francine: america is closed until may. president trump says social distancing will continue until at least april 30. medical experts say u.s. deaths could reach at least 200,000. spain,ite in italy and spain recording 17,000 deaths as coronavirus continues. and the markets are overwhelmed by cratering demand and a booming surplus of crude. good morning, good afternoon, good evening, depending on where you are in the world. tom, if you look at the markets in europe, we were down to 2.5%, now we are back up a touch, still in the red but only losing 1%. i think the focus -- and this is what is extremely hard for markets across the world -- they look at stimulus, measures to support the economy, and then they look at the horrific numbers of deaths around the world and they have to try and match and see what happens to

the economy in the next 3, 6, 18 months. tom: it has been an extraordinary recharging of global recession. germany looking at recession calls back to 2009, really no surprise there. but it has been the additive facts that we have seen over the weekend measuring global slowdown. there is no place you see it more than this's morning, not only in the price decline of oil, but specifically brent has had-- worldwide crude has an extremely difficult six hours. francine: yeah, we also have to look at currencies, dollar had quite a move, and dollar of course is now benefiting, or at least moving on the back of the credit rating downgrade from other countries. we look at pound, a lot a lot of volatility there. that's get to first word news in new york city with viviana hurtado.

viviana: president donald trump wants the public to continue practicing social distancing until at least the end of april and not by easter come as he previously suggested. dr. anthony fauci telling cnn if efforts to mitigate the spread are not successful, up to 200,000 americans could die. now to u.s. treasury secretary steven mnuchin. he says this week expects to have fall business loans up and running. mr. mnuchin telling fox news news sunday on friday the massive $2 trillion stimulus plan signed into congress is already discussing a another relief package. to the u.k., where lockdown measures could last for months according to the deputy chief medical officer. she says in the coming weeks the death toll will probably get worse. it will take time to see any impact that measures are happening that are having in the initial data.

cutting the u.k. credit rating to aa minus. global news 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in i'm than 120 countries, viviana hurtado. this is bloomberg. tom: let's look at the data now. equities, bonds, currencies, commodities. equities are a mixed bag. i will call a turn to the market, -- a churn to the market. in bonds, yields, curve flattening, that is what we are seeing this morning, a bit of a jumble there. the real news is in commodities. what people are watching worldwide is a new decline in oil. lows,t back to 17-year west texas intermediate for a cup of coffee, reaching $20 per barrel. brent has come in with a vengeance this morning, there is no other way to put it. we are watching brent very, very carefully. the dollar complex is simple --

stronger dollar. don't want to make too much of that, but nevertheless an elevation to the u.s. dollar. francine? rightne: tom, you are looking at dollar. i have been looking at it all morning, also looking at some of the currencies, including yen and including euro. i am looking at stocks overall declining. this is after we saw the bounce in risk assets last week, buried by three days since negative news on coronavirus. the number of deaths absolutely appalling in europe. forgotten, not to be oil, plummeting to a 17-year low as the market seems to be breaking down. we will have plenty more on the market movements. let's get straight to the principal global investors chief strategist. ray to have you on the program. what are markets look -- great to have you on the program. what are markets looking at? there is a lot of fear -- there was -- is it policymakers, stimulus, or are they just

watching the number of infected and deaths? >> i think it is a bit of everything at the moment. policymakers, what they have done is very important. .here could be further measures of course, the daily effect -- the daily infection rate is keep your you can have li stimulus, but until you have those cases starting to peek -- to peek, i think there will be a lot of caution about getting back into risk assets at this stage. take for what will it people to go back into risk assets. criteria.re are three one's monetary policy, which has been extremely effective so far. this will policy is starting to get there. i think we are not necessarily there in all the countries, but and there areg,

some signs of hope we are seeing the numbers starting to keep up in both italy and spain, so that at least gives us an idea of where we can hope that in a couple of weeks another couple of countries will be peaking. expectot possibly activity to rebound in the wake of coronavirus. the what i saw in literature this weekend is the gaming of global slowdown. idea, deficit to gdp in the united states of 12%, inflation well under 2% by a number of houses as well. is your model, your template right now, that we are going to see soon and fast another tranche of income substitutions, income stimulus? seema: i think this is key now.

