emily: i'm emily chang, and this is "the best of bloomberg technology," where we bring you all our top interviews from this week in tech. coming up, hibernation disrupted. u.s. markets enter bear territory as the coronavirus outbreak breeds investor panic. we will break down what it means for tech with dan ives. plus, speaking of vulnerable, hundreds of thousands of americans are working from home amid virus concerns, and hackers are seeking to capitalize on it. we will talk about the potential

threats to national security. and no refunds. hotels and airlines might be refunding trips, but many airbnb customers may be out of luck. we have the details. we begin with the volatile state of the markets and the global economy as the coronavirus outbreak widens. italy went into a nationwide lockdown, u.s. fire's the dow cases spike, and the market plunged. the dow jones industrial complex entered a bear market wednesday, the s&p tumbling into bear market territory thursday after president trump took to the airwaves, announcing a ban on travel from europe. pres. trump: to keep new cases from entering our shores, we will be suspending all travel from europe to the united states for the next 30 days. the new rules will go into effect friday at midnight. emily: in tech, the forecast on how much companies like apple, amazon, google, and facebook would lose in a downturn, and

uber and lyft shares plummetted on the reality that customers are sheltering in place. wednesday, i asked wedbush securities' dan ives for his take on the volatility. dan: you need to put a goalpost around them in terms of demand. right now i think the street has written off the march quarter. what does normalized demand look like june, september, december? that's why when i look at the core names, a lot of the faang names, to me, we continue to believe these are buying opportunities and you navigate the volatility. i view it as you look upon, you know, what are normalized spending environments going to be, and even if you stress test the models in terms of an economic downtip, right here, you buy apple and you buy microsoft. emily: uber ending the day down almost 10%, lyft down 12%. these are names you think might benefit if people don't want to take public transport. how bad is it going to get for

them? dan: look, you have to separate the risk profile. i look at names like microsoft, apple, some of the cloud, cybersecurity names. i have used golden opportunities for the next two or three years. when you look at uber and lyft, right now guilty until proven innocent stocks just given global travel, obviously that will continue to get gut-punched across the board. now look, they came out and said it they have not seen any changes. profitability is still going to be there, but still very volatile names. i still like them long-term, but there's no floor in terms of where their stocks will go. emily: is there any specific name you are particularly worried about? i mean, look, we can look out the june, out to the fall, but we do not know what is going to be happening at that point. dan: yeah, i think that is why when you look at, let's say security, like cybersecurity,

you kind of have to separate out some of what i view as the nonessential purchases versus what you need to spend on. you know, when i look at names in cybersecurity, those names that to us are essentially in a stress test model. you look at nonessential purchases, especially these private companies maybe that are going to struggle, i think it will form what i believe will be a surge of m&a across cloud and across tech over the next three to six months given some of the valuations we are seeing. emily: where are we going to see that m&a? and are people going to be making big buys right now? dan: oh, i firmly believe if we sit here four to six weeks from now we have already seen a handful of m&a. because right now in terms of corporates, look at microsoft, google, gcp, you look at ibm, you go across the board, adobe. i think right now they are

continuing to look to expand their cloud empire and expand. and if you look at the private and public side, a lot of these stocks that are down 30%, 40%, 50%, look at the valuations. that is why i believe strategic as well as financial buyers are going to be putting in the floor on software over the coming months. emily: wedbush analyst dan ives there. now, according to bloomberg intelligence, the impact the coronavirus on advertising demand could drive first half revenue losses of over $3 billion for google and $2 billion for facebook. and despite the frenzy to buy hand sanitizer, masks, and bleach wipes online, even amazon's profit estimates are at risk. for more, i spoke to bloomberg intelligence's jitendra waral wednesday. jitendra: we look at it from two lenses. one is the impact that we have seen on the internet sector. january and february was none. so whatever impact china saw, we

are going to see a delayed effect hit in q2. that's mostly coming from two angles. it takes a chunk out of that, but also if you look at country-specific. what does the italian quarantine mean, for example, for these countries and how much revenue they derive? as these concerns spread outside of china, u.s., u.k., germany, japan, france, italy, these countries account for a majority of revenues for these companies and is that is why we feel a pullback coming from key verticals and also key countries can lead to the u.s. companies seeing what the chinese companies saw in 1q. the u.s. impact would be in 2q. emily: let's talk about amazon, an interesting case.

