>> okay. interesting call talked about a lot this week. >> anthem. expected to grow 10% to 15% on cost. >> bernie's done. >> sowetis i emailed you this morning. >> this is what it was like. jimmy, thank you again. >> thank you, buddy. have a good weekend, everybody stop fearing. >> "the exchange" starts now thank you, scott and jim. hi, everyone i'm kelly evans. welcome to "the exchange" today. another wild day on wall street as the record sell-off continues. here's staggering stats that sum up where we are today. the dow, s&p, nasdaq and russell down the major indices have a worst week since october of 2008 and we remember as the heart of the financial crisis every dow stock is in correction with nearly half of them more than 20% below the recent highs and the s&p 98% of companies are

in correction or worse every sector is down more than 10% from its highs with energy the biggest loser, off 34% we'll have more on that in a bit. the bond pits, 10-year yield, get this, today hitting a new record low of 1.155% the 2-year below 1% an the selloff is global with almost all global markets down 10% from the highs. for more on the action quite as dramatic as the week, down to bob pisani at the new york stock exchange bob? >> it is remarkable. the global stock market down 12% to 15% even here, all of the major sectors as well, even reits are down and utilities down dramatically taken everything down. not seeing this very often and show you the s&p in the last couple of days we have made attempts to call bottoms yesterday and it didn't quite work because the headlines turned against everybody and the market dripped lower we are trying to do this today we don't have the major

headlines to deal with but the important thing is everyone's playing what i call the capitulation game. is there enough selling to indicate exhaustion of the selling an a natural rise up because there's more natural buyers we are not quite there yet but we are bouncing in the last -- since the early morning here here's things to watch look at the big stocks that are oversold in the last few days. microsoft, for example exxon down 15% so far this week sis cisco and apple holding up fairly well and a good sign of buying interest as we're down here transports, ryder, for example, fedex down 15% this week expedia, u.p.s. the important thing here, look at u.p.s. here. stuffing kicked out of it holding up in the middle of the day. obvious will i that's not a complete sign of capitulation but a good sign at least that there's buying interest out there. guys, back to you. >> bob, we appreciate it in the middle of the action.

so's rick santelli as rates continue to fall with 10-year hitting a new record low. the markets pricing in three rate cuts this year. what do you make of the action, rick >> well, you know, let's go in reverse. in terms of the rate cut action all markets have moved dramatically this week so has fed fund futures acting like a t-bill market so in deference to that, it doesn't surprise me with a math premise on to that to figure out the statistics, it is adding in three eases but at the end of the day we have to watch the way that the market moves. i think bullard it right maybe we can see what fed fund futures joutd look changes to. look at an intraday of 10s and recall that we settled so much higher last week at 147 that at 117 we are down 9 on the day, go to one-week chart. down 30 basis points on the week if you think that's wild, a

2-year note now is down 42, 42 basis points on the week so it settled last week and if you said the math its settlement means from 136 last week to its kurmt trade of .94 it is down 30%. that's why i never use percentages with yields. timely, a january 1st to the vix index for 10-year notes and it's over 7.5%, highest since early 2016 back to you. >> enough to make your head spin, reck that's for sure. we appreciate it. while coronavirus cases in china might be slowing down, the opposite is true for the rest of the world. meg tirrell is here with the latest that the hour meg? >> kelly, the world health organization today raising the risk assessment level for the world to very high, the same level for china since late january. the w.h.o. emphasizing there's a

chance to contain the virus if robust action is taken the cdc saying it's shipping out more testing kits to state and local labs as they investigate a case in california that could be the first instance of community transmission in the u.s. and bill gates issuing a warning this afternoon in an editorial he writes, quote, in the past week covid-19 is behaving like the pathogen we have been worried about and says in an addition to this crisis, billions of dollars must be committed to preventing another one. >> do you think he's going to scare -- that's scary, scary stuff. i understand they have a lot of involvement in the -- with various health initiatives so i guess if they're saying this is the kind of pathogen they don't want to see, you have to take notice. >> they have committed $100 million to the w.h.o. to try to help fight the virus around the world and especially in developing countries where w.h.o. is especially concerned

about this potentially spreading and a thing he says here in this editorial is that it's such a threat because it can also kill healthy adults an enpeople with underlying conditions and incredibly scary. >> more tallty rate is relatively low as it's spread around the world with a ton of different systems and not just chien's to rely on at first, are the stats about this changing? have they changed at all in terms of how many people tend to die from it once they're infected >> a lot of the estimates for the fatality rate are starting to sort of focus on about 1% now that is a lot lower than sars at 10%, lower than mers at 30%, but ten times higher than seasonal flu which is .1%. so a lot of concern. >> it is true with coronavirus, you keep getting it. which is why, look, we have already had reports of a woman apparently gotten it twice so this thing could come back if we don't -- but that's why we

