you're in the exhibiting symptoms that's a big risk there and you're seeing that being reflected in the stock price >> so much more to do to be consistent about this, but thank you. the latest there and that does it for the change today. next hour, we'll look at whether the cruise industry should be canceling cruises in the wake of coronavirus. we'll talk the a former chief of staff at homeland security about it i'll see you on "power lunch." we start with a big market sell off what a day, what a week it has been stocks dropping to end this wild week the dow down b about 500 points right now. after yesterday's thousand point decline, but amazingly, stocks are clinging on to gains for the week on the strength of those two big day, monday, it wasn't wednesday, yes, it was meanwhile, the bond market is flashing red yet again the yield on the ten-year treasury collapsing now to record lows as wall street

scrambles to absorb the rate shock. opec has failed, failed to reach a deal to cut production all of this as the coronavirus spreads globally we are now more than 100,000 confirmed cases worldwide with more than 200 cases right here, kelly, in the u.s. >> thank you we have all angles of today's sell off covered bob pisani is watching squatock. rick santelli is in chicago where yields continue to plunge. steve liesman is monitoring the fed and economy and diana oleic is telling us what it means for the economy and eamon javers at the white house looking at possible government response, but let's begin with bob >> just barely negative for the week i know that sounds startling barely negative for the week overall. important thing here the bottom was 2954 and we are below that bottom right now for the s&p

500. take a look at some of the laggards now microsoft down very weak today jpmorgan, the worst performer, down 7% overall. nike also weak dow inc also down. home depot is down for the day, but up for the week. that's been one of o the better performers all throughout the week energy stocks, new low you heard from brian, no deal with opec and russia big drop in oil. exxon mobil, 7.3% dividend yield. all the major oil companies, new lows these are rather startling numbers. banks new ulloases lows. low yields we've got loan growth possibly being slower higher loan defaults potentially down the road. all these new 52-week lows finally, cyprus semiand and lot the other semiconductors

micron, logic, nvidia, all down. looking for om bottom here, but still very, very tentative back to you. >> thank you very much the ten hf year yield falling low r and lower and lower, briefly below .7% early this morning. i can't even read that .7% rick santelli tracks the action at the cme hi, rick >> hi, tyler let's start at the two year part of the curve even at 51 if they close here, that would be the lowest yield close in basically five years and there was a point where they're at 51, they were at 38, they would have taken it back to october of '14. 24 hour of tens. 66 was the low and when it was there, it was down just shy of 50 basis points on the week. as it sits now, we're down 16. hovering at 75

let's look at the one week chart. still down 39 even though it's not 49 and finally, tens minus boons. this is really crazy i've always wondered how they're going to rekcalibrate what's going on with the two different policies and negative yields we're getting closer and closer. 146 is the difference between the tens and europe in the u.s that's the flattest in four years and remember, what's good for house iing refinancing is nt good if you're looking for rates to firm up the convexity hedge. when they lose a mortgage, their portfolio gets less sensitive to adjust that. they buy ten years then they have to buy a trillion ten years institutions as people refi finally one week of the dollar ind index, it is down % 2% on the week >> yep convexity grab term i learned this morning, president trump signing a spendinging bill and

now the white house is hinting on an economic stimulus bill eamon? >> yeah, kelly, a big change this morning from the white house earlier in the week, officials had been telling me they were not pursuing policy options to absorb some of the economic impact of this coronavirus hit. they did not think earlier in the week it would be that significant. now today, that tone is changing we have larry kudlow out on cnbc earlier this morning talking about a variety of policy options. he says he wants the response from the federal government to be tashlgted here and narrow in scope, but it is clear that they are considering a number of policy options here at the white house. an official tells me the president has not yet been believed on all the options, so no decisions have been made, none the less, larry kudlow talking through the think iing about how they're approaching that >> let's think about individuals who might lose paychecks because they have to stay home if they get the virus. small businesses that might get hurt by this

perhaps we would look at some sectors. i know you all talk about airlines >> so one senior administration official telling me today that the president here does not want to be caught flat footed he doesn't want to go too small and in terms of what options they're look iing at, this official says they're looking at september 11th response as a model for how to approach this based on how this impact rolls through the different sectors of the economy. >> thank you meanwhile this morning's jobs report shows the impact of coronavirus hasn't yet hit the u.s. economy but it is coming as fears of recession loom over wall street. steve liesman has the latest >> yeah, kelly, federal reserve fi officials here in new york by the way, listening a lot to what i'm sure eamon is reporting about what the fiscal side might do they've been emphasizing the public health response, the most important cure for the virus

