breakers in place. they already kicked in for the first one, down 7%. they are supposed to kick in for down 13%, but that gets suspended in the final 30 minutes of trading. we are getting ready to close the books on another day of massive moves. 9.5% to 10% for the s&p, nasdaq and dow, falling through the roof, more than double over the last 20 days. romaine: officially the s&p is in the bear market. majore major -- all the indices in the u.s. and around the world are now in bear market territory. 10% drop in the dow jones industrial average is the worst drop since october 19, 1987. the big dip in 1987. scarlet: on a percentage basis? romaine: what do you make of that? joe: it is unbelievable. the combination of the speed of

everyone watching parts of the economy shut down all at the same time is like nothing we have ever seen. superlatives to compare past plunges, but everyone is trying to compare it to what experiences is this similar to. i have heard from people today, and no one had some obvious analogy, whether the cry natural -- whether the financial crisis, the wake of 9/11. everyone of these past events was in some way a reminder of this, and that is what makes this so extraordinary. scarlet: and economic damages going to get worse. we heard from france that they are going to shut down all the schools and universities. new york is banning public gatherings a more than 500 people. it is only getting started in terms of the real-world effects. romaine: a lot of emotion, a lot of intangible things. let's get back to some tangibles.

taylor riggs is going to look a little deeper. taylor: let me try to keep it tangible for you. i have three good charts. the first, let's just recap the day, because it has been a long day on the trading floor. we opened, within five minutes we hit the 7% circuit breaker limit. we paused for 15 minutes, reopened. the fed came in around 1:00 and said they were going to operate repo operations and extend what i am calling non-qe qe. they are not calling it that, but i will. there was a brief reprieve but then tumbling 10%. the good news is we did not hit the second circuit breaker limit, which would have been 13%. but we closed down for the lows of the day. unfortunately if we look at the individual stocks, if you were a winner you are still a loser. all of the winners mostly in the red. i wanted to take a look at the bottom of the screen. most of the travel stocks are

those getting hit the hardest. norwegian and carnival, off 30%. carnival suspending their princess cruise lines for 60 days. energy was the worst performer. that sector was off 12.5%, barely holding at $30 a barrel on crude. energy stocks in this mix as well as retail stocks i wanted to point out. capri. our retail analyst yesterday said foot traffic or retail stores fell more than 9% last week. luxury getting hit the hardest. often you talk about peak fear. within the retail market, it is almost like they anticipated this. this is the aaii survey. throughout 2019, they were pretty bearish. they had 30, 40%, 50% of survey participants said they were feeling pretty bearish. unfortunately, that just got bigger. more than 50% now say they are bearish. that coincides with the drop.

if you think that is perhaps a buying opportunity or a sense of peak fear, maybe that could be the case. joe: thank you, taylor riggs, breaking down the day. a few other headlines crossing the bloomberg. canada, their stock exchange plunging 12%, its biggest drop since 1940. since theiggest drop one-day route in 1987. romaine: throughout all this noise we are getting earnings coming out. ulta, oracle, 3q adjusted revenue $9.8 billion, above the estimate of $9.76 billion. also boosting its stock buyback program to $15 billion. we are really going to try to find what they're forward guidance is and specifically any commentary they make about coronavirus and the effect on their business. joe: still with us is michael regan and saira malik.

saira, want to go back to you. we are just listing one superlative after another. every country around the world seeing historic moves. we have to go back decades in some places to find any comparison. does that tell you anything? you are saying the word before, capitulation. does that give people who may have been holders themselves to suddenly question their own faith in holding on, and thus, want to sell further when they see headlines like that? saira: i think that constant headlines are definitely creating a lot of fear. the more that people stay home and do not go out, it creates more of a problem. the consumer continues to weaken and it exacerbates the problem. a couple things, coming into this period we were pretty much priced to perfection, markets were healthy. having a quick coronavirus hit the market has caused this level of volatility that is almost unprecedented.

