this is fundamentally about how your behavior has changed. we are getting the closing bell here. tuesday, we does back below that 2900 label. we haven't traded backup of it since. we are ending on a relatively high note for the day. 2863 and change on the s&p 500. the nasdaq composite up about 0.8%. alleast on a weekly basis, these indices in the red. the nasdaq composite is creeping back into positive territory, but in terms of the week, a lot of this was based on pharmaceutical companies and some retail names, particularly non-retail names. we are getting a few headlines. the fed financial stability that itthe fed saying

warns of a major decline in asset prices if the pandemic worsens, also saying commercial real estate could endorse , and flags stress risks with regard to financials. we are going to dig deeper later, but this is quite the yearly report. the main headline here is that there is a major decline in asset prices. also crossing the wire right at, march investment inflows $350 billion. 349.9 if you want to be precise. still with us is the capital markets u.s. equities strategy head. lori, when we get past what we've seen in equities, can you talk to me about what we are seeing in the treasury market,

specifically with some of the expectations we saw late last week that the fed might have to go into negative territory with its nominal rates. there is still this concern that given the fed support and the trajectory of the economy that some sort of near zero if not below zero rate policy may be in the cards. what do you make of it? negativeonomists think rates are unlikely at this point. what i will tell you is that it does seem to me that negative ours would be very bad for financial system, very bad for the banks. it does seem like the fed wants to support the banks. we saw the buybacks cut. we've seen defensive dividends. it seems like the fed and the banks are working closely to me. sortthink equity investors

of continue to talk about that issue. i've done several conference calls over the past few days and that is an issue that keeps coming up in the q&a. it is something we have to watch. romaine: the reason i wanted to pose that question, a lot of the support we've seen in equity prices seems to be tied to the general assumption that the fed is going to do whatever it takes to support, not just the economy, but by default, asset prices. and when you look at some of the other areas of the market, small and mid-cap companies that were in a credit position, that may be lend itself to needing more fed support, i wonder if you can put those two together and give a sense of what we should expect out of small caps and mid-caps. lori: small caps are inherently

an expression of how you as an investor think the economy is going to do. what we also learned was that fed stimulus and support could sometimes overwhelm the sort of economic fundamental concerns. say,had a lot of investors what is the market doing? how are we rallying so hard when the fundamentals are so bad? my response has been, i was covering small caps exclusively during the qe era and that is the same thing people used to say. just --ps would multiples would expand and it didn't make sense for the fundamentals. that is how you have to think about it. what i will tell you is that small caps have shown a little sluggishness out of the gate. they did eventually start to outperform, but they didn't do

it right off the march 23 lows. one thing we've been hearing is this idea, the fed can't do it alone. they are doing absolutely everything they can, throwing everything including five different kitchen sinks at this crisis. they do need some support from fiscal. they are not able to carry this burden all by themselves. i think you need to see things start to pick up. need to see more signs of healing in the labor market. you need to see small business optimism pickup. we have recently gotten a pretty negative data point there as well. romaine: obviously a lot of eyes on the fed. expecting to hear from powell over the weekend. when you look at the general investor sentiment out there right now, the idea that a lot

of folks have, to move to the sidelines or avoid some of the riskier assets out there, is there a sense that we could start to see people take a little more confidence in the trajectory of what is happening in the markets and put some of that money back to work, or is it too soon? really dependst on which investors you are talking about. there are different camps that have done different things. retail investors, some things i've picked up our that -- one person said to me, this just happens so fast. data,e seen that in the where the bears have gotten extreme, but not financial crisis extremes. assets went up a little bit, but not as much as they did in the recession. moneys a lot of retail ready to come back. funds,io managers, hedge

they raised a little bit of cash, but not a lot. cash we did see some big raised was on asset allocation funds. those are the professionals. what we know is at the end of the first quarter, bond allocations were back to peak and cash allocations had gone back to peak. i do think a lot of that cash made its way back into the market in april. it is not clear to me that we've got a ton of that cash and bond money ready to rotate back into equities the way we did at the end of march. scarlet: good to know what is available on the sidelines. is it too early to start thinking about positioning for the elections in november? it looks like people are pricing in more risk six months out that i year from now. lori: i don't think it is too early at all. i've been doing lots of investor

