and the ones that are not so. this is really great opportunities to rebuild the portfolios and improve the that,y, but having said want people scarlet: there you have the closing bell. empty new york stock exchange. at indexes closing basically session lows. s&p 500 losing 1.8%. energy names really getting crushed here as oil prices plummet. exxon mobil and chevron each losing more than 4%. we also have ibm and cisco systems the two loan gainers.

ibm will be reporting results shortly. first quarter numbers will be crossing. parsing through the relief to about they say anything the first quarter. those people were focused, fixated on the oil market where the may contracts closed at a -$37 per barrel. romaine: they will probably be fixated on that tomorrow as the contract has the final day of trading. a lot of folks i have spoken four days,he last when they expect to see a rebound. 27% from up about those march lows, still down about 20% from the highs in

february. there is a lot of indication in these names, tele-dock. there are a lot of people coming that they think there is a bottom. now it is just a matter of whether we get the economic data and corporate profit data to back some of that up. fill with us, katerina simonetti. thanks for staying with us. i want to get back into our conversation. when you start to map out the long-term outlook, for equities, other asset classes as well, do you think there is a case to be made here that we don't necessarily have the worst of thereonomic data in, that is still enough here to be helpful, to be optimistic that

there is a long-term by to be put into some of these names? katerina: of course. extremelys are cautious about the short-term but most of them are optimistic about the longer-term. this is a great time, really a perfect time to go back to basics and evaluate our liquidity. as you mentioned, we see a lot of opportunity not just in equity markets but in credit markets. specifically, we see opportunity in high-yield space, in the u.s. dollar denominated emerging market bonds. treasury and gold. perhaps evaluate the risk profiles. we asked them not to sell out but to change the structure of their portfolio.

we truly don't know how long the situation is going to last. clients forepare the long-term growth that is going to come. it may take some time but we are expecting for it to happen. scarlet: as we wait to hear the results from ibm and these other companies, what will you be listening for to pull the trigger on establishing some long-term visions on the companies you are keeping an eye on? katerina: we are doing this now we are employing dollar cost averaging. we are approaching that target gradually every month we are encouraging people to enter this ,arket cautiously, methodically with good plans in place. we are not necessarily sure that this is the bottom.

it is impossible for any of us to predict it. we do know the valuations at the companies we are seeing right now are significantly below where they were. we are positioning our clients with portfolios to come out that her and stronger, at least not from the position of fear but the position of opportunity. scarlet: well said. katerina simonetti, thank you so much for joining us. that does it for "the closing bell." "what'd you miss?" is next, where we will look at the historic plunge in oil prices. we will be checking out the global supply chain and what kind of changes are needed. this is bloomberg. ♪

romaine: broadcasting live from new york to our viewers worldwide, this is "what'd you miss?" i am romaine bostick alongside my cohost, scarlet fu. howlet: a snapshot of stocks closed on the day. indexes retreating six week high. the dow off 2.4% with chevron and exxon leading losses. romaine: ibm numbers are out. the one key revenue number falling year-over-year.

the company withdrawing its full-year forecast. the other numbers, total cloud .evenue operating eps number slightly above what analysts were expecting. on that metric. , that was theue estimate, a miss on revenue. a beat on eps, miss on revenue. that full-year forecast being withdrawn from ibm. scarlet: no surprise. it will be one of many companies that will pull their guidance. in the meantime, i want to go back to our top story of the day, the plunge in oil prices. the may contract for wti settling at -$37 per barrel.

for more, let's bring in catherine, who covers oil for us. we keep saying that the may contract expires tomorrow. it does not expire until 2:30 p.m. tomorrow. the price chart for oil was a straight line down. what does that mean trading will look like tomorrow for this contract? >> today is any indication, tomorrow will probably be a little bit messy as well. -- we saw aine down big jump down, five dollars, 10 dollars, and we had probably -$40. there is basically no bidder anymore, so everyone is here for a fire sale. romaine: talking about that being a straight line down, the

price itself is not surprising but why didn't we see more of a gradual decline over the last few days? were people really taken by surprise that it would not be able to unload their barrels for a meaningful price? market, pretty regularly, the gyrations as a contract expires. there is a lot going on in the physical market where you are trying to match up people who have storage and figure out what your balance looks like. they still believe that may is going to be ugly, and is this just one of those times where it fizzles out and the impact is saturated? scarlet: talk a little bit about etf flows.

