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♪ been a long time since i did >> good tuesday morning. welcome to "squawk alley." i'm carl quintanilla futures were up and we were up 950 points almost on the dow but we're going to start with the market sell-off from the highs at least dow is up 243, caterpillar and bogey. bob pisani is here at post nine to talk about what these internals look like this morning. >> it all feels tentative, the whole thing. i said this morning, they're putting an awful lot of faith on fiscal stimulus, not monetary stimulus the traders want to hear fiscal stimulus at this point so there's two camps one is the cam whop said we are so ridiculously oversold there has to be a bounce and they have a point on historical basis. we have extreme oversold conditions we have the largest single day drop on the index since october

2008 90% downside volume. at one point 99% of the s&p was down the vix over 50. i don't think people understand what the vix over 50 means it's a real number over 50 the market believes there's a 50% chance the s&p will be up or down 50% in the next year. >> 50% >> that's what the number actually means if the vix is at 20 the market is a 20% chance the s&p will be up or down 20% in a year this is 50 those numbers are crazy. they're way off the chart. this is the technical. everybody else says wait a minute we're in a unique situation. this doesn't matter right now. other people are looking at okay, what about recessionary indicators a typical decline on the s&p in a year is around 13, 14, 15. that actually happens almost all the time you get some kind of draw down in the middle of the year. we're down 18% so already this is more than a typical decline and now i think a more reasonable question is, what happens if we get a recession.

recessionary declines are 28%, sometimes they go to 30 and really bad cases like 2008 they went to 50%. that is a real outlier in terms of the recessions. this is a more reasonable thing. if you don't like technicals this is a reasonable thing to say. what's the possible range the s&p could trade in down 18%, could go down 10% if we get potential modest. there's so many x factors it's hard to figure out one thing that's ep couraging, this is your beat, jon, technology held up well, 17% from the highs in the technology index on the s&p, that's about what we are on the s&p 500, energy has done a lot worse, of course, industrials a lot worse, banks a lot worse, but technology, which is the core of the s&p, 25% of tweighting on te s&p has held up in line with the markets. they're not dismantling the technology sector as you know or the momentum or emotional leaders of the market, i think that's encouraging right now. >> bob, what do you think

investors should read into this market behavior? i mean we had that huge drop yesterday more than 2,000 points on the dow, big percentages on all the major indices, everybody was saying well, you know, futures look like they're going to bounce. you would expect that. if they weren't bounce would be a problem. we're losing quite a bit of that bounce right now as you mentioned, the vix at 50 i'm going to ask you again what that means percentage wise and what the market expects, but does that mean that there could be further downside from here because we're not ready to embrace optimism >> i think of the markets in a very simple fundamental way. prices of stocks are a play on a future stream of earnings. it's not clear how the market prices six months to a yer out what the market is telling us right now it has no idea how to price a future stream of earnings that's what's going on we saw this in europe as well. europe six weeks to two months ahead of us in the coronavirus

situation. their numbers have been coming down more aggressively than ours has. they've had similar gyrations. we have a p/e ratio, a price to earnings ratio, the market is telling us we try to guess what the earnings are in the future and nobody has an idea what that "e" is in the p/e. that's why we're getting these crazy thousand point moves in the markets. what's the price of oil. what's the -- what is halliburton worth. we saw three trading halts in one hour that's crazy that tells you nobody has a clue how to price halliburton right now. not even on an hourly bases do they have a clue let alone figuring out what's six months from now. >> all this uncertainty from a macro perspective around coronavirus right now, but in terms of the crude piece of this picture specifically, the last time we saw a price war within the energy market 2014 into 2016, there is an expectation we will see that again now with crude?

>> there was. >> listen, we would not have hit -- this is a bold call, we would not have hit that limit without this going on with saudi arabia yesterday i am quite convinced and no one i have said this to 20 people, not one has said we would have hit it we would have been down on coronavirus fears, but that oil situation so exacerbated the situation, that i think that was the thing that kicked this into it it wasn't -- obviously the coronavirus the main thing i think we would have had a chance avoiding hitting that limit down level remember, just barely there and stayed down 7% the whole day i think the oil is what threw us into the situation. >> even with energy weighting in the s&p. >> the overall impact. they're seeing -- >> to industrials, manufacturing. >> yeah. >> it was huge remember, overall, you can argue this is good news. we have with ridiculously low mortgage rates and going to get low gas prices. >> sub $2 everywhere. >> that is a stimulus program for the u.s. consumer. >> yesterday, deutsch argued or