on the one hand people are flocking to amazon to get hand sanitizer and bleach wipes. and you can imagine that is driving a lot of business. on the other hand, amazon is the epicenter of the u.s. coronavirus outbreak. they just closed seattle area public schools. they are fighting counterfeits, they are fighting price gouging. i've heard people are worrying about getting the virus from their amazon prime packages. what does this mean for amazon? jitendra: a lot of uncertainty on that front. if you actually look at the distribution centers in the u.s., there is a high concentration in california, the tri-state area, and obviously seattle. but we have not yet seen the impact coming through the supply chain. the fedex report next week will give us good insight. but historically, what we have seen is this. when the supply chain gets overwhelmed, costs tend to rise. and what that all means is eventually, you know you also have to pay for employees when they cannot show up to work and things look that. the sum total of this is they are unlikely to meet their profit expectations for this year. so what we see happening is

expectations for the entire sector really gets probably a reset around april, the end of april in the report, and that reset then sort of gives them the room for outperformance in the second half if we see the developments for the rest of the world follow what china did in the last two months. emily: that was bloomberg intelligence's jitendra waral. coming up, hacker alert. malicious hackers are now trying to exploit fears of the coronavirus outbreak. we will hear from a cybersecurity expert, next. and if you like bloomberg news, check us out on the radio. listen on the bloomberg app, bloomberg.com, and in the u.s. on sirius xm. this is bloomberg. ♪ ♪

emily: as the coronavirus continues to spread, hackers are trying to seize the moment. cybersecurity firms like proofpoint and checkpoint have reported surges of phishing attacks and domain name buys

related to the virus. the key being malicious actors preying upon people's fears. for example, pretending to sell masks or sanitizers in an email to trick folks into routing them their bank account numbers are other important information. four mirror -- for more insight, i spoke to jamil jaffer, senior vice president at a cybersecurity firm wednesday. jamil: what you have is a series of capable actors, both nationstates and criminal groups, who are looking to use the coronavirus epidemic to spread malware. essentially get into people's email, because they are interested in clicking on things about the coronavirus, and establishing a long-term foothold, or establishing ransomware or the like in this current environment. emily: talk to us about the threat level here in cyberspace, given what is happening, the uncertainty, so many people working from home. is there a threat to our national security right now? jamil: well, i think there is. as we know, emily, there has been a long-term threat from intellectual property theft, from potential activities

against critical infrastructure, and as people start to work from home, a lot more of the economy depends on a highly secure cyber infrastructure. that is what we are utilizing now to conduct our day-to-day business more and more, even more the case in this environment. obviously there are concerns. people recognize this is a situation, and criminal actors are starting to exploit this capability. we will see what nationstates do going forward, but we know they are going to use this capability to use long-term hooks. emily: what are companies and individuals supposed to do if they are working from home? they may be do not have all the security protocols. jamil: one of the keys for companies is to be using vpn's, virtual private networks. even for individuals, you can buy vpn software and at least your information is secure. secure, itation is is encrypted over a tunnel. you can also use the latest in behavioral threat detection to protect your networks if you are a company. part of this too is companies working with one another, industries working with one another in a collective defense

posture to defend against these threats as we enter this new environment where we are all working from home, and recognizing that this is just how it may be for at least a while to come. emily: you were at the rsa security conference here in san francisco a couple weeks ago, the same conference that now three people attended and have now tested positive for covid-19. one of those folks is sadly in a medical-induced coma. this is a huge gathering for your industry. you were there. i am curious how this is impacting folks in your industry right now. jamil: sure. well you know, people are taking wise precautions. there were 36,000 people at the rsa conference. only a handful apparently had this issue. the concern is you do not want it spreading, you do not want to be a point of spread. so a lot of people are staying at home, a lot of people are working from home. we have seen some major tech companies announce they are going to have their staff stay

home. not necessarily because of rsa, just more generally, a better precautionary measure. and at least for this industry, you want to be cautious and careful. so we will see what happens as this plays out. we are now about 12 days out from rsa ending, 11 days, so the incubation period is thought to be 14 days. by this weekend we should know better if there are further cases, but i think for now it is better to take precaution then an not. emily: that said, the disease is continuing to spread. earlier today, the buildings of cbs in new york city were evacuated. cbs is saying, this is just crossing now, that two of its new york-based employees tested positive for coronavirus. they are asking employees in at least two of their buildings to work from home. jamil, this is certainly going to get worse before it gets better. what are you most concerned about from a national security perspective? jamil: i think, honestly, one of the things is people over-panicking and getting too worried and not engaging in their normal day-to-day business or normal economic activity. look, this is a challenge, obviously. we have seen a lot of public spaces be left behind, people