there has been a lot of reporting about how there has been a lot of inflows into the main etf that tracks oil prices. at the same time, we see oil prices under pressure because of the situation you were just discussing. how do you reconcile that? we are seeing a lot flows into a handful of them. some of them are even double and triple leverage. i think there is a conception that a lot of people who are buying these things are doctors, lawyers who have no idea. , lot of the money behind it people are saying a lot of it is institutional money. people who have a lot of money. besaw that $20 was going to a bottom. .pparently it was not

this is incredible, dramatic. right?y it remains to be seen. the interest is incredible, so much so that they have become a big part of the market in unprecedented ways. romaine: unprecedented day. it will be interesting to see how long -- how it all shakes out. ngai, appreciate you being here. coming up later, pimco u.s. economist will be with us and she says the next couple of weeks kobe critical in -- couple of weeks will be critical in determining the full extent of the fallout from the outbreak. this is bloomberg. ♪ ♪

states: has individual trying to find ways to reopen individual economies, the trump administration is trying to lay out a multi phase roadblock. larry kudlow spoken little bit earlier exclusively with bloomberg about what federal government is doing. i don't think the rules are bad to begin with. there might have been some glitches here and there. i think secretary mnuchin has done a good job at treasury. on the whole, judging by how fast the original $350 billion went out the door, i think it is a very good program. stepping up are into the medium-sized area but

that seems principally due to the so-called main street lending facilities. someurse, there will be assistance to large, important companies that have hardships. the airlines being one of them. there always tweaks here and there but the fact that it works so please think is testimony to its efficiency. >> i agree that it has acted much quicker than i thought it would. i was certainly wrong about that. but if a $1 billion up and can get access to the paycheck protection program, we have a bit of a problem, i think we can both see that. is that part of the agreement, just tweak things up a little ,it so the likes of shake shack a $1 billion company, does not get access to those funds for small business?

larry: i have not really followed the shake shack story. apparently there were some issues there. seek throughble to the federal service loan facilities. the whole point is, and we have talked about this, we just want to stabilize, put enough cash, liquidity into the economy to get us through the next couple of weeks. that is the whole purpose of this. small businesses and those who work for small businesses. there is some evidence that a very badit is hardship situation. no question about that. if we can get through the next couple of weeks and, as you know, the administration's

health scientists have given a road for reopening in several stages, may may be a transition month for a better economy moving into the summer. we are just trying to set the with and keep folks going direct treasury checks, with deferral of the payroll tax, with deferral of student loans and payroll taxes. in a short period of time, i have to give credit. i think the operating agency has done a good job. >> let's move on to tariffs and trade. the latest announcements will be differing payments of tariffs on some good. i talked about this back and forth several months now. what have you done, why are you doing it?

mfn, mostso-called favorite nations, where there hardships, we will suspend tariffs for i think three months. we are not rolling back 301's, i.e. china tariffs, or other trade deals. customscases, the duties, the excise tax will be lifted. particular, there is a lot of andern about retailers related supply chains getting into the united states. it is a way of helping out certain industries. it does not change the president's own trade policies. we are suspending and deferring as we have with things like income taxes, payroll taxes, and elsewhere in our plan.

scarlet: that was larry kudlow speaking jonathan ferro earlier today. to get more of a broader look at the economy, we want to bring in tiffany wilding, chief economist at pimco. i want to contrast what the president's economic advisor is saying with the economic data that has been reported, which is pretty dismal with you look at the job numbers and chicago fed numbers. misplacedr optimism given the extent of the damage we have seen and the expectation that there will be more destruction in the economy in the months ahead? tiffany: thanks for having me. i think the economic data we have seen for march and the early data we have seen is just confirming the staggering speed economicth with which

activity has declined as a result of these mandated business closures. you asked about the markets relative to this. the markets are also going to price in that deceleration. in addition, markets are also i how muchy attuned to policy response we have gotten. even though this is an unprecedented decline in activity, we are also getting unprecedented stimulus from the government and federal reserve. ofhave gotten $2.2 trillion additional stimulus. we actually think that you will probably get more over the course of the next several months. that will obviously depend on how long from now the economy is closed. ultimately, all of that taken together, we think you will

probably have a pretty deep recession. come with aso pretty quick recovery. romaine: how are we reading this? when you look at the data, obviously a lot of folks are looking at the weekly unemployment claims number, which we know is at historic levels. how should we be reading that data? should we be starting to look for when the growth rate declines and that is a sign for some sort of potential rebound? tiffany: i think that is right. for the initial jobless numbers, you have to remember there could be some skew because of the timing of the good friday holiday we saw the week before. so, we could see some catch-up this week. i think more broadly, you are right.