it was jpmorgan argued not as much we're not driving as much or going as many place snooze don't kid yourself the single most important factor for a lot of people is gasoline. how come so many americans know what the price of gas is if it doesn't matter everybody seems to know the price of gasoline and they still do comparison shopping my brothers do all the time. they know. i don't drive as much so i couldn't tell you within 20 cents of what the price of gas is >> in the midst of coronavirus if you have to travel are you likely to get in your car or on the plane right now. that's a piece too. >> it's a tough situation right now, but tell me a little bit better about what the economic impact is and we can price earnings model and you're not going to -- you're going to stop having thousand point swings 50 on the vix means the market believes that s&p will be up or down 50% in the next year in a one standard deviation situation. that means 68% of the time it's -- the vix is a probability

estimator tore the market. a market crowd guessing. i can break it down if you want. but it's a way for the market to guess where the volatility of the s&p over the course of the next year. >> these extreme situations give us a good excuse to get your deep knowledge on exactly what some of this stuff means that we talked about. >> once in a blue moon they drag me out and say remind us what this is about. >> i love that. >> there is something behind the number >> we'll take the silver line where is we can find them. bring in former nasdaq chairman, the chairman of virtue financial, bob, good morning >> good to be here >> i want to ask you first about the behavior of the markets. we have this trading halt early in yesterday's trade when the s&p was down 7%. trading resumed after that seemed to be orderly today we got a little bit of a pop, a big pop in the beginning, but that's fading.

what does all this action tell you? >> what's very interesting is when we were discussing putting this trading halt in, you had kind of the academic point of view which says that if an investor wants to sell, the fact that investor has to wait 15 minutes, will not change that selling decision what we with saw yesterday is that 15 minute pause really did work it speaks to the fact that investors are not always logical. we're emotional beings and the fact that we had 15 minutes to reconsider it changed in many ways the direction of the market or certainly mitigated it i should say i think academically a 15-minute pause doesn't make any sense, but we saw in real life yesterday it made a meaningful difference >> at virtue where you're chairman, there's a lot to do with liquidity focus on helping people make the trades that they want to make what kind of behavior and concerns are you seeing from

trading activity right now and what do these levels on the vix communicate to you >> sure. so i would say, you know, with respect to virtue, the exchanges and really everybody in the ecosystem, what you're experience is -- experiencing is, is volume. this is volume you've only tested in the labs you know from a laboratory point of view you have the systems in place, but then to experience that volume in real life is quite a different, you know, outcome. so the fact that virtue and the exchanges and others is held up in this massive wave, really is a great credit to the industry, to the individual firms, and certainly i'm proud of how the markets have performed from an infrastructure point of view clearly we would rather see the markets go higher than lower >> your take on the infrastructure piece of this, given the fact that we are seeing such extreme moves and volatility in the markets overall right now, your assessment of that and how that fits back into this macro economic picture for which we

don't have very much info yet. >> yeah. i would say first with the macro economic picture, as a person who deals with markets and financial situations, i really want to focus on the real world today and when you look at the real world, 8%, $8.8 trillion is tied to tourism, about 10% there's no way that number holds up it's impossible to believe that we do not go into a real recession. that will happen so i would also say -- >> do you expect us to go into a recessi recessi recession? >> well, $8.8 trillion in travel and leisure will get cut in half, maybe by a third or two-thirds to take $4 trillion out of the global gdp is certainly a major recessionary force that's going to be hard to overcome but i think it's important to recognize, i would predict, the

recession swrel recession will have a v-shape to it you will have cheap oil, near zero interest rates, as we get past the virus concern and the vaccine is developed, you have a strong consumer going into this outcome, a strong consumer ready to come back into it it's going to be impossible to avoid a recession when you lose, you know, probably $4 trillion or more from the global gdp. i think you can see a v-shape to that in time >> bob, if the all clear is the availability of a vaccine, fauci would argue that's a year and a half away, maybe shave that down to a year, so it's a v, but the tip is a year long >> yeah. i would say this, certainly the vaccine will be the ultimate you could have therapeutics that will help mitigate the situation or a situation we see in china where the number of new cases declines and it seems to be manageable and we're past the peak you can instigate the v as you

get to that part of the progress certainly i'm encouraged i also pay close attention to what's happening in singapore and the warmer climates. hopeful this that's a predictor to what will happen here as we go into the summer months. >> bob, isn't this just as much about sentiment, though. right now people are canceling trips that they have planned for april, maybe even may, based on the uncertainty that we were just talking about around what the impacts are going to be. even if the economic conditions otherwise return to normal, the health situation returns to normal, there's no guarantee that the optimism level is going to return to what it was before, right? so does that have an impact on that v >> i think you're completely right. there will be a lag factor people will have to have data that says this thing is under control. they will probably look for data that confirms that viewpoint and