hope we have a vaccine or better treatment by next year. >> that's something people try to figure out. is that report and others of re-infection just detecting the virus in people after they technically recovered? we don't know about that possibility of being reinfected soon. >> great point thank you for now. we appreciate. back to the markets where stocks sell off with the coronavirus concerns joining me now to discuss that, jim paulson and we have a bond guy and a stock guy today and we appreciate you both being here guy, i think the action is more dramatic than the action in the stock market, believe it or not. do you see based on charts or fundamentals that we are near the end of this move yet >> well, i suspect so. i think in the longened of the u.s. yield curve, out 7, 10, 30 years i describe a bullish

overthrow with yields coming down faster than the underlying da that in terms of the probability of rate cuts an inflation and the factors justified. you know that said the degree of sort of panic buying in longer term bonds is palpable and i doubt it subsides but once it does we could have a 20-point basis - >> in the stock market seeing the corrections since the rally began a decade ago we have seen sharp recoveries s. the same true of bond >> not really. one of the most likely outcomes over three to six months as rick mentioned is that we get fed rate cuts and as a result the absolute level of yields across the curve comes down i'm arguing that the long end has come down further than the problem rate cuts justify at this point so shorter term yields are likely to sustain at

longer levels or back up. >> jim, let's bring you in the conversation kind of reflecting on history and different panics that you have seen, how would you describe what we are going through right now? >> well, it's certainly a full panic. you know i'd say of all of them that i have seen or been through, it really kind of reminds me of 1987 the '87 market crash that was a much bigger within for the day, of course, but both of them came in with a healthy economy, a pick-up in global growth going into this and we have a pick-up in the united states and still do. just like we did in 1987 it was caused bydifferent impacts, mostly tightening back then than this one and when it happened it didn't really matter what caused it it was all about the collapse itself it was all about the market

falling without any noticeable bottom and it was combination of fear and program trading i would say we got exactly the same thing again today. >> so -- >> now the reality of that was even though today's is the fastest drop ever and that was the biggest drop ever, it fully recovered because underlying all was a fairly healthy economy and i think that's what we have here what we are doing today is we're trading on what if rather than on what is or even what is most likely to happen. i think it's kind of what if to our worst fears right now. i think that's going to ease and i agree with guy that if it does i think there's a pretty good bounce and if i think ahead we'll see we lost a quarter of growth and a recovery comes. >> okay. we got to go now but, guy, you probably saw the quotes from fed member jim bullard earlier this morning where despite the calls

to do something immediate, coordinated central bank action, bullard said, no, not until it's a full pandemic. is that what sent us to the lows do you think >> it certainly didn't help. right? bullard usually tends to be on the bullish -- excuse me, dovish side of things and a cautious tone from him didn't expect and i fully expect to see a parade of fed officials come out and express confidence that we're going to do the right thing toen sure liquidity and support the economy which is really the precursor to rate cuts and could come sooner than we expect. >> that remains the open question thanks to you both and it's not just equities that have taken a hit this week. oil has gotten hammered as demand fears grow. we bring in brian sullivan. >> marcus may be the prophet but if i cover oil and gas i feel like the prophet of doom it is a rough week for retail

stocks let's tack about oil and gas the xle. worst week since 2008. now, a lot of sectors you can say that whether it's '08 or '11, either way xle awful. look at these declines this week this is this week. okay these are big companies. exxon down 14% 6.9% dividend yield looks good to some. chevron, marathon and occidental with the staggering stats, tack about this 27 mid major oil and gas stocks lost 50% or more of their value this year. in fact, many companies because the debt loads are trading as if oil was at $15 a barrel not $45 a barrel ironically in the last hour or so, kelly, a couple bids coming in some stocks are higher right now. maybe it's cherry picking,

programatic buying the xle down 28% in one year i mean, this is -- i mean, not quite straight down. it is a double black diamond in ski terms and that's how it's been there's a feeling, kelly, i guess i'm going to walk an join you. >> that's more than a double black diamond. that is tumbling head first down a hill we don't see action charts that look like, brian you said something - >> apparently we do. >> you're right. what you just said about exxon i find interesting a 6.9% dividend yield. the only time of them that high is question of the company can't pay it is that any kind of question to even raise here or is that ludicrous? >> i don't think it's leudicrous no i don't think anything you say is ludicrous they have plenty of cash chevron has cash but many of the other equities, the names we kind of talk about sometimes, trading as if they're going bankrupt we'll hear from darren woods i think on with becky quick next

