someone put out -- some would put on a white paper and they came to the conclusion that if you went really negative, that may work because it would push people to spending their money quickly. until that happens, it does not work it just hurts your bank earnings. romaine: we are just hearing the closing bells here. the dow jones industrial average down about 390 points. s&p 500 down about 1%. 0.5% or so.own the russell 2000 down as is the mid-cap index. two individual movers. selloff pretty significantly. it was up 7% yesterday on the news about the vaccine trials. but a new story seemingly

drawing some questions about that data and how reliable it can be. to the upside, spotify closing up about 8.4%. that company signing an exclusive deal with joe rogan, one of the more popular podcasters, a deal that could be worth more than $100 million this year. scarlet: pretty incredible deal for mr. rogan. this incredible reversal we saw in late trading, almost three stocks down for everyone that is higher on the new york stock exchange. of the 11 industries on the s&p 500, all 11 are down. on the dow, only three gainers. the market turned pretty quickly from what was looking like an extension of yesterday's rally. reportinggoing to be this week.

walmart and home depot, for the most part, showed they are getting a little bit of a boost from their status as a businesses. it is interesting to see how the shift in consumer buying patterns have been reflect in the sales. also point should out, outside of equities, we did see wti crude oil moving higher. mind, -- when we went from that may to june contract, we went to negative pricing on that contract. some of those demand and supply issues that created the negative beenng appeared to have sorted out, at least for now. basically the opposite of where 3250, positive territory.

scarlet: we want to thank shawn matthews for joining us. that does it for "the closing bell." "what'd you miss?" is up next where we will be hearing from boston fed president eric rosengren. this is bloomberg. ♪

romaine: broadcasting live from new york to our viewers worldwide, this is "what'd you miss?"

how u.s.a snapshot of markets closed. a late selloff. indices closing out in the red. s&p 500roups within the losing ground. all 11 groups in the dow. themmbers and 27 of declined. moderna,ll a result of the results from the latest study may be not as positive as some expected. a feds standing by with official. mike: we would like to welcome boston fed president eric rosengren. thanks for being with us. we are getting to the point tore the economy is starting reopen in your district.

boston mayor walsh laying out some conditions to reopening yesterday. as we get there, what do you see happening in your district, in boston, in massachusetts? other states in your district. what are people telling you about how fast they think they will reopen? pres. rosengren: it is wonderful news that we are getting to the place where we can start talking about reopening, but i would highlight that is only the first step we need to take. consumers need to be comfortable going to businesses, restaurants. employees need to feel comfortable going on the subway, the train, or the bus. with community spread still continuing in massachusetts, i think we are a little ways away from that. as important it is to take the first step to allow businesses to open up, i think we should be cognizant of the fact that many people are particularly older

americans, will be leery of going on to mass transit or on the planes before the public health problem is resolved. what are business leaders in your district and people who run mom and pop stores telling you about? i think theyen: are very much hoping they are very much hoping there will be a pickup in the second half of the year. i think, in gdp terms, there will be a pickup. i think the labor market will still be pretty weak. i expect the unemployment rate to still be in double digits. it is probably still going to be significantly down from where we are right now. many americans who took that survey said they were employed but not working the week of the survey, so the number is probably a little bit closer to

20%. we will see if it goes up a little bit more. by the end of the year, probably talking in the low double digits. that is still a very high unemployment rate. that reflects the fact that i don't think many employees will want to go into the cities that are still having significant problems. i think consumers are still waiting to feel more comfortable. the things that is supposed to mitigate that somewhat is the new main street lending program that you're is in charge of. what has the delay been? pres. rosengren: it is a very complicated program. think of the need to get thousands of loans from thousands of financial institutions. we have to set up all the i.t. and the networks to do that. we also spent a lot of time putting the term sheets

together. the federal reserve is usually not in the business of lending to businesses. we wanted to get a term sheet that reflected the needs of both businesses and banks to get sufficient volume. we had to hire vendors to do some of the activities. so, these complicated facilities can take quite some time to open up. i would highlight that the money market facility opened up in about a week. that was a much simpler program, it was dealing with market securities. nature, isg, by its not really designed for someone like the federal reserve to provide money to existing loans or even new loans. bank loans are very particular to the are aware and lender.