sort of staying at home. but you can still get your work done. you can still participate in the economy. this is not the zombie apocalypse, as it were. the thing to do is just be safe, take normal precautions. and in the cyber arena, take smart precautions. but do not stop doing business. don't stop participating in the economy. the general variables of the economy and the like are good and they are solid. what we want to avoid is a panic here. emily: that said, what would you like to hear from the white house at this point? some of the panic might be tied to the fact that we are not getting a lot of information. the president has been due to unveil a stimulus plan, that has not happened. the daily briefing today by the vice president was canceled. what should we be hearing from the white house? jamil: well look, the w.h.o. today declared this a pandemic. 114 countries affected, over 4000 people dead. this is a huge concern. it has been a pandemic since h1-n1 years ago.

and so what we need from the white house is leadership, to come out and tell us the plan. tell us they are going to stimulate the economy -- we know things are going to happen. we know the fed will continue to cut rates to the extent they are able to do so. for all we know, they will engage in quantitative easing too. i think the economy will stay strong. i think the government will do the right thing. all we need for the white house and leadership in congress to do is to step up and say we will do what is necessary to keep the economy going and keep the country's work moving. as long as we get that i think we are in solid shape. emily: that was jamil jaffer. coming up, if you are trying to cancel a trip, don't expect a refund necessarily from airbnb. we will have all the details and disgruntled travelers, next. plus later, universities and schools around the world continue to shut down to prevent the coronavirus spread. how can kids keep learning at home? the push to get classes online is next. this is bloomberg. ♪

emily: travel -- one of the industries being hardest hit by the coronavirus outbreak. if you are canceling a trip, hotels and airlines might give you a refund or a voucher, but if you booked through airbnb, you may be out of luck. unless you booked to stay in china, italy, or south korea, airbnb is enforcing no cancellation policies, or allowing hosts to decide. that leaves out 97 other countries where the coronavirus has spread. i got details from bloomberg tech's olivia carville. olivia: we are seeing a lot of frustration out there at the moment from guests, people who have booked trips years in

advance who really want to go and unfortunately now, as coronavirus has spread right across the world and reached pandemic status, health authorities are advising people against travel, and families like this one we were talking about, who we featured in this article, think it is in their best interest to protect their family in terms of safety, but also to try and avoid actually spreading the coronavirus. they don't want to take the trip anymore and are trying to cancel. their airline and their hotel have both refunded them, but unfortunately, airbnb is a different position. they have told the family that according to the cdc guidelines, they could still safely travel to japan. from the family's position, they have a 10-year-old son and they just don't think it is safe right now. so we are hearing from a lot of people at the moment who feel as though airbnb is putting their health at risk by giving them unsafe travel advice and encouraging them to continue to

go by not offering a refund. emily: i have a line from your story, airbnb's official response to this family saying if the cdc's precautions are followed, you could safely travel to japan. well, nobody knows if this family could safely travel to japan or not. airbnb has responded to this, responding to all of the frustration out there, saying we are a two-sided marketplace. it is not just you travelers who are the customers, it's our hosts who are the customers. tell us more about airbnb's side of the story. olivia: right. so airbnb is in a particularly difficult position here. we know that the travel sector has been the hardest hit. airlines are canceling flights, hotels are closing, businesses are prohibiting travel, and events are being canceled across the world. but while airlines and hotels only have to deal with the customer, airbnb is a two-way platform. so on airbnb, you have a host who will rent out a home, and you'll have a guest who intends to stay there.