then they'll evolve into normal behavior that could happen in a relatively short period of time. and i know -- i love bob talking about the vix and what it means, but understand the vix is of the moment a 50 on the vix today can go to 30 or 20 quite quickly consumer sentimentcan follow the vix. we're at a 50 level today, people are definitely canceling trips. they're not going to travel. they're going to try to cocoon at home. but that sentiment can change now to a 30 or 20, maybe not the 10 vix last year, that's certainly in the distant future. if you get down to the equivalent in human sentiment to a 20 or 30 vix, you can certainly initiate the second part of the v. >> bob, would fiscal policy change the discussion, the possibility, for example, bailouts for industries that could behardest hit. >> i think it will help and encourage congress and the president to move along with it and i think they will. i look at the size of the whole. we're seeing this right now

because you've got essentially $9 trillion industry that's under fund mental threat fiscal policy will help. it's not going to help the fact that we get back to $9 trillion. that will be very helpful. we've got to take steps that will help us to get to the other side of the v more quickly, but you thing about that $9 trillion, we never had this situation where you had tourism being such a large part of the global economy that did not exist in years past right. tourism has increased greater than gdp growth for the last ten years and your trend line has been that way for a long period of time. it's a large part of the global industry and it's being attacked like never before. their entire marketplace is disappearing of the moment it will come back, but it's not going to be back for a period of time >> finally, bob, european

parliament is shutting down a host of their scheduling, their meeting, their processes we know we have a few members of congress in self-quarantine. i wonder is the market ready for an interruption in our legislative process due to the virus or would that come as a shock, a new shock >> well, it would be a shock, but i think the legislature has to change the rules pretty quickly. i think there's a movement afoot to allow them to do more virtual meetings, that's a reality we have to get into it's not what the founding fathers wanted back in the day, but it's a realty we have today. i would certainly implore people in the positions of power to say let's change our rules where we can have meetings where not everybody has to be in the same place. equating it back to the world we know, it used to be the common belief you had to be on the floor of the exchange to get a trade done we've learned that's not necessary and we have to get that mindset into congress. >> bob, thank you. >> my pleasure

the former wells fargo ceo joins us now from san francisco as well. dick, thanks for being with us the conversation we were just having with bob where he's basically predicting a v-shaped recession in the midst of everything we're seeing with coronavirus and the global economic impact, do you share the same view? >> i'm not as certain of that as bob is i think it's certainly a possibility. i would point out with comments on tourism, i think there will be a substitute for people doing other things, maybe not using an airplane, but using their car and so on. i don't think that money is going to go all in to savings accounts so what i'm really more concerned about is, is what happens to the jobs market if tourism shut down. and i think there's still, at least in the united states, very tight labor markets and people find other jobs or temporary jobs and importantly, there's

going to be some fiscal policy stimulus monetary policy just doesn't work in this situation and we need fiscal policy and that's going to be a huge plus and as mentioned, you're going to have mortgage rates down, you're going to have energy cost and gasoline down all those are stimulative. i think it's possible but i'm not as sure of a recession as bob. >> i appreciate your comments about monetary stimulus as well, especially on heels of the debates we've been having here over the past week with the fed doing its emergency cut last week having a little bounceback in treasury yields today, but overall the drastic drops we've seen, for example, in the 10-year treasury yield how low do you think rates can go and is the u.s. financial system ready for something like say negative rates? >> they can't go very far.

you have the 30-year at 1% yesterday and 59 but the point is, that lower rates just aren't that helpful i mean they can have a psychological benefit but they're not a stimulative one. i think there's risks that you have a negative psychology if you're going to negative rates so i think the fed shouldn't not move again this month and i know the market thinks it should but it should save its ammunition because they don't have much left. >> one thing i like to point out is we've talked about, you know, what's going on with the market and as bob mentioned, i certainly agree, that the situation on oil -- is certainly half of what happened yesterday. but the point is there is tremendous motivation for that to get solved. we have two alpha males out there who are trying to determine who is the top dog it makes no economic sense for

either one of them russia, they produce 11 million barrels a day. putin did not want to reduce his by a million which opec wanted oil fell from $50 to $30 so now that extra million dollars is worth $30 million to him, but the 10 million remaining, loses $200 million because it's $20 less. so he's losing money every day for no good reason they're going to make some sort of a deal soon and it's all about who is the top dog and let me tell you, saudi arabia has more bullets than russia does. >> at the same time you talk about two alpha males going at it, i'm not sure they're going to be exactly reasonable i want to ask you also, though, about sentiment and is this the end of an optimistic streak that we've been seeing where stocks have shrugged off bad news

it seems to me if anything now, they're shrugging off good news, the idea that this fiscal stimulus is coming, is what caused the market pop at the open, that has faded we had the fed rate cut that popped and faded have we seen a shift in how the market is reacting to those things >> well, i think the problem is the uncertainty. we're not dealing with economic matters. we're dealing with viruses there's no model for that and no one knows what the answer is the market always falls more on the uncertainty of the situation than it does on the fundamentals and so we need to get this virus under control and i think there's some positive things happening -- i'm not saying we know it for sure -- but it looks like china is now moderated and is in a -- you know, a neutral state. there's some feelings of that of south korea. we have to get through italy and so on.