calls because we can't do face-to-face meetings. over the last week, we can a half, the election itself has taken up a considerable amount of time. not because i'm pushing it, because the clients are asking me about it. i think you have to look at the risk now. a couple things to take note of, i was looking at some data on the senate races and it looks like the senate might be in play for the democrats to tie it. based on analysis by political consultants. if you think about some of the news chatter, people are starting to talk about the vp selection. some opinion polls have been showing elizabeth warren as one of the top choices. the markets are expecting harris to be the vp pick. course one thing that we

like to highlight, the s&p 500 is still just trading in lockstep with expectations as to whether trump will get reelected. that has been in place since last july and it has not changed. what i'm hearing in the questions, they are starting to worry about it. they are starting to ask me, when does it hit the market? watch the senate races. markets will pay attention in a big way. we will certainly keep an eye out for all of that. lori calvasina, u.s. equity strategy had. that does it for the closing bell. "what'd you miss?" is up next, where we will look at how higher education might need to team up with big tex. this is bloomberg. ♪

romaine: broadcasting live from new york, i'm romaine bostick alongside scarlet fu and this is "what'd you miss?" snapshot of's get a how u.s. stocks closed on the day. for the week they finished lower, but ending friday on a high note as investors and traders look past trade jitters and economic data. we also saw oil jumping as well. for the week, the s&p 500 posting its worst week since march 20, right before the

recent bottom. retail sales and factory output registered the steepest declines on record in april. joining us now with some perspective is chief economist paul ricker donna of bloomberg economics. let's start with retail sales. it was a record drop and this is after another record drop in the month of march, actually double what we had seen in march. , which i believe includes amazon -- is there reason to believe that perhaps we have seen the worst and it might get better from here? >> i don't think we can actually make that claim. this was a very disappointing retail sales report. sales orsaw internet

retailers, really the only category that did increase, things like groceries and personal-care remained in steep decline. was, ins this report most of the underlying categories, the decline in april was sharper than march. there's not a lot of evidence that we are picking up here and that one category you did highlight, online shopping, did not rise by the amount one would expect based on past episodes when folks were locked at home during a severe weather event. typically you see people stuck in their homes and there's a big spike in online shopping. the magnitude we should expect given they are not spending on restaurants, gas stations, and other discretionary categories. this tells me consumer sentiment

remains low. that can be a real problem. romaine: scarlet did go out and buy three freezers for her garage. one interesting data point that caught my eye was data on something i don't pay much attention to normally, but there was a huge spike in march, then it dropped off in april. this seemed to suggest what i've heard anecdotally, this idea that there was this surge of buying of essential needs for people staying at home, but that dropped off. we are going to get retail earnings from some of these companies. is this going to be the trend line or can we expect a rebound in sales? suggests that is

the trendline. household savings rates have skyrocketed. it is not for lack of other things to do people are shopping online. it seems to be a sweltering of economic sentiment where people have questions about the reopening of the economy and the virus and whether we have adequate treatments or other ways of dealing with covid-19. a plunge inere was activity. there was a sentiment that this will be temporary. now they are starting to be more lingering doubts of the extent of economic damage having more of a long-term impact on the economy. that was even reflected by fed chair jerome powell. he said the prospects of a vigorous rebound appear to be

slipping. romaine: carl, we have to leave it there. hope tote your time and finally see you in person one day soon. carl riccadonna. some breaking news crossing the wire. doj and state the agencies in the u.s. are likely to bring in antitrust suit on google. this is according to dow jones. says that department of justice and the state ag's are well into planning that litigation. program, next on this the commercial real estate market. cities and states get ready to reopen. there's a lot of rethinking of communal spaces. that is coming up next. this is bloomberg. ♪

are amongitness gyms the many facilities that have been shut down due to coronavirus concerns. we spoke with the equinox executive chairman. take a listen. >> as i speak today, we are still closed throughout the united states, canada, and the u.k. we are closely evaluating the situation in texas. that will probably be the first market we open. but no decisions have been made. >> how do you make the decision? force of and a task internal team working closely with our own medical experts, epidemiologists, infectious