we should start to see over the course of the next couple of weeks some moderation in initial jobless claims. there is still probably a decent amount of backlog in many of the states. they have been reporting inability to handle the large volume of claims. on the others, programs like the ,aycheck protection program which provide incentive for companies to either keep their payrolls the same or to rehire people to get those loans forgiven, that should help moderate the pace of firing rates and you could even get a little bit more rehiring as a result of that. going forward, that will be something to watch. there are other high-frequency indicators we have been monitoring. other data that google has been putting out on workplace mobility.

notably ined quite the middle of march. that is still kind of lower level. we have not seen an inflection up yet. scarlet: larry kudlow touched on this. we know that the white house and large swaths of the private sector or would like to start the process of returning to normalcy. what sectors do you think will lead sooner than others? tiffany: i think overall reopening of the economy will be slower and probably bumpier than many people expect. we have many states which have put expiration dates on mandated closures. many of those states, the expiration date is from may 1. right now, based on that, there is an expectation that a big

chunk of the economy in these mandated non-essential business closures will be able to reopen as those ordinances expire. i think there is a couple of things to keep in mind. that is that we could see delays and things will probably be a little bit slower to rebound. that is just because a lot of the guidelines that the cdc has put out on when it will be safe to reopen, in our mind, those principles and goals have not been met yet. that the cdcsting and other experts have recommended, other things like hospital capacity, personal protective equipment, those inventories are well below levels that i think we would be comfortable with them and. and what we have seen from foreign countries suggest some of these timelines have been too

optimistic and we just need to remember that there is a cost to reopening the economy too early and potentially suffering another outbreak. we really have to weigh that cost against some of the ongoing economic damage we are seeing from keeping it closed. i think overall we will see a slower reopening some of these sectors obviously that are getting hit quite hard are going to be slower to come back even when the economy reopens. romaine: we are all keeping an eye on it. i am sure you will be, too. tiffany wilding, u.s. economist over at pimco. this is bloomberg. ♪ g. ♪

a historic day in oil markets as we saw those futures contracts dip into negative territory, well into negative territory. the bigger question is about demand issues. we want to bring in m.i.t. professor of systems engineering and the professor of the center for engineering. he has been with us before to talk about supply chains. professor, we want to start off with what we saw in the oil markets today and what we can extrapolate with regards to the oil supply chain.

>> first of all, wow. we saw something unprecedented, clearly. no demand for oil because there is no way to store it. unless you are in the business of oil storage or owning very large capacity tankers that float on the ocean, you are losing money. oil is just not selling. oilthe question for the companies is, when is this going to turn? we have seen that futures contracts are not quite negative. because people are betting that may, june, july, the markets will turn. it is a question of when the markets will turn. and a lot of it has to do with when we take control of the coronavirus. scarlet: perhaps you can answer this. there articles over the past couple of weeks about how much

food is being wasted, which is a huge contrast to the scenes of empty grocery store shelves. the dairy farmers of america estimates that farmers are dumping as many as 3.7 million gallons of milk each day. what is going on and how can we fix this? >> we should all acknowledge that there is no shortage of food. there are spot shortages of some items. all of the pictures of empty shelves are being taken at the end of the day. you come in the morning, you can take a picture of full shelves. but certainly, there is a problem. the problem is that about half the food consumption in the united states is with restaurants and institutions. supply chains are tailored for certain markets. supermarkets use a different network of people they trust and no, producers, warehouses,

