it's 10:00 a.m. in omaha, nebraska, 11:00 a.m. on wall street, and "squawk alley" is live ♪ oh, baby burning down the house ♪ ♪ hold tight wait till the party's over ♪ shoulder tight ♪ >> i'm carl quintanilla with morgan brennan and jon fortt at post 9 of the new york stock exchange a big selloff in places, within three points of a 1,000-point

dow decline. >> massive market sell-off is where we begin this morning. kevin koran and keith lewis join us now on today's down swing keith, the pullback we're seeing right now, start of a larger correction how are you position organize how would you be suggesting investors position given the steep moves we've seen today >> first, good morning well, from our perspective, back in late january, we downgraded our near-term equity outlook to neutral, and part of this happened before the coronavirus. already we had stocks at a cycle high, the sentiment that was stretched and we've gone over six months without a normal correction you lay on the coronavirus, which provides for uncertainty, and we think the risk/reward near term remains mixed. from our perspective, that means maybe bringing equity allocat n allocations that have run up a little bit back to target.

some of our more tactical portfolios last year we added a little bit of gold longer term, the bull market trend is intact, but when you shut down the second biggest economy in the world, it will have some impact >> 2.5% moves in the major averages we're still only a few percent below those records highs that were reached earlier in the month. >> yeah, so there's a lot of good things going on beyond the immediate news and that is the improvement in tone in terms of the overall global economy there was a lot of pump priming from central banks over the last year or so there has been a drawdown in inventories around the world that could lead to a more sustained pickup this year unfortunately, right at the moment where you would be looking for that pickup to get a real lift, we've been hit with

this coronavirus, which has some real impacts there are significant supply chains in china. when you look at the ihs market services survey from last week, it was a very large drop here in the united states. so we're weighing the bigger picture, which is one that is we think going to move towards an improved economy later this year, but we have the near-term challenge and uncertainty surrounding coronavirus and the spread of that virus, which has significant impacts as we see today in the near term >> keith, i want your thoughts on coronavirus concerns running into the political cycle in eight days we'll have super tuesday, two weeks after that we'll get michigan and florida, ohio, missouri, illinois, or at least we'll have results from all of those important states. at what point does the medium term become uncertain? we're not sure what other

developments will be >> good question we always work in an area of uncertainty. it's the degree and what's priced into the market i think you make a valid point the election side, i think the market's perception is that trump is very likely to get reelected. as we move towards the democratic nomination and who that is, i think that thesis will be tested as far as if it's going to be sanders or someone else and that will inject volatility into the market and probably periods of pullbacks, which will be an opportunity but if you look at the s&p trade, we're still trading above where we were december 31st. valuations haven't corrected that much. sentiment is just starting to correct right now. we would look for a deeper pullback, sentiment getting more extreme before it's time to step in and maybe the political side will help that, but so far right now we still think we're in a mixed near-term risk/reward

situation. >> kevin, dramatic moves in equities today but also in treasuries you have the 10-year breaking well below, and the 30-year treasury yields, record low, 1.82%. how much lower can rates go right now? i guess overall, what is the bond market signalling >> we just wrote about this at washington crossing advisers that is a sign that you've got pressure around the world more recently as it relates to this global slowdown and it's being manifested in lower yields the very significant number that you just cited was that offensive board low is at the longest end of the treasury curve. so 30 years out, the yield below 1.90 i think, the last time i looked at it, is significant because it has also accompanied a version of the yield curve in the earlier parts of the curve if you look at a three-month, 10-year spread for example, that

has reinverted and many people look at that as a harbinger of a potential recession. it doesn't mean that recession must happening, but the flattening version of the curve again is something that is going to be an arrow in the quiver of the bears who want to push back against the more bullish thee situation as we go through the year >> keith, i want to go back to what you were talking about with politics right now some would argue that the market's interpreting bernie sanders strength as resulting in a likely trump win i imagine that if somebody like bloomberg were to really gain and sustain any kind of strength, the market might not have as much of a problem with that either. so what do you see as being the potential potholes or dangers of things that could develop in the democratic primary side that would give the market pause, whether it's a sense that sanders' popularity is growing stronger among moderates or something else >> is that question for me