disease experts, to help us evaluate how to think about opening. tocreated this task force create something we call the equinox standard. to take those to another level. we've been working with our medical experts to do that. that is the equinox standard we introduced to our community. obviously we are seeking the guidance of local governments. but even with that guidance, we will evaluate whether it is prudent to open based on our judgment and making sure we protect the safety and well-being of our community. basedh market will vary on the specific situation. >> as you go into crafting what the gyms can look like or what facilities you need, how much does that all cost? comes with ait

significant cost. we are prepared to spend that money because that is the commitment we've made to our members. equinox is recognized as a leader and we believe it is important to protect our community and do what it takes to protect our community of employees and members. we've already done things that most have not. so withcontinue to do our employees and make sure we create the safest environment possible. >> let's talk about your employees. you have furloughed them, not let them go, correct? >> that is incorrect. the majority of our employees continue to be compensated by the company. we furloughed a group of employees that we felt would be

financially better off because of government initiatives if they were furloughed and collected unemployment. but the majority of our employees continue to be compensated by the company, which is clearly unique. all of the hard-hit industries that have effectively zero revenue, hospitality, retail, and the like. it, ifdo you think of you wind up reopening some clubs, if demand is uncertain, do you expect a second round of valuation? >> we continue to evaluate it. when you don't have revenue and you have the unknowns, it is an ongoing process. we've taken the measures that i've mentioned so far, but we will continue to evaluate, hopefully we will be able to open some of our markets in the

immediate future. but there are uncertainties there and we have to evaluate what kind of spending we can incur until we are open and generating revenue. romaine: we were just listening to the chairman of equinox. speaking earlier here on bloomberg television. right now we want to turn to what is going on with commercial businesses. a lot of executives publicly question how much real estate their companies need once they get to the other side of this crisis. bloomberg u.s. real estate reporter joining us now to discuss this. all of us right now are doing a lot of things from home that we would normally do elsewhere and we are getting used to it. how are a lot of these businesses, offices, hotels, etc., how are they going to deal with the potential of getting people back to their facilities

in a safe way to make people comfortable? problem,a big especially landlords in places like london and new york. if you have an office building in new york city, you are looking at the subway, long island railroad, wondering when it is going to be safe to get your people back onto public transportation, and that leads you to the question, if we are going to live like this for a while, do we need all this office space? scarlet: one thing that struck me when reading the story is how inflexible and rigid a lot of commercial leases are. there are no modifications. you guys see that changing. give us an idea what might change. >> it is kind of ironic. works like airbnb and we

have disrupted the traditional model. they are both struggling right now because of the pandemic issues. but they've introduced ideas that i think people want, which is more flexibility. tenantsot a bunch of who are creditworthy, twenty-year leases, they are going to pay on a regular basis. those companies might not want 20 years anymore. the world changes very fast now. i'm not going to be able to commit to a 20 year lease. what about some of the investors in these real estate companies? we've seen shares of sl green and others basically trading around the lows that we saw back in march. is there anything that is going to make them more comfortable investing in these companies? >> two stocks that people in new

york know pretty well, they own a lot of properties, madison square garden, where they've been rebuilding that, they are really exposed. new york city has been the epicenter of the pandemic. sl green has a giant tower going up in grand central. what all of us are watching the news and trying to think about, when we will be back in the bustling city? it is hard to imagine that happens any soon. it is really sort of return to normal life that would be good for investors, but it is hard to see that now. scarlet: little visibility for everyone. craig, thank you so much. covid-19 keeps college students stuck at home, higher education may be right for disruption. we will discuss the future of higher education with scott galloway.

