Begin to open questions about what does that mean, what are the risks inherent in that absolutely, rick, this is an issue that markets are paying attention to but again, both the commercial paper funding, if we get a facility, a similar way of trying to provide liquidity to markets and make sure companies can keep the doors open would certainly be steps forward to make sure that corporate sector doesnt experience too much stress as a result of this excellent thank you for your thoughts. Were running light on time and we will have you back as this proce progresses back to you. Good tuesday morning. Im Carl Quintanilla here at post nine of the new york stock exchange, Morgan Brennan at headquarters, jon fortt heads our coverage from the floor of the nyse compared to yesterday, relatively stable action no Circuit Breakers taken today, did lose 20 k briefly. Lets get to bob pisani. Not only is it a no, sir cut breakers but the volume is lower and the key event this week is going to be the quadruple expiration at the end of the week normally you get increased volume tuesday and wednesday and thursday and maybe traditionally calmer after that. The s p 500 we were briefly negative after 10 00 eastern time the key level technicals dont mean an awful lot here but 2351 the december 24, 2018 low. Everybody using that mentally. We didnt get close to there right now. Were not far from the highs of the day after the open the announcement of the fed to establish a commercial Paper Funding Facility is welcome news but didnt do a lot to impact the market it had been lifting prior to that banks, for example, mostly to the downside throughout the day. Bank corp and regional banks on top of citigroup and some of the super banks were also down modestly and remain down modestly the big story continues to be staples continuing to rally. A core group of names weve been bringing them for the last three or four days clorox, walmart, which got an upgrade today, kroger, campbells soup, procter gamble, all notably outperforming the market positive for the most part the other story the opposite end we mentioned this on our special at 7 00 p. M. Eastern time the destruction going on in the retail area continuing today these are not typos. L brand downs 27 , guess, kohlls. The consumer is not going to be shopping if and when the stores close and many are closed in the tristate area. I would note we have gotten a read on some of the metal names today. New u. S. Steel and reliance steel and dow inc a material name rebounding a little bit still very, very tentative back to you. Bob pisani, i will take it. Now lets bring in david katz, chief Investment Officer at Matrix Asset Advisors along with sam stover of cfra good morning to you. David, in this market which has been just so volatile, stocks down quite a bit, of course, it is time you argue for those who anything but a short time horizon to think about buying. Who should buy right now and who should sell . Well, basically, if you have a onemonth to threemonth time horizon what youve learned is this market is unpredictable and moving 5 or 10 on the upside and downside and no way to know which its going to go if you have a 12month time horizon and an investor and dont mind the volatility, theres a great likelihood theres going to be some sort of clarity the economy, which might very well go into a recession, an earnings recession, will be on the mend and stocks will be higher 12 months from now. The key is to buy very good businesses with very good Balance Sheets under 12 times earnings youre likely going to make a lot of money now sam, i want to question what a lot higher means. You subscribe to the idea we are in for a vshape recovery but im looking at what new yorks mayor and governor are saying about the need to get cash in the hands of consumers here because of the shock that theyre experiencing because of the coronavirus social distancing measures and bars and restaurants, its important to get cash in hand i wonder if the consumer is not ready to come back, can the markets really have a sustained vshape comeback when this is all over well find out in retrospect, but i think that when you look to Second Quarter gdp, which we expect to show a decline but then to see arecovery in the Third Quarter by more than 3 because we believe that the selfquarantine will be done, there will be a lot of pent up demand that our belief is that we are maybe we see one or two quarters gdp and or earnings declines but our belief is that the consumers are going to want to come back they are going to have cabin fever and want to get out and to do some spending david katz, you just mentioned the opportunity to buy strock businesses with great balances and prices like what . I ask that because the selling has been so broad based and we have seen some of the traditionally more defensive names sell off by double digits recently thats exactly it you dont have to buy names that are in the travel industry that are down a lot you can buy a lot of businesses that probably are not being that affected Companies Like abvi and merck and at t, we like facebook, home depot, getting shellacked on the retailer selloff. They have a better trap, a longterm business, great Balance Sheet, we like it a lot here we like the banks, pnc and wells fargo and the last thing to point out you definitely are starting to see a lot of insider buying and places in the market insiders are investing for the longer term and if they see an opportunity theyre stepping in. Theyve done this when youve had bear markets a year later people kick themselves for not having followed them. Sam, youre a man that likes to run the numbers and put them within historical context. Seeing a lot of comparison right now to things like world war ii, this idea that were at war right now where the coronavirus is concerned, from a numbers standpoint does that make sense . Well, from a numbers perspective, i think it made sense when we were trying