week ceo of exxonmobil and i'm sure that question will be asked. remember that chevron years ago when everything was all that stuff was hitting the fan they held on to their dividend. like basically gripped it tight and everything else could go what i think you are going to see and the people i have been talking to is you're going to start to see capital cuts. what does that mean? it means job growth slows down and industrial machine -- i like these random stats right? >> before you give that. so people realize, this is how it's transmitted from financial markets back to the real economy. when you start talking about pulling back on capital spending, less money there, obviously, less to go around what were you going to say >> it's a job story and debt story. i love these rbis. random but interesting

random but sad on may 9th last year occidental bought anadarko. deal including debt. >> contentious one. >> the market cap today of occidental is 28 billion. >> wow. >> paid 57 billion. >> and combinedn' identity is worth less >> random and sad. thank you very much. it's been a rough week for the retail stocks, too today's no exception on that let's get to dom chu with the latest there. >> so you think, kelly, with the conversation you guys just had about lower fuel prices and energy stocks the consumer to benefit paying less in gasoline, we can spend it out on other things the fears over the coronavirus hit the consumer spending picture. a pillar of the global economy looking at etf to track it, just one on a one-week basis, down

12%. mid and smaller cap names, as woel take a look at the real laggards in trading today looking at the overall picture for dollar stores and could have supply chain impacts of china, home depot on the consumer spending front down 3% target down 3% amazon.com is an e-commerce play down 1% trade-in trading today and balance it out with green chutes here. ralph lauren, capri holdings, the company known as michael kors, tapestry, macy's, many hit hard recently and, yes, maybe short covering, maybe fundament alibiing back over to you. >> green chutes this time of year we appreciate it see you soon. for more on the consumer and how all companies to plan for a wider coronavirus jut break, i'm joined by steve oddland. steve, welcome it's good to see you do you guys pick up on anything

in the last come of weeks since the latest monthly confidence survey >> the conference board in february didn't pick anything up we are sitting here at very, very high levels, almost near all-time highs but that is really important measure as you know because most of our economy is driven by consumer spending so we watch this now, the consumer confidence index is driven more by jobs and wages, so how the individual consumer is being impacted and less by the rest of the noise so so far the consumer unfazed but doing it right now you probably see a slightly different picture because everybody's a little bit more afraid. fear is driving this thing you see fear driving markets the question is whether it impacts excuse impacts consumer spending. you will have people avoiding large crowd situations, out of the malls, out of sporting events so you're not going to see a level imfrakt all of this.

you will see different industries, travel industry hit, oil as you said. but you ought to see in-home eating go up, things like home delivery, amazon be affected positively netflix, home entertainment. so things that you can do at home in small groups ought to go up while people try to avoid the other situations. >> let me ask you, given the experience in the ceo office and on boards and so forth, there are companies across the country now trying to think through their coronavirus planning and hopefully a lot of them already thought it through before today but now i'm sure everybody is. what are the kinds of plans they need to be making? are we talking about coming up with another way for employees to work from home? those kind of things supply chain what are the various factors to be considered here >> yes, yes, and yes ought to be focused on the customers and your employees first and foremost so from a customer standpoint every company should have some

sort of disaster team in place that's cross functional thinking across manufacturing, supply chain f. you're a manufacturer, you need to understand where your ingredients or components come from to make sure you have alternative sources of supply. from a supply chain standpoint, make sure you can get it there from a consumer standpoint, respond to the customers if your customers are expected to come in to a large gathering, you have to do some sort of virtual coverage of that from an employee standpoint, everybody should be testing virtual employee work. okay because at some point you will come to the point to say this is too dangerous to bring everybody in so you have got to test this right now and equip the workforce for this then you have to be going through all of the planning now and then, you know, maybe you want to pull the trigger on the stuff because the insurance is worth it. >> i was just looking up slack as i'm thinking through this

everybody knows is a messaging system people use now up on the day up 1.5%. there are these tools, steve, to use now we didn't have before and i wonder if there's a lasting impact of this. >> it's interesting because every one of these kinds of crises or disasters, whatever it is, does impact us, changes behavior if we can find out to work remotely, well, why do we need all that real estate why force the employees to come together every single day in large gatherings provide some of that but maybe that will change work. more rapidly than anything in the gig economy over the last 20 years. i don't know. >> exactly. >> these are the kind of things to have happen through this situation. maybe that will be great maybe it will help work productivity for the long term and maybe there's as you said green chutes and light at the endof the tunnel but the issue is there's unknown here because this virus is unlike any other

