thank you for coming the phone talk to you again. >> thank you. >> a cnbc contributor, meg, thank you so much. >> thank you. >> let joois check the market before we go at the lows of the day. the dow dropped more than 1200 we'll keep our eyes peeled on that next show will as well that does it for us. "the exchange" starts now. thank you, scott welcome to next, everyone. i'm kelly evans. major indexes are sinking after the best day since december of 2018, at the lows the dow down 1218 just off the level right now there's the 10-year treasury yield. holding in at 85 basis points. more confusion and mixed messages of washington secretary mnuchin testifying on capitol hill with ideas but no plans. just now the world health organization declared the coronavirus a pandemic and dr. fauci of the national institute

of infectious diseases rit rating that the coronavirus is likely ten times more lethal than the flu markets certainly didn't like the sound of that. let's get to bob pisani for the latest action. bob? >> kelly, we are just off the lows for the day the important thing here is that we were in a modest rally. i say modest until 12:30 when the headlines came about the w.h.o. declaring a global pandemic and took air out of the modest rally to see here sitting near the lows for the day. i want to highlight sectors here essentially this is a 4% takedown, the market highlighting overall not individual sectors coming down here industrials, energy, consumer staples, tech, across the board. down 4%. this is what we say about the global takedown. i want to highlight boeing down 13% today with a draw down of the loan, existing loan there.

as of friday that's a source there and you see we're sitting at the loans of the day for boeing. interest rate sensitive groups doing bet they are month, down worse than the market. i think that's curious because they have outperformed but with a drawdown of the market, this suggests to me that investors are lighting up on positions across the board getting rid of the stocks that have done better or outperformed on a relative basis. that's a sign of lightening up back to you. >> thank you let's get the very latest on the big story moving the marks today. the world health organization declaring the coronavirus a pandemic, meg tirrell is here with the details and so much more of the action we have seen today. >> people say this was a delayed declaration. some experts calling for this to be made weeks ago. the world health organization said not just the concerning level of spread and severity but

the inaction seeing from governments to not act quickly enough to combat the spread. i don't know if we have sound from the world health organization if we do, we'll play it now. >> w.h.o. has been assessing this outbreak around the clock and we're deeply concerned both by the alarming levels of spread and severity and by the alarming levels of inaction we have, therefore, met the assessment that covid-19 can be characterized as a pandemic. >> now, part of the reason they hadn't made this declaration earlier is worried about it sparking panic and said you need to be doing more around the world to stop the spread we don't have a vaccine. no immunity and no approved treatments only thing to do is try to slow the spread. >> i want to make sure everybody heard what dr. gottlieb said

there needs to be more urgency of municipalities to be proactive and shutting down parts of the economy, encouraging people to stay home and at any given point it is more than you realize that it is. >> he literally made an estimate, ten times as many cases, perhaps more than that than we have detected in the u.s. >> the current case about -- >> little more than 1,000. >> at least ten times that, ten time it is communities, as well. the point is, look, there's economic pain for the municipalities >> right. >> that don't want to have to take the step and need the federal government to inspector general -- signal there's relief coming and waiting for washington for an announcement like that. >> the actions in terms of closing things down will be taken at the local and state level and the federal response is needed he is saying to shore up those economies so that they feel confident in making those moves that are going to hurt their local economies. nobody wants to do that. governor cuomo yesterday talking

about a one-square-mile area in new rochelle apologizing and that's a tiny little spot. we're talking about communities -- >> you can argue they should have done it sooner. all right. meg, we appreciate it. thank you. check on the markets down at session lows with the dow dropping 1260. a 5% decline the dow is the worst performer today with boeing's weakness the s&p down 4.6%. the nasdaq is down 4.3%. the russell small caps down more than 5%. so what should investor dos to protect themselves here? let's bring in douglas bone, chris zacharelli and mike s santoli is here. mike, any indication of why we have seen the weakness in the

last hour? >> not specifically. i think the wear and tear. we had a decent rally yesterday but that only recouped little more than half of monday's decline so the market is been in the defensive mode of not wanting to extrapolate any one day's action i think that one slightly surprising thing is that treasury bond yields have actually been lifting today. that typically has been consistent with a stock market that was able to find the footing. however, corporate bonds are not acting well so i do think there are these kind of lower level credit concerns that are well related to the economic slowdown story but not center of it and in terms of levels you did mention the dow underperforming. the s&p 500 basically a few points above the lows from monday so that has been the low for this move. it seems as if we need a little bit of a stress test at those levels. >> okay. the 10-year yield round about 8% we have breaking news on that. up for auction top of the hour rick santelli with the results