not really surprised to see that and have it continue on. if you have a portfolio right now, if you make sure you are positioned in quality companies, slow debt, healthy balance sheets, that kind of company will do fine and come out of this or remain strong. and over time, you can continue to add into the market as volatility probably makes it get cheaper. romaine: can you address the quality we are seeing in the all -- in the earnings universe? prior to the coronavirus, we saw relatively encouraging reports, not only in terms of what they did in the past quarter, but what was being forecast going forward. michael: i think a lot of investors have that quality naturally, so they are going to get a little bit less -- romaine: aren't you a vogel head? what would he say? michael: burn your 401(k). that is your challenge right now.

with certainly seem some forms of capitulation by certain market buyers. i am not sure we have seen it from the retail investor yet. if that is still yet to come, that could be a nasty situation. scarlet: does that have to happen for us to reach a bottom before we can begin to build back up? saira: i think it depends how quickly maybe the governments step in and how quickly we can get our arms around the spread of the coronavirus. if this continues, we will still need to seek capitulation. if we can get a coordinated policy response, or clarity on the viral -- on the virus and what makes a plateau, you could bottom will be for any kind of adulation occurs. scarlet: angela merkel, the german chancellor, said germany will act in concert with eu members states. there has been a lot of call for germany to step up. you,i want to go back to because after the great financial crisis, one of the

things we heard is it is very important for everyone to be globally coordinated. it is very important for people to move aggressively ahead of the curve. it is very important to fire the bazooka. how much is the current selling the fact that all of these lessons that we had hoped our leaders had internalized have apparently gone unlearned? because for the most part we are not seen any of it. saira: it is a challenge right now for the markets, because that is really hard for the markets to find a floor. where do s&p 500 earnings go? it is really hard right now to determine how deep the recession will be. we could say it will be a v-shaped recovery, which is what we think it will be because there will be a strong snap after it. i think the global response is still important, because it gives the market more certainty, it helps you find the earnings pinpoint, it helps move people forward from here. romaine: are you concerned about

some credit issues? michael: absolutely. you look at the spreads. they have basically doubled throughout the credit universe. high-yield energies -- energy spread is something like 16 percentage points above treasuries. is absolutely i think the main focus of concern going forward. depending on how long this lasts, and again, how quickly we get that government response, what they are going to do about that. there's clearly a need for some type of, one of those acronyms we saw in the financial crisis, to sure up the credit markets. the sooner we get that, the better. but with this dysfunction in washington it is hard to see it happening in the near future. scarlet: we have some headlines from the of city mayor bill de blasio. the city has declared a state of emergency. new york city mayor bill de blasio declaring a state of

emergency in new york city. they are seeing an intense increase in the virus count. this follows the neo-state governor andrew cuomo fanning gatherings of more than 500 people, and saying it will take effect 5:00 p.m. friday. i want to thank our panelists here, michael regan and saira malik, joining us from san francisco. we will continue to watch the subelements with more market analysis -- wash these developments with more market analysis. we continue our special coverage on a day where the new york fed took some aggressive steps to ease what it calls temporary disruptions in treasuries. flooding the market would liquidity. clearly it was not enough. stocks closing after lows of the session, down 10% in the case of the dow jones, the biggest one-day loss since 1987. romaine, you have been looking at different metrics. there are some any points of stress. romaine: so many. i am not sure where we are going with the graphics, but let's be clear.

this was a global market selloff. we talk about coordination, there's your coordination. this was across asset selloff. people flooded out of everything. you saw that really reflected in the dollar today. the dollar index pulling up now. almost 1.2% today. that was a lot of where you saw the flows going. not just flows from u.s. ambassador's, but from overseas looking for some sort of safety, looking to unwind positions, reset positions, and they looked to it in the dollar. joe: it was really a one-two punch of not getting anything from policymakers that was at all reassuring. first it was president trump last night. regardless of your political opinions, the market did selloff basically as soon as he started speaking. continued selling. then we got the ecb at 8:45. a day after talking to other european leaders, talking about this could be a potential 2008-style crisis, not bringing

out it would seen the bazooka, yet. then nothing further from d.c. throughout the day, no obvious progress being made on the fiscal front. romaine: pure panic. scarlet: if anything the situation is getting worse because people are not getting .ested, schools are canceling the situation has gotten to the point where bill de blasio has declared the city in the state of emergency. romaine: we do have to talk about the emotional aspect. like myself, i was on the couch with my family last night watching the president. people are looking for assurance. at the same time they are seeing schools close, businesses close down, concerts canceled, and we are not getting a response as to how things are being addressed. that creates a certain fear, and that can lead to the financial markets. that plays a role in where we see a day like today, where we have the worst day drop since 1987. joe: people are looking for