as you said before people are sick without symptoms or passing it through. i think that businesses need to be more cautious than you have ever been before. >> a final point on that earlier about 20 minutes ago amazon said it was asking all employees to defer nonessential travel including in the u.s. do you think that's prudent? again, we are seeing a number of now major companies do that. need to be more comfortable. is that prudent >> you have seen it from nestle, worldwide. in switzerland they have got the car show in geneva that's canceled from jpmorgan saying all nonessential travel. i think if you look atself 2 countries, watch the state department site, watch the cdc site i think all disaster relief folks and companies, c-suite to watch those sites and taking their guidance from those sites and being consistent we should have nonessential travel backed off.

i don't want to kill the airlines but same time why put your employees and customers in harm's way >> right okay so like you said, prudent from the companies point of view and have to understand the toll to be taking. steve, great to see you. thank you. we appreciate it >> thank you, kelly. well, the trump administration is trying to calm the public and the stock market this week. with white house economic adviser kudlow weighing in again earlier today. eam eamon javers has the message. >> reporter: the message is don't panic. larry kudlow talked to reporters earlier today and saying the risk to americans is still low, that's still where the administration is in terms of projections. i asked larry, though, about this idea that's been kicking around wall street for a couple days that the president might respond with something dramatic, perhaps up to and including the idea of suspending all the tariffs against china, larry

kudlow says he doesn't think something like that is in the offing >> we have no precipitous actions right now. again, you know, it's sometimes a hard case to make in the middle of a crises which is part psychology and part fact but i just don't think anybody ought to panic right now we are going to stay the course on our policies. >> reporter: so no massive mobilization of policy here from the white house today but a tone overall saying, look, everybody needs to settle down and take it in stride. the acting white house chief of staff speaking at an event this morning and asked for his advice to calm the markets today. he said, look, everybody just needs to turn off the tv for 24 hours, kelly. >> eamon, this weekend we're seeing the sunday shows and the pressure from politicians on the white house to say, you need a better response here, you need to step up do you expect by this time next week to see a coordinated plan,

maybe that comes out of the coronavirus task force or the cdc to provide more daily updates? it feels as though there needs to be some kind of regularity and communication with both the market and the public about what's going on here. >> reporter: look f. that comes it is as a result of the vice president taking over that coronavirus task force there's been a lot of diplomatic niceties of who's in charge but it is the vice president and his team running the response from the white house and the president of the united states an important to note that the president just has not really wanted to embrace the idea that the coronavirus is causing the stock market to go down. over the past two days, 48 hours or so, twice he's offered up as a primary reason for the decline the democratic debates right? he acknowledges the virus is part of this and pointing to the democratic debates saying it's caused the market sell down and he's looking for other reasons to explain the sell-off right now and i think that is sort of a -- impacting the way that the

white house is responding to this and by next week that might change but that's where we are right now. >> a quick final point on this, do you think any further steps are under consideration in terms of cushing travel into the u.s. or any measures that -- again, the u.s. was complimented of shutting down flights from china early and doing something more to basically solidify the borders? >> reporter: the president said not yet. i think they monitor that and decide at some point to hit the toggle switch and weary of anything to do with any kind of major economic consequence of a decision like that how far reaching that is is the other question. >> a double-edged sword. thank you. >> reporter: you bet. now to sue herera for a news update >> hello, everyone here's what's happening that the hour a major fire in the area of the train station in southeastern paris with thick smoke visible

for miles. french police tweeting that the railway station evacuated without commenting on the causes of the fire. that's a live look looks like most of the fire has been damped down at this point in the early evening in paris. illinois governor and chicago mayor say they, quote, successfully contained the coronavirus to two confirmed cases in the state and they are monitoring travelers for further cases. >> the risk is low the level of preparedness is very high and any event we need to scale up our efforts we are uniquely qualified to do so. and the biggest ovation at a hockey game last night came for someone in the stands. fans honoring st. louis bluesbor good to see him back in the