rick >> we all know yesterday's 3-year wasn't very good and today 9-year 11-month note, 10-year note we are adding to that issue. 24 billion the yield came in at .849. so obviously less than 1%. the lowest auction of 10-year notes ever i grave the grade a charlie minus. c-minus. it didn't price bad. the when issued market all over the place. mike was right to point that out an hour and a half ago 10s and 30s higher in yield and settled yet and demand light 61 on indirects slightly above average. dealers take 29.8% the most since august of last year so c-minus fits. could be worse many continue to buy but just not necessarily in the auction

process. kelly, back to you. >> all right thank you. let me turn to chris now chris, you say, look, most likely outcomes of coronavirus an all of this self quarantine behavior are either demand shock with some bounceback before the election or a recession. how would you update those likelihoods today? >> well, i think it's really hard to tell yiright now. you can't tell how far things spread with a coronavirus. with a wide outbreak across the country, takes months to work through, it is a severe demand shock and if it is the case we can't get our arms around this crisis, it is widespread and potentially that will knock us into recession however, we are starting from a pretty strong point. looking back to last friday, no one cared about because the positive economic news overshadowed by what's happening going forward, look at the gdp now forecast from the atlanta fed saying 3.1%. we are not expecting 3.1% gdp in the first quarter by any means

i'm sure below 2% but as long as we're starting from a stronger point it is possible a strong shock isn't enough to knock us off the game and head us into recession. >> with all that going on, you have goldman talking about a 2,400 price tar get on the s&p 500. jim cramer this morning talking about a retest of the 2018 lows of this market, 10% below where we are is that feasible given despite the economic strength we are talking about the market action with this dramatic plunge so far? >> anything's possible, especially dealing with something with this much uncertainty. you are seeing the pricing happening and having a recession you are probably two thirds of the way there. so it really remains to be seen. as far as what we tell investors how to prepare for this, you need to ride through the volatility things bounce back quickly or takes longer but with so much already priced in you don't want to panic

stay calm and let the market do what it does hopefully you had the right asset allocation and insulated you but this is a black swan event that come out of left field, do damage and no one predicted this is the year to happen. >> you figure out if it's appropriate for them, right? risk off is a good time to find out what the risk appetite is. what's it been like in terms of panic, down 20%? what do you think it looks like down 30% from the highs? >> i think we'll see more phone calls at three handles and 30% down and i can't think of a better time than to go back and reassess the planning that you have hopefully done, especially for pre-retirees and retirees thinking, oh my god, this is where we go again and look at the plans to see what a correction is going to do for trying to live on your assets.

>> how much does the plunge in bond yields make it harder for people to figure out, yes, the price is up and that should help you on a total return basis and most people plan on the income aspect of that and worried of that income stream going forward. >> watching yields fall is going to make you nervous. but there's a flip side to that. and that you now have higher price bonds and may be able to take advantage you need to do the due diligence in terms of what your appetite is for risk and being more risk on given this uncertainty and you need to be very careful and plan out when to take the opportunities. so in a way trading yields for future appreciation is in play but this is something that, again, needs to be well thought out before selling safer lesser risky assets. >> mike, before we go, a leg down around the top of the hour, do you think it's anything to do with bernie sanders reportedly staying in the race and not dropping snout.

>> i hesitate to attribute it to that right now, i honestly think it is just follow through selling pressure very, very oversold. the next 5% is the hardest call from here. very long-term investor, in a weird way, being down 20% makes it easier to decide to take that chance. >> i like that next 5% is the hardest call. doug, finally, you mentioned the pre-retirement the trickiest time of life at 55 years old, what do you recommend that people do right now? what about real estate people say mortgage rates plunging and i feel like it's not safe do i have to get into something like that? >> yeah. no -- don't be quick to act here be quick to check those plans, have those conversations, get a realistic view of what best and worst-case scenarios look like for your particular situation.