>> as we've seen bernie sanders' nomination go up, trump's re-election odds have also gone up i think what could go wrong is, again, that at some point you will need a shift saying on the democratic side as far as to gain votes or look at more likely of a gain to the white house and also about congress as a whole. i just think we're not at a 60/40 country, closer to 51/49 and the confidence in the re-election of trump will be tested in our view again, not from a political standpoint, from a market standpoint that's one of the things as we get closer, you'll see that really move the headlines from day to day >> jemgentlemen, thanks for join us out the dow down 850 points. >> let's check on mortgage

rates. diana olickthe has that from washington >> take a look the average rate on the 30-year fixed hit 3.42% on friday and could fall to 3.375% today, that according to mortgage news daily. it was at over 4.5% one year ago, and the expectation was that rates would move slowly higher this year no surprise the refinance market is suddenly booming. applications to refi up around 165% compared with a year ago. mortgage applications to purchase a home and home sales so far are not reacting as well. that's due in part to the severe shortage of homes for sale but also due to still tight lending. the ceo of amherst holding said as much at a recent real estate conference >> unless you have a large down payment, unless you have a very solid amount of free cash flow, that's underwritable and we forget about this because the uber driver might not have income that's fungible from a mortgage lender's perspective or the people working two, three,

four jobs or the contributors to cnbc who contribute to two or three places they may have a hard time applying for mortgage. >> mortgage rates could be even lower but lenders are pricing in the risk of what will happen to fannie mae and freddie mac, which seems to be moving to an exit on conservatorship. obviously, the virus fears contributing to the downturn the who whov w.h.oorld health on says the status in china has peaked it's not witnessing an uncontrollable global spread they say it's too early to speak of a pandemic. blackstone joins us with this take, byron wien would you grade the action as being methodical and rational? >> well, i don't know about that

i think it's a very strong reaction to a change in the outlook. i think people were expecting that the coronavirus would be brought under control by the end of the second quarter and now that's being called into doubt the central banks were moving to ameliorate the economic effects of the coronavirus and now the feeling is that what they're doing may not be enough. and there may be recessions in europe and elsewhere the final thing, in the opposite direction, it looks like bernie sanders is going to be the democratic candidate and the popular perception is that donald trump will beat him and donald trump is favorable -- viewed favorably by the market so we had an overbought

condition. the sentiment was optimistic and verging on euphoria. the market was very vulnerable to a decline and the shift in thinking that the coronavirus could be a pandemic spread across continents beyond china and the factor that's driving the market down so severely today >> so what is what does that mean to you, byron 4.5% below all-time highs below. is this a five to ten-er >> no. i think the market was vulnerable to a 5% to 10% correction at any time maybe we're getting it now i don't think it's the end of the world. i think the virus will be brought under control. the u.s. was doing very well in spite of the virus i think the virus is brought under control, the world economy

will continue to expand. >> byron, po tuto put a finer pt on it, what does the relative optimism you're exhibiting, i guess the market is exhibiting, if this is 3% down in major indices at least so far on a day like this, what does that say about the state of the market when faced with this kind of an issue? >> i think it says more about the state of the world economies. the world expansion was projected to be in excess of 3% before the coronavirus hit it's below 3%, but we're still predicting world growth, not world recession. so if the virus is brought under control and the overbought conditions are corrected during the market decline, the market will speed up again. valuations were not crazy at the

current interest rate level. >> byron, the fact we've seen this flight to safety, whether it's the move in treasuries, 30-year record low, gold at a 7-year high, even though every sector in the s&p right now is lower, real estate holding up to the broader markets right now, these moves when we talk about valuations and sustainability, a, do they make sense, and b, do they continue to play out or do we potentially see a return to the rotation that we had been seeing at the end of twibt . >> i think what we're seeing is a correction in an ongoing positive market. i think that's where we are right now. the question implicit in what you're saying is, is this the beginning of a bear market and

my answer is no. it's a serious correction related to a fundamental development. the fundamental development will be corrected ultimately in the correct and it will resume its previous direction, which was positive >> finally bishgs ron, did i detect some uncertainty as to whether or not you think sanders is easily beatable >> yeah, i do. i mean, you know, i remember back in 1992 when bill clinton became the nominee the republicans thought, oh, my god, here's this nobody from a small state, we're going to easily beat him. that didn't turn out to be the case sanders is a formidable competitor, big campaigner, he has the popular support. he may be harder to beat than