jim bullard expects a powerful one from businesses, families and schools and he thinks the market may be underestimates that response. >> markets seem to be pricing in the very worst outcome here and not quite sure that's warranteded. given the kind of response i'm describing >> now charlie evans also emphasized that public health response, but if you listen to the end of what he says, he's saying iing the fed stands ready and watching perhaps to do more. >> but at the moment, you know, we're face iing a new risk public health safety is a paramount and getting on top of the spread of covid-19 has to be moamong the highest priority of things takinging place today, but the fed is paying attention and responding as appropriate.

>> the market sure thinks the fed is paying attention. take a look at these probableties a 10% chance for a cut at the march meeting then 90% for a 50 basis point cut. so that's where the market is priced while the fed perhaps wants the fiscal side to step up, they know the market is still looking at them for additional rate cuts >> and steve, even as you're talking, we have more from the boston fed president we were talking to dave last hour, the fed's going to have to start buying bonds in the near future if we almost go to zero, then you have 25 basis points left if you need to do anything else, you're going to have to buy bonds. he's saying the fed should consider widening the type of assets they can buy. japan was like 30% of unoclo just feels like we're going down that path. >> well of course the fed has certain legal limitations on what it can buy, but there are certain things it can do with

additional what would you say kind of provisions many the federal reserve act. but i think the fed is not there yet, kelly i think they want to take this step by step it gave 50 this week feels like last week and it has additional rate cuts to go before it gets to zero now you have larry kudlow talking about additional responses from the fiscal side >> totally agree on timing you know it might no not be this week, next week, but it seems to be more in the near future >> also, kelly, it's important to think about what's the most effective? rate cuts have limitations in helping out people who can't get to work and i think hopefully the fiscal side is aware of that i know the fed is. >> thank you very much the dow and s&p 500 now down

nearly 14% from record highs made just less than a month ago as investors try to ingest daily 1,000 point moves. how much more pain may be ahead? michelle and michael are with us neither of you expect a recession in the united states both expect potentially what's calleded a v shaped recovery in other words, a sharp bounce off the bottom when ever that bottom may be. why do you feel this way >> we're looking back at the data and previous viruses like sars, swine, bird flu, r and you have a move down in regards to the market then you get a move high er a year later. the s&p in all those cases were up anywhere between 10 to 30%. so we're just looking at the pass as a guide and of course history doesn't repeat, but it rimes. >> in those cases, did the market fall off as significantly as it has this time though >> i don't think so.

now keep in mind, we're coming off an extremely strong market in 2019. valuations were getting a little stretched, so probably the market was a little due for a correction and one would argue last week, yes, i think coronavirus was on our minds, but also the surprise of bernie sanders probably a part of that sell off so i think it's just multifaceted >> so michael, you say in all likelihood, no reeducation, but you must give it some probability of possibility how much >> well i think the key data to watch are going to be the housing data and the point of data. typical recessions happen after a lot of tightening in the system inflation spikes corporates hit consumers. we don't have that today so for me, if we continue to see employment remain healthy. today's jobs report is good, it's going to likely get hit in the near term from the virus, but if housing and employment stay healthy the odds of a sharp

rebound are extremely high >> let's talk about the fed's next move. a full point cut would be what we're basically discounting. that's what steve told us. at the next meeting another half point. is that going to help? >> unfortunately, i don't think it's going to help in a big way for the economy. because we don't have a financial banking problem. >> liquidity a lack f o money problem >> no. and ultimately, when markets are going down for specific reason, this case, the virus, history shows whatever that specific reason that's taking down the market, there needs to be a solution around that for the market to begin to rebound we saw that in '09 in oil prices, bringing down the market in 2016. european banks in 2012 so when there's some view these issues have been resolved, that's when the market can start the look past that and cutting rates

isn't going to do that >> i think it's going to be about fiscal stimulus. if you see a break in consumer confidence, the government's going to have to step in, offer small business loans, maybe tax cuts >> relief. let me ask you something that may be out of your zone, but i'm going to ask you any way would this be a wonderful time for the u.s. government to float a 100 year bond or a 50 year bond with interest rates where they are why the hell not zpl i have no idea i am not an expert but with rates being so low, it wouldn't be a bad idea. completely on the surface a. >> i have a low rate on my mortgage and i'm looking to refinance. it just makes perfect sense. >> even the 50 year, they can't really get the interest from the participating banks because they say how u would we hedge against something. just sell it to households bypass wall street all together. you brought up an interesting point on credit. what do you see