what we are starting to see is governments almost nationalizing part of the economy to take it through this crisis. on one side it is positive because if you have workers still in employment that have not been let go and companies have not been allowed to go bankrupt, once social distancing ends, companies and workers can get back on their feet very quickly, and that is great. but the thing we have seen in the last few days as investors are looking beyond this, looking 10 -- five to 10 years down the road, how are these governments going to pay back all this debt? that is how your changing the way you are analyzing regions. the deficit numbers are in double digits. it is starting to put much of it , a very significant cloud on the horizon. tom: i don't want you to be a day trader or even a week trader. we have the american jobs report on friday, all the different headlines including the german recession headline, the number

of minutes ago. is it a time to just wait, wait, wait until some of the unknowns become a little bit more known, or can you actually have comfort in the markets today, looking up three years, or even five years? it is reallyk about your horizon. toyour -- if you are a three five-year year or longer investor, at some point this will end. point, point -- at that we may start to see a slight shift. rethink, newt to wey we should -- think maybe should not be so reliant on countries far away, that changes the supply chain dynamics. that is one thing. but from a day to day basis, i do not think we can be quite comfortable yet. we know that policymakers, what they have done so far on the

monetary side come have taken away a lot of the panic, and the volatility should be less than what we have seen in recent weeks. we are probably not at the bottom yet until we see the daily infection rates start to ak. tom:tom: how many -- francine: how many companies will have to be nationalized or partly nationalized, and what does that mean for investors? seema: with nationalization, you will see a number of sectors -- one is airlines because they are the ones who are most sharply hit and will be having trouble getting back off the ground without any help. but when we analyze the sectors, they are not as attractive. they will not go bust but they will struggle to get back on their feet. we look at balance sheets of companies that will not have to be reliant on any more government action the other thing to think about is, companies looking at this as an

opportunity to change direction and make them most of it -- for example, if you look at how people are working now, working from home, on the technology side, those companies that will be trying to benefit and make the most of those changes in consumer work and behavior, are the ones that will outperform longer term. are we underestimating -- a lot of people think or say that we will go back to normal, and what you're hinting at is maybe the way we work will be changed forever after. so how do you find value in companies that will be more progressive in the way that we change as a society, once this is over? seema: i guess this is kind of entre active managem analysts come in and look at companies ended the way -- and the way they are moving.

the people talk about u-shaped comedy w shape, and some talk about the l-shaped. we do overall expect the economy to get up on its feet, even if there is a slight change. we have seen that with crises over time and time again. we do see new trends emerging from those moments. but in terms of is this going to go back to normal, one space we are looking at which will give us a good idea is the credit size. if you do not see credit spreads blowing up, we are looking at a multiyear process. we are not there yet, but it is something to keep a close eye on. tom: seema shah with us. terrific news flow as well. the timelines have been drawn out. we saw that with the president's up a press conference yesterday, having out from march through -- the president's press conference yesterday. in japan, mr. abe and all of japan are looking out to late july of 2021. that is where they shift the

summer olympics 2, 1 of these stories we are looking at today as well. interviewserrific with mr. bostic and mr. kaplan of the fed. this is a timely interview with a gentleman who has been original and fed thinking. mr. bullard of the st. louis fed. look for that on bloomberg. this is bloomberg. good morning. ♪

tom: good morning, everyone. "bloomberg surveillance." we say good morning from new york, from london. again, under these arduous at home ines from

new york, francine from home in london. a real deterioration in news that we saw over the wiccan. we will get to that on surveillance this morning. the ideas of 10 hospitals in central park. 'se oil market -- bloomberg advantage to have will kennedy and our team, arguably the best coverage of oil. our leadership there is with javier bloss. his leadership has been next ordinary, from $60 and $70 a barrel, down to where we are on the edge of the cusp of $20 a barrel. we're thrilled that he could take time out from bloomberg news print. why is brent coming down so sharply relative to west texas intermediate? javier: it gives you a better view of the global economy. -- is really

feeling a lot of the pressure in europe or the lockdowns in earlier, and in the united states, that is what really is driving brent so sharply down. pricebarrel at the lowest that we have seen in 17 years. the number ofee microeconomic articles over the weekend suggesting that saudi arabia is k.g. here in flooding the market with oil, that they are just going for a revenue grab based on their power, if you will. is there any validity to that? javier: saudi arabia is trying to recover somewhat what they have lost in terms of revenue because of the crisis. there is a lot of demand we have seen because of the coronavirus outbreak. at the moment we have a quarter

of global demand, meaning effectively, if everything has to stop in china twice, that is the amount of oil demand that the global economy -- 25 million barrels a day. i do not think they were thinking about that when they launch their oil price war a couple weeks ago. francine: this is a double whammy, javier. first demand is collapsing and then there is this price war for market share between saudi arabia and russia. what do we know about the two sides? are they talking? what will it take for saudi arabia to call russia? aredon't think they talking. certainly some companies are areng to -- the two sides saying that this is an also --e, -- they are