the republicans think. >> and if we got to october and sanders was polling ahead with a healthy margin ahead of trump, would that be worth a bear market >> it might be i don't think sanders would be viewed favorably by the market, but we'll have to see how that develops >> we have time to work on that. >> yeah. >> coronavirus is more in the short term byron, thank you see you seen >> okay. great. bye. >> speaking of covid-19, coronavirus concerns sending markets here and abroad steeply into the red take a look at the biggest laggards on the dow this morning, including unitedhealth, disney, apple, american express, and dow chemical "squawk alley" returns in two. >> i don't know how many of those declines i've had in my

lifetime but there have been a lot of them. and i can't think of one that you shouldn't have bought, basically. (soft music) - when i see obstacles, i create opportunities. - when i see adversity, i find a way. - when i hear never, i say now. - [announcer] southern new hampshire university is education made to fit your goals with over 200 degree programs, flexible class schedules, and some of the lowest online tuition rates in the nation. (cheering) - so when i face barriers, i can break through.

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warren buffett's berkshire hathaway owns more than 5.5% of apple. we asked him whether he's concerned about the company's warnings on revenue. >> i don't think i've placed a phone call to tim cook in two or three years. no, all kinds of things are

going to happen with apple in the next ten years real question is what is the degree of pervasiveness and strength of that product five or ten years from now i don't think of apple as a stock. i think it's our third largest business >> apple is one of the dow's biggest laggards this morning. take a look at it, down more than 4%. chris drexler and larry haverty join us now on where the stock and maybe some others go from here guys, good morning good to have you at post 9 >> hi, carl. >> hi, jon >> carl's next to you. larry, apple is one of your top holdings so is disney, another one of the dow's biggest laggards you probably don't have ne jerk reactions on a day like this, but what kind of data points are you looking at where coronavirus is concerned when it has to be with those stocks? >> well, i think, jon, the most

important thing is to get yourself out into the real world, so when i'm in new york, i will confess, i read the subway or i ride the subways and when you look at the people sitting across from you, probably 60%, 70% of them are on cell phones. i was also wondering around sojo, doing some shopping on saturday, and there was this store that was really much, much busier than any of the others. turned out to be an apple store. so i look at apple and you have the numbers and the numbers are very, very persuasive. the free cash flow generating ability is just unprecedented. but you also have this consumer franchise that i think is not appreciated. apple is basically a part of people's lives it's going to continue to be a part of people's lives you'll have this hopefully very significant technological innovation with regard to 5g coming up eight, nine months from now will there be some hiccups they've already warned in the first quarter.

i think it will go longer than the first quarter because i think the market is currently underestimating the impact on supply chains. but once the dust settles, and i think the dust will settle, looks like it's settling in china right now with regard to the number of cases and the virus, it has to be the first stock ha you buy at the margin, not this afternoon but sometime seen >> chris, i remember when china was a weakness for apple, no first-party stores, trouble getting the wireless carriers they needed. now it's strategically so important as an assembly manufacturing hub and as a market for them. is there a chance that coronavirus is exposing any kind of strategic error that they might have made, or has everything you've seen so far suggested that they've actually done well in how they've structured their presence in that location? >> well, look, i would fully agree that this is a hiccup, and i think what they've done strategically on a global scale is correct and i think we're going to

probably be looking through to probably a couple quarters here. a lot of the small-cap names we invest in are the suppliers in that supply chain, the assembly, the testing of it. we are seeing weakness there we're hearing from companies who aren't yet able to give us guidance i think we'll hear a lot of that in march i think the preannouncement season could be pretty bad in march for a lot of those companies. but this is temporary. we're out there today with a lot of buy limits, kind of below the market, but we're a buyer out there. we think this is a great opportunity. we've been cautious for the last six weeks or so, so this is the opportunity to really pick up some good value names. i don't think it's over this afternoon. >> i was going to say, buying now or wait till the guidance comes out and some of these bottlenecks are more obvious >> as i say, we're below the market trading with limits, so you can't just get taken along and filled we're strategically below, and it's only a portion of what we