stands kelly, back to you >> thank you so much now the travel stocks have been staging a surprise reversal today. dom chu is back with a look at a sector that could be key for the broader market finding a bottom here dom? >> value stocks could be in the travel and leisure names take a look at the price action we are seeing so far it is of note because if you take a look at the stocks individually, norwegian cruise lines, royal caribbean, carnival, marriott, booking holdings, many travel related stocks have been hit especially hard given the coronavirus concerns and fears that they will not make up revenue if people aren't traveling or taking vacations and those stocks, yes, may have been a big, big sell but today at least maybe again short covering or fundamental value buying and take a look at the parts of the market to watch overall an enthat's the airline stocks. they have not managed to catch a bid. those falling demand concerns hitting the airlines hard despite the fact that fuel costs

going lower. the dow jones transportation index one of the indices of a possible leading indicator very, very much heading for a bad week could be one of the worst weeks on record for the dow jones tranport down 11% so far on a 1-year basis. we'll watch that itf that track transport stocks. >> down another 1.5% there thank you, dom. mortgage rates fallen sharply and they can go lower. we'll explain. plus, some parts of the high-end auto market are practically grinding to a halt we have that story. and seven days, six companies and $1 trillion. here's a look at the market cap lost in a week by some of the world's biggest stocks we are back in two find the best instructors in the world, and tie it all together with a world-class software experience. we ended up creating, as you all know, so much more.

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welcome back another big sell-off on wall street at the lows a short time ago. the dow down 1,085 we have come back. we are still down 650 at the highs for the day down 272 the nasdaq had been leading the way earlier. briefly positive but down 1.5% right now. the dow down 2.5%. s&p down 2%.

coronavirus jououtbreak felt ine markets and we have all angles on that. seema mody is live at 3m eric chemi on sports world robert frank in the auto world seema, let's start with you and 3m. >> reporter: well, kelly, take a look here. see the respirator in realtime made from here it's shipped out to a number of hospitals across the nation this specific facility spans 450,000 square feet and more than 650 employees are working around the clock to try to get as much product out to not just hospitals here in the u.s. but around the world >> we immediately ramped up production in this facility. we have capacity to do that went we have done that immediately. for more of a standard five-day week to more of a seven-day week with additional equipment, as

well, been able to bring in and turn on. >> reporter: the key question is whether 3m and other mask producers will be able to meet demand the department of health and human services said the u.s. had 30 million res pirators in stoc. i spoke to a manufacturer saying it received a combined order of 100 million from taiwan, singapore and hong kong. while they ramp up production and operating at maximum capacity, the key question is whether they can fulfill the big orders back to you. >> i have to say it's reassuring thinking, all right, there's new production out there and are they close to being able to meet the demands even just from the government right now >> reporter: yeah. it is a rapidly evolving situation. they said they're in touch with washington to try to see and meet the demand coming in from hospitals across the nation,

especially as a risk of an outbreak here in the u.s. continues to rise. this is the mask that really in demand it felters about 95% of particles. >> yeah. feel free to bring a back with you. >> reporter: i will. >> seema mody at 3m for us and now the sports world eric, this because of the stadiums and crowds. >> making the impact felt across the world of sports. the top soccer series playing out fans in the stadiums we have seen striking visuals of games happening with nobody there to watch the university of michigan's football team canceling the annual international trip. the boston red sox kept a taiwanese prospect from the spring training complex in florida. dozens of americans stuck in limbo because the chinese basketball season is suspended and may be completely canceled

players aren't paid. but they can't get released from the contracts to look for jobs in america and other countries formula 1 already postponed the chinese grand prix and considering what to do with several of the races in that region the lpga holding a japan tournament without spectators and speculation of moving the tokyo ownership. the prime minister called for sporting events the not be held for two weeks after a tokyo baseball team said it would play in an empty stadium. olympic executives said they're preparing as planned and did not rule out alternatives. of course, the major american sports leagues tell cnbc they're monitoring the situation and not suffering declines. >> interestingly even in the nba with ongoing games during this you might have seen it there just real quickly, who do you think has the most to suffer from this? frankly, as long as the games

are on tv that's the biggest cash cow, right? >> there's an ecosystem for going to the events a ten local businesses around there, are you traveling to the event did you already buy the ticket trip insurance, ticket insurance? there are a lot of different parties that start to come together here. i think the biggest impact would be the olympics. in 1940, supposed to be in tokyo and world war ii. >> here we go again. we appreciate it it is not just the sports impacted event organizers are pulling the plug on the biggest or within of the biggest annual auto events in geneva. for more on the fallout, we turn to robert frank. what are you seeing throughout >> that auto show, main showcase for luxury sports cars it was canceled due to ban of gatherings of more than 1,000