i think it all depends upon the sentiment not of the -- it's on the economy, but it's the sentiment is what is the virus doing to our economy and if that gets -- if the feeling is that moderates, i think the economy is going to come back and so is the market >> although, it's moderated in those two countries as you know because of the social measures they've taken and we are nowhere near doing that unless you disagree >> well, we are in those two countries. i mean i think that -- >> my point are we going to bend the curve the way south korea is without shutting down schools for a month? >> well, we may have to do it for a month. but it will be for a month south korea has been in this for only about a month and they're looking at moderation. we shut it down for a month. you know, there's schools now on-line. stanford university just said that they're going to have all their classroom activities

on-line. okay you get on the internet. how bad is that? >> yeah. just -- >> you have to adapt all i am saying is you have to adapt and we will. >> yeah. it's an evolving situation dick, lastly, i just want to go back to the financial sector with you specifically one more time, given the fact that we have these low interest rates, the fact that you do have at least the potential for slowing economic growth right now. i wonder what this is going to do to lending conditions i realize we're already starting to see the surge in demand for refis right now, but as all of this continues to play out, what does it do to people and business abilities to keep getting loans in the tighter conditions >> well, the loans will be there. the question is, you know, do you believe that they're going to get paid back there's tremendous liquidity in the market you know, remember, banks now are required to have a year's

worth of liquidity sitting on their balance sheets just in case of a situation like this. so the regulators have to allow them to use the liquidity. the fed is buying short-term instruments today to increase liquidity. everyone knows you have to have liquidity and we have liquidity. so i think the money is going to be there and as long as it doesn't look like we're going to go into a long, deep recessi recession -- and i emphasize the long -- they will be lending money. the problem of the bank industry they had the money and no one wanted to borrow it. that's going to change. >> you talk about adapting, dick, while we're talking, charlie in front of house financial services, he says that a third of employees, 62,000 employees, are now working from home and then, of course, greg meeks says for the life of me i don't know why you took this job. how would you gauge the ability of these banks to react so far

>> well, you know, it's just starting but, you know, i don't know how many employees we've had -- that wells fargo had that were working from home before any of this i do know we had 80 businesses that were headquartered all over the country, and through video and using on-line and so forth, they were able to communicate with all their employees from different headquarters and so on very easily. you know, i don't think it's -- i think it may not be quite as effective, but it can be very effective and i don't -- i think we will -- all industries will adapt and lose some productivity, but it's not going to go down to zero by any sense of the imagination >> dick, thanks for joining us as we're having this conversation the dow has turned negative, down 26 points the s&p is just hanging on to

gains but close to the flat line well off the highs of the morning up 0.2%. >> as we continue to watch oil, brent crude and west texas intermediate rebounding this morning way earlier, each fell by more than 20% on monday coming off levels they haven't seen in nearly half a decade nasdaq energy and utilities director and the head of geopolitical risk, join us now good morning to what degree is the market today even continuing to take its cue from oil do you think that situation is at least known, stabilized enough what are you seeing? >> i don't think that we're going to be out of things situation with oil any time soon i think the new mantra is lower for longer certainly saudi and russia are hurting from lower oil prices but i don't think there's an incentive to come to the table any time soon because what we

have here is more than a market batter between two of the biggest producers. we have oil being used as a political weapon by both countries. saudi wants to punish russia for not being compliant with the arrangement since 2016 and because russia never fulfilled their promises on investment in saudi, and russia has been very clear and explicit they want to marginalize u.s. shale and take revenge a little bit for the u.s. sanctions on northstream 2. i don't think there's an incentive to come to the table any time soon. even though they're both suffering they can withstand lower prices and take measures to be resilient for a long period of time. >> given that, how much blood do you think they want to draw from pea each other and how long time period wise do you expect they're going to be willing to be locked here >> well, they both have more tools in their arsenal and they both can borrow money cheaply so they can issue more debt, run

deficits, print money, saudi if they wanted to depeg their currency and devalue it and that would be a little bit of a but tress. certainly president trump is a wild card. we understand that he spoke to mbs already. i don't know if that does anything because mbs is probably going to say, if you get russia to play ball with more production cuts, then we'll play ball as well in this type of environment, i don't know how you get russia to play ball. even if there is some kind of agreement with the typical opec math of, you know, you have to calculate what are their baseline levels and whether they're including or not, it's going to engineer a little bit of an uptick but it will be short lived because they can't engineer a change in sentiment when you have coronavirus making people scared of a global recession. >> scott, whether it's a direct or indirect challenge against u.s. shale producers, what we're seeing happen between russia and saudi arabia right now, definitely caught in the cross hairs. how does this play out here in