would want to own. if i want to own 100,000 shares, that would be a trading strategy for those who want to inch in and put money to work. >> along the same lines, larry, you mentioned apple would probably be the first stock you would buy but not on a di like today. what do you mean will the pullback get deeper >> i think you have to be respectful of the market's technicals, morgan, and at 2:30 margin calls go out. there could be some forced selling of the stock later in the afternoon. i think there's time to wait and you look at these things and they're not going to go away the other stock i think you have to look at here is google. they don't have any exposure in china. i was at toy fair last week and p peppa the pig, 42 million views on facebook. people are underestimating the power of youtube to say nothing of google's monopoly position in

search that's going along as all the funds are trading like individual companies that's a great place alongside apple. >> apple, you mentioned google, in general we're seeing big tech, but relative to the broader market maybe it holds up a little better. minimum exposure to china for any of these names are they buying opportunities? >> i think the thing that works in favor of the market right here, morgan, is this is a deflationary problem it's not like the price of oil going up and squeezing consumer incomes. consumer incomes are going up right now because the price of oil is going down. the ability to spend is going up because employment so far hasn't been hurt and there may be some shortages in goods temporarily we're going to see a very, very fine bounceback in the u.s. consumer sector and that will more or less drag the rest of the world along with it. the lower the market gets, the

more optimist you can you have to be. but i think we have a couple more percentages to go down. the idea you can get 1.37 in government bonds is the biggest commercial for equities i've seen in my 45 years in the investment business. >> challenging days for many around the world with this virus, particularly. chris, larry, thanks as we go to break, look at the sell-off across europe where shares have been down, well, almost 4% for most of the morning. take a look at the biggest laggards on the s&p as well. >> you like to own american businesses you're getting a chance to buy it 3% cheaper. i don't consider that a lot cheaper, but how can it be bad news unless you have to sell stocks hey there people eligible for medicare.

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moment mold mo seema mody has the action. >> the virus spread, hitting european stocks, lower by as much as 3% to 4%, on track for their worst day since summer of 2016 for the european averages a number of european economists relaying their concern here. the research team at ing running this drop in tourism from china could add to a weakening of domestic demand, adding to the existing problems stemming from the manufacturing sector and delaying the timing of a oour zone rebound to the second half of this year analysts were hoping as the virus was contained the chinese traveler would return in full force, specifically in europe, long benefitting from china's tourism, accounting for half of germany's annual duty-free sales. tourism spending makes up about 1.5% of germany's gdp and over 2.5% in france and italy one key sector to watch, the

european luxury names, specifically the italian brands, prada, gucci, and tod's. goldman sachs on friday had lowered estimates for the sector, 11% on average for 2020. we'll see how the outbreak in italy changes things >> seema mody, thank you time for a news update with sue herera back at hq. >> good morning, everyone. trump and first lady melania trump visiting the real taj mahal. he toured the iconic structure just before sunset you may remember the president once owned the trump taj mahal casino in atlantic city, new jersey israeli forces firing back at militant sites in the gaza strip this in response to a rocket attack on southern israel. benjamin netanyahu threatening gaza's hamas rulers with a war if the attacks continue. the search continues for the

cause of a deadly bus accident in southern california the bus was traveling to mexico when it overturned three people were killed, another 18 were injured. and katherine johnson, a mathematician who worked on nasa's early space missions, has died she was one of the pioneering black female mathematicians portrayed in the award-winning movie "hidden figures. she was 101 years old. you are up to date that's the news update this hour back downtown to you n morgan >> best known for work that contributed to the first american orbital space flight piloted by john glenn. >> absolutely. >> and the anniversary of that flight just passed a couple days ago. may she rest in peace. >> absolutely. still to come, the opportunities for value amid today's drop as stocks continue to sell off. the biggest laggards this morning on the nasdaq. american airlines, tesla, booking, a number of others.

