>> mr. hightower, give us a final trade. >> striker, sam yellow ken for the recovery in elective surgeries. >> all right we appreciate everybody today. see you back here tomorrow check the dow once again see you tonight on the special kelly picks it up right now. >> thank you, scott, hi, everybody. dr. fauci makes bullish comments of the trial results of gilead's covid-19 treatment drug. let's get straight to this optimistic dru news with meg tirrell with the latest, the stock move and the implications. meg? >> hi, kelly to share this is an unorthodox way to share results is an understatement we got the comments of the trial of gilead's remdesivir now in a

briefing from the white house oval office. what the top line results show us is there's a benefit in the time to recovery for patients, the main goal of the study dr. fauci saying it took poirnts on the drug 11 days to recover versus 15 days for those on a placebo and a mortality trend meaning 8% of those taking the drug died versus 11% on placebo and it was not statistically significant however the original finding of the time to improvement is significant important for measuring just how powerful the study results are and a clear-out positive effect in diminishing time to recover and compared it to early days of treating hiv and it's important because the first drug it was something to build on an it wasn't until we got more drugs for hiv that we really started to see dramatic improvements in

treating that disease. dr. gottlieb said he expects to see the fda issuing an emergency use authorization for remdesivir immediately and did ask the fda about that they told us essentially they're in ongoing discussions with gilead making it available to patients as quickly as possible as appropriate we'll stay tuned on that but these results pretty encouraging today, kelly back to you. >> a theme to see is people think it's much better news for the overall market and the economy than gilead itself saying that the company stated they won't benefit that much financially from this. but i wonder even if the news is all that great, for people who get coronavirus, i mean, to say that the mortality fell 3 percentage points is of course good news but is it enough 11 days versus 15, you know, again, any little bit of this is good news but do you think the market's making too much of it >> well, it'll be difficult to say until we see a deeper dive

into the trial results this trial enrolled patients at a spectrum of severity of disease. some on ventilators, other patients were less severe, they were alm in the hospital with breathing issues, but when's clear and gilead released some clinical trial results today, as well, treating earlier is more beneficial and seeing the top line results of the study right now that is a blending of the results for all of those different patients and as we get more granularity we see some benefit and not some great benefit and they're working on optimizing when to give the drug, the dose to give the drug, to whom to give the drug, all of that and could be very good news for some folks and won't work as well for others. >> great if it turns out giving earlier helps a lot an all of this plays into people's reopening decisions as well as the market moves today

meg, thank you huge news. let's get to more on the rally. bob pisani joins me now. there's a lot more going on today. >> there's three things going on we have the reopening of the economy rally. then we have the better testing expanded testing rally and the hopes for expanded treatment mo dahlties you have three different things going on 10-1 advancing to declining stocks not five stocks in the s&p 500 like amazon moving today that is very, very broad rally we are just off the highs for the day. we crossed 2900. we have regained 60% of the losses since the end of february which the serious declines happened here. it is broad. lock at the s&p. yes, up today, but the equal weight s&p 500 is even doing better and outperforming this week and the russell 2000 is outperforming today and this week, that's not happened in a long time. broadening of the rally and the laggards, the stuff that used to have a tough time, the bank

stocks, the energy stocks, the retail stocks, for example, put that up there. they're all outperforming today and the week the rally is broadening out and that is very positive sign >> all right bob, thank you very much we're counting down to the fed decision today and news conference it all kicks off in less than an hour's time. today's meeting is unprecedented coming on the back of the massive action of the fed taken recently two emergency rate cuts to zero, a bank reserve rate cut, swap line expansion and then purchases of treasury, corporate bonds, aset backed bonds, commercial paper, credit securities the list goes on and on and expanded the commercial paper program, loosened lending rules an finally has a major $6 trillion worth of a main street

lending program on the way and adds up to a lot an is it the beginning of what we could see the fed understotake here? let's get to steve liesman steve, with your thoughts on the scope of this action and what we might hear from the fed this afternoon. >> yeah, kelly, thanks that list you had there looked like the credits for the end of the a movie but it is the beginning of a movie and a historic meeting here where the fed embraces two roles, running monetary policy where it's in charge of interest rates, the economic outlook, guidance, credit markets but also the other thing, fed chair jay powell now the financier for the shutdown, the jpmorgan of the shutdown but the fed is now running a whole bunch of programs that essentially finance the economy, provide liquidity for the economy through this coronavirus shutdown you can see the balance sheet here as rocketed up, $2.3