>> in the last few day, credit has caught up and gone beyond what equities are pricing in we've seen them move up to about 270 in the last week and in market corrections, you typically see a tight correlation between investment grade credit spreads and pe of the market and as of the last three day, investment grade credit spreads are more consistent with a pe of about 15 so if equity markets catch up to investment grade, that's about a 10% draw down. that is concerning >> we have to leave it there michael, michelle, thank you very much. coming up, we are continuing to watch the dramatic decloin of the ten year yield, briefly dipping below 7.7% this morpg. up next, a closer look at the impact of falling yields on housing and the banks then we will get the pulse of the consumer from landrieu's ceo what is he seeing at his restaurants and casinos around

the world? and we're all over these moves in the stock market as well. as you see, the dow is off more than 600 at fidelity, online u.s. stocks and etfs are commission-free.

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the yield down to 0.75% right now.

mortgage rates are fall iing to near record lows as well diana oleic looking at the impact that's having on housing and the mortgage market. >> yeah, unlike earlier this week, the home builders aren't holding up in today's sell off all off as much as 3% even though the average rate fell to a record low of 3.29% according to freddie mac's weekly averaged yesterday. rates are up a tick today as lenders try to deal with this volume and volatility costs them money. nearly 13 million can reduce their rates by 75 basis points and save big that's a record refinanceable refinan refinancing. the average borrower can save about $277 a month on a 30 year fixed if all those borrows did

that, that would be a collective $3.5 billion a month in payments quite an economic stimulus now if rates fell just four basis points more from there, another 1.7 million borrowers would fall into that pool of savings. while home openers are conservative, they have a record amount of tapable equities $6.2 are trillion worth collectivity so we could start to see a lot more cash out refis. >> that's what we've been talking about this week. thanks those lower rates might be good for home buyers, but not for banks. the banks making new loans making less money on them and the big banks are all sinking again. financials are the second worst performing sector. mike mayo of wells fargo securities warning that earnings could take a hit of 25 to 30% and yes, he is here with us on et what's your worst case scenario look like? sfwl worst case is the reduction to bank earnings by 30%.

>> because of? >> and over the last couple of week, we've reduced our earningings by almost 20%. and the biggest reason is because of the ten year treasury yield. the flatter yield curve. lower interest rates, what we talk about net interest margins in bankling. >> what do you have it doing >> we have it somewhat around here >> so this is the worst case >> and we have another 50 basis points of federal reserve cuts banks make money on the difference between they're b borrowing and lending. for banks, this is an earnings recession. not a balance sheet recession. and that is a critical difference from the financial crisis a decade ago. >> that's what i want to probe more with ou because back in 2008, '09, banks were at the center of the

problem. here, banks are collateral damage to a problem not of their own making >> and i would say when you say collateral damage, the banking industry has the strongest ambulance sheet in a generation and think about this the bangs have added 1 trillion of o additional cap one trillion with a t 2 trillion of additional cash. of deposits. you have a federal reserve stress test every year every year, the federal reserve, the overseer of the banking industry, they assume armageddon will happen. >> then it was an exten shl crisis many did or got swallowed up this is not that >> absolutely not. if you want to look to the $6 trillion investment grade bond market, the fixed income market saying about balance sheets? they're fine remember during the financial crisis, we had early warning indicators, you're not seeing that here. you have u more capital, more liquidity, the stress test, a bond market saying fine. you have u the strongest balance

sheets in a generation so you have this earnings decline it's painful in the short-term but long-term, banks are are more resilient >> are banks buyable and if so, which ones >> ilt depentds who you are. >> i know you have a lot of new viewers watching during this period so at first, it needs to match your objectives. if you're asking what's going to happen in the next day or month, i have no idea if you're looking out over the next year or two, or three year, i'd love to come back on your show and say what an amazing buying opportunity >> you think you will be doing that we might have you back i think we would, but you think you'd say that in three years? >> absolutely. three years seems almost high conviction call. if you buy one of the largest banks. goliath is winning you have citigroup, bank of