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in the midst of a sell-off today, dow down 840. some of the lofty valuations in tech getting tested as stocks continue their sell-off in dramatic fashion who better to talk t

draper from draper associates. good morning thanks for the time. >> thanks so much for having me on the show. >> so talk to me about the degree to which ult there was froth in valuations and the degree to which it's being unwound today, rightly so or not. >> actually, i got to admit, i have been out of the market for about six months it felt pretty lofty for me. and i kind of moved most of my stuff to crypto and bitcoin. i think that's kind of a safe haven now. and i think this correction, it may end up being more than that, but i think we're in for a kind of an interesting ride >> all right let's go back. what pushed you out six months ago? and what went through your mind as we saw tesla approach 1,000 >> well, it just got very

frothy the market got too excited, and uber drivers were doing day-trading and, you know, all the signs were there so i think it was time it's a good time to be in the private markets. that's what i do and so at draper associates we're very happy that we're continuing to be in the private markets. but i think in the public markets it just got frothy and then there's the fear of socialism. i mean, nobody wants socialism capitalism may only work 70% of the time, but socialism mass never worked in the history of man. so i don't understand why there's this move. but i think there's some fear there. and i think there's some interesting things coming. >> tim, i want to go back to the point you just made about

shifting your investments to bitcoin. earlier this month we saw the price break above 10,000, trading below that right now there's been a lot of talk about this flight to safety move, this idea of digital gold how do you see it and where do you see the price going from here >> well, i'm still holding to my prediction i think bitcoin in 2022 or at the beginning of 2023 will hit 250,000. and that is a big move from where it is here i think the rceason is bitcoin will be the currency of choice right now you have this choice and bitcoin is not as easy to move around, but eventually it will be, and then you'll have a choice and you'll say, hey, do i want to pay the banks 2.5% to 4% every time i swipe my credit card or do i want a currency that's frictionless, open, transparent, global, and not

tied to any political force? i mean, at some point, people are going to make that switch of and bitcoin is going to be the big winner >> tim, 250,000 is 25x plus from where it is right now. if you really think it's going to be there in two to three years, what percentage of your net worth do you have in it today? >> i never tell anybody that kind of thing but a lot of it. >> if you're telling viewers 250,000, if you're putting that number out there, you have to at least give me a ballpark is it half, a third? >> it's a lot. it is a lot, a lot >> for you, 1% is a lot for most people >> i look and say, hey, this is just better. long term people move to things that are better. what merchant is going to want to pay their 2.5% to 4% to the banks and the credit card companies? they're not going to want to do

that forever at some point they'll say this bitcoin, why don't we accept bitcoin because we can now use open note and the transaction happens instantly and it's faster than a visa network and we don't have to pay these guys 2.5% to 4% this is kind of an interesting time it's an obvious thing for me i think the world is going to be much better off because of this decentralized movement and it's not just bitcoin. bitcoin is decentralized currency, but it's decentralized everything and i think that the -- some of the politicians are clinging to their -- to the past and clinging to their tribalism, but most of the best politicians are moving toward this new world that's global and open and transparent. i think that's going to be the new world. i think it will be a more beautiful, more loving and more peaceful world, but you're going

to see a lot of tension on the way to getting to that world >> speaking of that, tim, buffett was asked about crypto at large this morning on squawk by our becky quick here's what he said. >> cryptocurrencies basically have no value and don't produce anything so you can look at your ledger item for the next 20 year rs and it says you have x of this cryptocurrency or that. it doesn't reproduce it can't mail you a check or do anything what you hope is that somebody else comes along and pays you more money for it. >> i'll never own any crypto i assume that's what you mean by tension. >> that is hilarious 50% of his holdings are banks and insurance companies. they are not going to do well in this new decentralized economy of course he's not going to like it he sees a huge threat to his holdings his holdings are more than 50% in banks and insurance companies

in berkshire hathaway. so clearly he's not going to want this new currency that is completely -- everyone knows, everyone who has studied it knows is so much better than what we have out there and these currencies that are tied to fiat government are -- i think they're just going to be a relic of the past. it will be like holding drachmas and francs >> what kind of risks are endemic to his holdings if we reach this new world you foresee by 2023? >> enormous risk >> existential risk. >> i wouldn't hold a fwabank ifo paid me to own the bank. i wouldn't hold an insurance company right now. they are not in good shape for the next ten years things