you get very different terms in any kind of bank agreement. mike: you mentioned volumes. there been questions about whether financial institutions want to participate as much. also, might it be a little too late to have a significant impact? i think this is actually a pretty good time for this facility to open up. the loan by the bank was viewed as a test alone. the kind of business we are looking for is one that was a perfectly good business that got badly disrupted by the pandemic and is now looking for bridge financing to get them to the point where the economy is doing much better. i think this is a situation where we are currently at, where a lot of businesses have been badly disrupted. it is going on longer than a lot

of businesses were hoping. as a result, there are a wide variety of businesses that want to take advantage of this facility. the secondary market lending program, some critics say you are propping up zombie companies that cannot continue to survive unless they continue to borrow and at some point we will have a lot more defaults and bankruptcies. do you see that happening in your district? pres. rosengren: with the main street program i'm a we are definitely doing somewhat risky lending, providing financing for borrowers that were in good shape but are now facing difficulties as a result of the pandemic. what we are trying to do is get the right outcomes for employment. businesses ende up failing, that would be a significant impact on

employment. we want to avoid that outcome. that means we are taking a little more risk than we normally take. i would highlight that, during the financial crisis in new england, the 1990 crisis, which was a credit crunch crisis, one of the problems was that borrowers and households could not find financing. we are trying to make sure that lack of financing is not a problem right now and that hopefully spells of unemployment remained temporary and people can stay employed. the longer people have to finance themselves, the riskier it becomes for the economy overall. mike: many companies have discovered the joys and may be a savings of working from home.

do you see any problems in the commercial market? pres. rosengren: office space is one area. there are more warehouses than we needed before. some multifamily housing a be more challenged as people rethink whether they want to be downtown or in suburbs. mike: any prediction on when the red sox season opens? pres. rosengren: [laughter] i don't predict the red sox. mike: you have learned. eric rosengren is the president of the boston federal reserve bank. thank you for joining us today. romaine: thanks, mike. great interview. coming up on this program, we will talk a little bit about some of those retail earnings we got earlier today. we will break it down with joe feldman. that is coming up next. this is bloomberg. ♪

scarlet: one third of small businesses stopped operating and another 11% expect to fail in the next three months if covid-19 conditions persist. our colleague emily chang, spoke with sheryl sandberg, facebook coo, about these devastating numbers. survey a planned this few months ago. when we first thought we were launching a we expected a completely rosy picture for small businesses, but that is not what we found. what is so important for people to understand, small businesses are the engine of job growth in

our country. two thirds of jobs created before coronavirus came from small businesses. shared,istics you just a third not operating at all, 11% expect to fail. one of the numbers that jumped out at me, half of small business owners do not expect they will be able to rehire the employees they laid off within a reasonable period of time. we have our challenges cut out for us in getting americans back to work. businesses account for the majority of advertisers on facebook. talk about how crucial they are to facebook as a constituency and what small businesses mean for facebook strategically. >> 160 million small businesses use our services every month.

advertisers are a small fraction. we have deep pockets, and we are lucky. our focus is not only on our own business but really on helping small businesses. we launched a $100 million fund, $40 million of which was earmarked for the u.s. half of that earmarked for women, minority, and veteran owned businesses. our focus is really their business. we all have a responsibility to do as much as we can through this crisis. emily: i know a lot of businesses have been getting creative, using technology, using the web to market themselves. facebook has been working on bumping up the e-commerce experience on the platform. i wonder if you are accelerating any of these efforts, whether it is shopping on instagram or whatsapp storefronts? sheryl: we are, and we will have more to share with product updates tomorrow. we are seeing small businesses

do on the platform is incredible. there are so many good stories. there is a bookstore called i see me out of missouri, a local community bookstore for black children to get books about their own history and see the positive role models that are not written about enough. they did everything in person but now they are doing classes with facebook online. they have morphed something that was totally off-line into an online activity. there is a grooming company out of kalamazoo, michigan, now helping a local distillery make hand sanitizer and help people find it and donate it from local hospitals. the resilience from small business is now so apparent. it comes from our report.