from new york, this is bloomberg. ♪

romaine: alongside scarlet flu, let's get over to mark crumpton standing by with a bloomberg first word news. mark: president trump says he's hopeful there will be a coronavirus vaccine available to americans by the end of the year. the president unveiled what has been named operation warp speed, which administration officials have billed as a manhattan project style effort to speed development of a vaccine. the fda is giving new guidance to the white house about how often president trump and others should be tested for covid-19. this after data suggested that a rapid test made by abbott labs

and used by the president and others may provide inaccuracies and false negatives. the fda says if someone is suspected of having the virus and the first test is negative, a second test might be worthwhile. new york city will remain on lockdown for at least two more weeks. the city and other nearby regions did not meet requirements for reopening. says fivendrew cuomo upstate regions can reopen. the metrics used include requirements for hospital bed capacity, testing, and tracing. in florida, gyms can reopen and retailers and restaurants will be able to operate at 50% indoor capacity beginning monday. governor ron desantis says florida has dodged the worst case scenario. he said today that ventilatory use and covid-19 patients in intensive care units have both declined significantly.

global news, 24 hours a day, on-air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. scarlet? scarlet: thank you so much. the u.s. has seen some of its highest jobless claims numbers in decades because of the pandemic. our bloomberg white house reporter spoke with the u.s. labor secretary about trends in jobs data. let's take a listen. >> the numbers for last week were a little bit under 3 million. it is a high number. we are looking at 36 million americans that filed for unemployment over the last couple months. it is difficult to see. we are reminded daily of the sacrifice that workers and their families are making as we try to beat the virus. there are some positive signs

that the number of people filing is declining. there is a backlog that is being worked through. we know the situation is so fluid. now people are going back to work. that is very good news. talk about how jobs are lost. a week ago, 25 million jobs were lost. i look at it as many of those jobs are still there. the workers know they are there. they are preparing for people to go back into those jobs. >> does the data reflect that optimism, they'll a lot of workers feel their jobs are going to be there when they return? >> some of the most interesting data is to that. i have a chart. this comes from the port we put

out last week. red line is americans who said they were on temporary unemployment. the blue line is permanent. if you go back to when we had a big slowdown, the blue line went way up. but now it is the redline. surveyed% of people we said they were temporarily unemployed. the fed came out with a report yesterday. very similar survey results. >> speaking of jay powell's making the folks who are less than $30,000 annually, they are going to be significantly negatively impacted by the economic effects of this. on capitol hill democrats are pushing for another round of economic stimulus. do you think the best way out of this is more stimulus or to reopen? >> i think reopening is our

focus right now. we want to help businesses reopen safely. have the right protections for workers. but it is critical that we reopen. again, safely, but it is the private sector, not the government that drives this nation's economy. although we've had some really extraordinary government intervention, we have to remember how strong the economy was and why. a major part of that was president trump's focus on reducing tax burdens, reducing unneeded regulatory burdens. those are keys to a strong economy. >> some economists have been crunching the numbers on unemployment and by some estimates, some individuals who are receiving unemployment benefits are actually receiving more than they were when they were working. does that concern you?

and does that concern you about the potential for them to get back to work? >> what you are referring to is the extra $600 a week that president trump signed in the cares act. we thought it was really important to keep these people who are sacrificing their jobs for public health as near to whole as we could. that was a really important benefit. but unemployment benefits are for people who don't have a job. you can't quit your job because you think you might get more unemployment. we have been emphasizing to the states, as we reopen, states should be making sure people are making that transition back to the workplace. secretaryhe labor speaking with kevin cirilli. let's talk about education. the school year is almost over. for college students, plan b may

well be taking a gap year or living at home and enrolling in community colleges. be colleges, plan b may hybrid instruction. down the road, what does higher education look like? let's ask scott galloway, professor of marketing at nyu and host of vice tv series no mercy, no knowledge. it is clear that the pandemic has exposed the flaws of higher education's business model and schools will have a hard time surviving down the road. a you think we will see string of collapses at colleges? scott: good to be with you. if you just think about the waterfall here, 10% to 20% of kids don't show up for school in the fall of the 4 million they were expecting to be freshmen on campuses, the tier one schools are fine. they just reach into their waiting list.