trillion in historic times and there's much more to go. much more to go. derrick camp of morgan stanley writing the fed will increase the size of its asset holdings by additional $4 trillion, those purchases paired with the fed's credit facilities would bring the balance sheet to $12 trillion or roughly 50% of gdp not as bad as japan. what are the withins 600 billion. corporate credit facility to buy investment grade and some fallen angels, as well. 750 billion. asset backed purchase, 100 billion. treasure secretary steve mnuchin on a call i was just on with reporters said he's holding back on 259 billion which could fund trillions dollars more of purchases. that's a dirpt kind of press conference here where powell

will face the press not only responsible for the credit market stuff but also much more directly to the american people for financing this shutdown. >> yeah. steve, to jump ahead here to the end game in all of this, as we hope to look beyond coronavirus and the fed is left with a $12 trillion balance sheet next year, people speculate about extinguishing the debt does that need to be repaid? >> it depends on what you're talking about. some stuff's going to roll off there's a defined maturity on some of this lending here and the fed -- look. i don't know what it does about the treasuries and the mortgages that it purchases. some of that stuff to roll off, as well. i don't think the fed is even thinking or considering or doesn't even want to talk out loud about the end game here because what the fed -- the message the fed to give the markets is we are here, we are here and absolute force with no thinking or talking about or any looking over our shoulder about

what we're doing right now remember, that was a big sort of break on the fed's stimulus in the crisis, this idea that, hey, we are ending this, we'll go back to normal rates real soon this time it's all out, all open, whatever it takes for as long as it takes. >> steve, because the data is more promising from gilead today, because the stock market is 15% from the all-time highs, is it possible the fed never launches some of those programs if the economy they think improves enough? >> that's a wonderful question it really underscores the way the federal reserve can act. there's a marked effect on the corporate bond market. yes, it is possible. some of these programs may take weeks to launch but the idea that the fed is going to launch them had a positive effect on markets oar very much so it'll be interesting as we see more details thanks very much see you again next hour for the big decision. stocks are higher today with

the dow on pace for the best month since 1987 interest rates are hovering near record lows. what is the market expecting from the fed today let's ask brian bellski and subadra rajappa. it's great to have you both here brian, i'll pick up on what we were saying with steve which is does the fed need to launch the programs if they listen to the market signals and sense that the ship is stabilizing? >> you know, as steve said, it is a wonderful question, kelly the fed's clearly proven they're all in it is really -- they came to america's aid in a crisis of confidence where the communication from elsewhere was not great. and so, we're fortunate to have the fed come in and do this. i think the broader question is, coming out of this, which everybody wants to worry about, what this looks like in 2021,

2022 we like to remind people that in during and following the crisis, it was ten years to get growth back and the slowest recovery in history. and so many people thought the fed would be more active to raise rates in 2011 to 2012. so we really think that this is going to take a lot longer to unwind in the fed than most people are thinking about but bottom line is the fed as you said, the best news of all could be that it ultimately never has to put this money to work and that would be very good for the economy locker term. >> let's ask you about the market in general. we have done reporting of whether the rally is less vigorous because you have companies with a lot of debt who have issued more equity and taking a big buyer out of the market we have talked to you as whether you're a bull or a bear but talk about the degree of your billishness and if you're sharing concerns of a slow recovery, what do you think that means for the stock market

>> well, i think it means you have to focus on fundamentals again. we have been an advocate for fundamental investing for a long time and against macro invested that controlled the mood for investments for ten or 20 years and been very clear since march 23rd that was the low, that the market to rally 40% to 50% from the lows we had unprecedented downside and now unprecedented upside everybody would hate this rally, everybody would want to see a retest and everybody would want to make these big calls that we are going to see a retest. we can't invest like that. i would caution to do this stop trying to pick market points in time and be an investor to look at free cash flow yield, the balance sheet. per your question in terms of buybacks, that's why you want to buy companies that are going to benefit from this growing dynamic and themes of communication services,

technology, and the eventual rebound which we have seen with mr. pisani talk about with value, financials, small cap, energy be diversified and buy the best companies in the world who ch are right here in the united states. >> there's an interesting question of saying the question for the fed is what level do they want to see the 10-year at? at zero like the bank of japan or 3% because this actually suggests people are much more bullish on the prospects for the economy? what do you think? what would you make of rates and where they go from here? >> i would argue that they're probably happy with interest rates where they are right now i think there's really no need for 10-year treasury yields to trade at 0 because the purpose of asset purchases is liquidity to the treasury markets not necessarily to stimulate the