57% of small businesses say they are still optimistic over the long run for the future of their business. emily: you are also highlighting some of the challenges being faced by female entrepreneurs. i wonder if you can share some of your thoughts about the pandemic, childcare issues, school be enclosed, how that might be a double whammy and making it harder. sheryl: women worked a double shift before coronavirus. it is clear that women are putting in a double-double-shift. the average heterosexual straight couple right now, the woman is working 71 hours per week. men are doing 50. that is a gap of 21 hours a week. that is half a full-time job.

we have talked for so many years about what has to happen in the workplace has to happen at home. this is a great time for men to lean in to their families and take as much of it that they can so that women are not going to completely burn out. romaine: we were just listening to the facebook coo sheryl sandberg, speaking with emily chang on bloomberg television. in the retail space, a bit of a mixed bag for retail learning. walmart reporting earnings as well as home depot. and ofs about costs course the bottom line. ,oining us, joe feldman advisory group assistant director of research and retail analyst. let's start off with walmart. the numbers were pretty good, at least in terms of the comp sales numbers.

order to get those sales, they had to spend a lot of money. >> that is right. they actually spent nearly a billion dollars. $900 million incremental expenses. some of that was to pay employees more, to reward them for being on the front lines. some of it was for cleaning the stores, creating better social distancing, all of the different things going on within the retail stores right now to make it safe to shop. even with that, they generated better than expected profitability, and we were able to expand their profitability margin nicely. scarlet: when i look at walmart online sales, they really hit their stride. when it comes to expenses, you talked about how walmart had to

spend more on employees, paying them more, making sure they gave them ppe. what are the expenses involved in the online operation. i understand that walmart's online operation lost less money than the same time last year. ppe tou do need some make the fulfillment center safe for employees working there, and making sure packages are clean when they drop them off. a big part of their online business was curbside pickup, pick up at the store. that is the most profitable way to fulfill an online route -- an online order for a retailer. curbside focus really helps to reduce the cost side. clearly, delivery was up as well, and they are spending on tot, making the investment

make that available. romaine: we had seen a lot of these retailers, before covid-19, making these big investments in online sales, a click and pickup type of model. we saw that with home depot, to a certain extent with target as well, walmart, best buy, a few others. i'm am curious, with regards to the sales bump, do we expect , meaning areo last the spending levels going to be there and the types of customers that gravitated to a target or walmart in this environment, are those the same customers that stick to those names? surge think the initial we saw in spending in mid-march related to essential goods, i

think that is starting to slow down a bit. which makes sense. there was some initial panic buying and people were spending. however, people sheltering in place, staying home more frequently, even in states that are starting to reopen, they are eating at home more frequently. consumer goods, the need for them is starting to increase. the new york region, for example, people are having three meals a day at home versus maybe one or two in the past. you will see that for other essential goods. home depot, lowe's, do-it-yourself projects have been doing quite well. i think there is going to be this sort of nesting like we saw after 9/11, where people will be

more reluctant to go out as often. we would expect it to be solid. scarlet: we have about 10 seconds. of the 18 companies you cover in your get of, what is your single best buy idea. joe: we really like walmart. they are well-positioned plus, the economy, with the challenges longer than the next couple of quarters. scarlet: joe feldman, thank you so much. up, the u.s. expected to make up a shrinking share of the global easing market. outlookget an industry from porsche cars with america. this is bloomberg. ♪

♪ torlet: we want to turn now mark crumpton and get a check on first word news. mark: new york state continues to see declines in new cases. governor cuomo cited deaths well below the height of 799 deaths in april. the governor also said that the albany area is ready to start reopening. -- sevenal region is

of 10 regions. the leaders of germany and france have agreed on a package to help the european union recover from the coronavirus pandemic. it is a major step toward tighter integration of the bloc. angela merkel and emmanuel macron discussed the plan via videoconference. president trump says secretary of state mike pompeo asked him to fire the state department inspector general. the president says he was happy to do it. say theional democrats inspector general was looking into an emergency declaration that allowed the united states to speed up arms sales to saudi arabia. he was also inquiring on whether secretary pompeo used an eight to perform personal errands. michael flynn has asked a federal appeals court to have the federal department -- federal justice department to

drop his charges. a showdown between flynn and the u.s. district judge, who has refused to accept the government's motion to drop its own case against nickel flynn after he pleaded guilty undergrowth twice. oath twice.der 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. romaine: thanks for that update. breaking news on jn jape. &j.on j they have been fending off almost 20,000 lawsuits related to that baby powder and claims there was a link to cancer. the t pulling off alc-based baby powder. we want to turn to the