to ascertain the killing of general s soleimani and why we thought the market would recover nicely from that, which it did with the coronavirus, history did not serve us well because if you look to one month, two months, three months after, sars, swine flu, mers, ebola and zika the market was higher in every observation, higher one month after the first u. S. Case of the coronavirus, but now in the second month, were down 29 . History has not served us very well and so i think you have to do as david was mentioning, look to historicals, health care, industrials, trading at double discounts to the relative p es and many not only trading at double digits but 20 and 30 below their absolute p e historical averages. David, finally, because you guys seem to be arguing that fiscal stimulus and right kind is key to the kind of recovery that the market hopes to see, i wonder how did workers and freelancers are affected by this weve seen a rise in that. I would even bring in, you know, waiters and waitresses into that group who might not see a benefit interest a payroll tax cut that we expect to see recommended by the administration here. What type of fiscal stimulus do you think would be most effective and perhaps even include those workers, the uber drivers and taskers, waiters and waitresses who maybe dont receive a paycheck by those traditional means . In terms of addressing the virus the government got it very wrong from the beginning theyre finally starting to get their act together in terms of the Health Issues with the quarantine in terms of the fiscal and Monetary Policy, the Monetary Policy we think is where it wants to be and we think the government is going to be pretty aggressive in getting the fiscal policy right, throwing a lot of money and a lot of areas of the economy. We think, you know, the payroll tax could help we think there will be a lot of other resolutions in the next two to four weeks that address some of the areas that you just mentioned that are being hit that are not being properly protected. We think thats going to happen. We think you have everybody in the government understand this is a major problem and major problems get Major Solutions and thats what we would look towards. That will help the market recover when things start to bottom out yeah. Well see if they can figure out how to target that money thank you. My pleasure thank you meantime former wells fargo ceo joins us this morning. Dix, good to see you this morning. Good morning. Good morning. The guys in the prior segment were talking about insider buying and we know that charlie bought some wells on friday at 28 and change. Are you doing any buying im buying a lot of things including bank stocks, although i own a lot of banks i do think its an opportunity i think were going to have a were like throw have a recession, but its going to be vshaped you know, this is all about the virus. Were talking about markets and so forth job number one is we have to get this virus under control we know how to do it other countries have done it and its and it can be solved relatively quickly, maybe a lot of disruptions in our lives to do that, quarantines and so forth. But this is not a financial crisis its not a banking crisis. Its a Health Crisis once that is solved the need for people to go back out and live a normal life is going to have a booming economy once we solve this problem its such a good point, because you look at the price action weve seen, especially in financials and then you look at the experience that obviously different types of countries in china and singapore and taiwan and south korea have had, they have peaked out and it seems like the bear argument right now is not paying attention to that dynamic at all or even that possibility and even you guys, youre still talking about all the issues in the finance and markets and so on. Because were heading into it what you should be talking about is the Health Providers and what needs to get done and talking to south korea and so forth, what happened there, and i think it was interesting that the mayor of new york city said he could see an end 45 days from now. Now im i dont know whether thats an accurate prediction. I certainly wouldnt believe a mayor, but the experts that are out there, you know, and the experience thats happened i think thats where the communication should go. Of course there are svaccines being worked on which is a longer term situation. It sounds like theres some interesting things going on there with people that know the business, the scientists that know the business, think they are going to find a vaccine. 45 days from now sounds good when President Trump is talking about this potentially stretching into august and certainly with everything were seeing play out in south korea, i do hope that becomes something of a template given the fact that we are seeing the numbers come down there. For what plays out here in the u. S. As well in the meantime some of the steps that have been taken in the last couple days where credit is concerned, where the banks specifically are concerned, Kayla Tausche is reporting that the regulators are looking to loosen some of the rules, governing the Bank Industry to basically free up liquidity right now, are these the right steps . Do they go far enough in the meantime well, lets talk about what arent the right steps you know, the monetary bazooka has been triggered it will have no impact in my opinion on improving the economy and doesnt do anything about the Health Issues and has a negative psychology that happened in the financial crisis, quite frankly. You know, they decreased by the fed funds by 50 basis points, the market went down a thousand points. They said lets do double that the market went down 3,000 points they also said like they said in the other crisis that well keep Interest Rates low forever well, that doesnt build any confidence every six weeks the fed came out during the crisis saying