it has never been a better time to be on a waiting list. then the tier two schools reach into their waiting list. at some point, you get to the tier three schools that don't have waiting lists, and they are caught in a financial struggle. the ones that face that shortfall and don't have some of the endowments we hear about -- 90% of universities don't have substantial endowments. those universities could be caught with a fixed cost base -- [inaudible] you could see a lot of universities not only just not reopen -- [no audio] scarlet: hello? i think we are having technical issues. there we go. go on, scott. scott: so you could see

hundreds, if not thousands of universities, not only not open in the fall, you could see them never reopen again. romaine: this is going to be an interesting shakeout here. i'm curious, for some of the top-tier schools, the ones that tend to be more desirable, a lot of ivy league schools, stanford, northwestern, what are they going to have to offer to students who are going to be returning to more of an online environment, given how expensive some of these tuitions are? are they going to offer the same value they had before? scott: 100% no. part of the college experience is the experience part of it. with your tier one universities, m.i.t., boston college, berkeley, michigan, the real value is not in the education. it is in the certification.

an uncomfortable truth around america is we live in a modern-day caste system and that casting is largely indicated by the university you graduate from. even without the experience, the football games, if you have the opportunity to buy your child, and you can afford to, from a place like stanford, you continue to do that. but without experience, without world-class certification, there's a whole sloth of the populace that is going to say, i'm not going to pay $58,000 for resume classes with a mediocre certification. the ones that don't make it out of this are the week. the ones that have very small endowments, that don't have great brands, that all of a sudden have to offer a substandard experience. scarlet: scott, you are an expert on branding. the tier one schools have incredible brands.

big technology has incredible brands that have been tarnished, but still pretty notable. you see a wedge. what does that look like? how would it work? tott: i think you are going have tremendous cost pressure. but in order to capture or recapture more gross margin dollars, i think you will see tier one schools partner with big tech. you can envision a future where berkeley or m.i.t. welcome 10,000 as their geography or their campus will no longer be the constraining factor. many or most classes will be delivered online. big and small tech companies will help them with that process. like when big tech enters any category, a lot of people have access to education that didn't, but we are also going to see big

winners and losers. there could be a loss of the traditional campus experience. it might be relegated to a small number of universities and wealthy people who can afford to send their kids layer. we could see a reshaping of the college experience. romaine: scott, is it possible that we could get a reshaping of this caste system that you referred to, this idea that your ticket to a better life is getting into harvard or stanford or one of the schools? there's been pushed for a while now, saying that real-world experience and circumventing high-priced schools could be a path forward. do you not see a way that path could weasel its way into this environment? scott: that is a nice notion,

but until the heads of recruiting from mckinsey, goldman sachs, and the world -- it is still largely going to be the primary indicator of your trajectory as a young person. it is really corporations who need to change their mindset around whether or not a college degree from a certain university is a prerequisite for a job at that organization. we might see the low cost universities be ok. the high-end universities will be fine. but the guys in the middle, there is no market for them. uprlet: i'm glad you bring cal state. they are going to all online systems in the fall. you went to ucla. what happens to public universities? can they team up with big tech? how do they survive when they

are not getting the state funding they need? scott: exactly right. the top universities can continue to offer or get 58,000 dollars just because of the branding and certification. the cal state system probably does ok. californiaity of probably does fine because their andion is still about 16000 38,000 dollars for an outstanding degree. but does pepperdine survive this? a university that still charges $40,000 for what is not considered a top-tier certification, and you can no longer attend a campus overlooking the pacific ocean or go to basketball games -- those universities might be caught short. i think the university of california comes out of this just fine. but we need to rethink priorities. unless we expand the number of freshman seats and stop using

universities as a means of layering more debt on u.s. households, are we in fact bumping up against moral hazard where we have been praying on the hopes and dreams of middle-class families and have put too much debt on young people? it is a hard truth we have to face. every crisis raises questions that sometimes lead to big changes. we will see if this leads to big changes as well. great having you here. nyu businessy, professor and host of a vice tv series. don't know why they didn't hire him at bloomberg. we will be back in a second. this is bloomberg. ♪

romaine: welcome back. you are watching "what'd you miss?" as policymakers are boosting stimulus packages to fight the coronavirus slow down, the line between borrowing money and printing money is starting to get blurry. ben hollins joining us right now. talk to me about this separation that we've typically seen between fiscal policy and monetary policy, this separation of church and state. is this sort of general implicit guarantee that a lot of folks seem to think is out there, is that relationship going to become more explicit? think they are already cooperating in a whole bunch of ways they didn't use to cooperate. themer you will see bringing it entirely out into the open, i don't know.