they have sold the cheapest oil on the planet to produce. a is very cheap to produce barrel of oil in siberia. spiking with $20 oil, they are -- many of these will go out of business. future, touy for the who can survive at $20. but let's not forget, in the united states, in the physical market today, in some states in the u.s., oil has been trading -- a barrel. francine: but if it goes to $15, i don't know what market makers are telling you about that. $15? who can withstand that? if you look at russia and saudi

arabia locked on this current path, what will it take for them to change their minds? javier: i don't think for the moment they are changing their minds. we are going to see lower prices, telling me that brent can go into the single digits, the point that we saw in 1999 and 1986. and we have already seen prices going negative in the united states, as well as some producers compelling consumers in very remote areas in the united states. and that will control the market. let's not forget that some producers will keep pumping no matter what because shutting production is also expensive. adjusting the well. it means the market will close with a lot of oil for a while, and there will be low prices,

lower than today, for that to be curtailed. colleagues in hydrocarbon crime in reuters reported a few days ago of an american bank deeply troubled in their derivative space by the plunge in the price of oil. is that what we are going to see this week, or even into april, where finally we get an analysis losses taken by the financial system in oil and gas? i think one of the problems for banks today, the banks havece, some seen oil producers, obviously the oil producers are going out of business. some length some banks are going to be very similar to what we saw in 2008, 2009 when we saw toxic loans from the mortgage

market, the residential market, and we may see some back in oklahoma and texas, having a lot of bad loans with oil producers. some pressure on banks in some areas, in new mexico and west texas. tom: javier blas, thank you so much for your world-class coverage. he is with bloomberg news. francine lacqua and tom keene on this monday. this is bloomberg. ♪

tom: -- francine: this is "bloomberg surveillance." if you look at european stocks, they are not declining as much as they were an hour ago, but a lot of folks are focusing on the -- a lot of the focus is on the number of horrific deaths over the weekend. that is counteracting all that we heard from central banks and policymakers last week. the dollar rebounding and treasuries also rebounding. we had a wonderful conversation with javier blas, down today. tom: oil down today, no on brent it 22 handle crude. what we focus on are the different research trying to game out the unknown unknown of where gdp will be. those are grim statistics.

you see it now, as francine mentioned -- price up, you'll down across the fixed income space. the act -- price up, yield down across the fixed income space. not flattening to any kind of record flat, the distancing between the two-year and the 10-year, but nevertheless a dampening led by commodities and of course some of the currency as well. francine? francine: coming up, we have a conversation with the former senior advisor to the bank of england -- the former bank of england governor, mark carney. he did a lot of work on sin tech and liquidity spirit now with ups. this is bloomberg. ♪

>> we can expect by june 1 we will be on our way to recovery. by june 1, a lot of great things

will be happening. i said if we-- could do it by easter. >> the decision to extend this mitigation process until the end of april was a wise and prudent decision. hurtado.i'm viviana president donald trump abandoning his goal of a return to normal life by easter. he wants the public to continue practicing social distancing until at least the end of april. earlier, top white house medical advisor telling cnn its efforts to mitigate the spread of the virus are successful, up to 200,000 americans could die. now to china, the nation cutting the interest rate and charges on loans to banks by the biggest amount since 2015. the rate is being set at 2.2%, down from 2.4% and it comes as

the people's bank of china invests into the banking system around $7 billion. low,umping to a seven-year dipping to $22 a barrel. kingdom says it hasn't had any contact with moscow about output cuts. russia says while $25 a barrel is unpleasant, it isn't a catastrophe. south africa's rand continuing its decline against the dollar after being downgraded. -- and leaked business confidence. the treasury says the leak isn't -- and "do the right thing." global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm viviana hurtado.

much.hank you so what we have tried to do including late last week is speak to as many voices on central banking as we can. let's listen. >> there is the possibility that once the public health crisis has gotten under control, and we do not have that issue, the economy may rebound quite robustly. >> unemployment rate peaked in the low to mid teens, but we would expect that to quickly decline. back has been mounted come involving both conventional and unconventional measures in a continuously battle ready mode.

tom: there we have a number of speakers. i want to emphasize how this is a movable story and moving so quickly. we said that moving from friday over to monday, but even trying to move into this coming week. with us right now is huw van steenis. is someone we speak to each and every year in davos about the state of the financial system and banks. now, this crisis it is inspect -- it is important to dr. van steenis. adapt to theseto unknown unknowns. what will they do operationally to adapt to may? or out to july? huw: rate to tattoo you. -- great to chat to you. ensure the safety of workforce, ensure we have great service and help lines.