something to curb the impulses they see both in real life, which are panic. you see it every time you look at an image from a cosco. you see it in the market when you see selling. so far, nothing is curbing those impulses, in the real or financial world. scarlet: physical markets or financial markets. taylor riggs has been tallying up the damage across the markets and has some perspective for us. taylor: when you see damage this hard, i do not want to create extra panic, but i want to show you the vix which is now the highest since 2008. you never want to say anything is going the highest since 2008. but the vix reached a 75 print today. i was speaking with matt rowe earlier and he said there is interest now in long volatility trading. it is called a straddle, basically making a bet in the next month the vix will move in either direction by 16%. you really could start to break even and see some money.

again, volatility was the name of the game when it comes to tracking the vix index. what that means is we fold that over into credit. we talked a lot about both the investment-grade and digging down into the high-yield space. some of the concerns that you are seeing within credit. as you can see, the cost to protect against the default within a high-yield corporate company, now blowing out. look at that. i mentioned this yesterday. we talked about log charts. that just went vertical. we are going back the highest we can track. going back since the extremes of 2015 and 2016. we do have a lot of investment-grade companies like toldg, helton, wynn, being they are drawing on their lines of credit. that creates concern deeper down that investment-grade into the high-yield scale. what that means for some of those companies. we fold that into the energy sector. as we know the energy sector was the worst performer today, off 12.3%.

new marathon petroleum off 27%. year to date, halliburton off 75%. what that means is high-yield spreads on an option adjusted basis, option removed basis, slowing out to 15%. that is 1500 basis points above treasuries. you are really seeing some of the spreads widen out. romaine: a great breakdown, t aylor. let's keep this conversation going. tom finke is joining us now from charlotte, north carolina. tom, help us make sense of this. obviously the normal metrics that we would normally used to try to value markets, all of those are meaningless on a day like today. when you look long-term though, is there a fundamental base that we can sort of work off of to try to figure out whether things have gotten oversold, or maybe if there is more to come? tom: first, thank you for having me on. it is definitely very hard to be in a day like today and really

think long-term, but that is what you have to do. a a lot of this is looking at industries and companies that will be countercyclical, or that are more defensive, whose cash flows will be strong. but there are industries we do not know about, whether that is lodging or transportation. right now there is a lot of noise, a lot of anxiety that is fueling the drop in all the markets. but you need to step back and continue to watch for your opportunities to invest in better quality companies. whether it is in high-yield market or high bond market. scarlet: in the meantime as we do our homework for those opportunities, we are seeing commercial paper rates rising, the cost of converting euro to dollars are climbing. based on what you see and what you are able to do, are things working as they should? is there any sign the system is

breaking down? we know it is under stress, but is it breaking down, or operating as it should? tom: it would be very hard to say it is breaking down. it is under stress, and that is creating funding issues. but i take us back to the financial crisis. there was a lot more leverage in this system. the one thing we do know, we manage a lot of institutional money, is there is a lot of money in the system. it's just buyers will not produce themselves on such a very volatile day. so, some of this is the short-term nature of the fact that the acts in different markets have widened out and we need to get through the phase and let arcus settle -- markets settle in. joe: i am curious, what are you seeing from the perspective of -- you are talking, ok, here is the time to attention we step up and buy quality. that is a great message, and at some point we know that will

work, or he hope -- we hope so. but at the same time a lot of people have this idea of never sell anything, and just go along and hold and ride it out. i am curious if you see that that mentality is starting to break yet and people are questioning whether they have the stomach for this drop. sides.think you have two the retail market is where sometimes you see investors pulling out money, they panic. and they are pulling them out of the mutual funds, out of the etf market, and that accelerates the issue. on the institutional side, i think institutional investors tend to be a little more patient. that does not mean they will not start pulling money out if they think that the situation is prolonged and they need to de-ri sk their portfolios, but they are slower. managers, whatet