transportation providers, they don't just allow the stuff to be delivered by any truck. supply.ry hard to shift there is only so much capacity for packaged food in supermarkets. rice -- at flour, wholesaler will have to retool in order to do it but this will take the more time than they expect the pandemic will last, so they don't invest. another problem is that consumer demand is not enough to compensate for restaurants and institutions. also, households are consuming packaged goods, bread and pasta, and a lot less fresh food. the fresh food cannot get to markets. the producers are not equipped

to get the stock to household standards. also, food commodity in china and elsewhere, they are not equipped to supply supermarkets. romaine: it is interesting because what we are seeing on the consumer side, it sort of is understandable that you would have food companies that would not necessarily be able to make that shift to the consumer side. but talk about what we saw in the medical space. uswas a little confusing for who are not experts to understand why they could not ramp up production of masks, gowns, ventilators. why did we not have a supply chain able to accommodate the increased demand there? >> very good question. the demand went through the roof. explainedlain what i to a local media interview when

they asked me why we don't have enough manufacturing capacity. fourth of july, there is about one million 2 million people in boston who go to the charles river and they all want to come on public transportation. there are not enough cars, not enough buses, complaining every year. you cannot hold five times as many buses and railcars that you need just for one day a year. that is what we see now. the solution is a three-pronged solution. first of all, hospitals have to be treated like banks. are required to have a reserve. hospitals have to be required and stress tested to have reserves. second thing is national stockpile, woefully low. the bush administration actually

replenished it very well. the obama administration did not replenish it. of course, the trump administration did not do much. we did not have enough of a national stock pile. the last leg of this three-legged stool is to have people in reserve who can man ventilators and help hospitals. for this, i am calling for something like, you can think of it like a medical national guard, people who come and train once a year, then come one weekend a month to help hospitals. all of this, but the main thing in terms of supply, focused on -- like a strategic petroleum reserve, we should have a strategic medical reserve to be able to withstand weeks and weeks and months of a pandemic like we have now. scarlet: i love the fact that

you come equipped with solutions. professor yossi sheffi, director of the m.i.t. school for transportation and director on -- an expert on global supply chains. it's head over to mark crumpton. mark: i just thought the same thing. everything he said made so much sense. the white house is ordering federal agencies to begin repairing to return workers to offices. in a memo, the white house says government operations need to be opened to the maximum extent possible as long as local conditions warrant it. the memo said employees should untile to work from home state and local authorities began reopening their economies under the three plan that the white house outlined last week. top infectious disease expert is warning that even to quickly to reopen the

economy could backfire. dr. anthony fauci is warning that unless the united states gets the virus outbreak under control, a real economic recovery will not happen. dr. fauci is pushing back against protesters who are ignoring stay-at-home orders and calling for him to be fired over the guidelines. the worst is to come, a warning today from the world health organization. the organization's head did not specify. the comments, as many come -- many countries are easing the restrictive measures that have been in place. the coronavirus has killed more than 166,000. 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 mark crumpton. this is bloomberg. ♪

>> you have got two phases, the suppression phase, then the managed or controlled revival of the economy. it is a false dilemma between lives and livelihoods. the economic and health damage is so great that you need to be considering now what exactly are us measures that will allow to return to the lockdown and be a new normal.

question not so on what theing back government has done but looking forward to what it has to do now to make sure we can ease that lockdown as significantly as possible while not of course losing control of the disease. it is a balance we try to set out in our paper to stimulate the debate about it. i think right now is the time to have that debate. people'st should expectations be? if you were in government, what would you be saying right now to prepare people for how long into the future? tony: there are two things we are saying. you have to reposition the whole of government. we have to get well ahead of the thee in terms of revival of

economy. you identify the absolutely core tasks around this. adequate the there is -- etiquette and business consultation from sector to sector, making sure that it requires not just technology but manual tracing. how do you get international travel started again? each of these areas, putting a and controlnd structure with a senior person who may be outside of government and bureaucracy. a lot of the skills are skills more particular to the business sector. you have to reposition government to be able to do things effectively. the second thing is you have got to really take people with you in explaining that the normal

will be used. i think there will be widespread use of masks. the countriesat like south korea, it has been pretty invasive. we have to prepare people for that. we have to make sure that people are accumulating the knowledge -- in order to make sure that people get a proper sense. we have to get out of the situation where even though a small percentage of the population at any one time is at risk, having to be shut task to but -- shut down to protect the population at large. scarlet: that was of course the former u.k. prime minister tony blair. let's turn back to our story of the day, our top story.