people you got the travel bans and a slowdown in that critical china market i sat down yesterday with the ceo of rolls royce saying the business in china, the second biggest market after the u.s., has fallen, quote, close to zero and that this shock may be different from those of the past >> we have seen overnight basically demand flipping and then after the economy recovers, poof, it is back to normal and these kind of patterns we see with corona and but nobody can tell you exactly how long that will take and that's probably the difference >> rolls-royce with a good long pipeline and a lean factory in england. 2,000 workers. owned by bmw and probably ride it out for the short term but aston martin, shares down 65% from last year and pinning the hopes on a new suv to launch this year. the ceo saying this week, quote,

we hope and pray for a quick recovery in china and ferrari in italy closing the museums, suspending the popular factory tours and restricting workers from nearby areas, most affected so far they have not shut down or restricted their production line but the company said that could change overnight. >> 65% drop for aston martin and so much riding on the suv launch in china what do they do now? as long as you said the ones like owned by bmw, you have the cash, the resources the ride it out. what are some other options for everybody else >> the big unknown, the auto industry as a whole, looking for a decline of 2.5% based on what we have seen so far. the luxury end, especially the very high end luxury end, could be much steeper than that but as i spoke with rolls-royce ceo yesterday they have no idea how long or deep this can go and so far production is koptdicontinut

a big unknown how deep and how long to go. >> investors in no mood to see thank you. mortgage rates now hovering near historic lows. could be a silver lining, right? the rates not sliding as fast yoz you might think. diana? >> kelly, get ready to re-fi 2.36%, an 8-year low and very close to a record low. the 30-year fixed follows but it is not falling as fast right now. why? well it has to do with risk to the investors in mortgage backed bonds. unlike treasuries which cannot be paid off early you can refinance your loan which pays the investor back early and then the investor loses out on years of monthly interest payments, a super fast drop in rates has caused a refi boom and investors worried of more losses and paying less for your loan and that means you either have to

pay more up front or take higher interest rate. given enough time and stability in the bond market, mortgage rates should close the gap with treasuries and still falling now not as much as you might expect. kelly? >> is it going down? you have people waiting in the wings looking for rates like 3.8% >> i wouldn't wait anymore. >> okay. all right. you heard it here. thank you very much. let's get over to julia boorstin with an entertainment related market flash for us. >> kelly, amc entertainment shares up 6% today after being down 20% over the 5 days ahead of the earnings yesterday. the ceo, the theater giant, said that coronavirus' immaterial pact is minimal with 22 of the thousand theaters closed he did say amc would have a problem with coronavirus spread to the u.s amc entertainment shares are still down more than 50% over the past 12 months kelly? >> okay.

we appreciate it now in stocks falling as drastically and quickly as this week one question many people are asking themselves is what to do with the retirement account here's what jim cramer had to say. >> if your 401(k), you have to buy. buy some >> it's easier especially if you're younger with a longer time horizon and does it work for everyone for more on what strategy to work closer to retirement, i'm joined by ivory johnson, a member of the cnbc financial advisory council let's go piece by piece here what do you do in your 50s right now? >> you pray and you hope things get better but the nice thing is if your 50s you have a lot of time who rhorizon but this is ae risk and the traditional risk management tools to use like asset allocation or modern

portfolio theories don't hold true seeing the selloff broaden to all asset classes and so i'm telling somebody in the 50s is we have to be proactive. now you still have some growth that you need. obviously can't stick your head in the sand, no need to panic. but certainly we can carve out a piece of the equities that you have - >> give me - >> in the portfolio. >> one tactical example of what that might look like for a client this week, a specific example. >> a specific example would be i would take a portion of their equity position, things winning like the utilities and reits of 18 months and do an innovative etf. you still need the growth. we are going to buy something that caps out at, say, 15% after 15% you don't participate anymore. but now you have defined your loss right? the first 9% on the way down you don't participate. if it goes down 15% you only lose 6 so that way you don't take money on the sidelines and not participating if the market were to rebound. >> okay. structured notes

are you using options in these strategies how would this change in your 60s? >> if you're in your 60s you want that cap lower. risk is always in direct proportion to returns. you have maybe a lower -- higher buffer maybe 15% but now the cap is 10%. so operates very much like a structured note. derivatives so they can capture and put the limits on there. but it's an etf. you are paying 80 basis points and complete liquidity. >> paying more than for a market product but a known on the gains and losses man in the 70s to have a big buffer sort to speak what does that look like >> the buffer then, they have buffers for 30% that are coming out in march but the cap is going to be somewhere in the range of 7%. obviously someone in the 70s, particularly if they're taking money out, dealing with a sequence of distribution, right? pulling money out and the market going down, you don't have as

much going up and the potential to run out of money before, you know, during the course of your retirement increases so you want to have a bigger buffer even if it's a lower cap, not trying to appreciate as much as they are maintain the quality of life in the portfolio. >> not worries of derivatives? famous warren buffett line weapons of mass destruction? >> not credit default swaps and pretty liquidity. >> all right ivory with innovative strategies thank you for joining me. >> you're welcome. >> ivory johnson now how about the fang names? they have been the market leaders for years now and also been hit hard this week. apling down 15%. so does the sell-off present a yi oornibungpptuty that's next right here on "the exchange." [cymbals clanging]