we need to do is not just serve what the investors want in terms of pulling the money out when they want to pull it out, but we need to be looking ahead. and if there are assets that we think the risk of holding those is too great given what could happen into the future, then we need to make adjustments in the portfolios we manage to eliminate that risk. it is tough on a day like today, because as i said before, if there is not a strong bid out there, it's very tough to hit very low bid. but that is where asset management and the decision-making portfolio managers make a big difference. scarlet: let me jump in because we have some headlines a lot of people were waiting for. the ncaa canceling its remaining championships. that sounds to me like march madness is now canceled. the ncaa canceling the remaining winter and spring championships. a lot of people were looking forward to that as a diversion

from what we have been experiencing. they do not have that anymore. another headline i want to touch named sarah has nash as chairman. that is effective on the close of the sale. let me take a look. it is effective as of -- we do not have a date, but she is named chairman of the board effective as of the close of the victoria's secret transaction. a new chairwoman of limited brands, l brands, sarah nash. a lot of headlines here that we can expect for the retail industry and other stress industries -- distressed industries. romaine: we should probably talk more about the oil industry. on a day like today where we saw oil down again, brent crude dropping down percent down, around the $33 a barrel level. i mean, we are seeing once in a general -- once in a generational-type of shifts here. when you look at the outlook

here, beyond just coronavirus, what we are seeing with the breakdown of opec plus, the breakdown in demand for oil, what does this really spell for some of these energy stocks, or some of these names that right now are basically just on the floor? tom: sure. the, with energy, one of things we did back in 2015 when we saw the first prices being around $80 to $100 a barrel, we our portfolios and our exposure was primarily in the high-yield market. what we did was stress test the portfolios down as low as $25, $30 a barrel. the key here is over the last few years, we have significantly under weighted energy. because we felt that while you can look at a certain range over a period of time like we did between 2015 and today, we knew it was always susceptible to shocks.

and it is about staying in the names that we could felt ride through a period of time at ultra low prices. right now, the situation is exacerbated i rbc the impact on markets of the coronavirus -- by the impact on markets from the coronavirus. for thanks to tom finke helping us sort through this historic day. i want to bring you another headline. withdrawing prior annual guidance on the coronavirus impact. i do not think that is particularly surprising. i just think we are going to see more and more and more of these withdrawing of any guidance they had been contributing to a sense of uncertainty. people talk about valuations, how can we possibly value a company right now. scarlet: the p is going down and the e is a big question mark right now. joe: let's go back to taylor

riggs who has a look at the impact on companies. taylor: i want to show you a great chart we have. a percent day change. a map of which countries are reporting the most increase in cases. as we know earlier this week, italy bearing the brunt of that. france shut down schools today. we come on over to the u.s., percent change still relatively low. but california and new york closing major events. new york closing broadway. new york city also in a state of emergency. that will step up the picture for our next terminal chart i am showing. i have earnings revision. we were just talking about broadcom and companies pulling back their forward guidance due to the uncertainty around this. interestingly enough, this is going back since january 20. within the next month or so, we are going to get earnings from the first quarter. rbi analysts are estimating a 1%

drop in earnings growth on a year-over-year basis. and look for a re-acceleration later in the year. crazy enough, and i'm speculating here, technology has not seen earnings revisions. i'm wondering if, a, there are bigger growth companies, they have bigger exposure abroad, perhaps leveling out of some cases in china is making them more optimistic. this is relative of course to industrials and energy. earnings revisions down 7%. 17% for a lot of the u.s. cyclical companies that perhaps now are starting to bear a little -- little bit of a brunt of this. somewhere in the middle you have health care, and consumer discretionary getting a little bit of a hit on earnings revisions, but nowhere near the types of energy we are seeing. energy clearly bearing the brunt of this, both on a supply issue with opec plus and russia starting a price where -- price war, and the demand issue, as