america, jpmorgan, three large banks. this is what they live for to demonstrate the strength, the ability to gain market share the ability the to provide support to the economy this is what the bank industry prepared for for a decade. now it might be the real scenario, but they're prepared for it >> is there a different threat though not the one we saw in '07, '08 we were talking about how the fed might need to expand its purchases of bonds and stocks and other tools. i guess balance sheet expansion can be good, but if we're talking about zero and negative rate, jeff gundlach said it's destroyed the japanese banking system how do you factor that in? >> i think i've been on your show earlier last decade talkin about japan light and you can pull that up online. to some degree, the banks have been through quantitative ease

lg and all that and a big difference is the ability of banks to control costs so half the costs are employee costs and so people on wall street will be making a lot less money. people in the high income jobs are making a lot less money and also technology is allowing banks to be a lot more efficient. that's a huge change versus the japanese banking system and i think the policy response in the u.s. tends to be a lot more dynamic and then what took place in japan so we'll take that back off the shelf and bay ty the wa, the bank dividef yields are supr safe the federal reserve assumed armageddon would happen before they allowed banks to pay off their dividend if you look at yields versus the ten year, these are nice bond proxies, so this super high conviction that banks can weather a body blow can weather a storm, we don't know how severe, but it probably won't be as severe as the armageddon scenario implied by the fed every year over the last several

years. >> good to see you mike mayo of wells fargo now to rahel >> it's time for trade iing natn gold surging 7%. stocks sink and investors pile into the long time safekeeping but does it have more room to run? craig johnson and danielle shay joining me now for more. danielle, would you be a buyer of gold here >> so normally i wouldn't buy something that's ran so far, however with the downturn to get even worse, we have a variety of fakctors. the emergency rate cuts. the flight to safety in bonds then we have no buyers coming in the s&p anywhere so yes, i think gold still has more room to run and i am a buyer >> so craig, let's bring you into the conversation. what are you seeing in the charts >> well, the gold continues to shine at this point in time and

yes, it is a defensive play and the question everybody's trying to figure out is it moving up wabecause of the coronavirus, as we're seeing the equities sell off or is it fear due to what's happening with ten year bond yields i think the it's a combination of the above when e look at the chart to me, your next comes in around 1785 then it's going to be 1885 so i think there's more room for gold to work and yeah, i would be a buyer of it in maul positions. >> and more specifically, do you like gold mining stocks or prefer something more direct buy in gold. >> i prefer the direct buy on go gold i love the gld etf i think the it's a great way to add to a long-term portfolio i also enjoy buying calls on gld as well as just selling putt credit spreads i think those are all great plays. unlike gdx which would fall in a dunn turn, gld would likely

continue higher. >> thank you for joining me and for more trading nation, head to our website or follow us u on twitter. >> thank you very much still ahead, the coronavirus impacting business around the globe. we'll talk to tilman fertitta. that's next on "power lunch. we see homes staying cooler without the planet getting warmer. at emerson, when issues become inspiration, creating a better world isn't just a result,

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here's your b cnbc news update president trump touring hard hit nashville, tennessee, and surrounding areas slammed by tornados this week 24 people were killed and there are still many more missing. the president earlier signing a disaster declaration which will free up federal money for the recovery efforts the house committee ves gaiting boeing 737 max planes saying quote a lack of transparency and other issues led to fatal crashes last year the committee's preliminary report blasts boeing for technical design failures and says the faa failed in its duty to find those safety problems. the islamic state group has claimed responsibility for r a

deadly attack in kabul this morning. afghan officials say the death toll has risen to 32 after a gunman opened fire and the vatican has confirmed its first case of coronavirus. some facilities in the vatican have been closed for cloning the pope is rofr iecovering froa cold the vatican says he is sufing from no other illnesses. back to you. >> let's take a look at the markets. the dow dropping about 600 points as you see there. about 582 at this moment that's b about two and a quarter percent just slightly higher for the week the s&p 500 down 3% on the day north ameriasdaq s&p in the red all the major indexes down about 14% from record highs. that puts them scarily into what's called correction territory and that's happening as interest rates continue to

reek havoc on the market the ten year yield sinking to historic lows. still at levels we have not seen .739%. >> oil is also sinking dramatically for the day and wildfire 'close up, it's down u 10% to $41 barrel. this after opec was unable to reach a deal brian sullivan is here with more and we've been looking for any sign they might be able to scrap something together >> i'm talking to people, they're not getting together it's 8:00 p.m. in vienna so they have time. the saudis are leaving tomorrow so any hope of a deal has flown the coupe i think and that's what we're seeing. >> they're talking about potentially video conferencing if they have to finish >> just remember this, the current deal to cut 2. off the quota expires at the end of march. if it's all countries for themselves as the u.s. has been doing, like we talked about in the last hour on the exchange,