economy like it was during qe-1 and the focus really now stabilizing the markets, providing liquidity and having a semblance of normalcy and i would say 10-year treasury yield 60 points is a positive sign for the markets. and that's why you're seeing the risk taking in equities as well as in corporate bond spread. >> let's follow up on that we hear this all the time, people say, kelly, the market's up 30%, 40% off the lows and the bond market said we'll retest the lows and it is worse out there. your interpretation seems different. why do you think the level is a bullish sign >> i think that keeping rates accommodative. not seeing the same level of volatility of the bond markets like a few weeks ago and, you know, for the most part the fed is providing accommodation as needed they have tapered their purchases of treasuries ever so

slowly it is hard to keep -- sustain the same pace of asset purchases so really what we will be looking to at the fed meeting today is the way forward what are they thinking of asset purchases broadly speaking are they going to sort of switch to a monthly purchase program as opposed to a daily size they have been targeted >> yeah. maybe giving us some sense of the monthly number i saw you nodding in agreement 3400 on the s&p. we'll see if we get back up to the levels i thank you both for joining me today. let's get to boeing now, the sharing soaring 11%. despite the company reporting a massive loss in the first quarter and cutting 10% of the workforce. the ceo calling the industry frozen by coronavirus.

phil lebeau has more from his exclusive interview. phil >> frozen but in the midst of a thaw perhaps the hope of boeing ceo calhoun yes, it was a loss wider tharn expected but frankly, first quarter people knew it was not going to be good. people said that's fine. what kind of moves are you making to cut costs? cutting 16,000 jobs, most in the commercial airplane division, in part because they're reducing the production rate in xherm airplanes. here's calhoun this morning about where boeing is in the commercial airline industry. >> we feel a little bit like we're the tip of the spear, aviation, in light of all of the shutdowns. not just here in the united states but pretty much everywhere in the world. the ramifications are big. for the most part the industry is not interested in taking delivery of airplanes at the

moment and/or prepaying against contract that is we have in hand so as a result there is this moment in time where everyone is sort of frozen, trying to contend with the dramatic reductions >> and those reductions and the fact that they're going to see fewer deliveries for commercial airplanes over next several years is burning through $4 billion in cash. they had $15.5 billion at the end of the quarter, kelly. dave calhoun says they will be accessing the public markets in terms of getting more capital and then there's always the option of potentially borrowing from the treasury. that has not been determined yet largely in part because they don't know what the terms are from the treasury department the options are out there. >> all right phil, thank you for bringing us that interview we appreciate it. coming up, battleground stock tesla set to report this afternoon. one analyst says the company will emerge stronger than ever from this crisis

plus battle royale a fight of amc and universal that could turn the movie industry upside down we will have the details "the exchange" is back after this quick break ♪i may be acting crazy now it's getting late♪ ♪they took my heart away ♪but i'll be okay, 'cause♪ ♪in my dream world ♪i'm still your dream girl ♪ooh, i'm still your dream girl♪ ♪ooh ♪ some companies still have hr stuck between employeesentering data.a. changing data. more and more sensitive, personal data. and it doesn't just drag hr down. it drags the entire business down -- with inefficiency, errors and waste. it's ridiculous. so ridiculous. with paycom, employees enter and manage their own data in a single,

easy to use software. visit paycom.com, and schedule your demo today. there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these. powered by the nation's largest gig-speed network. to help give you the speed, reliability, and security you need. tools to manage your business from any device, anywhere. and a team of experts - here for you 24/7.

we've always believed in the power of working together. that's why, when every connection counts... you can count on us. welcome back tesla is reporting earnings after the bell today while the stock hasn't been immune to some volatility, it's had a major comeback it delivered 88,000 vehicles in

the first quarter. the shares around $792 today the next guest said tesla should emerge from coronavirus stronger than before. joseph, welcome. you know, your note caught my eye the other day. why do you think that a company like tesla with all of its reliance on capital markets and so forth could come out of coronavirus stronger >> thanks. there's a couple points i'd make i think there's a perception that hangs over from last year that tesla's not financially stable they have made enormous headway. they're coming out of the quarter with more than $7 billion in cash and not that dependent on the financial markets but the idea that i think that tesla's competitors are going to pull back from the commitment to developing electric vehicles, particularly in the u.s., and so i actually feel better about tesla's market share and competitiveness. >> i take your point that gm is making ventilators right now