perhaps the economy slows down, there's not as much demand for energy. scarlet: fantastic insight there, taylor. now, clearly the u.s. is facing heavy criticism for its response to the virus. our next guest is the outbreak is a wake-up call for american institutions. joining us is dr. rod hochman, president and ceo of providence st. joseph health, which is a health care system operating ultimo hospitals across seven states with headquarters in washington. he is also chairman elect of the american hospital association, and he joins us from seattle. doctor, the fact that you are in seattle is something i want to start off with, because clearly seattle is ground zero for one of the big clusters of coronavirus cases we have seen in the u.s. can you give us some insight, first of all, into what providence has learned from treating the first patients, as well as several more across of its care centers, and how we can

apply that to what we are likely to see across the nation? rod: sure. i think we are a good test case to see where things are going. we have the first case, and the important thing is is to recognize cases, is that most of us would tell you we are under diagnosis. we have not had the tests available. we are seeing a lot of cases were already out there. we are predicting that the there mayrketplace, have been six or eight weeks with people with coronavirus but it has gone unrecognized. what everyone has to get ready for is as testing becomes readily available, the public should not panic when the number of cases that they see rises. for all of us clinicians, we know they are out there already, and we expected to see that happen. what we are trying to do with closing schools down and kind of attenuating the curve, so that

those people who get very ill, if we can hold that down a little bit over time, the impact, particularly on the health system, the hospitals, and everyone else, can be truncated. you have heard that several times, we call that flattening the curve. what you see here, we have been able to deal with the cases that are out there. we are starting to see them evolve. obviously the hotspots we are seeing are particularly in those vulnerable places like nursing homes. we are doing a whole number of things to look at how nursing homes, and how we have to deal with those hotspots in particular. joe: you make a great point about bending the curve down so that the health care system can deal with the rising number of cases. of course we do not know how effective it is going to be. we hope that will be effective, but it still remains to be seen the degree to which we put it in place and how timely we did. what is happening, from your perspective, from the

hospital-side to prepare for expectations of an increase in demand, or the difficulty that so thate on capacity hospitals can avoid a situation like we are seeing out of italy, for example? rod: right. i think we have been ready for this for a long time. we have been through h1-n1, thro ugh ebola. we has had a look at surge capacity, where we can put extra patience. =-- patients. we can use tents. are notal rooms we currently using for people who are less ill. we have 51 hospitals in the western united states. we get them on the phone every morning at 7:30 a.m. with 250 people to really plan out all of those steps. i think the key for us is to be able to test enough patients, nate -- make sure we know what we are up against. i keep emphasizing that that is

starting to catch up, but it has still been agonizingly slow to get the testing done. the other big issue is getting supplies. so, we need more masks, more protective gear, all those things we need to take care of patients. we feel comfortable so far that we will have enough ventilators, enough i see you capacity as it goes forward, as we plan that. but it is really protective gear and particularly testing. the other worry that we have with everyone now staying home, particularly the kids, is, is our workforce going to be able to come to work? we have a nurse now with kids not going to school, can they come in? we are watching the workforce really carefully to make sure people are coming in. we are looking at things of being able to take care of their children at home, so they can come into work. so, those are some of the things on the front lines that we are dealing with. but so far i will say that we are ready and able to do that.

and i feel more comfortable with our response as we are sitting here today. testing you mentioned and how we have under-tested our population here. i know in seattle the gates foundation is preparing at home testing kids. we've heard how companies have started screaming in the past week as well. talk about how the testing capability should pick up. we know the number of cases will increase. once that starts to pick up, will we see a more robust response from authorities? especially at the federal level? we hope so. the private sector has been dealing with this issue. ramping up. the university of washington, the gates foundation.

it is going to take that kind of effort. say, these are recognized cases. we just have not had the means to identify to know where they are. knowledge is really important for us. the more we know about how this spreads, the better off we will be. hocine: all right, dr. rod hman, thank you for being with us today and giving us a breakdown. we want to bring you a few headlines. disney closing its disneyland parks and disney california adventure. these are the california parks, shut down. another headline, philip janssen has tested positive for covid-19. bt group's philip janssen

testing positive for covid-19. we want to keep this conversation going. major league baseball in the u.s., the latest sports league to suspend operations due to concerns about the coronavirus, after similar announcements by the nhl and nba. standing by, emily chang, our bloomberg technology anchor in san francisco. what do you know about some of these cancellations? ed: major league baseball suspending spring training, delaying the beginning of the season and of course the ncaa minutes ago canceling march madness. the pressure was on the ncaa all day long. you had duke university pulling out of the championship. this decision is based on the covid-19 public health threat. our ability to make sure it does