perhaps not. but we are seeing a level of cooperation between them that we have not really seen before. we did see quite a lot during the financial crisis of 2008 when it became pretty common to see the treasury secretary and armchair kind of arm in talking to congress. i think what we are seeing now with issues of debt, the federal reserve is on another level. scarlet: part of the reason why there is so much reluctance for there to be such a close relationship here is the threat of higher inflation, runaway inflation, but that hasn't really been the case. there is less of a wall between monetary and fiscal policy. inflation is far from the problem. ben: and inflation is also a problem that you can say, it is

down the road, then we will deal with it. we have an immediate problem. createdanonymous hole in your economy by a pandemic. we havekers are saying, to deal with the problem we have now. it may involve turning some of the debts into money, basically monetizing those debts. but we are dealing with the immediate problem. arrive,ure problem does we will deal with it when it arrives. they made the same prediction in the united states. cases, never materialized. asrlet: i think it is known kicking the can down the road. bloomberg economy editor ben holland, thank you so much.

from new york, this is bloomberg. ♪

romaine: welcome back to "what'd you miss?" now from hisght fishing house right there on the shores of lake travis in austin, texas, joe weisenthal. what have you been watching? dataobviously -- economic today -- can you hear me? romaine: got you. keep going. joe: hello? scarlet: we can hear you, joe. romaine: keep going. joe: i can hear you now. sorry. lots of economic data today. the retail sales number getting a lot of tension.

manufacturing, better than last month, a little bit better than expected. sentiment very low. one of my favorite measures, we got the jolts report from march. a great measure of consumer confidence. who feels comfortable missing their job, down to the lowest level since 2012. very little bright spots. very few green shoots emerging yet. scarlet: what i found interesting was that the university of michigan one year inflation expectations rose to 3%, which doesn't match the data the fed tracks, but consumers feel like they are paying up. how do you think that affects their spending and saving and gdp, even if the official data indicates that deflation is a bigger concern than inflation? joe: great question. i think it really shows, it speaks to what data points are

really saying. when we got the cpi report last week, there were certain grocery store food purchases that really soared, even as inflation was lower overall. when you talk to people about inflation, they will say things like grocery store prices. it is possible that some of the uptick in inflation is because certain measures, you don't notice. mortgage or rent doesn't change on a month-to-month basis, but you really notice if food at the grocery store picks up from one week to another. hence the rise in survey measures. romaine: what are you looking forward to going into the next week and beyond with regards to any kind of signs of economic recovery? dead horseeating a

on this, but i continue to watch initial claims, weekly jobless claims. those have to keep coming down. two months into this crisis, we have to see improvements. they are also getting a lot of other survey data. after empire fed -- it wasn't good, but there were some green shoots in terms of the percentage of companies which say they expect to see improvement. that was a nice surprise. if we could see that in some of the other regional surveys, that may be a sign that companies would start to slow down the pace of jobs cutting, which is what we need to see before we see outright improvement. scarlet: a lot -- romaine: a lot to keep eyes on. glad we finally got you through for more than 30 seconds. joe weisenthal is a cohost of

this program. we hope to get you back soon. i'm going to let you get back to fishing, joe. we really appreciate you taking time out to work for five minutes a day. ♪ staying connected your way is easier than ever.

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faster than a call. easy as a tap. now that's simple, easy, awesome. >> welcome to "bloomberg technology." i am emily chang shelter-in-place in san francisco. markets entering the week in positive territory despite a slew of dismal economic data. u.s. retail sales punching in april worse than march, new record drop. store closures and bankruptcies continuing across the country. the fed issued a stark warning the value of stocks and other assets could see significant declines