are going to change very big you go to anyone who's 35 and younger, and you say, do you want $10,000 or a bitcoin, they'll all take the bitcoin if they're older they'll usually take the dollars but the ones who are younger are saying, hey, this is just better currency so let's hold that >> tim, just to shift gears here, i want your thoughts on another conversation we've been having and certainly given it is a down day for the markets more on focus, and that is do you feel like there's a reckoning setting in within the start-up community right now, given the fact that ipos for the most part in the past year maybe haven't performed as well as had been anticipated versus valuations in the private market, the fact we are seeing cost cuts, seeing many start-ups right now cut jobs as well, more focus on profitability? do you think there's a sentiment in the start-up community? >> well, i look at -- there are

companies like forge and equit zen trading companies in the private market now it's changed the whole nature of what we really want. the reason companies are worth more in the private market than in the public market, they're worth more in the private market than the public market it costs $5 million a year just to comply with all the stupid regulations they have for public company, and that never was the case sarbanes/oxley led a huge change in regulation, and so no company wanted to go public until -- i mean, nobody wants to go public now. why would you ever want to go public it will take a lot of the value out of your company. if you're paying $5 million a year just to be compliant with all the stupid regulations, it makes no sense so nobody wants to go public

if they do, it's kicking and screaming. then when they go public, everybody is surprised it drops. that's just because had to just pay $5 million a year to comply with all the regulations of being public if i'm nasdaq or the new york stock exchange right now, i am panicking. >> tim, you always speak plainly and colorfully it's good to get both points of view see you seen tim draper >> still didn't tell us how much bitcoin. luxury names getting crushed this morning as a part of today's sell-off robert frank has more on that sector back at headquarters. >> good morning, jon luxury has two problems today. the first is a slowdown with chinese consumers. they account for more than a third of all luxury spending now you have this outbreak in northern italy near milan, one of the global fashion capitals which is hosting fashion week. fashion week attracts tens of thousands of clients and designers to milan

that was cut short sunday night when authorities restricted all public access to events. georgio armani holding his show to an empty the theater. bella hadid wearing protective masks. dolce & gabbana, prada, versace all among milan's famous brands facing questions about how they're going to staff and keep up production with all theelz closures you also have ferrari based just south of milan issuing a same today that it's closing its two museums there, banning access to employees from affected towns, suspending factory tours it will consider new measures as necessary. that stock rationed down over 5% today. shares of lvmh, tapestry, coach and kate spade, they're down

almost 8%. the fashion world now moves to paris for fashion week chinese designers there already deciding to drop out along with many buyers and retailers. some designers moving to live streaming or virtual events since there won't be any crowds. back to you. >> robert, thank you want to get to sue herera now back at hq with a news update. sue? yes, jon we have a verdict now in the harvey weinstein case. the jury had been deliberating for five days, was deadlocked on friday they have come to a decision count one, predatory sexual assault, not guilty. that was the charge if he had been found guilty would likely have sent him to prison for life not guilty on that charge. count two, criminal sexual act in the first degree, guilty. count three, predatory sexual assault, not guilty. count four, rape in the first

degree, not guilty and count five, rape in the third degree, guilty so basically he has been found guilty on two of the five charges, but importantly, the predatory sexual assault charges, both of those charges he was found not guilty. jon, back to you >> sue herera, thank you that is one that many people will continue to comment on as we wait for sentencing >> absolutely. we expect some comments from both sides probably in about a half an hour or so. we'll keep you posted on that. >> thank you, sue herera we'll have more on today's dramatic sell-off for stocks straight ahead for now, take a look at the fang stocks all significantly lower in today's trade. facebook down most of all almost 5% netflix down 3.5%. we'll be back in just a minute >> the real question is has the

10-year or 20-year outlook for american businesses changed in the last 24 hours or 48 hours? you n't dobuy or sell your business based on today's headlines. liking the now platform?

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right now. with coronavirus concerns sending stocks plummeting our eric chemmy is looking a the demand for infrared therm meters and why they may be causing more harm than good. >> many striking images to come out of the deadly health crisis in asia. a masked official aimingan infrared thermometer at travelers. all in an effort to curtail the deadly virus that has now killed more than 2,000 people experts say the devices may not be so accurate >> i think the greatest harm or danger comes in missing a person who might be feverish and could be actually sick. >> reporter: he says officials are using industrial grade therm meters meant for testing machines not people. >> they are not appropriate for human body temperature measurement because they can be off by seven fair height degrees. >> reporter: we visited the institute where they do training