not spread the pandemic and the impracticality of hosting such events during the academic year giving the decision by other entities. obviously devastating for the players. it is a huge cash cow for cbs, tickets are 200 dollars apiece. marche you 90 how popular madness or march sadness as some people are calling it, there were more brackets last year for march madness then votes cast in the u.s. presidential election. there's an industry built around it. you see beer sales rise, pizza sales, chicken wings, desserts, and then it leads to the question of what is happening with the other leaks. we reached out to the nfl. no comment yet. we tried to get a statement from the golden state warriors.

no comment yet. a story crossed the wire that the nba is down, disneyland is open. disneyland now closing its parks as far as we know in california. disneyland and california adventure. the new ceo of disney, named a sople of weeks ago, certainly an evolving situation. the olympics of course coming up. we can imagine they are considering contingency plans. certainly not a good situation. joe: thank you. ourwill be speaking with sports editor, john edwards, joining us from boston. headlines.evable everything getting canceled. do the headlines last night, the nba suspending its season, stopping a game

after a player tested positive, is having the effect on emphasizing the realness of this crisis in a way that no other, nothing else has been able to. >> absolutely, that is the effect these cancellations are having. hankswith things like tom and other prominent people diagnosed. the sports cancellations are shocking to people. they expected when they are stuck at home to be able to rely on turning on their favorite sports. even as they are played in empty arenas. thateague has gone beyond to cancellations. saying that even players and staff, are referees,

at risk of being in close quarters. the way they would have to be to compete. talk about the economic impact of this. it is hard to quantify what this means. if you look at just march madness, $8.5 billion was bet on the tournament, talk about the trickle-down effect of that kind of money changing hands, and not changing hands this year. hard tou say, it is quantify. there are billions of dollars at stake. complicated tv rights, contracts. revenue. ticket revenue. that is all going to be lost this season. adding to a wave of

other economic impacts throughout industry and american life. it is huge. we heard emily detail the leagues that have canceled. she mentioned the summer olympics in tokyo. differentloated ideas, such as continuing with the game, without an audience. of the give us a sense calculus organizers are considering as they make this decision? this is something that japan and tokyo have invested billions and. >> absolutely. given that they are even more eager than the ncaa and other of theo keep some form olympics going this summer, they are considering all sorts of

contingencies, going without fans. still you see to do the olympics you have to bring thousands of athletes and other people together. and have them live together in close quarters for two weeks or more. be a definitely going to challenge for them to figure out a way to salvage. it is starting to look unlikely. romaine: how prepared were they for this? there's been talk about this the past few weeks. were they prepared for this possibility to lose the revenue of playing without fans and now shutting down the season? >> well, i would not say they were prepared. i think they were hoping that would not be the case.

this is a fast-moving situation. most of the talk was about competing without fans present. some teams were getting ready to go ahead and do that. diagnosis of the utah jazz player as positive for the coronavirus really crystallized to people the players and others in the arenas are at risk. and it was just a very quick realizing theyle had to cancel everything. or postponing. scarlet: john edwards, the latest on the sports scene. the nhl, nba canceling or suspending their seasons because of the outbreak of coronavirus. march madness is also canceled for now. emily chang, thank you, john edwards. aboutrse we are talking

the real-world effects of the coronavirus. when it comes to markets it was about the central bank that got investors. taylor riggs gives us a look at what happened. taylor: let's take a look at this chart inside of my terminal. telling with the u.s. in white, , not evenne closely in negative territory. markets really wanted a global response. you had a cut yesterday. ecb extending their liquidity. the fed next week looking to act between three and four cuts after that emergency cut they made last week. federms of stimulus, the provided some more liquidity to support some of these markets. the markets are telling us that working.