the u.s. oil patch who is most at risk? >> well, i mean listen there were a lot of u.s. shale companies, small and medium-sized companies before you saw the plunge in prices where we might say the priest was already at the bedside they were struggling at 50 and higher most of the companies certainly aren't profitable at 50 and at current prices that's not the case i think right now you're going to see a number of bankrupts, you're going to see m and s activity go up the near future, i agree with tamara, neither russia or saudi will yield and you have a staring contest that will go on for a while. while looking in the low 30s in terms of brent, i think we could go lower and that spells real difficulties ahead in the near term for shale. >> ta mmar, bloomberg has a piee the president had spoken to mbs. bloomberg saying the call was before the production hike was

announced. that sort of gives you a sense of how resolute the saudis are taking this. >> yeah. i think they are i mean they have really -- they are in no choice you could argue their decision in 2014 that notoriousopec meeting where they decided to open the spigots on thanksgiving day was a failure because all they ended up doing was cratering prices, but arguably, they could be more successful right now in marginalizing u.s. shale because the capital markets today are not open for u.s. shale companies the way they were back in 2014 and 2016. debt and equity are both closed and private equity market is also closed. so you really have the opportunity to rationalize the market and take some of the unprofitable barrels i don't think they are sitting there with a list of u.s. shale companies they want to go bankrupt it's not like that i think they want to make u.s. shale less globally significant. what we mean if you look at the past couple years every single

year u.s. shale growth has eclipsed the level of global demand growth. they're saying that's not sustainable for us >> and you're saying they sense weakness the capital markets and now is the time to strike. >> now is the time this type of policy would be effective. they could have been fec effective in 2014 if they held out longer but they flinched because it was painful for them. they're little more resolute because they understand that the debt levels are really high and more particularly investors in the u.s. have no patience anymore to underwrite more drilling without profits >> so scott, bottom line, your expectation on the u.s. economic impact of these lower oil prices, are they going to be as stimulative as we've expected them to be in the past given that people might not want to go out as much given that we won't have as many planes flying, for example, or, you know, given the fact that there's so much u.s. production now, might it actually be more negative than

some expect? >> well, i think it's ultimately going to be more negative. i think initially as it always has with u.s. presidents and administrations in the past, the first phase of a price bust is euphoric it's elation because it's going to stimulate spending and be good lower pump prices is what every administration wants our forecast right now is, to our clients, brace for a lot lower for the reasons tamar was suggesting and other geopolitical reasons the russiansand saudis don't have a near term interest in stopping while people are speculating about $30 oil and how long russia can survive, what about $3 and single digits when you start talking about oil prices that low on a sustained way, you're talking about real damage to the u.s. economy and during an election year i think trump is starting to pay attention and when you're talking about states like texas and louisiana an others being affected. >> yeah. i mean $3 sounds pretty darn extreme right now. but just quickly, scott, given

the fact that we did see ripple effects the last time we saw crude crater into the 30s and below the 30s we saw ripple effects to manufacturing and other industrial companies, materials other industrial commodity classes as well. would your expectation be as we see crude at these prices for a sustained period of time we will see similar i guess ripple effects into some of these other sectors? >> i think so. i don't think there's any reason to suggest otherwise especially given the fact that the drivers are in place for a much more sustained bust for the reasons we're talking about. if sectors that were affected in the past i think it's going to be arguably worse this time. >> yeah. this oil story far from over tamar and scott, thank you. >> thank you alpha one capital partner dan niles joins us on the cnbc news line. what a relief to get insight from you on another interesting day as this nearly 4% gain has evaporated in the first couple

hours. what is your game theory right now? do you have a playbook does anyone have a reliable play bopla playbook at this juncture? >> i don't know how reliable it is but i have a playbook it's sort of the same one we've had since late january we were on your show in late january when apple reported and we talked ate the fact then that we were worried about the virus, hedged out our disney exposure because they had a lot of exposure to china and we were thinking about shorting apple because of what was going on we were worried about a recession in 2020 before the virus ever hit i mean economic growth at the end of last year was already very poor. 2.9% globally, 2.5% technical definition of a global recession. we were already worried coming in our playbook is, you know, we were expecting a recession, we expect stocks to go down 30 to 50%, and we've said that before.