things arent very good, were going to keep rates at zero, how does that help the confidence of people and the investors . They also said theyre going to do qe on longterm bonds that didnt help even the financial crisis what they should emphasize and they did, but not enough, is that this is a liquidity crisis, not a financial crisis weve got to make sure that we get through this with by giving the liquidity necessary to do so and if theres any parts of the market that seize up like what happened in the financial crisis and is happening now, like commercial paper, theyll fix it. Those are the two things that they should be emphasizing, not the stuff that didnt work in the past now i hear you, but i want to ask you about something you just said you talked about this being a health issue agree with that, but it also seems to be a policy issue and an economic issue for a certain type of worker workers who are perhaps getting paid in cash, workers who are freelanced what needs to happen to make sure that worker, who was also a consumer, is able to be able to tide over for 45 days and doesnt turn into a financial crisis for that sector of the economy. I would call this fiscal policy we have to for whatever time is going to be nez, we have to support the people, those kinds of people at the lower income, particularly that are the ones that are being to be laid off or already being laid off because we cant go into bars and restaurants and the hotel and hospitality area and airlines and so forth, and we will have to supplement them and be sure that theyre getting Unemployment Insurance and whatever necessary things do to hold them over its very important. And i call that fiscal policy. We also need to ensure that the that whatever Small Businesses of who very little access to loans and capital are able to get through this whats important and we havent learned our lesson, is that industry to help these things get done is the Banking Industry they know how to do credit they know the businesses theyre probably already customers. We need to make sure they have the liquidity to make loans. The fed has decided and we all said this is the problem with the dodd frank bill, that the capital can now be used, not set aside for, i dont know, what do you need more capital for other than to be available in a crisis like this, the capital can b used to make loans, they dont need to keep 20 of their capital in unliquid or liquid assets that they never can use, use those assets, and right. And the window is open. This is a very important factor. One of the reasons that some of the markets are seizing up is because banks arent allowed to trade or take any risks on their Balance Sheet with securities. Yeah. Thats how they seize up. Maybe people will learn a lesson that what we thought were positive things become negative if you dont use them in crises like this. Exactly finally, for our viewers who are Small Business owners, maybe watching from home this morning and they are thinking to themselves, what is forgiveness going to look like regarding my mortgage, regarding my line of credit at the bar or health club that i own, or help run, what will forgiveness look like well, i think for sure, youre not forgiveness is you wont have to pay your Monthly Interest costs and so forth. You will be alolowed to extend that in some form. If you have healthies assets you will be able to get a larger loan with that but the entity can make that risk decision is your local banker but the banker has to have the liquidity to do that and thats where the right. The fed and the treasury and other activities go on exactly. And you have to do these fiscal policies, you know, that were talking about putting 8 billion in and now up to 100 billion and 840 billion. Let me tell you something you shouldnt do and california is usually the ones that do things we shouldnt do, they passed a bill that makes it that seizes up the gig economy. You know, you cannot be a gig you cannot work in the gig economy in california because of a bill that was passed last year yes. Weve been around that block. You cant make this stuff up and they still havent rescinded this. I doing all kinds of other things and all of these workers cannot even work anymore because theyre not allowed to do so basically. I imagine well be looking a law out there is that is being restrictive on the gig economy should absolutely be eliminated right now. Thank you for the fire as always a lot of good information there guys, session highs up almost 600 points on the dow up 111 points on the s p, morgan, which doesnt seem like much a month ago that would have been an enormous move. Isnt it amazing. Weve no decision on a potential Domestic Travel ban from the white house. Its been a tough few sessions more than a few sessions for Airline Stocks our next guest says if all flights do end up being halted the Major Airlines would exhaust their cash reserves in less than a year city Airline AnalystStephen Trent joins us now. Thank you for having me. Is that the case . How did you get to those numbers in terms of the airlines and what could potentially be a cash crunch, especially as we see this continue to get worse before it gets better . Yeah, certainly so, you know, one of the things we did, you know, the analysis assumes all commercial air traffic haltsz so under those circumstances the only revenue coming through would be credit card revenue, which incidentally did not exist during the previous crisis and in Delta Airlines case you have an oil refinely, certainly with oil markets where they are, there still could be some revenue coming through from that and then we look at the cost side, you have somewhere 25 to 35 some odd percent of costs that are fixed so some of that costs can be deferred and the u. S. Majors, for example, have a little bit heavier fixed costs than the discount carriers. Once we get past what the expected cash would be in the event that all flying stops, then t