being in control is the best medicine right now and that's going to come through conversations and hard thinking of where you are and where you need to be. >> thank you all today doug, chris, mike. we really appreciate it. i mentioned that sharp drop in mortgage rates and does have borrowers rushing to refinance and there's staggering new numbers this morning diana olick joining us >> reporter: total mortgage application volume up over 55% last week compared with the previous week. refinance applications drove the demand spiking a whopping 79% for the week and they were 479% higher compared with the same week a year ago. refinances made up 76.5% of all applications up from 66% the week before and it's all because the average rate fell. that's the lowest since december 2012 and other reads on rates like freddie mac at a record low

and made new last week mortgage applications to purchase a home increased just 6% for the week and 12% higher annually potential home buyers weighing the low interest rates against the concerns of the economy and on their jobs. kelly? >> one question, diana, to keep coming up. is there a rule of thumb to know if it's worth it to refinance? does the math change now with such low levels? >> 75. that's what i say. 75 basis points what they tell me is what makes it worth it if you can lower your interest rates by at least 75 basis points and you still have 20% equity in the home do very well. anything less than that, probably paying more and the fees and everything involved in refinancing. >> okay. everyone calling up having this conversation now we'll see if the system can handle the number of refis, too. washington where all of the action is today. closely looking for any movement on the various stimulus

proposals floated and also to see what comes of the bank executives called to the white house. ylan muey has the latest wilfred frost is here to tell us what to expect from the meeting with the bank executives of two hours from now ylan, big, big trillion-dollar question today is where do things stand >> reporter: kelly, the short answer is we are not close to a stimulus package here on capitol hill treasury secretary mnuchin acknowledged as much earlier today testifying on the hill saying any type of broad economic stimulus including a payroll tax cut to come as a phase two in a federal response and then the top republican on the finance committee chuck grassley tried to tamp down expectations. >> so let's see down the road a week, two weeks, three weeks, whenever we get a feeling that we got to do something more dramatic then that would be very much on the table.

>> reporter: so instead, kelly, house democrats are focused on introducing a targeted bill aimed at workers impacted by the outbreak we are expecting that bill to drop later this afternoon. >> it's amazing to watch the news wire. you have on the one hand reports that the cruise line industry might want the white house to bar people over 70 from boarding a ship without a doctor's note and then that the administration might work on plan to delay the april 15th tax deadline because of the virus so there's a ton of fast moving pieces and elements that sound like they could do a lot to help cushion the blow of coronavirus but only if we get moving quickly here. >> reporter: well, what the administration i think congress as well is trying to do is see what levers to pull immediately. mnuchin did confirm to recommend to the white house that they extend the tax filing deadline for certain individuals and for certain businesses

he said that could be as much as a $200 billion short term stimulus to the economy and looking at what they can do right now because they know that the years of politics take a long time to move here in washington and getting something big done could take a while and don't want to wait for that to happen before they start providing relief to workers. >> or at least signaling it is on the way let's flip to wilfred watching the white house and the meeting of bank executives very different backdrop of anything in the financial crisis. what are the topics expected for today? >> yeah. so as you said a different backdrop and nonetheless a bit of a financial crisis feel to it given that top executives from most of the nation's biggest financials to attend a meeting at the white house hosted by the president. 3:00 p.m. eastern time vice president and treasury secretary will also be present in attendance from the bank side will be the ceos of bank of america, citi, wells fargo, blackstone, citadel and the

president and coo gordon smith in place of jamie dimod still recovering the focus on lending to small and medium-sized companies and the most obvious action for the government to ask regulators to reduce the amount of capital banks have to have to hold against the loans in return for the banks agreeing to extend loans to clients feeling pressure from the virus and expect the topic of the functioning of markets and levels of liquidity to be discussed. ceos might be asked if there's tweaks in regulation in that area to help enhance the liquidity in the short term. we are not expecting anywhere near the level of widespread action seen by the government in italy, for example, where all interest payments have been su spenlded that said, it is rare that we see this level of financial ceo together in one place and the ability for them to try to calm wider market fears including about their own share prices is

significant and want to listen to any comments on those lines later today. kelly? >> thank you we'll check back with you soon as we continue to monitor what kind of response is needed from the white house and congress to stabilize the economy and calm the markets, joining me is tony frato, former white house press secretary under george w. bush, here with me on set and austan goolsbee, as well. goody verse if good diversification of opinion if i can say that. tony, this is a big deal now you could argue in the early days we were all watching china, other countries, should have done more quicker here in the u.s. arguably. what about now >> part of what the administration is doing trying to reach out to people is a good idea they have a lot of information to share they look at the global economy. they can talk about what their small businesses and customers are doing, dipping into savings?