automotive market. electric vehicle sales accelerate in china and europe while the u.s. is kind of tapping the brakes. refocusapped automakers on their most profitable products, trucks and suvs. se from to bring in klau porsche cars america. i went to get a broad overview on how porsche is doing right now. i assume a lot of your customers will be a little bit more insulated from economic downturns. how are sales looking? hard, 50% ofhit us our dealers are closed for sales. they can do some online sales. april was bad. may does not look too bad for

us. hopefully, we can get to our original budget by the end of the month. of our dealers closed down. scarlet: are people buying new cars, secondhand cars, and how long are they deliberating for? our sales strategy, our digital retail strategy is just ramping up. number for some area by online possibilities. we had a pilot going on for covid-19 with 26 dealers. market,ovid-19 hit the

customers are reaching out via digital sales possibilities. it is dominantly the youth car sales of aital digital retail channels. thelso see people taking next step in terms of digital purchasing for new cars. romaine: when we talk about what people are purchasing, obviously, there are a lot of folks out there who may be still coop, ororts car, a something like that, but the overall trend has been to suvs. where you see the trend moving now. klaus: the overall market, the suv is something that is not stop for the foreseeable future in terms of customer demand.

five years, the only growth rate with overall growth was in the suv segment. the car market actually went down year-over-year. it is interesting in this crisis we are in right now, april actually sold as many 9/11 this year compared to 2019. more stable than the overall market suv. ask you aboutt to electric vehicles. porsche isll-ev available later this year but we have a different environment overall. gas prices on average are now below two dollars a gallon. what does that do? what do you anticipate that will ev's?demand for

fors: the barrier electronic vehicles, range, battery, new technology that might be complicated when you use it. for us, we have to respect customers that do not want to engage in new technology. do something that contradicts all of that we have more demand then we will be able to supply cars this year. the gas prices at the moment, for the overall demand of electric vehicles, has not happened. the gas price as opposed to electricity cost, more attractive. price staysthe gas

where it is now, demand for electric vehicles will most probably get a hit by the end of the year, will not soar the way everyone has anticipated that new technology to take off. morene: there is a lot competition in this space. i am curious as to where you see porsche fitting in that, specifically when you have people like elon musk sort of taking jabs, sometimes friendly, .nd your car what we did, we did not really attack any of the other battery electric vehicles. tesla, the battery electric vehicle market.

with capabilities, experience, whether we can build a battery electric vehicle. a real sports car that you can take to the racetrack, that you can set new records, the list of design philosophies, personalization possibilities. this is what we are striving for .nd looking at the market we have found a good spot of the market where we can see more demand. scarlet: klaus zellmer, pleasure speaking with you. this is bloomberg. ♪

scarlet: the ceo of -- investment managers spoke with us exclusively on european funds that are set to whether the current crisis as well as his expectations for next year. believers from day one in the fact that and ofe -- up and down, course we have seen some of those about a month ago. a furthersee is continuation of the political project that is the euro, some solidarity seems to be warranted. let's face it, $500 billion, in the context of all the

significant measures taken in terms of fiscal stimulus, or what the central bank of europe is already doing, is one more but it is not the stone that keeps it altogether, it is one more element in a cocktail of measures taken. >> when you look at the contracts -- the contrast, perhaps, where the markets are and where the economy seems to be heading, do you see a contrast between what the real economy is telling us and what the stock market is telling us? >> i tried to understand it. asset prices that are at the level they are today, of course, the function of central bank , iuidity and intervention -- i on the program about

think the key question, we have the fed perceived as running out of ammunition. it is intervening in the sovereign bond market, not necessarily in credit. but, the liquidity crisis of a couple of months ago, partially because the fed is seen as having the look pretty and the will to intervene. yesterday, you talk about the european announcement. of course, the market also reacted quite strongly to the news about a potential breakthrough in the vaccine. there will be others. react -- on the underlying economy, we will have to see where we are. evidence from

corporate's here in paris as we exit slowly the lockdown, the comments i have had over the past 10 days from corporate leaders here seems to indicate that maybe the downturn has not been as bad as people feared. markets can expect a faster recovery. some damage done in the foreseeable future. >> do you see consolidation opportunities thrown up by this current crisis? about thedy talks world after being very different than the world before. expect consolidation in

the asset management space. the world after, not necessarily a revolution. -- does not happen as often as people would like to believe. if i draw the parallel with the m&a, in 2021, probably, possibly. givene see opportunity our particular model? i would expect that. aboutdustry, when we talk consolidation, large-scale consolidation, because i think we will all be looking, at least large asset managers, will be