smallk one aspect is the and midsized lending programs. they want to make sure there's timing to help small businesses. , we in the first two days have been able to help 10,000 small businesses. as i talked to policymakers over the weekend, the really key debate is how to make sure central bank equity it's down and how small businesses are helped. large businesses have been helped whether it is commercial paper buying or qe, how do we help that middle? one policy debate, we need to help go further. tom: really wet said -- well said. that was the overture this weekend. vivian hurtado had a timeline

from friday which was the easter.t's april 12, now we are rolling out well into may and maybe even june and some discussions. the horrific stories in the united kingdom, but frankly it worldwide as well. extend the timeline out for commercial banking that you envision. huw: let me take one piece of it which hasn't been debated much which is the payment system. the longer we go on, the more we need to rely on on online content. this is accelerating what was already the demise of cash that you and i have talked about. take one statistic. u.k., the amount of atm withdrawal was trending down 50% -- 15%. it is now down over 30%.

it is about resilient online systems. it is probably more in europe but it is coming to states. if you want countries around the world that now have to lift their limits because people don't want to use cash. they are worried about infections. this is a really multifaceted debate. tom, you are right. payments is one high on my mind. mortgage holders, small businesses is going to become located and until we get further through this, small businesses will become smaller. we need to make sure they are built to help -- they are there to help. francine: how are the markets reacting to everything? do you still have concerns about policymakers having to do more? huw: we all lived through -- it

should take a couple of good days to set the tone in the markets. i was very struck when the swap lines were announced. the primary market for corporate funding in bank funding having improved dramatically. last thursday, it was the single biggest day for bond issuance in the year with $35 billion and a smaller amount but healthy amount in the euro zone/u.k.. improvement -- are proving at the longer and. bond fund redemptions, nervousness of, it's -- of clients, deleveraging is having an impact in the sugar and. -- in the shorter and. are the markets functioning ok? is the plumbing working? huw: i think it is fair to say two to three weeks ago, it was

very bumpy. i'm going to take this from the point of view of the bank. banks have built up huge liquidity and cushions over the last year. for a week or two, inks were in good shape -- banks were in good shape. if even the treasury market was indicated, funding from the very a cute deleveraging and a hoarding of cash was really a very profound -- and it is not just in the markets. just imagine you are an asian or latin american bank and you knew you were going to get paid later and you needed to hoard dollars. there has been a very intense stretch. since the qe in most markets in the next are buying program has improved. i talked the clients. they are deleveraging through the system. there is redemptions in bond funds. we are stuck in a two way market in the last few days.

tom: in the last three or four days, trouble banks. two sources suggesting it is capital one but who knows? hydrocarbon and derivative strategies as well. how do you interpret the decline in oil over to commercial banking? huw: this is a great question. there's a specific theme. knowe who has got -- we from the history of banking, a concentration risks which is what will trip you up. a great financial crisis, it was the mortgage market. here, oil and gas will be front and center given the abrupt decline in oil price. need for speaks to the scale and ever speak. one other trend i have seen has have there been a flight to safety? as i look to the u.s. and

europe, that seems be playing out. -- seems to be playing out. as you there is quite think about the next two to three months, they will be a broader stakeout. some of the banks will buy into text -- techs. tom: thank you so much it would got much more coming up. he was in the west wing. the dog barking and that is a part of what we've got going on here. up, bruce kasman will join us. he is with jp morgan. a barking new york.

this is bloomberg. ♪

francine: this is "bloomberg surveillance." tom and francine from london. a lot going on in the markets when you look at markets across the world. focusing on the number of deaths, a horrific weekend and trying to figure out what the next policy response is from policymakers and central banks. unicredit suspending dividend payment and share buybacks. that is what the european central bank asked lenders to make sure they have enough capital buffer it we spoke to the unicredit chief executive a little bit earlier on.

>> i welcome the recommendation of ecb which will help relief -- relief. clearly i got -- we are seeing other banks following this recommendation. important to support the economy. banks are a part of the solution. >> what will be the conditions between dividends and buybacks? >> the ecb has asked that we review the condition after october 1. if the economy can stabilize so if thely, conditions are right, i see no reason why we will not pay the dividend. >> is anything regulators need to do to make sure that banks do anything else should be looking at?