is there credit impaired so they have that kind of information and they could just impress upon the administration the importance of quick action right now which i think things have been slow and the markets are hoping that they get coordinated and do things quickly. >> no reason why it's not multifaceted larry kudlow suggested the emergency loans without necessarily needing to move that through congress i don't know exactly the mechanics of this but there are ways you could at least take some first steps while working on a bigger package. >> that's right. a lot of people trying to spend time to figure out the perfect answer and talking about or. we should do this or that. it should be and you hope that they do it quickly. this is really concerning markets right now. that pandemic announcement i think the word that this may be coming in fizs i think is disappointing markets today that there isn't going to get something done this week. >> thousand do we take what's so

far a dribble of different kind of announcements, i don't know trying to float them with the public, i don't know why not just move and to congress i understand that -- i have emails from senate democrats, we want these items, not on board with the payroll tax cut. fine can we agree to 3 out of 5 and get it going >> maybe but when you have the president proposing relief to oil and gas companies, or saying things that public health officials are kind of in a panic about, not wanting the president to tell people that it's safe to go back to work if they have the virus, not announcing that we only have 14 cases and pretty soon that will go to 0, i think the white house has lost all sense of let's call it message discipline and if you lose message discipline and you lose your credibility this in a crisis is exactly the moment when where that's disastrous

you saw that happen early on in the crisis in china that people start taking your statements to mean the opposite of what you say because they don't believe you anymore. i think the white house -- >> go ahead. goi this is an election year in any year they feel they don't want it to topple the economy but especially this year, right? >> that's what i would think the thing of virus economics as i say is it is different from normal business cycle economics, the best thing to do for the economy, the best thing you can do for the markets right now is everything in your power to slow the spread of this virus and to give people the feeling that they don't have to be terrified and making statements that turn out to be false or not getting enough tests out so that people can figure out where it is, that's bad for the economy and extending the tax deadline, look, fine

they should extend the tax deadline but not gong to solve the basic problem of the virus which is everybody is really afraid right now. >> the interesting thing, tony, we heard from scott gottlieb last hour, there's this sense now that you might as well just go all the way, why wait unfortunately we see it. telling kids to stay home from college. shutting down sporting events. why not say? better safe than sorry and don't worry, municipalities about the toll to take because the federal government will be there to backstop you? >> i think that's right, too the fact it's happening in pieces, piece by piece, is just really confusing the people. the enemy in any crisis is uncertainty and there's an enormous uncertainty markets don't know where the federal government will be, not seeing coordinated action with other governments, getting mixed messages on things people saying keep your kids --

we should have social distance and other people say keep your kids in school people are confused. >> i'm one of them, too. >> i'm told to -- now that -- go to spring break, don't come back maybe you will come back not sure so things like that. really confusing to people and confusing for themas economic actors, also. >> so let's go through step by step what to see bipartisan support for. paid tax leave for affected workers? >> yes. >> yes. >> payroll tax cut. >> but the one thing about that -- >> go ahead. >> paid sick leave is critically important so that sick people don't go to work and get other people sick. >> crucial. >> recognize that's not stimulus it is kind of the opposite because fewer people are going to go to work so in the immediate term it means a little less economic output but it's important. you got to do that. >> is it government money and the economy that otherwise isn't there? that's how i think of it

in that case, yes. what about the payroll tax cut a mechanism for an extra $1,000 for households republicans are lukewarm and the democrats are cool what's the problem >> i think i'm the only one, the few people in favor of it. but not on its own austan's former colleague, our frenld, jason furman argued against it send people checks but it's hard to choose, you know, who to send checks to. they will have a lot of people left out saying what about me? payroll tax holiday is one way of saying we are taking care of everybody. and it's also going to give underlying support longer term this isn't a two-month thing it damages growth for the u.s. economy for the rest of the year and also dial it back when the time comes. >> flexible. almost out of time i would like to see more urgency so the federal reserve doesn't have to cut to zero.

what would your big pie in the sky idea be to say here's one thing to really kind of turn it around and not take us into either a strange place for the fed to go or a much worse u.s. economy? >> yeah. first, like i say, i think all focus should be on slowing the virus and might have a short-lived recession but wes d shouldn't do everything to do that and accelerate the virus spread once you get to the part where you're just about stimulus is have the federal government rebait the states. i'm afraid that just handing people money, they're not leaving their houses right now and not going to spend it. cut the state sales tax and have the federal government pay for that >> yes. >> interesting love having you guys on.