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welcome back technology has been one of the worst sector this is week. lock at the dow just now down 890 points and heading to the session lows down more than 1,000 in the session this day. the dow's down 3.5%. s&p down 87 points, nearly 3%

right now and watching it closely. tech has been at the epicenter. fell about 15% as a sector this week let's drill down on the fang names in particular. for that, josh lipton joins us josh >> so, kelly, fang falling hard here facebook, amazon, apple and netflix and alphabet collectively lost about 628 billion in market cap from their recent highs and just to put the number in perspective, more than walmart and mastercard come booned apple, alphabet, amazon and facebook in correction netflix the tenth best performing stock this week down 4%. analysts saying an obvious beneficiary if consumers stay home due to virus concerns back to you. >> josh, we appreciate it. tech has gotten pretty beaten up my next guest said he is tempted to buy paul meeks is a portfolio manager at independent solutions wealth management. welcome and what looks most

tantalizing to you right now >> now sh josh just teased into the fangs. actually, among the fangs the only one i'm incrementally bullish on is amazon i have some more fundamental issues even pre-coronavirus in some of the others i think within the payment processers which a lot of people don't know but they're very large exposures in the tech indexes. mastercard and visa. mastercard did have a negative announcement the other day they are directly intertwined with what's going on in asia with the coronavirus but here is a great company and if you have a long-term perspective i think mastercard is going to be a wonderful investment. >> i see you also like micron and adobe. before those, since you started with fang, amazon to interest you and still not there yet. why aren't you jumping on to the netflix bandwagon, everybody will stay at home and buy the stock? >> you know, that's a tactical

reason to buy. the reason i stay away from netflix is the continued cash burn and also, of course, the onslaught of other competitors apple i'm worried about that we'll not not see even ax the coronavirus this big 5grk suh peer cycle for the iphones and of course google and facebook have some very serious regulatory concerns about privacy of data. >> let's turn to micron and adobe. do they have direct coronavirus related business issues or they've just been thrown out because people are selling everything these days? >> there's a distinguishing factor between the two micron does have ties to what's happening in southeast asia. adobe, not so much, but the way i look at it is micron has been at the bottom of its cycle for d ram and flash memory chips and

once we get through the coronavirus, they were on a nice part of the business cycle so i still think it's going to be a good one once we get beyond the most damaging part of the coronavirus. adobe systems is a company that is a little bit different. it's a worldwide firm but being a software company, it's more insulated from the coronavirus but it's a company that's doing all the right things >> i know a lot of these you mentioned, adobe, mastercard, visa, the best names of the decade so it would make sense to buy them on pullbacks. let me ask you about amazon. still not ready to buy it yet. too expensive or is is there another issue? >> actually, just think it's the expense. they reported a great quarter and remember despite being the mother ship, they don't really have that much traction in asia. and the company continues to be on a multiyear cycle of which they will lose some share but still remain a strong number one

in the cloud so i'm bullish on aws. amazon web services. i think they have an embryonic health care business an embryonic transportation business and more than an embryonic digital advertising business each of those things could be multibillion dollar businesses. >> what price gets 40 today? >> i think a little lower. we don't worry about the fundamentals but we find some kind of technical support, that's probably down about 5% more from here. >> we'll see if that's true of the broader market paul, great to see you today thanks so much >> thank you a news alert from google from diedra, it's about google, which we were just discussing. what's happening >> that's right. google is confirming an employee in its zurich office has tested positive for the coronavirus it's not sharing any more

details includes where the employee is is now or where he or she may have traveled to. in a statement, the company says that one employee has been diagnosed with coronavirus they were in the surk office for a limited time before e they had symptoms we'll continue to take all precautionary measures as we prioritize everyone's health and safety now that office in zurich remains open like all of google's other offices and they're going to continue to monitor the situation. shares down about 2% >> the office does remain open i think that's probably the most important thing for investors and employees. >> and their headquarters is in mountain view, not far from here google is not sharing any more details. we don't know where the employee is is. if they've left or traveled anywhere else. >> thank you