continuing to look at diversification, and that can occur through large-scale consolidation with other market participants. romaine: let's get a quick check of the latest business flash headlines. we are going to start with pier 1 imports. it has asked the bankruptcy court to shut all of its brick-and-mortar operations. it plans to shut about half of its stores, in talks with multiple buyers. now, no buyers emerge. the company has said it has faced multiple quarters of declining sales. dimon sayseo jamie the coronavirus endemic is a wake-up call to address economic inequality in the u.s.. rites, " policymakers should use this as a catalyst to

produce a more inclusive economy. he said the bank will be sharing ideas about how to foster economic inclusiveness. warren buffett is cashing out. berkshire hathaway sold 84% of equity stakes in goldman in the first quarter, one of the more notable changes in his portfolio. he traces his relationship with goldman sachs all the way back to a meeting with cindy weinberg in 1940. the federal reserve will sound all of the stops to bolster credit markets. america's zombie companies are multiplying and creating risk for the economy. for more, we bring in bloomberg reporter lisa lee. zombie companies, this has been talked about a lot. the name a bit of a pejorative. most of the companies we are

talking about. avis,al, marriott, delta, etc., these are companies that have not gone away. they are basically using the central bank backstop to borrow money. we are not saying any of these companies are going to go away. but, companies have an incredible amount of debt. investment-grade issuance for march, april, at all-time highs. high-yield bond issuance was at multiyear highs. that has been a positive because that has provided corporations with liquidity to whether the covid drama. but, there are longer-term consequences that need to be thought of. one of them is that we have not gotten rid of all distressed companies. some are expecting a default wave. that means that, when these companies actually do go

bankrupt, they will go into bankruptcy defaults with even more debt. for those that don't, they will have more debt loads, so they might become zombies. zombies are just not very productive. they are using most of their earnings to pay off interest costs. so they are not investing into productivity. not only are they sort of languishing themselves, they sap productivity in their entire sector. they pull away positive investment from other companies, employees. they become a weight on not just butselves, their sector, the entire economy. we have to start thinking, what happens with all this debt? scarlet: when it comes to creating this zombie situation,

we have heard of this happened in japan before with the record low interest rates. no one is blaming the fed. they said that is what the central bank needed to do. when do you think this all comes ?o a head when does this become an issue? lisa: even before the rise of covid, we have seen an increase in zombie companies. we don't quite know when this might happen. probably it will be tied to covid. so, wealthy federal reserve -- so, will the federal reserve continue backstop credit markets? a system in which zombies will just walk around and really start limiting the growth potential of america?

or will the fed pull away and we start seeing distressed companies and defaults? that could be a more positive scenario so it could clear out the system. scarlet: lisa lee, thank you so much. theng up, what is next for u.s. economy after we reopen? we will look at a new kind of job picture. this is bloomberg. ♪

romaine: welcome back. alongsidene bostick scarlet fu. joining us now, the cohost of this show, joe weisenthal. also most of the odd lots podcast which surprisingly spotify did not pay $100 million for. joe: what were they thinking? it's ok, i would take you guys

over 100 million, if i am being honest. romaine: what are you watching? one of the big questions, there is this jobs crisis going on even as we reopen. the interesting story on the bloomberg today about some of the types of new jobs that will be needed as offices, restaurants, all of these things reopen. it is going to be extremely labor inefficient. casinos, all kinds of sanitation cleaning. i am not sure that it will be enough for say to make a major dent in the crisis of unemployment that we will be facing for a while.

but it will be interesting to see different roles emerge. sort of negotiate the transition back to something that approaches the new normal. scarlet: a contact tracer, where you have to get in touch with all the people who have had contact with somebody with covid-19. this is a tough job to have to do. joe: it really is. up early, it requires a certain amount of training. since romain already plugged the podcast, we actually talked to mark cuban, it came out yesterday, and he has a vision of the government hiring millions of contact tracers. scaling that up because of the training involved, getting people on the phone, getting in

touch with them saying, you may have been involved with someone who may have covid, not necessarily easy, but a laborious task ahead. scarlet: from new york, this is bloomberg. ♪ ♪

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emily: welcome to "bloomberg technology." what goes up must come down. afters taking a today reports circulated that the widely shared news from moderna wasn't quite the full picture. needne experts saying they more data to prove that the vaccine actually works.