but the jury is very much out. Everyone reads the press, how a disproportionate number of folks that have unfortunately died from this pandemic have been elderly folks, many of them in Senior Living facilities. The jury is out. I think the early read is generally, people have been safer in these communities, but there is a question longterm, when we look back on the crisis, that is the question everyone will want to answer. I am hopeful it is good for the industry. Vonnie obviously, as you map out the future or the company, you are looking at lower labor costs for these facilities that you run. Are you also thinking about potentially changing the Business Model entirely, changing those facilities . While, we had been trying to get out in front of this. Before the pandemic even happened, we were trying to be forward thinking about the of caring for americas elderly. There was a push over the last few years of people staying home longer and longer before moving into these types of communities. With the advent of technology, services being delivered to peoples homes, it is a lot easier to stay home longer than before. Before you moved into these communities. That trend may accelerate as a result of this pandemic. That is something that we were very focused on prior to this pandemic, something that we are continuing to focus on. As a result of that, as a business, you try to move your operations from providing services in a community to providing services to people in their homes. That is something we are focused on in our Senior Living business, trying to expand into that to address what we see is coming. Within the communities themselves, we dont think they are going away, but maybe some of these communities, especially the agerestricted active of the communities, really just apartments that are agerestricted, and or independent living, where people i couldg fairly well see a world where some of those communities turn into general apartment buildings. Moving away from catering just to the elderly and start catering to the general population. Vonnie more than 700 retail tenants. How is rent collection going this month compared to last month . Do you anticipate to see a problem there . Adam last month for the month of april, we collected 45 of the rents from our retail tenants, which in comparison to many of our peers, looks like a Pretty Healthy number. So far, as we are in the first the collection rate is right on top of what we were experiencing in april. We are where we were in terms of collections 10 days into may as we were in april. The only thing that gives me a ause, init off p april, we got a lot of inquiries from our tenants asking for deferrals. The overwhelming majority we worked with. This month, wedd have not gotten as many phone calls. While the pace of collections is roughly the same, those that have done get paid, we have not heard from a lot of them. I fear they just may not be paying this months rent. Of course, we will have outreach and will try to work with them. That could be a shift in mentality. In april, some of these smaller retailers, calling up, asking us to work with them. This month that they are not calling is a bad sign psychologically. I hope it does not mean that people are throwing in the towel, but it is not a good sign. Vonnie i want to ask you about the leading indicator, truck stops, fuel sales. You control a lot of the supply chain for where trucks stop along the way in the united states. How is april looking there . Adam as we have talked about, our truck stops are doing a fantastic job. Ant business has been deemed essential service by the federal government, almost all state governments. They have been up and running the last two months, providing services which are vital to keep goods moving around the country. As we saw in march, volumes were a little elevated. Few volumes were down a little bit in april. They have started to pick up again a little bit as we get into may. It is still a little unclear what is driving that. Trends does not make a necessarily, but it could be us ticking up a little bit of market share, but it could also be that the economy is doing a little bit later better in may than april. That would tie into the fact that parts of the u. S. Are starting to open up, so it makes sense that you would start to see a modest increase in the fuel volumes, which would indicate a modest increase in goods moving around the country between may and april. Vonnie we have to leave it there. Thank you for joining us today, adam portnoy, ceo and cofounder of the rmr group. Lets get a check on the first word news with Mark Crumpton. Infectiouscas top disease expert is warning against reopening the economy too soon. Dr. Anthony fauci told a Senate Health committee today that do so would risk new coronavirus outbreaks. My concern is we will start to see little spikes that may turn into outbreaks. Therefore, i have been very clear in my message, to try to the best extent possible, to go by the guidelines which have been very well thought out and delineated. Dr. Fauci, who testified from his home, said there is a real risk a premature reopening with the two suffering and avoided. Could be democrats are thinking about holding a virtual Democratic Nominating Convention in august. Officials are discussing plans for an event that will not require delegates to appear in person. Announced avis we delay of the convention because of the pandemic, pushing it back from july 13 two mid august, the week before republicans are set to gather in charlotte, north carolina. 11 millionhina, all residents will be tested for coronavirus. The city where the pandemic began has reported new infections for the First Time Since lockdowns were lifted. Casescally transmitted were found in people already under quarantine. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Vonnie thank you. Doctors and scientists are working around the clock to come up with treatment for covid19. We spoke with an assistant professor from Johns Hopkins earlier about the latest strategies. Ventilators have been fighttely critical as we to help individuals survive this illness. Seen improvements in the availability of them. As some individuals are we then, of course, would have those ventilators available for others. They truly are remarkable. Tho are interesting, too, ugh, as there have been discussions behind the scenes, thinking about how we make the best use of our technology while also protecting our staff and ppe. Some work bybeen engineers, nurses, others, how can we maybe use those ventilators from a distance . Again, there is so much that we need to do, far that we need to go. Stable,w, we are pretty i can say in the Johns Hopkins system, our ventilator situation is stable at the moment. Ofthere were a number troubling reports about blood clots being formed. What do we need to know about this linkage . Michelle there are more questions than answers at this point. Many are studying this connection. Is it a direct result of the virus itself . Is it more