and from their perspective, every time a guest canceled, the host is left out-of-pocket. so traditionally, airbnb has always had a refund policy that was kind of up to the host's discretion. they could choose whether they wanted to have a flexible refund policy, which means you could cancel up to 48 hours before you arrived, or a stretch policy, which effectively says no refund at all if you cancel. the problem we have here is that you have created this extenuating circumstances policy around coronavirus, but it only applies to three countries. a lot of people are traveling beyond china, italy, and south korea and do not feel safe. emily: in some cases you found some anecdotal stories where perhaps the host would refund the money, but airbnb still took its fee. meantime, this is a company that was planning to go public this year at $30-some billion valuation. if you look at a company like marriot that is a $33 billion market cap, do we buy the idea

that airbnb cannot cover for these travelers in a crisis like this? olivia: we know that they have been cash flow positive and they have turned a profit in 2017 and 2018. we believe they did swing to a loss in 2019 but that has yet to come out. we do know that for airbnb, they were founded in 2008 during the global financial crisis. and this is the second biggest challenge the company has faced. and unfortunately, it is coming in the year that they intend to go public. emily: bloomberg technology's olivia carville. well, tesla overtook boeing wednesday as the most valuable industrial company in the united states. the electric carmaker's market cap topping boeing's by $10 billion. i spoke to bloomberg's ed laszlo. ed: it is as much a story about boeing's pain as tesla's gain. boeing has this double whammy where it is dealing with the coronavirus, the impact on

travel globally, people are traveling less, they're definitely flying less. emily: and they are continuing to deal with the 737 max. ed: and we are approaching the anniversary of the 737 max being grounded. if you look at the decline of boeing's shares so far this year, that is how tesla has managed to creep up. but to be fair to tesla, it is amazing that we are even talking about them in the same breath as a boeing, this legacy, huge industrial name with $80 billion of revenue last year. tesla did $25 billion of revenue last year, and it is this kind of a crazy concept that investors have been talking about. they have been talking about how tesla is becoming a "real company" that is producing real things in real factories. there's a growth story there. tesla shares are up 55% year to date. it is expanding its production capacity to 500,000 new vehicles this year. and it's increasing its base of industry, already up and running in china, plans for europe next year. and now perhaps a new factory

here in the u.s. as well. emily: tesla has been a real company for a long time, let's be honest. there's an irony here in that elon musk tweeted last week that the coronavirus panic is dumb. meantime today, he's tweeting about opening new factories in the united states. ed: on the coronavirus, we actually do not know how it is impacting tesla. on the last call, january 30, the cfo said look, it will delay production in china by one, 1.5 weeks, but we have not heard much more. we do not know what the situation is over in the fremont factory over the water from us. elon tweets, he draws attention away perhaps from the company and onto himself. but, you know, they are looking at this new potential factory here in the united states to produce the cyber truck, this futuristic pickup, and even a model y factory they hope will be on the east coast, according to another tweet by elon. emily: and tesla has not been immune to the volatility over

the past few days. the stock plunged almost 14% monday, regained about half that yesterday, down again today. you have to think if there is a broader economic downturn, that that impacts a carmaker. ed: so i guess there are two schools of thought here, right? the first is like, where is tesla's demand coming from. this ties into the cyber truck debate. there are signs that the demand for this, what was once thought of as a concept vehicle, is really strong. in a market of pickup trucks, which is entrenched with three players, so analysts raised, is it just the diehards, the people that really believe in a concept and will go for it, or is it this idea that if the world is going to shift to a renewable energy, sustainable source of energy and electric vehicles, that tesla has first mover advantage? and even in a downturn, even in a recession, people still buy vehicles. yes, used vehicles do better than new cars in a recession, but tesla is pretty much the sole player in ev's, so it depends on what kind of support they get. emily: does tesla have an advantage over other carmakers in this moment?

ed: we have done some reporting around this. part of the big gain that we've seen in the first of this year comes from this idea that technology-wise, tesla could be three to five years ahead of the big germans, right? this is what is so incredible about this story. tesla's market cap is greater than volkswagen, yet volkswagen produced 10 million vehicles last year, tesla produced 350,000. what investors are looking at is the range, look at actually the volumes they are producing. no matter how many billions of dollars these big legacy european makers are putting into ev's, they have yet to build a single viable competitive vehicle. emily: bloomberg's ed ludlow there. coming up, as the coronavirus spreads globally, workers head home en masse. could virtual reality help the remote workforce? that's next. and bloomberg tech is livestreaming on twitter, and be sure to follow our global

breaking news network quiktake on twitter. this is bloomberg. ♪ >> welcome to a special edition of daybreak australia. >> it is sunday in the united states. we have seen the federal reserve already jumped into action trying to save the u.s. economy, slashing the key rate by a full percentage point to near zero. also promising to boost bond holdings by at least $700 billion. other and trump coming out minutes ago saying he is very happy about the move. he probably hopes it will boost the situation when it comes to trading on wall street