oil could be in the high 20s or low 30s in a week. >> what happened to the presumptive deal or was there never one? >> there was a deal and what happened according to everybody that i'm talking to who was in some of the meetings was the russians were ticked off that opec announced a proposal for a deal without their blessing. right. like your son comes home and says i'm spending the night at bob by's i was going to say yes, but that's how it's gone this is according to the iranian oil minister the worst meeting he's ever been to and he's the longest serving oil minister of all. 30 plus years, so he's seen it >> where does that leave the oil producers now if we're talking about heading into the high 30s, maybe lower. how much risk? >> baker hughes count came out at one and showed another four they're not cutting back they will. capital spending will go down.

i think you'll see, not me talking, people i've talked to, dividend cuts happen across the board and these oil stocks are going down and that could take a big toll on houston, which i think we're going to get into now. >> stick around as your next guest as a unique insight into the consumer both here and around the world the chairman and ceo of landry's his company owns 600 restaurant, five casinos he says starting this week, his revenue dropped sharply, roughly 10% a day because of the coronavirus and he doesn't have much of his ability for how long this slide will last and hod how bad it will get. welcome. good to have you with us >> hey, guys tell us about what you're seeing and segmented if you wouldn't mind is the pain mostly in urban

areas. suburban, high b end, mid or lower end? where? >> where it's really happening right now is that you're having conferences canceled everywhere. and in your big urban just say steak house, you're feeling it in your tourist areas, you're feeling it where you're not feeling it is in your suburban restaurants your dell frisco's in new york by you guys. by your martin's in new york by you guys then in the suburb, you're okay. then the regional casinos are okay because you're staying local but then you get into vegas and vegas is really starting to slip now >> so what are doing mitigate the damage from this fall off in business are you having to restrict hours? cut back on hours? tell people not to come in and how does that ripple through the system then people who

really feel it because they may be making really a kind of a subsistence wage >> what happens and it's a shame, but it's the only way to combat it is that you've got to protect your labor if you're a restaurant that was doing 20,000 a day and now you're doing 20,000 a day, the way to stay profitable because remember, when i say i'm off a million a day in revenue, that's on a base of 12 million a day in sales in restaurant sales. okay but remember, that last million in sales is your most profitable it's just like any business. where your heavy profit is so if you don't cut expenses and what can you cut not going to cut the quality of the product. now so you can only cut labor. you've got to watch labor. what's going to happen is the old supply and demand like you're starting to sea seafood,

beef drop. start seeing produce drop because they're not selling as much well everybody's got to get rid of their product so if you manage your business really, really well and you can stay in that eight to 12% off in revenue, you're going to do okay but you don't want to go 20% off. when you get to 20% off in a same store sale no matter what business you're in, that's when you start getting into trouble >> there's a book i read calleded shut up and listen and there's a chapter called know your numbers you just gave us the numbers you're the consumer king what was it, tyler help me out here with the malt 12 million what is it day in revenue. down about 8 to 8.5% seems to be about the average number >> it moves around >> when i look at the stock charts of many of the big restaurant companies, they're down 30 and 40% month so even the mashlgt is getting it wrong or the market is suggesting that's where things are going to go so what are you seeing

>> the market looks into the future and that's the crystal ball and the market does panic with all the quick selling and we move in herds as we know. but remember we're just getting the coronavirus tests out there now. we're going to find a lot more people have this than we think e. but what everybody needs to remember is this is not going to kill you unless you're most likely already a sickly person and you just got to take care of yourself there's no reason to panic even when they announce that another 100,000 people have it people are going to get this the people are at home with it and you just don't take and you don't go to work and give it to other people don't go to a ball game and give it to other people everybody just needs to take care of themselves and we all need to have good habits right

now. but more people, we're going to find out every day have this, but we've got to go on about our lives. you're not going to die from this you can take your rarest diseases that yu get in america and not as many people are going to die from this coronavirus as die from these. >> let me get back to your business operations here as i understand it, you have some restaurants and different things in china. can you talk to us about what that business is like, give us any sense of how much china might be back online or not here >> one word. bad. it's so funny. i'm going to tell you u something funny and it's not funny, but we were finally able to reopen a martin's in beijing the other day and this is never happeneded in all my 30, 40 years with as many restaurants but we opened a restaurant and