and certification with therm meters to see how they can deliver inaccurate results. >> this says i am 98.4, this medical grade infrared thermometer says i was 9 .9. now let's see what the industrial grade thermometer says, the way they have been doing the measurements in asia. >> 94.6. >> not even close. >> it has been consistently off by four or five degrees. >> correct >> doesn't surprise me it is not made for this application. >> not made for it. >> it is not something i would suggest anyone ever use. >> reporter: he says the lack of education and training is the reason now, despite these warnings manufacturers reported the demand for thermometer guns has grown so big it has caused shortages across the world back to you. >> startling discrepancies, eric

chemmy, thank you. today's massive selloff sparked by continued coronavirus fears. the world health organization saying in the last hour that the epidemic in china peaked earlier this monday and has been the he hadly declining since there and they are not witnessing at the moment an uncontrollable global spread of the disease. for more on today's market move we are join by greg battle and kenny pokari when you see a 900-plus point move in the dow, major averages down %, if you are not a trader or watching your 401k or other funds on a dilyis aboutis it seems startling and skiry. how would you put this into context? >> it does seem a little bit startling considering when we have been doing over the last three or four weeks marching to new highs in the peace of all of this i would say to people this is the last moment you should start to panic or get drawn into the

chaos. down 3%. yeah it is a big move in one day. if it stays down here by the end of the day we will have lost 5% off the highs of last week, which is still relatively within the tading band. i wouldn't overthink it. i would also recognize that the automated trading and algorithms take it just as fast on the way up as they do on the way down. sit back and relax especially when you get a shock like this in one day you have to let the market settle down before you have reaction the worst thing you can do is have an emotional reaction. >> greg, pullback? start of a deeper correction what do you think is accounted for within the markets currently at these levels? >> i certainly feel a little bit less relaxed i think that 3525 on the s&p is good level to watch. that was the january lows. i think if the market breaks lower through there, we could to

see a pickup in volatility and more selling coming into today's correction there is leverage in the market. we look at thing like open super in the futures, asset managers of holdings of futures are close to record key. quantitative strategies are levered. if they accelerates f we see another down day together it could spark further settle and more volatility. >> right -- >> go ahead, kenny. >> i was going to say, europe just closed and the u.s. markets got weaker after they closed because they closed more on the loesz of the day than not. greg is right, if we see our market fail into the end of the day and close close to the lows it makes it another down day tomorrow that's why i said don't jump in right now, let it play out for a day or two. >> we will leave it there. greg and kenny, thank you for joining us and giving us your thoughts on the selloff today. on that point europe's close

did not help us. we are back within a stone's throw of session lows, the dow at least down 997. yields of course continue to be an ongoing story, the 30 year bond, another record low tens, fives, twos, deepest curve inversion since october. back in a moment. reaching for yield is really stupid, but it is very human i mean i understand it people say, well i have saved all this money all my life and i can only get 1%. what do i do the answer is you learn to live on 1% and u n'yodot go and listen to a salesman come along to tell you i have got some magic way to get you 5%. xperien. we ended up creating, as you all know, so much more. peloton is truly a category of one and we're just getting started. now, let's do this. together, we are going further than we ever thought possible.

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it's a responsibility. emerson. consider it solved. all right. once again the s&p is down 100 full points as fears about the coronavirus growing. china not the only concern supply chain impacts china is the largest manufacturer in the world. if they stop supplying us with components that's a problem for global production. nowhere is that clearer than in chips. >> absolutely. chips not fairing well as all. one area that seems to be is the stay at home, stay inside play zoom video another 52-week highs.

pell on the which hasn't been doing so well also higher. chewy, maybe you are home with your dog and verizon, what you need broadbandwise i suppose to do video calls. >> yield is lower, gold, seven year high, silver higher, crude lower. transports breaking below their 200 day moving average manufacturing freezes the impact that has on goods. not a good wegs. >> let's get to the judge back at post nine. >> thank or breaking news coverage of the market selloff continuing now i am scott wapner, this is the "halftime report." our investment committee here today at post nine josh worn, steve weiss, bryn talking ton, and also with us today is a very special guest, howard marks, oak tree capital's co-chairman. we will get right into the selloff. mr. marks, nice to see you thanks for being here on an important day. have we reached howard