appreciate it. we'll see what does come out of washington today and the days ahead. take a look at the markets right now. just off session lows and deep in the red still the dow down 1100. the s&p down 117 a 4% drop, similar for the nasdaq and all 11 s&p sectors are lower today. they're led by real estate, utilities and energy and all 11 sectors also at least 10% down from the recent highs. these are the worst individual performers today 92% of the names of the s&p 500 more than 10% down from the 52-week highs. meantime, boeing is biggest drag on the dow today down more than 13% and it's fallen nearly 40% in the past two weeks joining me now on the phone is ken herbert. ken, boeing is just sitting on $200 a share there is concern out there about with the bonds in particular

what is the main problem seem to be here? >> yeah. hi, good afternoon i say there's two things clearly the news flow around the airline financial health seems to deteriorate daily if not hourly you have a lot of concern of the crash crunch at the iairlines ad for boeing second i would argue there's -- you have had some cancelations that have come out and starting to see definite impact on the order book and demand environment and the unknown around the virus and doing not only to the airlines and traffic but what it could potentially do to the supply chain and production of aircraft at boeing and its suppliers. >> i would call that all kind of like the macro challenges for boeing what about cash flow pressures it does seem like there's some focus on its balance sheet today. >> definitely. keep in mind, boeing came out of the fourth quarter with almost

10 billion in cash and maybe -- i would argue i tend to think of the quarter cash burn rate of 2.5 billion so i think it's an overreaction and early to calling about -- or concern -- >> we're losing ken's sound there. ken, we apologize. i was asking about the cash and people may be overly concerned about it and can continue the conversation if we get the line back. it's a rough two weeks for them both because of what happened in the markets and the cancellations across the travel industry. let's check in with the social stocks feeling the pressure, as well, today julia boorstin is live in los angeles with more. >> social stocks are struggling more than the broader market today. snap shares down about 9% today, more than 20% over the 5 trading days and suffering from the news that nbc universal sold the

stake in the company last year twitter shares down 8% after striking a deal with investor elliott management to keep the ceo jack dorsey in place and also concerns of the declines in the ad market particularly china pinterest shares all-time low today off about 7.5% on concerns of the coronavirus impact on advertisers. facebook is suffering the least of the group down about 4% back over to you. >> the least and down 4% you know what kind of a day it is. thank you. let's get to sue herera now. >> hello, kelly. senator bernie sanders says he is staying in the presidential race and is looking forward to debating joe biden this sunday sanders said a change in the white house remains the top

priority. >> donald trump must be defeated and i will do everything in my power to make that happen. on sunday night, in the first one on one debate of this campaign, the american people will have the opportunity to see which candidate is best positioned to accomplish that goal. turkish president erdogan comparing the greek authority's alleged mistreatment of refugees to the nazis greece denies the accusation and a spokesman dismissed the comments as ramblings. india's parliament is debating the violent clashes of hindu and muslims that now killed more than 50. the home minister said strict action would be taken. protests and riots broke out over a new immigration law which sped up naturalization for most but not for muslims. that is the news update this hour kelly, busy day on wall street and outside, too. >> boy is it

thank you. coming up here, it is getting ugly for the retailers shares of adidas on track for worst month since december 2018. nordstrom, kohles, gap, lower by 9% we'll see if the action is justified. with oil down sharply, there are worried of bankruptcies in the oil patch. a guest has idea of how to play out across the industry and shares the insight ahead don't go anywhere. "the exchange" is back if two. there are untold hours of careful construction... infinite "what ifs?" and contingency plans. creating funds that help target gaps in client portfolios. tap untapped potential. and strengthen confidence in you. flexshares. powered by over a century of investment expertise before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

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welcome back to "the exchange." we have a news alert on the cruise lines seema mody with the details. >> i am hearing the new proposal from the cruise industry will include denying entry to travels above 70 unless they have written consent from a doctor. also, travelers with chronic medical condition will be banned from getting on a ship, according to people familiar with the matter. we are seeing the shares of cruise line operators lower on this this is just a proposal that has been sent to the white house we are awaiting a review of that proposal sometime today. the head of the cruise lines international association adam go

goldstein set to be at the white house. the cruise lines try to minimize the risk of infection. we are looking at royal caribbean down about 17% the overall market is down but this specific sector getting hit hard here. >> the fact it came from the cruise line industry itself and hurting the stock this is much is shocking. norwegian, a name, all of the names i thought down 60% this year does that mean it's 70% declines >> exactly right 65% to 70% move year to date for the major cruise lines of course, yesterday s&p, the credit rating agency putting royal and carnival on negative watch. royal and norwegian separately have been trying to secure additional lines of credit as they really try to get through this what's quickly a crisis. >> norwegian 72% off the high