sales for the day were zero. okay so everything is getting better and i think it's a good lesson for us to learn because we hear from ore people in china that things are getting better but people are still not moving out freely like they did before. but it's good for us to see though that if it's better in china we're going to hit a peek then it will get better. >> we talk and spend time together in houston about the oil price impact i understand houston is a mass massive city it's well diversified. you've got a consumer er econo. however, oil prices have gone up and down wildly. we're now starting to enter this period where price rs remain in depressed for a long time. nobody expects prices to move higher over the next couple of years, so we get this extended sort of slow slide in the price

of oil what do you think will happen to houston, this is the fastest growing large metro area in the united states and a massive economic driver for your state and for the country? >> well, when we manage to adjust to $50 oil and you and i think a show on this a couple of years ago an we've adjusted. adjusting to $35 oil or $30 oil is pretty improbable because you, you really, you really can't do anything to cut expenses and can't find any more technology to drill any cheaper and basically people aren't drilling much any way, but the biggest problem is oil companies have lots of debt. there's so many small drillers and suppliers. it's going to be interesting for houston. at some point if oil sticks around 30, $35, you are going to

see problem. but we've got a great economy. we saw the jobs report everything changed monday morning. that's when everybody started canceling conferences and huge conventions. everybody's canceling everything right now. so everybody needs to remember it's going to get worse. but then it will get better. >> let's talk about something that hasn't been canceled and that is nba games. i wonder what you're seeing atting rockets games or around the league what is adam silver saying about whether individual teams should play in front of empty arenas or whether the league will do that league wide. bring us up to date there. >> the only no show was us last

night against the clippers and rockets that was played in houston but our fans were all there and like i said, a lower no show rate than usual. which i like to see because then we're not panicking and a we shouldn't. i don't think you should play games in front of no audience. i would hope we would suspend for a week or two. but you don't want to play games with no fans that's never going to work like i said, everybody just needs to be a little better. we're doing a few different things that we've never done before of course in our kai issy knows and rest raubt raunts and hotels, but everybody needs to wash their hands and stay away from people that are sick and if you're sick, you shouldn't go to work but y'all have been hearing this from everybody for weeks now so i don't need to repeat it. >> quickly i was going to say i think we can't overstate the reason i got

involved in oil and gas, that city and state was so important to growing the entire economy at the depth of the great recession. we have remember a lot of people don't care what happens to oil and gas or maybe they don't care about texas in general, but your state has been the economi growth driver in the country, so if we see texas slow down, it's very possible and steve liesman will confirm this, that the national data will start to come down as well >> this can bring down all the data if people stop spending money, that's what causes everything to go away. because remember, we're always overbuilding always overbuilding and always a lot of supply. as soon as there's no demand for any product, that's when we get

into trouble that's what i'm paying attention to because we can take a robust economy that we have and let's all be smart and let's really work hard on not panicking and let a coronavirus run our country into a recession >> yeah. look, it is not the flu though the it's worse frankly so we understand why people are scared there are deaths and it comes during flu season. it's hard. it's a lot for the hospital system to handle i understand why people are concerned. >> i understand why people are concerned. i'm doing things to be safer, but at the same time, i'm still living my life i'm going to basketball game i'm going out to dinner. i'm not doing, the rodeo is really having, which is 100 thourk people a day here in houston. it's not suffering any attendance issues now. two eegs concerts in town this week and we're sold out and i'm glad to see that people are are

taking precautions and not panicking. >> great to see you. like you, i don't think i've ever washed my hands so much in a week as i have this week thank you very much. good to see you as always. >> thanks, guys. good to talk to you. >> houston rockets owner and owner of so much more. coming up, the cruise lines may be the hard hit stocks in the sell off royal caribbean, carnival, norwegian losing roughly half their value this year. now should there be a full stop of cruising on all cruises to stop the spread of coronavirus we'll speak with a former homeland security official after that right after this quick break on "power lunch." at fidelity, online u.s. stocks and etfs are commission-free.