we have yet to see really any indication that central-bank action is creating that exuberance in markets. there has been huge volatility when it comes to markets. this, after a weekend of developments in terms of many countries really turning inwards to take a look at the containment and mitigation measures for the coronavirus. i thought it was interesting the fed said they would be passing through these actions until a point where they are confident the economy can weather the effect of the coronavirus. the problem is we do not know how long that is. three months, six months, or longer. let's get you to the presser at the white house at the moment. >> -- the progress we have made over the last 72 hours. following the president's declaration of emergency, the admiral and our public health service have forced a partnership now with fema, made possible by that declaration. they have reached out to all 50 states to create a process that

will enable all americans who need to be tested to go to a community-based testing site outside of the usual health care facilities. as focus of these tests, will be described momentarily, will be on those most in need. a priority will be placed on health care workers and first responders. who are out coming alongside people that are being impacted by the coronavirus. we want to make sure they have access to the testing as a priority. and then americans 65 or older with a cough or a fever or other symptoms will be prioritized over other tests that are extended. as i mentioned, the admiral will describe the progress we have made it a few moments. but we are going to continue to work very diligently, hour-by-hour, day by day, in the days ahead to expand testing around the country and access to this extraordinary and unprecedented national

public-private partnership for diagnostic testing. with regard to testing, as we expand testing the are so pleased that congress joined with our administration to make sure the cost is never going to be a barrier to anyone getting a coronavirus test. as you recall several weeks ago, the president directed a change in our medicare and medicaid programs to ensure that coronavirus testing was included. in,th insurers were brought they all agreed to waive co-pays. but because of the good bipartisan work done in the house of representatives, now all coronavirus testing is free and free for all americans, including uninsured americans. we continue to urge passage of legislation that will be considered by the senate this week. let me say one final word about the testing issue. as thet is that president often says, we are all in this together. it is absolutely important that

as we expand testing resources across the country, beginning by prioritizing the areas the cdc and our state leadership talents are most important, it is important that the tests are available for people that are most in need. and for our health care workers and first responders that are helping them and supporting them. describe,ctor will the testing that is available anyld only be done if for reason you think you may have the coronavirus. we encourage people to consult their doctor. symptom-free, we then encourage you to work with us to make sure the testing is available for people that are experiencing symptoms. wes extremely important that have the continuing cooperation of every american as we expand testing and make it available

during this challenging time in the life of our nation. ask thet, i'm going to thisable -- leader of great core behind me, to describe the extraordinary work they have done and will be doing each and every day in conjunction with our states to expand testing to community-based testing across the country for the american people, using this new public-private ownership diagnostic testing. admiral? >> thank you. thank you for your personal interest in support of our team over the last 72 hours as we have worked on this critically important project. as the vice president said, over the past 72 hours we have developed and are beginning to process and aa program of testing that will enable americans who are in need

of coronavirus testing to be tested, effectively and efficiently, according to a few principles. number one, we want to assure that those most vulnerable and those impacted are able to be prioritized. number two, we do not want to do testing that in any way threatens the acute tear system. in other words, we do not want people going to hospitals in acute care clinics were number one, they could infect other people -- listening have been to the white house coronavirus test force. over 10 states have drive through virus test sites. the crucial issue here in the u.s., as authorities tried to get ahead of the outbreak. of course to big news today was on the fed as well, just before the presser got started. we saw the fed implementing an emergency rate cut by a full percentage point.

in michael mckee and global economics policy editor kathleen hays. thank you to your both for coming in the u.s.. this was quite unexpected. how significant is the move? michael: this is huge. i would call a kitchen sink move. they are basically doing everything they can at this point to support the economy. donald trump will have nothing to complain about going forward. they are cutting the target rate essentially 20. -- range of zero to 25 cutting the target rate essentially to zerp. -- zero. if banks can get over the stigma of going to the discount window, borrow more money and perhaps lend it on if they want to. they will boost treasury holdings by $500 billion. mortgage-backed securities by $200 billion. in essence they are restarting qe. they are going to hold the rates