just this year just amazing thanks the retail stocks also not looking that pretty today. nordstrom, kohl's and gap among the biggest losers this morning adidas reported results and expects a billion-dollar hit due to the coronavirus. here's what the ceo told our sara eisen. >> but in the sporting goods industry, you are at the end of the food chain and people when they're shopping buy food, drinks, you know, detergents before they buy sporting goods. >> not just sporting goods, many retailers not the top of the food chain joining me is brian nagle from oppenheimer. welcome. just today these are pretty big declines is this all justification action as far as you're concerned >> it is hard to say obviously my team and i are watching this very closely and i

would say right now this is important. what we're not seeing and again, fluid and watching this closely and not seeing is any indication of a broad -- within the united states, a broad-based consumer confidence driven pullback in spending i was talking to dick's sporting goods reported results yesterday and comment on the report, you know, they have not seen any inld cases urban outfitters this morning talking about sales weakness in seattle but really nowhere else. again, it is -- if there's a weakness in spending within the united states it is very, very isolated not seeing a broader pullback in spending. >> it is comforting in the sense it doesn't feel like a business cycle but it still is taking a toll an it's building on itself so, you know, a couple weeks, a month ago, people watching to see how they should react and today people are going, you know what close school for the rest of the school and do it remotely. that's just not a conducive

moment for months, right so what do you do with the stocks it's very difficult because if it is a passing event, that's one thing but running into crash flow events, it could push them to the brink. >> i'll say a couple things. with one, i think a positive again, trying to find positives and obviously a very critical and ongoing situation but one positive, too, the consumer's really coming at this or entering this from a position of decided strength okay the consumer spending by any measure within the quite over the past several quarters now has been very solid. we have seen the recent jobs reports of the government, very solid. the consumer heading into the crisis coming from a position of strength what i have been telling our clients as, again, looking for areas of improvement and one theme is interest rates to decline significantly. seen this huge decline in interest rates to me that's a big positive for

names in the home sector like home depot, lowe's and williams sonoma and other names like a nike, a lue llulemon. stocks have been hit hard. as we rebound i think those are the names that rebound the fastest. >> it was just the other day that dick's sporting goods with 5% u.s. comps, great number. do you also cover tractor supply great tailwind story but everything is thrown into disarray so what should investors do try to pick up some names here unjustly sold off and would those two be an example of that or is it just too soon to tell >> it's hard right now to call the bottom because this is a sentiment driven market. looking at the valuations for my group and definitely lower than they were and for retail and consumer valuations relative to the market are at historic lows. okay that's reflecting the higher multiples but when i have told our clinlts right now, might not

get the bottom but the high quality businesses, i mention home depot, lowe's, in the home improvement space, nike and lululemon, you might not get the bottom but high quality names on sale right now and my view and take it for what it's worth, i'm not an expert in viruses but i'm optimistic that while this is bad and getting worse probably it will pass and it's -- not hopefully in the not too distant future saying this was an opportunity. >> all right thank you for joining me today. >> thank you. we have got another news alert on, yes, the coronavirus let's get back to the desk for more >> thank you very much washington state and california both making news on this front washington state is banning certain types of gatherings that are bigger than 250 people that, of course, is an effort to slow the spread of the coronavirus. in addition, the washington state governor is asking all school districts to prepare for

online instruction and perhaps closures that will last longer than initially thought we have been expecting some comments from him but right now he is basically saying to school districts get ready. we are going to close down some of those school districts and in addition to that, prepare for online instruction for your students now, california specifically san francisco's mayor coming out just a few moments ago in a press release basically saying san francisco is issuing a moratorium on large gatherings of 1,000 people or more to slow the spread of covid-19, otherwiseknown as the novel coronavirus. we are starting to see more an more states become proactive in trying to limit the spread of the virus. kelly, back to you. >> sue herera with the latest there, we appreciate it. want to show you the action in markets. session lows once again here dow down briefly just down more

than 1300 points at the first time today better than 5% drop and, yes, bioing is a big piece of that. but even the s&p 500 is down 4.6% so get 5.2% drop for the dow, 1300-point decline and even the 10-year yield which earlier, in fact, starting the hour around 0.8%. down to about .73. so definitely a weaker tone in the last little bit. tech is an area hit today. we'll talk to a trader after a quick break saying stick with it you can see the names down 3%, 4% the airlines right across the board. united airlines and american, jetblue, delta, southwest all seeing declines up to 7% we'll have much more on the other side of this break tomorrow.