this attitude of whatever it takes is not enough to support the markets. i think we know central banks, as much as they give credit to monetary policy, that does not cure the virus. that is the problem. this is not a financial issue. we mentioned some of those rate cuts. right now the market is pricing between three and four rate cuts by the 18th. i would say from all the notes today, that number is closer to four. morgan stanley out with a note saying they expect to drop even before next week. wells fargo yesterday said they had forecast a mild contraction for the second quarter. they had to readjust all of their estimates. the fed also expecting to cut to zero. romaine: great stuff.

thank you to taylor riggs. paul scheer, from the harvard kennedy school, vice chairman of s&p global after serving as chief economist. we want to bring you in. let's talk about that policy response everyone seems to expect, this idea any policy response, fiscal, monetary, there is a concern that might not be enough anyway. what is the policy response for people like me who may be our canceling vacations? >> the unique issue with this is a supplyat it aop that has turned into demand shock. it is a public policy health issue. . state of emergency basically the public health policy response is to basically social distance, cancel events,

stay home. that means you are going to drop down in demand. , theyly in a demand shock try to reverse the drop. sense toot make much try to get people out of their houses and spending more. you want to keep them away from each other. there are limits now. you saying there's nothing to be done? peoplepolicy could help who are losing their jobs or were planning on working at the ncaa tournament. in light of the fact we can't offset the demand shock, what would you like to see out of policymakers. >> i'm not saying nothing can be done. whenever you have any kind of crisis, financial, natural disaster, whatever.

it's important to government response and the physical response to be directed at the problem you are facing. this is a pandemic. the mobilization of resources you want to achieve, it has to be directed at solving that problem. breathing in the medical export -- experts. beyond that, because you have this market reaction, the risk we move into this generalized deterioration in sentiment and negative feedback loop, there you have to think about liquidity measures. i'm thinking beyond this now. the financial crisis, liquidity issues became solvency issues. we have to think about, the ecb today was basically asking governments to think about credit guarantees for loans. getting the regulators pulling -- cutting banks some

slack. we'll have to think about shoring up the capital basis of the firms seeing their businesses and revenues collapse and damage being done to the balance sheets. scarlet: what does that look like? the 2009 the scars of financial crisis. was tarp. app often does not have a good rap in many quarters. at some point where the problem is a lack of demand, but you don't want to fully reverse that demand, you say, cancel everything, stay home. you won't be doing much consumption. we don't know how long this will last. guarantee,f credit maybe capital injections from

government, different countries have different ways of doing that. ofaine: there is criticism tarp and all the other programs. but they were effective. there was concern about how long they were extended and how broad they were. there was a sense that once you put it into the market, it gave us the stability we needed. obviously this is a little bit different. >> and i'm not saying do it today. it has been interesting without liquidity. at some point, this goes on long enough, it becomes a solvency issue. joe: how concerned are you by the lack of action? it feels like a lot of lessons from the crisis are going unlearned. maybe they are just theoretical. the crisis,get even from the other side of the world. we see what is going on in italy.

this is a different issue, we are all catching up. thead to get up to speed on plumbing of the financial system. now we have to become experts on viruses. , i don't want to minimize it, any loss-of-life. one loss is one too many. given the scale of this on a global level. reallyt sure you can beat up on governments for being slow to act. it is not clear what the action should be. a lot of governments have been playing without a compass. i would resist the temptation to beat up on them. now is the time to look forward. ask the question, where are the resources? what are the resources we need and how do we mobilize them? reallyul sheard,

appreciate your perspective. thank you for joining us. let's go over to taylor riggs standing by with a recap of today. taylor: let me remind us where we are in terms of the cross assets. let's start with equities. hit thed up 7% and circuit breaker limit and continue to fall after week reopen. the fed came in. the fed can't cure the virus. so no one cares. down almost 11%. we did not hit the second circuit breaker limit. let's wake up tomorrow and try this all over. bond market, something interesting is going on. the 10 year yield has fallen 100 basis points, but we are not near record lows that we had on monday. we are still at .8. we were below .5.

they predicted this crash on monday, or you are having some buying and selling issues in the treasury market. and a lot of liquidity issues that we ran into today, perhaps a combination. let me walk you over to this board. we are going over to the dollar. it is now the new safe haven as we approach a three year high. again the rate cut last week meanting to michael was to weaken the dollar. that did not do the job. the dollar continues to strengthen. we had funding issues come into play. take a look at a chart i am showing you at this terminal. i want to push forward to asia. we talk about the dollar-yen. i wanted to do the aussie dollar yen. on monday we blew through four standard deviations.