a correlation of the level of inflammation, damage to blood vessels throughout the body . To what extent does fever play into this . There are some people who may need more susceptible to developing clots. Individuals treat prophylactically, watch closely, but we are still gathering theence to understand specific risk within covid, as opposed to maybe other illnesses. What do we know about other systems symptoms that persist once it clears . Patients that can no longer pass it on the basic for many weeks and months. Michelle certainly, the be long. Ent time can a lot of it depends on the underlying circumstances of each individual person. To asks of being able the virus, there is a time frame where you would be able to pass that and contract it. Again, really not clear. A few weekso be for while the viral load is high. Is,rtunately, our challenge some people do not show symptoms that can be carrying the virus and sharing this virus, unknowingly, with others. Vonnie that was assistant professor michelle patch. Of course, the Johns HopkinsBloomberg School of health is supported by Michael Bloomberg and bloomberg philanthropies. Auction, a successful we are also hearing from the Federal Reserve it is borrowing collateral details for the program, and also for the ppp liquidity program. The fed saying they will be completely transparent on who takes on these offers from the fed, offering detailed information to the public. Stay with bloomberg for leadership live with david rubenstein. Ceopeaks with the nasdaq later today. This is bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn. Investors following the fed and piling into . 4 billion into corporate debt etfs over the past week. What impact will that have on equity markets . Joining us to discuss all of the programs and their impact on the markets is Causeway Capital management ceo and cofounder sarah ketterer. An unusual day for the Federal Reserve. Reassuringd speakers the markets, talking about transparency. What have youows, seen the programs due to the equity market . Sarah these equity programs are very supportive. All of this liquidity has led to a buying up equities, the upward movement in markets since they bottomed march 23. Importantly, credit spreads have globald, and this is monetary fiscal support, not just the fed. That means there is a great chance the last crisis was a banking crisis. This one is health care. That means banks have the opportunity to get through this without raising capital. Be active in credit, which is what Central Banks are hoping for. They want the banks to be at the forefront of recovery. Vonnie explain that a little more. If we have to go to negative rates, which is a huge leap from where we are now but you know the president will be putting pressure on the fed to do so. We are not out of ammunition, but it is one place the fed could go. Surely, that would be disastrous for banks. Sarah it has not been a disaster for the banks and europe and japan. The better banks have been able to manage with fee incomes, dependent on credit spreads. Some can maneuver quite well from a no to negative Interest Rate environment. The key is convex do not need to raise more capital. I cannot emphasize that enough. Currently, banks in europe trade at multiples similar or lower than that financial crisis, but they have 2. 5 times as much capital on average. The market disagrees with what we are seeing at causeway, but we are looking at these bank stocks. These stocks have fallen 50 many of them from the beginning of the year. All of this Government Support that you just noted, particularly with what the fed is doing, is positive for the banking industry. Vonnie so what are your picks, all european banks . Sarah i think we could find one in every region. We could start with citigroup, here in the u. S. Over 90 billion market cap company, almost a 5 dividend yield. The stock was 83 in january. 44 today. This is a bank that has made the effort, now that regulators have allowed them, to return excess capital. They will continue to have access capital. They improved their returns quite a bit by exiting subscale operations. They are just wellmanaged. We are seeing an economy that is going into recession again. Have thebe dont capital problems they had during the financial crisis, but it is a whole different era. Where do you see the big risk . Sarah the banks have already discounted the risk. That is what markets do, they anticipate upcoming events. The key is to be able to own these banks at low valuations. You mentioned european banks. The best ones are trading at 30 to 40 times tangible book value. They could go up to trading at 60 or 80 of tangible book, and that would mean the stocks would double. This is a remarkable opportunity. Banks come out of the financial crisis, and they tend to do well. You for your contribution, sarah ketterer. From new york, this is bloomberg. Mark im Mark Crumpton with bloomberg first word news. Americas top Infectious Disease effort is morning reopening the economy too soon. Dr. Anthony fauci told a senate panel today that doing so would risk new coronavirus outbreaks. He also told a Senate Health committee there are at least eight potential vaccines being developed, and also warned about being cavalier about the risk of virus poses two children. The u. K. Is extending its Furlough Program through october. The government is paying the wages of 7. 5 million workers to protect their jobs. Some will return to their jobs parttime. Employers and the government will split salary payments. Spain is seeing its number of coronavirus cases and deaths increase. Slowlyntry has been easing its lockdown restrictions after more than eight weeks of confinement. 100 76 people died in spain in the past 24 hours. That brings the total death toll to nearly 27,000. Spain has had more than 229,000 infections. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Amanda live from toronto, im amanda lang. Welcome to Bloomberg Markets. Shery im shery ahn in new york. We are joined by our bloomberg and Bnn Bloomberg audiences. Here are the top stories we are following from around the world. U. S. Stocks sinking into the red after opening in firmly positive territory. Major indices fall into session tos with the nasdaq on track snap a sixday winning streak. This as the u. S. Government top Infectious Disease expert says the country is on the right path but says consequences could be serious if states ease restrictions too soon. Dr. Anthony fauci emphasizing caution in his testimony before a senate panel as the death toll tops 80,000 in the u. S. A 25 aramco reporting plunge in profits while retaining its dividend. They are signaling that they would keep spending in check as in braces for deeper damage from the oil crisis. More on that next. Amanda lets take a quick check on the markets. As you say, they seem to be a little preoccupied with dr. Fauci and his remarks, the pace of reopening, a big question. Data out of spain will not help, when we hear the numbers spiked when they tentat