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my next guest said for the average institutional investor the sector is uninvestible true expert in the space thank you for being here. >> thank you. >> real quickly, the administration maybe floating some low interest loans for the oil sector is that something that you would look for in terms of relief or real help in this crisis or no >> what you need to understand is that we are potentially a systemic risk. opec launched a price war and by definition target it is weaker players to put them out of business and shale is weak today so when you think of what's happening in the sector we have seen the carnage in the economic market, high yield market but there is a ticking nuclear time bomb happening in the reserve base lending market and like the subprime of shale at 35. >> first, a lot of guests in the past week or so said we are about 4 million barrels a day

oversupplied and if saudi and russia hold out they'll push that out of the u.s. i wonder if why the administration is floating this is because they don't want cede america's position as the biggest oil explorer or energy exporter do you think there's a national security portion to this >> kelly, our foreign policy in large measure today is predicated on being energy independent. if you think about what we have done in terms of sanctions with russia, sanctions with venezuela, generally it's predicated on the fact we are not a big consumer of imports and produce a large measure of what we consume. if we were to relinquish that role it would have significant ramifications not just for the economy but the foreign policy standpoint, as well. >> you are a private equity guy and people want to know how to manage through this period one of the really interesting

things you mentioned is loans to the energy sector out there. energy is a biggest part of the high yield debt market you say the loans many times larger than that is that right? >> that's right. this sector for the better part of 30 years is funded by the bank community with very cheap financing, chiply 200 to 300 basis points over libor and measu mushroomed. >> the total high yield debt market >> high yield energy we are in a position now where the banks lost money for five years straight there is not fee revenue off the sector there's esg considerations and a lot of those banks we think calling the loans in at the worst time. >> are we going do see a wave of bankruptcies >> consolidation and are they going to try to continue pump oil in order to

just kind of get whatever they can? >> a couple of things to unpack in there if you think about in it terms of what it means for bankruptcies, we have a rate of 12% which is near pretty close to the peak of what it's been for 30 years to some degree we start already in the seventh inning of the game. >> wow. >> in terms of bank loan market continues to deteriorate and a second shoe to drop, you could see bankruptcies in the 50% to 60% rate an at that level not so much of pumping more oil but keeping the lights on. >> absolutely. we got to go but you think they would do tariffs it's a tool for other kinds of imports. why not oil, too >> if this continues to be as bad as it is it's a national security problem, an economic problem and we think you have to look at it the same way that the industry looked at steel in 2000s putting in anti-dumping measures. >> interesting thanks we'll see if we follow -- go down this road in terms of those

developments but at least puts it in perspective how serious it is thank you for coming in. >> thank you. let's get back to the markets in selloff mode. let's dive deeper into it. joining me is jeff it. "fast money" trader steve grasso and nancy tangler is chief investment officer of laugher tangler investments. welcome to all of you. steve, let me start with you and what your thoughts are on today's trading action >> we've seen 9/11, we've seen the financial crisis those were basically the first time we've seen things like that before we have seen outbreaks of viruses, but the reaction though one is unprecedented and that's why the market is caught off base here and that they're just waiting to see where the market is.

i don't see the systemic selling really put, the pressure i've seen in the last couple of days. but around these levels, look for near-term support levels and we'll see where the chips lie. but unfortunately, there's a lot of people that are calling for much lower levelses in t s in tp and we'll see where this takes the overall market in the long run. >> what are you seeing in terms of that action >> grasso brings up a great point. we have so much emotion, as traders and ninvestors are tryig to measure the actual risk, not the perceived risk, but the actual risk. we look at the realized volatility that's the actual move every day in the s&p 500 right now we're down about 5%. that is a realized move. and just under 50 in the vix future if you look at what an actual move when you price in vix terms of 5%, that's closer to 80 that's a substantial discount. my point is, kelly, there's so much emotion in the actual moves day-to-day, but the options market, which are typically and

historically more correct than the actual motion of the market, the options market are pricing the fact that this move, these day-to-day moves are overexaggerated and we will see it simmer down right now it goes back to december 2018. when you saw that market, the s&p 500 break under 200-day moving average right now we're under the 200-day moving average by 50%. this is a buying opportunity you have to be careful you don't have to go all in, but this is a welcome opportunity. >> nancy, are you taking advantage here of this market in that sense >> kelly, thanks for having me we are we put a hedge on our portfolio in early february. we just stepped in yesterday we sold some of our winners on the long-old side. we sold some of our winners, walmart, pepsico, and we started adding to some more growth year cyclically exposed names, salesforce.com, united technologies, picked up some jpmorgans and goldman sachs,