near zero until they are confident we have weathered the economic storm here. they are opening and expanding dollar swap lines they have in place around the world, and encouraging banks to use their capital and liquidity buffers if they need to to pay those down if they have any issues. so the fed has basically done almost everything. there was some thought they might do a commercial paper facility. we will have to wait and see if that comes later, and we will find out from the fed what the plan is. but beyond that, at this point, not much more the fed can do. the question is how much effect when young to have have an epidemiological problem and not an economic problem. does it helpon is, the economy, do we need fiscal help? yes, we need a lot. but at this point the fed is getting in front of it as much as they can. kathleen, i want to bring

to our viewers the fact that the fed was not even the first central bank to make a move. what else to be expect to see this week? kathleen: my -- this is a health crisis. at the same time, the same problem is this was seen morphing into a financial crisis. they are two separate things. all the fed is doing is keeping financials calm, to keep the gears moving smoothly while the federal governments around the world, certainly the trump administration, coming up with steps, talking about doing more spending will be very important. in the near term the fed had to move. analysts overwo the weekend had something to note about the specific commercial paper market, how it was heading towards freezing up. so the fed might be doing something sunday night. what the fed has done is

something much bigger. in terms of the discount window, just recently the fed was after a speech by one of the fed vice chairs was talking about getting a big bank like j.p. morgan to come in and borrow the discount window, to make it oakley -- ok again, not something seen as a black mark. we know the people's bank of china has made it clear they are ready to do more to their economy, even though it looks like there virus has peaked, to a certain extent. it has yield curve control. .3.ear at -.3 to plus so, not a lot more can do. just talked about buying securities. this just opens the door to other central banks to do more cutting as well. big fiscalhey made stimulus. everyone says this is a big deal, we have to stop it in its tracks, doing what they can. shery: what do you think? could this spooked the market,

given how active all these banks have been? michael: i think this will put a floor on the market tomorrow. we saw a big rally when president trump came out friday and announced a whole bunch of things that turned out not to be true. the possibility was we would see another sinking market. thatmay be one reason central banks are trying to get in front of it. at this point the market will probably be in a good mood going into the day. the question is what kind of development will we see during the day. markets are reacting both to what is happening in the economy and the idea of what happens to earnings down the road, and also to the headlines about the disease and where it is going. so if we get some bad news on that score, we might see the market turnaround. i suspect this will be viewed as good news because this is what everyone has been asking for. the fed should cut rates to zero. well, they went a lot farther than that today. there will not be much more to ask. unless he wants to go to negative rates, there is not a

lot they can do. shery: president trump says he is very happy. but very ambitious. haidi: very ambitious. bad news for all you parents in new york city. the new york city mayor saying it is possible schools may not reopen for this academic year. two things.ve set that this will put a floor on the markets, and the other thing, this is the kitchen sink, you do not think the fed can do more. there might be people who say central banks can always do more. we don't have to worry about extraordinary policy can get in the next few weeks or months. would that scare markets, the fact that there would be a lot of people thinking the way you are, which is this is the kitchen sink? what if it is not enough in terms of whatever it takes? michael: after a while they will probably get there. the fed has been talking about what it would do in the next downturn. they thought they had time to figure this out, and they had

been leaning on the idea of cutting rates to zero, which they did today, saying they will maintain the target rate until they are confident the economy has weathered recent events. and the idea of qe, which they are starting now. they could go farther, but with rates at the long end as low as they are right now, it is hard to see how much additional impact that will have. so then you have negative rates and you have with the europeans are going to try, we have never really done that here. the discount rate being as low as that is does create the opportunity perhaps for a funding for lending program. not clear whether that is authorized or how that could be done, but they have set the stage possibly for something like that. beyond that, there's not much they can do. they have to turn it over to the fiscal authorities. nancy pelosi, speaker of the house, said this weekend that they have done the minimum passing the legislation that

they did on saturday to try to get payments to people who are going to be off work, but that they would come back and look at doing more. and that is going to have to be the focus now. shery: we are getting more lines from mayor de blasio. confirmedity has 329 cases of coronavirus. there have already been five deaths from this operate. to mike's point, how much more can the fed really do, and will this be effective, given that this seems to be a public health crisis and not a financial crisis? kathleen: but it does have the danger of morphing into a financial crisis. if you have a commercial paper market freezing up, that happened during the financial crisis. that is what the fed is trying to stop. the question going to negative rates, i do not think there has been a fed official to talk about that the last few years who has voiced support for them. presumably they are a couple things. that this very aggressive act will show the markets the fed is present, the fed is doing what