>> from the regulatory side, they are already doing a lot. they have reacted very strongly and fast. the monetary side has been doing a tremendous job as well. i commend the ecb for the speed and liquidity of the actions. job. very, very good as the team of the different treasuries in the countries to make sure the measures taken are properly implemented. the process is extremely important to mature the money and support. the focus -- francine: give me a sense of smaller banks. how difficult is it for smaller banks to face this crisis? >> what is important is to have

a set operation and smaller banks which have not be internet yet will buy call centers. it might be more difficult to get up to speed. [indiscernible] older banks are fully educated. at thee: when you look bonds, do weona need corona bonds to make sure that europe is united on this? >> we need to show a message from europe on the political side that europe is united. of course, this is difficult. the processes and decisions. there might be other solutions as well, but europe on the political side needs to send a

message to all the countries that we work as one europe. that is of tremendous importance. the corona bonds -- francine: let's get back to huw van steenis of ubs. his corona bonds the only way that europe can show solidarity? or will something like the esm huw:fficient? she -- corona bonds will be helpful. socialize not the fault of any individual country. use. are other routes to it could be continued qe infinity, the ecb continues to buy for very long period of time. the coronavirus bonds will be the best outcome. you look at the

bank of england and what they have done in concert with treasury, they seem to have done it quicker than other countries. is it because of the way the u.k. works makes it easier? or is it because they governor carney, when he started the in 2008? huw: there's some lessons that governor carney made that made this easier. -- anstance, the fact predigital body, all of which were taught and communicated in engaging with each other. ,ne consequence in this crisis the ecb is a macro prudential body bring this together. number two, the changes governor carney, they have really been reopened at an extraordinary rate. the correlation between the

treasury and bank has been incredibly impressive. i know from my having been there how dedicated they are. exploring.so as we discussed, there's this question of is there a middle ground which may not begin the small business help? i think we need diversity comes from -- strength comes from diversity. we needed a diverse set of measures. tom: it is something we have been talking about which is consolidation. is this crisis a natural disaster? bring on crisis european bank consolidation? huw: if any years time, there hasn't been, i would be surprised and i will buy you a bottle of something appropriate. i think we are dealing with a shock.

be to our eyes needs to provide a lead to help. as we start to think beyond this, then i am sure the environment where rates remain at 04 very profound period of time will be a headwind to banks. to invest in technology and digital solutions which are going to be accelerated. consolidation is one of the most important routes to rebuild stability to the sector and have fewer but stronger banks to provide this transition. tom: you are one of the best qualified people for this question. what is the arts distinction between governor carney and governor bailey? what is the carney difference from the bailey difference? huw: that is a very tough question.

foremost, there's a very strong senior team at the bank. you can see in the measures they have enacted how well they work together. first of all, the team is strong. i think, governor carney is passionate. was at the forefront of the global debate about climate transition, and what that means to both the financial systems and the broader economy. the bank will carry on with that. things are being pushed to the right. where willn will be the climate debate sit in 12 months time? it can be accelerated because people see, if we can move mountains to defend against this public health crisis, we can move mountains against climate transition. i imagine that is where the biggest change. i need to think about it and come back to you next time.

tom: very good. huw van steenis, thank you very much. this will be the most interesting interview of the day . the 11:00 hour. bloomberg. on these extraan ordinary times on our fragility. this is bloomberg. good morning. ♪

francine: stocks are down. i'm looking at european stocks, down 2.5%, at least they were at the start of the trading system -- training session. u.s. futures also down as markets try to figure out what this week will bring. liquidity, one of the other things they are looking at. donald trump yesterday abruptly -- american life to normal by easter. i will let you talk about

futures, tom. of: futures in the futures is it april or may or even out to june? these strength to see shutdowns out to june of this year. coming up, we've got lots more to talk about. we will be looking at oil. oil really indicating that global slowdown in the politics of the moment. we will bring you richard haass for an extended conversation, the president of the council on foreign relations. we will speak to him about the changing story for the white house, how washington adapts to this president. this is bloomberg. stay with us. much more. ♪ to help you stay informed of the latest news just say

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history vault, reading corner and many others. for more information on how you can stay connected, visit xfinity.com/prepare. tom, this morning, all the

presidents a medical expert. president trump adjust past easter to the end of april. adjust to the global slowdown. oil plunges, brent particularly this week. thursday brings claims and on friday, a pretty ugly jobs report. in this new york city where children play in central park, build a tent hospital. good morning. i am tom keene -- i am tom keene. lots to talk about. richard haass will be with us. i will tell you, there was a decided shift in the grimness here in new york and all of the personified by a normal field on the east side of central park, halfway up in