added to a new position in tjmaxx, tjx, we're not jumping in with both feet, but stepping gingerly into the higher-quality names we already own and some new names, as well >> and apple being one of those, nancy. i thought it was interesting what you said here, while we're talking about oil companies cutting their dividends and yields plunging, you think that company, this could be ripe for a dividend hike. >> they should be. this has been a sturdy stock for us we've owned it since 2013. we were selling it into strength in 2018. we all know what happened in the fourth quarter we bought more it felt rehearsearly by the timt to january 2019. and we zart estarted selling itn this year. would i step back in yes. but i need a little bit more to come out of the valuation. and then we think the company can pull a lot of levers, including raising the dividend it's the ecosystem that we're buying >> sure. >> steve, let me circle back to

you, then. as you said, we kind of obviously have to wait and see how things develop with the coronavirus. so a couple of things on your dashboard. do they include rates, the dollar what are you watching for signs of capitulation here >> so, for us, when you look at rates, obviously, when you look at the ten-year, that's going to take a lot of people's fear gauge and put it into perspective. but jeff had mentioned that 2018 level, in the s&p, that was 2350 we're at 2750 right now. so to make this actionable on a daily basis, 2734 in the s&p cash, is where we bottomed in the last two days. keep an eye on that. if we break through that, then it gets to be a precipitous fall but there are plenty of people that are calling for that 2350 low. and the reason why they're calling for it is because that brings us from the high to that low, 30% drawdown of the overall market and that's where people want to step in. there's a lot of green between here and there and i think you're going to see a lot of speed bumps and a lot

of people like nancy step up to the plate and start buying discounted names, because everything is on sale and i think ultimately, look through the smoke, this is a buying opportunity. >> jeff, i know, too, you also like some of the big tech names, apple, microsoft, intel. thank you, jeff kilburg, steve grasso, nancy the eveninglengler we're near session lows, down 1264, with the trump administraoncrblg ti saminto sort out a stimulus plan my big idea on how to get the economy going is next. what do you see? we see a billion more people breathing free. we see access to fresh food being the global norm, not the exception. we see homes staying cooler, without the planet getting warmer. at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility. emerson. consider it solved.

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welcome back as the panic deepens over the coronavirus and the government drags its feet on a response, the economic toll is likely to grow the federal reserve is on the verge of cutting interest rates to zero and has few good options left to support the economy if it continues to weaken here's my idea a student loan t.a.r.p we know most of the $1.27 trillion in student debt is simply never going to be paid back i don't like that anymore than you do but it's not going to be paid back so how about this? as i wrote in my news letter today, you forgive up to $50,000 of everyone's student debt almost $1 trillion of stimulus, and give a $50,000 tax credit

back to everyone who have already paid off their loan. i've gotten a huge response to this idea, not always in a good way. peter e-mails and said, what about the families who struggled to send their families to college. tom m. writes, the problem is the outrageous cost of college and i agree. the key and most important part of this plan is in exchange for this bailout, you get the government out of the student loan business for good, stul fofo full stop. going forward, each student gets a $50,000 voucher for college. it's wayne johnson's plan. he left this administration after realizing that the student loan system is fundamentally broken here's a chance to fix it. it's one of the only big bazookas left that could really help the u.s. economy. and if we're going to spend months working on a fiscal stimulus plan with who knows what will even end up in it, why not try to change the broken student loan system for good it would have huge ripple effects in the economy it could really hurt some colleges, but higher education in this country is broken

because of the government's interference and this is a chance to maybe set all of it right. let me know your thoughts. that does it for the exchange today. >> we will see you over here in just a moment. welcome, everybody i'm tyler mathisen and we start, of course, with the major sell-off that you see right there, down on the dow, 1,200 points, approaching session lows, wiping out all of yesterday's epic rally, heading right back towards the 52-week lows we hit on monday, 23,800, the number this as coronavirus fears grip wall street. moments ago, the world health organization declared the virus a global pandemic as the number of cases around the globe grows. right here in the u.s., we have more than a thousand cases right now and the cdc said as of yesterday, it has only tested about 5,000 people, just 5,000 so you can expect those numbers, that thousand case number to rise from there. and it is all eyes on the white house. the administration says they are working on a comprehensive ul