within that, you're going to end up with vicious rallies in between. so you don't want to be sitting there, you know, being short or negative when you're at a point in time where things are oversold we went back and looked at when the spanish influenza hit, the stock market went down 47%, but you had two rallies of the s&p where the market was up 17% and 20%. on your way to losing 47% of your money over two years. that's sort of the playbook in our mind sell rallies and buy oversold conditions and, you know, hopefully you can make money even in an environment like this that's how we think about it and that's our playbook. >> okay. if you dig in within equity market, into specific stocks or specific industry groups more specifically, dan, what do you like, what would you be going long here? are you still employing the stay

at home playbook >> yeah. it's the same playbook we had in late january when we were talking about we don't like apple, we think disney has short-term issues because the theme parks are going to close the theme parks are going to close, people are going to stay home and play video games, they're going to stream movies we liked net ease and ten cent they're in china people are staying home and they're playing a lot of video games. we also started buying the u.s. video game stocks as well. activism actually has a dividend and so that's another thing that we like. if you can get a dividend as well, that's terrific. i mean people like to talk about the apple super cycle which i think is ridiculous. they preannounced twice on the last 14 months and have a new phone every year if you look at the video game sector this will be the first new console from microsoft and sony since november of 2013. that's seven years that's a real cycle.

and so i think your video game stocks do well into it you've also got streaming going on google, et cetera. you can stream to your phone, that's a billion and a half units versus 50 million consoles we like that the final thing is, infrastructure if everybody is staying at home, you need -- and i've talked to a lot of ceos, they're building out the infrastructure, you should see more spending on things like optical. you will need faster speeds. those are the things that i think are really interesting right now. so those are kind of the themes that we're very focused on right now. >> so you talked about some specific things and themes you're interested in i find a lot of people when they talk to me about what they're doing in the market, mom and pop regular folks, they talk about selling and they're glad they sold maybe some portion of stocks when they were expensive but they think less about exactly when and how to buy back in what is your perspective, your strategy for when the market in

general, stocks in general, start to look a little bit better, the economy looks better how do you get back in what's your strategy for spreading that money, again, more broadly into the areas you see are beaten down? >> yeah. it's great question, jon well, there are two things i look at. stock prices are only determined at the end of the day by two variables. one is valuation, the second is earnings right now you know both of those things are going down. and for me, the number one thing is always earnings when do i think estimates have sort of gotten to their low point and when are things stabilizing out. every day you have news stories about new things getting shut down, events getting canceled. i don't think we're close. then on the valuation front, we've talked about this a lot, you know, valuations if you look at it on a, you know, market cap to gdp level which is sort of one of the broader measures and warren buffet likes to use a variation of that as well, it's

high it's back where the bubble was in 2000. for me, i always talk about risk versus reward. i think for the individual investor that's what they should be looking at, which is, when are valuations at a level that seem reasonable given all the economic risks that we have right now and when do you think that, you know, sort of where peak coronavirus problems, i guess, when do you think the economy has stopped slowing down, those are the two things you need to be able to buy and think we're in the next up cycle versus we're in this vicious counter trend rally in a bear market you will get multiple opportunities like this. there were seven rallies when you had the spanish flu that averaged 10% on your way to losing 47% of your money individual investors i think need to be not getting caught into that trap of buying, you know, when it's up a lot and then getting crushed because then you had eight declines during the spanish influenza of

15% and beaten up like that. >> nobody -- not all of our viewers have a trading platform and desk like you have you talk about cancellation culture not getting even close to the peak. i mean bernstein has a note on disney this morning, maybe you don't -- maybe playing disney, but their point you buy disney when they close the parks. and they are pricing in a 100% probability that domestic parks close. do you think that's fancyself in. >> no. i think that's perfectly makes sense. i traffic in disney as you may remember when i started this interview. you know, we love disney we liked it for their streaming. we hedged out our entire disney position at the end of january we're looking at when do we buy disney back. because i completely agree with that i think all the parks, my base case is all the parks get shut down i truly believe that's going to end up happening at some point it started in china.

thinking longer term on disney the stock is back to where it was in 2015. how many great companies can you think of that are trading at those levels so the good news is, their streaming service, which is really what will be profitable for them over time, that's going to help their streaming service a lot. if you're not going to the parks, it wouldn't surprise me if you're buying disney plus service. we have it and think it's great. i think that's the right way to think about it when all the parks are shut down, it can't get any worse right now, all the parks aren't shut down and so i think that's the right way to think about this is, you know, i like that phrase buy when there's blood in the streets even if it's your own. that's the way you need to be thinking about investing right now. >> yeah. dan, i mean just to back this up and put a really basic question in front of you, given the fact that you are so active in the market right now, when it comes to coronavirus and the fact that there are so many unknowns right now, what are the key stats or