wtimay contract for settling at a -$37 per barrel. shark. us now is stephen i was just looking it up and it looks like the headline came out 2:11 p.m., saying it had below zero.to fall was that a good decision for the oil market? stephen: at this point, yes. you have to allow the market to dictate winners and losers at this point. amazingly, with today being the penultimate session, you had way too many people way too long wti. obviously, the cme knew this

going into the weekend. i was hearing rumblings that the was toyingthe cme with the idea of negative puts. certainly, with two days to go, you saw it occur. at the end of the day, i think it is not a leap to suggest that gotone at large -- someone walloped today with oil hitting an all-time low. debacle on many different fronts. that is not to say that this cannot continue. there really seems to be -- that this was all inherent in the may contract. that is not the case.

.his is a systemic bear market i am curious as to whether maybe we are downplaying the trendline in the may contract and what we could see in the june contract and beyond. stillof the factors are largely going to be in place as far as we know? they will be coming to fruition. the may contract got walloped. we know we will max out storage capacity. that did not happen. it is going to happen as the june contract is trading. you now run the risk of people rolling their positions. may held onto their

contracts for so long, had to buy the june contract at an extreme premium. you are going to see a lot of selling in the june contract. the table is set for the june contract to trade into -- i don't know about negative but i was confident you would see single-digit in the may contract and i am just as confident you will see single-digit city june contract as well. think we could see something like this happening in the rent market? stephen: not necessarily. the breadth market is more of a marker for the global market. now is crushing wti right is that storage capacity is limited. there are only 76 million barrels of capacity at the storage hub in cushing.

the canadians are still putting oil so you have a lot of oil that is landlocked that is crushing demand. the collapse on the wti spread the united states is not going to be able to export its way out of this. greater access to floating storage, companies like glencore are chartering multimillion barrel tankers just to sit on the oil and hold it in floating storage. opportunities for index oil are much greater. the likelihood of negative prices fell, i don't think we will see that, but we are seeing prices significantly lower. a couple of weeks ago, some analysts were saying we could not get oil below $20 per

barrel, let alone $40 below zero. romaine: we will have to get you back to talk about that june contract. we really appreciate you taking time to be with us. back in a moment. this is bloomberg. ♪

romaine: continuing our conversation about what was a remarkable day in the oil markets, seeing the current contract for wti crude futures dip into negative territory, down as much as $40 negative. that is how much you would pay somebody else to take that contract off your hands. aining us right now to talk bit more about this. this did not necessarily come

out of the blue. there was talk about how we were seeing bids on south texas sour at about two dollars a barrel, gold coast crude at about four dollars a barrel. there was a sense in the physical market that there was a breakdown in folks willing to take on that crude. is there any sense that the physical market will be any better, say, a month out? >> i like how you caged the question talking about the physical market versus the financial market. the physical market has been weak for some time now. physical storage has really been piling up. as you mentioned, this has been weeks and maybe months in the making. we have been calling this a

slow-motion car crash. andcar is speeding up now market forces will continue to cause further pain until whichever comes first. to theu look forward course of the next few months, there is no way to sugarcoat this. the next 4-6 weeks will be ugly in the oil market. the june contracts which will start trading really dominated by similar themes. we ultimately think that this month and next month will be the weakest points in the oil market. does today's collapse tell us about liquidity in the oil market? michael: this is a great

question. what happened today was unprecedented. does negative pricing mean? if they arekin to producing barrels and trying to sell it, you will have to pay someone to take your barrel. the gap so much lower over such , when youriod of time look at the time period where contracts generally role, you have the may contract rolling off the board tomorrow, there are a lot of gaps in terms of liquidity that will start to play out. romaine: can you talk to us about that relationship between what we are seeing in wti and what we are seeing in brent?

michael: to be clear, when you move,t today's historic you don't asymmetrically skew to the downside for wti but you did not get a moving the brent market at all. only down two dollars. when you look at the brent market and the north american wti dominated oil market, on a global basis, opec's historic the with, that should help print market. are baked in the cake right now. strategyglobal energy director at capital markets, thank you so much. "bloomberg technology" is up next. this is bloomberg. ♪

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