it can, and it will make sure liquidity does not dry up. if the ball goes on to the court of the federal government and we see more fiscal spending -- because some programs people are -- the fedut involve can certainly make sure banks do not foreclose on a medium-sized business that cannot make its payments for months. that is the kind of thing the fed can do. when i have spoken to fed officials recently, mike also spoke to jim bullard. what they are following now is not so much macroeconomic data. they are watching virus headlines, because they know once this gets to its peak and starts coming down, pressure probably eases on market, investors get more reassured. but at this point everything we hear suggests that the virus is going to accelerate. we are going to see more cases of the coronavirus in the u.s. for a while, so the fed has put a backstop in place trying to

i've -- trying to avert a financial crisis. they have done what they can. it is too early to talk about negative rates. it we saw the fed coming in, is just another sign that the fed gets it and they are going to do everything they can now. that is what people were worried about. where is your bazooka, jay powell? i think jay powell fired today. haidi: we just got a few more breaking lines crossing the bloomberg. more details from erb de blasio. new york city is to order hospitals to cancel elective surgery. also getting a line from under armour, saying they are closing all of north american stores from march 16 through march 28. i want to get back on this latest detail from mayor de blasio. this is what we saw happen in china. elective surgeries are no longer happening at hospitals to the point where significant illnesses and therapeutics and treatments required by patients

that were not coronavirus-related, life-saving treatments, were not able to be given because of how over qualm the health -- how overwhelmed the health system is. michael: the fed cannot do anything about that. and the fed is worried about that. you had the new york governor today, andrew cuomo, suggesting we are approaching capacity in new york state on emergency icu beds. that is what happened overseas and that is what happened in italy. problem.d be a real it is not even the death rate at this point from the coronavirus that is the main issue, it is how do you treat the people who could be saved not just from the coronavirus, but other issues if there are no beds. that is one of the reasons that they are concerned. there's talk -- we have seen this in some cities, but there is talk that what they are going to end up doing is authorized cities to take over hotels to use as emergency wards because they do not have enough beds. so this is very, very serious.

this morning we saw dr. anthony fauci, head of diseases at the national institute of health, say the country should really look to shut down. he was asked 14 days, he said as long as you can do it. just stop. that might help bend the curve, as they say, but right now it is still going up and there is a lot of concern. shery: shutting down the whole country, the economy would come to a standstill. what would that mean in terms of where we were in terms of economic data and where we could be? an economye were at where it was surprisingly chugging along. i think what the fed has also signaled, certainly in some interviews -- i don't know if they are going to have a meeting this week -- we would love to hear from jay powell. but they realize the economy will slow down. that is a given. the question is for how long, how deeply, and is it something

people will accept as a one-time event that lasts a few months. yes, it takes a toll. yes, we might even have a recession, although the first time we could possibly see negative growth would be in the second quarter of the year. it's interesting because one of jp morgan's chief economist has been calling for this time it -- this kind of rate cut. he is also forecasting that by the third quarter we will have 2.5 gp and by the fourth quarter we will have 3%. he is another one suggesting the fed cut is aggressive. you have a one-time shot to the economy. yes, it might be a recession, but then you come out of it. the supposition is once we get past the worst, the biggest part of the python, -- the pig going to the python, you will be a place where people will spend again. but the big question is how damaging is it to corporations, how much do people cut back, how much to the come out of this so wounded that the economy limps

through. so the fed might have to come up with more steps, or a federal government taking fiscal steps. michael: ask and ye shall receive. 6:30 p.m. eastern time he will be holding a video news conference to talk about this. we will be carrying that live here no doubt. shery: everything through video and skype these days. thank you for joining us here on a sunday. kathleen hays, and also michael mckee with the latest from the fed. let's see how the markets are reacting to the fed's move. still very early in the trading session in asia. sophie kamaruddin is in hong kong. given the action we saw with the fed emergency cut to the key rate. nikkei futures jumping more than 6%. new zealand we are seeing

losses. the benchmark lower for a seventh straight session. switching out the board to check on the yen, we are seeing the yen extend gains, strengthening, trading around 106 levels. we are going to keep and i boj to see what they may do i of their thursday positive decision. the yen now trading back above 107. lots of volatility to be had, given these latest of elements. checking on the euro, we are seeing reverse moves, gaining as much as .7%. the upside could be limited given the pressure on the ecb to act. limelight -- in the limelight. ofshore -- a quick check on the aussie dollar as well.