data that you are watching because we can point to china and south korea and say, new cases are declining. but we're seeing the increases here in the u.s. and we're seeing stricter measures being incorporated into the places like italy right now what are, as an investor, what are the key factors you're watching the most closely? >> yeah. i mean one thing i really like to watch is the shipping data and, you know, an individual investor can go on-line and there's things like the freight index et cetera that comes out monthly and at the end of the day you can't buy stuff if it's not being moved around so it's a very simple way of saying if it's not being sent on an airplane, a ship, a truck, et cetera, you know,s the economy is slowing down. and, you know, so i tend to watch that pretty closely and it's something the individual can get on and look at so things like that, goods being moved around the country, supply chains, things like that, the nice thing is, you know, asia, most of those companies they put

out monthly reports so you can see are things getting better or worse p. those are things to watch. versus like this morning where the market is up close to 4% the first thing i started to do was sell some stuff. this is ridiculous if you want a longer term plan those are things where you can get data and really see is that something sustainable versus the up 4% one day, down 4% the next kind of move that will ring you out unless this is what you do professionally >> how much are you paying attention to oil >> tremendous amount i loved hearing the prior interview where that individual was talking about $3 oil that, you know, we talked about well when disney shuts its parks that's when you want to be interested i mean when i hear somebody talking about $3 oil the first thing i want to do is look at the oil companies. i've been watching them for a

while -- >> go ahead. >> with apologies. about to see the president here and the vice president with some health executives. >> health insurance companies and i think tremendous progress is being made willing to do things for the people and the customers and probably in a true sense beyond their customers that normally i don't think they would be doing i want to thank them and ask vice president pence to maybe give us an update. >> i would be happy to thank you, mr. president president trump made it clear from the early days of the coronavirus in the united states that this would be a whole of government approach. we brought the full resources of the federal government to bear but this president has also called together businesses and industries to make this a whole of america approach. last week the president met with pharmaceutical leaders, nursing home leaders, leaders of commercial labs, airline cities, bringing all of the businesses

as a country to bear to protect the health of the american people but today, mr. president, you directed us to bring together insurance companies, health insurance companies, that cover through private insurance and through their support of medicare and medicaid, almost 240 million americans and i'm pleased to report that all the insurance companies here today or before today have agreed to waive all co-pays on coronavirus testing and extend coverage for coronavirus treatment in all of their benefit plans and at your direction, medicare and medicaid made it clear to beneficiaries that coronavirus testing and treatment would be covered these private insurance carriers have extended that as well they've agreed to cover telemedicine so that anyone, particularly among a vulnerable senior population, would not

feel it necessary to go to a hospital or their doctor they will know the telemedicine is covered these ceos have also agreed no surprise billing we want people to get tested over a million tests are out thanks to the diligent work of cdc and hhs, more than 4 million will go out this week. you've worked with commercial labs to expand testing and that will continue to increase by the day, but we want the american people to know that they are covered through private insurance, they are covered through medicare, medicaid, and there will be no surprise billing. finally, mr. president, as you directed us yesterday, we produced helpful information for every american family, how they can keep their home, their co school, their business establishment safer from the spread of the coronavirus. all of these major health insurance companies have agreed

to convey this information starting today to all of their customers as well as to send the cdc's guidance for seniors with underlying health conditions to give them specific recommendations. so as you requested us, they've all agreed to work with us to communicate information directly to the american people because as you've said, mr. president, while the risk to the average american of contracting the coronavirus remains low, we want full partnership with industry and give the american people all the information they need to avoid contracting or spreading the coronavirus and particularly, these companies are going to help us get information to seniors with underlying health conditions who really represent the most vulnerable population to serious outcomes i know i speak on behalf of the president when i say how grateful we are for the collaborative spirit and generosity and partnership represented by the great companies at this table.

>> very true we are working closely with the cruise line industry and very -- working very hard and we're going to be helping that industry likewise with the airline industry they're taking very strong steps forward people coming in to our country, even getting off the planes. we are working closely with them and helping them they're two great industries and we'll be helping them through this patch and so far i think it's been going very well. you know all about the big ship that came in yesterday heat going along incredibly well working with the state of california successfully, very successfully and also with canada and with uk so uk is taking their people, their citizens back and canada is about 600 people that are coming back and they're being met and brought to planes and

being brought very, very -- very dignified fashion back into canada we appreciate all of the help we've had and that's working out very well. with that, i might just ask a couple folks if you would like to make a statement on behalf of the industry, perhaps -- would you like to make a statement on behalf of the industry >> sure. this is gayle. one of the things that i think is most important from day one as an industry and company and anthem we have been focused on ensure access to care and that cost is not an issue for people to have the testing appropriately done so we're pleased that we're able to continue to expand this access and as the president said, i think it's really important for all of our customers, members and the american people to have this we are supportive of the efforts under way. >> great job you're doing. thank you very much. would anybody else like to make a statement? even the ones -- look at those cameras. >> i'll stay on behalf of the