we are approaching those levels again today. off of the strength on monday. to put this in perspective, sometimes i throw around standard deviations. it does not happen every day. the last time we strengthened through this level, december 2018, we had our last significant crash in the equity market. before that, go back to june of 2016 for brexit to see this type of strength in the yen. back to you. scarlet: fantastic contacts there. we want to bring in todd mariano , who has years of experience examining wall street and washington. i want to start with this idea wall street is looking for leadership. it was last night. it did not seem to get it. we are getting a little more encouraging headlines now the senate has canceled its recess.

mitch mcconnell pushing members to take up any legislation that emerges from discussions with the house, with nancy pelosi. what is your confidence we will get something in the coming days to address the coronavirus? >> great to be with you. we have a decent level of confidence congress will get something small done. it is not exactly the size of stimulus that wall street is looking for in terms of fiscal policy being used to counteract the effect of the coronavirus. there seems to be growing recognition in congress that they need to show american voters they are doing something before they go off on recess. there is enough bipartisan billap in speaker pelosi's she's negotiating with steve

mcconnellat leader was able to cancel the recess and give them more space to negotiate. we are looking for some action to be taken by next week. the schedule is still up in the air. joe: you don't think the stimulus will be up to wall street expectations. mechanism ifrcing it is not deemed enough to stabilize the economy, where we see more shut down and lost income, that further selling in the equity market would force more action. is the feedback loop such that eventually the stock market declines force that number up and d.c. will vote? >> that is right. we are seeing that actually. in terms of looking for

confidence from government. a couplen is actually of weeks behind the curve. that was the major problem of the speech. the government has been behind on this. you had an underwhelming and confusing and controversial speech. it was really that backdrop of the government not appearing to be ahead of the curve. i do think the stimulus discussions have reached a new level. it's going to take time to negotiate something big like a payroll tax cut. they were never going to get that done in a couple of days. the fact they are sticking around to vote on a small bill is evidence congress and the white house are now moving mored responding effectively. it is also about proposals. the payroll tax cut, why even bring it up? why stand there in the oval

office and propose something like that? talk to me about a couple of the proposals that could be done without congress having to act, something like a small business proposal. these are things that maybe could be done without having some sort of bipartisan support. how effective could those measures be? i think the effectiveness would be temporary. as you implied, you need congress to improve -- approve funding. those, the time limit of those longer. you're still going to need to work with congress. the reason to bring up the payroll tax cut is it is something president trump has wanted for a long time, even before the coronavirus outbreak. it remains his preferred fiscal

stimulus approach. he's trying to set the terms of the debate. that is why it was in the oval office last night. essentially executive orders will help. we are expecting a raft of those two becoming later today or over the next 24 hours. you are really going to need to work with congress in order to make those big enough that they can seriously affect some of the economic conditions. that is the state of play. later thans a little it should have been. scarlet: clearly politicians are busy trying to figure out the response to the coronavirus. talking aboutwere a rocket launch in iraq. a rocket attack that did not get any headlines. not a lot of attention.

i want to broaden our conversation to politics. do you worry there will be leaders that take advantage of the confusion out there, the lack of attention and try to stir up trouble and so discord? >> absolutely. that is something we have been worried about for 2020 in general. just based on an election year in the united states that we are anticipating will be close and potentially fraught in terms of the outcome being contested, or not accepted by the population. coronavirus ads even further incentive for some bad actors to test the united states' resolve. , thank youdd mariano

for joining us. that does it for us. stay there because we will have more in-depth coverage ahead. this is bloomberg. ♪

>> from new york city, i'm jonathan ferro, a special hour of bloomberg surveillance starts right now. coming up, the end of the bull market. the s&p 500 plunging. the ecb dropping. the federal reserve stepping back in as the vision and washington, d.c. puts the brake on its fiscal response. i'm jonathan ferro joined by bloomberg lisa abramowicz where we begin with the big issue, monetary policy. tate -- >> the ecb will not be able to