earlier jumping as much as 1.6%. now reversing those gains. rba, onhave the pressure to perhaps release emergency moves. checking in on the aussie dollar, just holding above 62. let's check in on what is going on with yields. we are seeing a move lower for also yields. three-year notes falling as much as 12 basis points. an emergency rate cut. a lot on their plates this week. haidi: sophie kamaruddin, very, very busy day ahead for market. let's get more analysis on what we could potentially expect. i saw you drew a sharp breath. adam: i think it is a big call. let's not underestimate the magnitude of the smooth. a lot of traders will be arriving at their desk this

morning very surprised by what they have just seen from the fed. both on the interest rate move, but also on the qe and the restart of a qe. that is huge. what you have seen initially in the market is the dollar has come up. we are waiting for in a few minutes for s&p 500 futures to open. you would have thought the impact be pretty big there. already you are seeing sovereign yields coming down in this part of the world, australia and new zealand. you would have thought you have got further rally in bonds. when it comes down to is there is still some debate in markets around the extent that monetary policy can really help the situation. this speaks to your questions to michael and kathleen. when you still have this public health crisis and no end in sight to the way it is being handled and await -- it is nowhere close to peeking in places like the u.s., and a real limit to what fiscal policy can

do. without that circuit breaker on the public health side, it is very difficult, for me at least, to see a floor in the market. but let's see how investors will take this. they will be assessing the scope of the move here, but they will also be saying what does this mean next. do we need more of this move we saw last week, where even money was coming out of bonds and it was going into cash. people really just wanted that dollar liquidity in that environment. and they are not going to impact for companies and how that will flow through to them. shery: what does this do to the u.s. dollar long-term? we continue to now see it really losing ground against major asian currencies, after it surged an almost three year high last week? adam: and that speaks to the volatility, doesn't it? it has been overwhelming. the amount of movement of asset prices intraday as well as over the last few days and weeks has been very discomforting for a lot of people.

making that long-term forecast continues to be quite difficult. the initial weakness in the dollar you think has some further moves lower. but of course the overriding theme here is now with the fed puts further pressure on yields to continue to come down. we got across a whole u.s. curve for the first time last week, we got under the 1% level. you expect a lot of that that still has further to go. the idea of the japanification of bond yields around the world and now getting into the u.s. yield curve as well. remember that we started the year with 10 year treasuries at 2%. so, the scale of just how much markets have had to reprice the global economic outlook over the last three weeks, really, speaks to just how much of a quick shift it has been from one way to the other. of course we have had a huge correction in equities globally. that has seen a repricing of the

fundamental risk. but of course there will steve -- some people will still want to buy at these prices, but i do not see wholesale shift. shery: adam, thank you very much for that. we continue to digest the latest lines on the coronavirus outbreak in the u.s. vice president pence saying he has updated guidelines on monday for public gatherings across the u.s. we have heard some voluntary closures with starbucks, saying they will not allow seating at all in u.s. and canada cafes, saying they will use a to go model for stores for at least two weeks. let's get ros krasny joining us now from d.c. give us the latest lines that came out of that white house presser from that task force. ros: the white house presser is still going on and we are hearing from a range of officials, from president trump on down. one of the key elements is that

testing should really wrap up in the you -- ramp up in the u.s. this week's. seems like it is really in hand. pence says at least 10 states have some kind of drive-by testing capability. one thing that really stood out is deborah burks, who is the infectious disease specialist on the white house panel, she basically warned people that as more tests come through, there could be a big increase in positive readings and a big increase in the number of cases in the u.s., and to brace for that. theome extent the u.s. -- fact that the u.s. has not been able to test has kept down the caseload. this is the week, or the next two weeks, where we will really find out how the hospital system can cope, and find out how extensive the virus really is. haidi: ros, thank you, with the latest from d.c. plenty more to come on daybreak australia. this is bloomberg.

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haidi: welcome to daybreak australia. shery: i'm shery ahn. i sophie kamaruddin. we are counting down to the market open. haidi: here are the top stories we are covering in the next hour. the federal reserve sweeps into action, flushing the benchmark rates near zero to save the u.s. economy from the virus. president trump says he's very pleased. cases continue to rise in the west with more