stocks have been selling off around the globe with the market on track for it worst week since october 2008 the nikkei, the kospi, shanghai composite all falling more than 3% just today. joining me now with bhr on this sell off is director of global macro at fidelity investments, which has more than $8 trillion in as et cetera under administration and steve is chief investment officer at fed rated hermes steve, i'll start with you anything about coronavirus, i guess why don't you tell us what you think the link is between the market sell off we've seen, the genuine coronavirus concern and any panic that might be happening now because of all this >> all of o the above. kind of three risks comie ing together this is a market that need ed a sell off it was very stretched and we were expegting a 5 to 10% pull uback. that would have been natural

got the coronavirus is a health or threat which doesn't seem to be a world ender but is a stealth virus. that's got everyone nervous. >> are you yourself nervous about contracting the coronavirus? >> no. one is you know i've got my spiritual life in order, so that helps, but beyond that, 80% of people infected, it's very low grade. it's normally people with other complications that have something really a threat and even there, the death rates are not terrible hard to talk this way though people die from this it's not good >> the main reaction i hear from people watching the show and in the markets is are, is the media generating panic is there a genuine reason to be concerned out there and is the market accurately reflecting that or not. >> so often it's the screaming

fire in the crowded movie theatre is worse than fire itself people trip over themselves. that's what's going on here. there's an economic threat here. at least short-term. as china kind of shut down for a few weeks, it looks like that would be very, very short-term no systemic risk in the financial system, but the third risk the market is grappling, you could see it in the health care stocks on monday. is what if this leads to bernie sanders, which i've long said is a 20% haircut on stocks. but we're almost at 20% down now. so it's not 100% chance for bernie still a lot between here and the end of the year. we're telling investors we're legging in here. it's hard to call a bottom we're not traders. if you go out three years from now, stocks are likely to be higher even if you bought down the first 20% in '08, '09, you were

break even and in good shape even though there was scary declines after >> now that's all ancient history. al though it felt scary. >> i know you lived through u that as well the most notable thing about the sell off, it was overdue h you had all of the extreme greed flashing saying a correction was coming. the speed of this one is the fastest ever and the levels of bonds, bond wreeyields are at rd lows do those make you change your investment strategies or you're thinking about the economy here? >> no, they don't because my investment strategy is to be in a 60/40 portfolio or some variation of a broadly diversified portfolio. the bond side of the equation is certainly helping out a lot. a lot this week. and you know as steven was say ing, market was priced for perfection going into the wreer at a 19.1 forward multiple it needs that earnings rebound

to really happen on time as scheduled and of course that's not happening. so what we're seeing is some price diskcovery pe is down 15% in four and a half days. it's a very sharp reset. but what's clear is that's what's quoing to happgoing to h, china will probably print a minus 5% gdp because everyone has cover to write everything off then the hope is for the v we don't know. as steven said, there's a political aspect to it as well and maybe that bripgs with it a large fiscal response. not just the fed, but fiscal as well so there's a lot of moving parts to this and right now, the market is just grappling with the price. >> do you share steve's point of view, if i can summarize it this

way, which is that we are working towards forming a bottom maybe closer to the end, now that we're end 15 or 20%, whatever the number is are there any indicators you look for whether it's gold, we mentioned bond yields. fed funds futures. what would tell you where we are in that process. >> well, so it's interesting right now, the vix went up to about 50 this morning. the equity risk premium, differential between bonds and stocks is at five. that's higher than it was at december 2018 bottom which was down 20% so the market has come a long way and if you look at the leadership today, gold down quality stocks down. that kind of reminds me a little bit of '08, not that this is anything like '08, but towards the end when voluntary selling led to forced selling margin calls. when you see that happening, investors end up selling kind of what they can and not what they

want so the fact that the defensives are selling off maybe is a sign we're kind of building that final crescendo,but having sai that, after a 15% down week, the market's going to have to do a lot of base building to set up for the next up leg and that could take a few months here >> okay, so people need b to be patient which means they have plenty of time to think about dipping their toes back in we thank you both very, very much that does it for the exchange. i'll see you on "power lunch" with tyler >> welcome, everybody, to "power lunch. for a very busy friday it has been by any measure a punishing week for your money and it is showing no signs of letting up as we are just two hours away from the closing bell this is where the action has started heavily this week. the dow off the lows of the session, but still down as you see this, 875 points on track now for its worst weekly point loss ever