industry we represent the companies around the table here but those that operate at a local level that we all have the same commitment to making sure that cost is not a barrier to people getting tested and treated. we want to make sure that we're focused on prevention, testing and getting that information out as quickly as we can to make sure people know how to limit the spread of the disease. >> thank you very much >> on behalf of the 36 independent blue cross blue shield plans to insure one in three americans, we're pleased to make sure people have access to the tests and the coverage that they need i want you know the commitments we made apply to the federal employees program where we ensure over five million employees. >> thank you thank you all. >> i would like to say as a large servicer of medicare that we are very oriented to the aging population most importantly how do we make it as easy as possible for them to receive their tests being able to do it in the home is a very important part of

that while we think about tele medicine and home, it reduces great barriers >> a lot of people are taking care of each other strong advantage >> mr. president, i thank you for having us. just to extend the conversation here we're working very hard to protect the health work force which we think is essential to ensure the americans have access to the proper care getting the health work force back to work so quickly tested and that serving their patient s a high priority for us as an organization serving somewhere around 18 million patients across america >> thank you governor nice to see you. >> we appreciate your leadership and vice president's leadership to work with the governors and be able to make sure we're keeping people healthy in our

states it's been a fantastic cooperation of all levels of government we appreciate the cooperation of these executives around the table to make sure the people in my state and the states across the country will be able to get the tests and not worry about anything >> thank you all very much thank you. thank you very much. >> press, let's go >> let's go. >> press, let's go >> that is the president a couple of headlines there.

first is the insurance companies agreeing to waive co-pays for coronavirus testing and saying they will help the cruise line industry and airline industry. i'm not sure what that sound was in the background. maybe we'll find out later >> i suspect we will also mentioning they will cover telemedicine and want americans know they are covered and the risk to the average american is low. getting those types of comments out of that event is well. joining us now, continental resources founder and executive harold hamm. thanks for being with us the other big story of the week, what we're seeing play out with crude prices right now for somebody who has been in the business as long as you have and seen as many different veeventsa you have, the drastic moves we're seeing in the price of crude this week, what do you think of those how would you sum those up >> i think it's unfair we have seen them before

here again the saudis and russians combined decided take advantage of american producers and it's unfair and we have seen it tried before. it's not the first time. here, again, they're in a different situation particularly with the russia involvement. it's against the law,st i it's illegal to put oil in this country below the cost of production we know the russian cost is around $4 th$42. everything they would import to the country at these prices are below that that's my take on it we have seen this tried before unfortunately, that didn't work in '98, '99. >> do you see this as the

disintegration of the opec agreement disagreement or part that will bring them back to the table >> it would be their tactic. we'll have to wait and see what plays out with the saudis. they might just been trying to force russia into the opec plus as they have done in the past. we'll have to see how that works out. whatever putin is somebody that, president putin is hard to push into a deal. we'll have to see how that works out. either way, taking advantage of american producers with a pandemic that's going on with coronavirus, certainly is not

something that ought to go by the wayside here easily. it's something very concerning i don't think it will work out very well for them certainly, the president is -- i'm sure he will stand up for industry and national security interest >> harold, how's it going to change a few months ago we were dancing on opec's grave arguing that the u.s. was going to change the global world order in energy complex. continue n continental has gone from 25 to 7. how is that impacting you personally and what leverage does the u.s. have against the russians or the saudis >> we have seen volatility in the market we don't get excited when it drops or goes up

with the situation like this, it's very short term we're in this business long term we're 52 years in this business. we have seen a lot of ups and downs and different tactics tried over time and here's another one of those i don't think we've ever danced on opec's grave. they've been a force since 1973 or 1974. they will remain a force in the future nobody is very forgetful of that however, we have created something in this country with american energy renaissance that that been very good for american securi

security >> given that, how severe do you expect the economic impact in the u.s. will be of these low oil prices if the president does not step in and do something to put pressure on saudi and russia to end this price war? >> i don't see this long term. they tried this back in 2014 opened the taps and they didn't work out very well for them. continental is well positioned to run our company and survivor this or any risk that comes our

way. >> we're going to have to lever it there we have to breaking news we have to get to. >> not unexpected. the company is slashing its dividend dramatically and also cutting capx the numbers are going from a quarterly payment of 79 cent.

not unexpected given the move in the stock. the company also significantly cutting its capex again. we're hear this from all the companies. cutting their dividend dramat dramatically to 44 cents per year saying this will take them to break even cash flow lower the cash flow break even level to the low 30s on wti. >> can't say people are surprised. let's get to the