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robinhood. welcome back ten year yield is just above .7% right now and the stocks the markets are headed back towards their lows of the session. the dow's down about 800 points now. that's a 3% drop brings us 25,300 today and in fact the dow is the outperform former nasdaq's case almost 4% and we've put crude on your screen it's a little hard to disentangle cause and effect but the 10% plunge in crude today isn't helping. you can see it not move ng the

after hours session after opec failed to reach an agreement with russia about the one million plus barrels per day cut that had been previously expected now vice president pence is expected to meet with cruise line executives in florida tomorrow as the trump administrationfla, as the trump administration is reportedly considering ways to discourage travelers on cruises as a number of ships have been turned around and question and answer tee are tee, a global security and risk management advisory firm, was former chief of staff for homeland security under michael chertoff is it prudent? >> it's on a risk-based approach if you're looking to take a cruise to italy or the southern part of china, that's probably not a good idea right now. the cruise industry would be well served to look at what the airlines are doing, which is

basically take that risk-based approach, any ports of concern in affected areas, those are the lines that should be stopped the other cruise lines destinations they should be screening passengers obviously before they get on a the lo of the cruise lines are trying to do that both with regular temperature checks as well as questionnaires. >> it may make sense to do it now, but it's a bit after the fact, and if we do it for cruises, why aren't we doing more at ampts? when i was at dhs, we looked at different technologies, and cbp, who handles the international flights into u.s. soil, they are in fact doing that any person coming in now from ports of concern or other destinations are being screened for temperature. if they're exhibiting any kinds

of stems they're put into a secondary screening process. dhs has the authority to quarantine at the border so i think the administration is doing the right thing hoff the high-risk destinations screened so then what happens to the traveler who comes back from, say, london. are they asked if they're feeling okay running a fever? did you go to these regions in northern italy or others where there have been outbreaks? >> that's right, tyler in addition to that, at some ports we've been implementing infrared technology that allows you to see if somebody is exhibiting a temperature even if they don't admit to that one of the challenges that cbp and dhs faces is this particular virus doesn't necessarily exhibit symptoms for 14 days so that's why the questionnaire

you mentioned is so important. it's also important why people need to answer honestly when they come in do you think it's time to quarantine the cruise ships? >> i think the intent was good quarantining that ship when you had somebody infected. the mistake the japanese made, unfortunately, a study in sweden show you probably would only have 70 infected instead of 700 if they allowed people to isolate those who were already -- and do what we did with the people from china even asymptomatic, put them in quarantine for 14 days, which is the time frame in which the disease manifests itself, then you can determine who is safe to leave, and who is not? ironically what's happening right now in san francisco in

that port, holds those people in that ship, in many respect, the ship is like a petrie dish, you're all crammed in, and the staff are trained to quarantine somebody in small numbers, not as much as large numbers, getting this was offshore into a proper facility is the better way to go. >> chad, thank you, sir. >> thank you. lows on worries of what the coronavirus impact will be on the economy. is the bond market signaling the fallout could be worse than we ink? an even slower economy than we expect we'll discuss that when "power lunch" returns

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glee welcome back. the mark sell-off continues as bond yields have been plunging we're close to the record lows we're at 0.72. joining us is r.j. gallo it's great to have you here. r.j., i hear people recommending munis when yields are already at a 40-year low. look, state and local

governments are munis safe right here >> right now the ratio, they have all surged higher it's the same as wider spread in investment-grate corporate bonds. the plummeting treasury yields are reflecting rising risk of a recession. to your question about munis, in a relative sense, they've been from spending most of the prior 12 months sort of rich, they actually look cheap right now. >> only ref tiff to treasuries the question, though, is we know they have huge obligations it means they have to spend more money servicing that i'd love the triple-exempt status that i can get. i'm not sure i can trust my local authorities.

if turned concerned about municipal credit quality, and if we do in fact end up in a recession, those concerns will become morered the muni mark is overwhelmingly high quality the fact that the discount rate is plumb elling, yes, that is a challenge. pensions get paid off over 10 to 30 years you have the vast majority of american states in better state than they were five or ten years ago. in a relative sense. munis probably still offer safety >> we have about 30 seconds. are there slivers that would be riskier than others? for example, airport authorities? >> well, right now in the market you are seeing the reaction to the evidence plummeting in demant airport-related are in fact

underperforming. i think it's safe to say that they are forecasting higher risk of reseg i don't know if it's a fait accompli i think it's prudent to remain in fixed income given the volatility in stocks. >> r.j., thank you so much thanks, everybody for watching "power lunch." >> hang in there "closing bell", the last hour of the week, right now. >> well can um to "closing bell." objection densal down 15%. the worst performing sector this week, oil is down a massive 10% just today we are at session lows, down 3.7% on the now nen tiff for the week as a whole.