instead of electric vehicle batteries. i thought you emphasized that the tesla workforce is not unionized and when they demand more protections to come back to the office, tesla was forced to close down the operations in california after really trying not to. >> yeah. i will step away from making any comments about workplace safety. i believe tesla will do what's necessary but they do have some flexibility in terms of the ability to purr low, unionized jobs do not. i'd like to return to the point of investigators gasoline is under $2 in a lot of the parts of this country and there's going to be a strong temptation at gm, at ford to return to selling big pickups and suvs an ento defund some of the very expensive catch-up programs on the ev side when they will have to do if they want to catch tesla so i think it's more about what happens at gm and ford over 18 months and

not whether they're making ventilators right now. >> no. i take your point and people thought after '08 we would be driving small, more fuel efficient cars and instead we have the suv boom. do you think that cheap gasoline poses a threat for tesla or changes the number of cars, especially the mass market cars that you previously thought they would sell >> that's an interesting question i think it cuts two ways one could argue that the overall size of the market for electric vehicles maybe is impacted a bit by cheap gasoline but that on the other side -- pardon me. you have to model where you think market share is going. is gm going to be competitive? is ford going to be competitive? i think the answer there is that you're going to see those companies be less competitive so i guess to answer your question, i see tesla having bigger share of a potentially slightly smaller market. >> you know, one thing to ask

you about before we go, what do you make of the move for elon musk to self insure the directors? because he said the insurance costs were too high. does that tell us something more than just, hey, this is a quirky story? >> i think it's elon being iconoclastic he has plenty of money and very, very passionate about the message of conviction in his company. so i think that's just him being iconoclastic it is very interesting to hear what he says about his commitment to the business, his commitment to continuing to grow on the call today. i think that's what investors should focus on, not the second or third quarter. >> interesting joseph osha, thank you for joining me. >> thank you. coming up, from layoffs to uber to works of wework, the sharing economy is suffering big time in this crisis.

remember you can always watch or listen to us live on the go othn e cnbc app "the exchange" is back in two. m. that's why we're offering contactless delivery and set-up on all devices. and for those experiencing financial hardship due to this crisis, we'll work with you to keep your service up and running. hi! because at at&t, we're always committed to keeping you connected.

woi felt completely helpless.hed online. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555.

welcome back let's get very latest in the coronavirus pandemic over to sue herera for the headlines. >> hello, kelly, everyone. the world health organization's michael ryan says the proportion of people with antibodies is quite low, even in hot spot areas with intense transmission of the coronavirus that he says is a concern. new york's governor cuomo unveiled acollage of homemade masks from people across the country for new yorkers on the front lines of the virus he calls it a self portrait of america. and a tattoo enthusiast in stockholm put the face of the state epidemiologist on his arm. the man said tagnel dealt with the outbreak in an admirable

way. that's a novel way to do it. more on the coronavirus coverage, head to cnbc.com >> maybe fauci tattoos - >> i'm sure! >> sue herera, we appreciate it. an epic battle on the silver screen, amc the world's largest theater operator threatening not to run universal movies in the theaters in response to universal releasing movies in theaters and on demand let's get to julia boorstin for the latest julia? >> reporter: amc laden with debt is showing the concerns about universal bringing in some $77 million in revenue from its digital release of its film "trolls world tour." and amc saying it's any movie maker that abandons current windowing practices so they and

we both benefit and neither are hurt from such changes regal just today telling variety also boycotting universal films. we have reached out to regal for a comment on this. universal saying in response to amc to reach the widest potential audience, quote, going forward we expect to release films directly to theaters as well as on paid video on demand when that outlet makes sense the effective deadline for universal and the theaters to reach a deal is september. because that's when universal is doing its next wide release movie and just reminder universal is owned by cnbc's parent company back orr to you. >> i wonder, julia, if amc feels like it can throw the weight around here or that it has to. in other words, we were talking about whether the company makes it through coronavirus the equity trading very, very low levels and might not think it's a position to be waging the battle until they think it's

existential and if they don't they go out of business. >> well look seems leek it ends up being a negotiation. you're right amc doesn't have a lot of negotiating leverage right now they have very high debt looking at the box office market share before theaters started to closing down, universal had 20% market share there so amc arguably really needs the movies but also so scared about losing all that movie going and all of those movie tickets that are sold so what we could see here is some sort of agreement where universal agives to theaters a three-week exclusive window or saying that some percentage of the movies will have that three-month exclusive window and smaller percentage to do whatever they want with them but universal putting the numbers out there confirming they got $77 million in revenue from video on demand, that shows that there's massive demand by

consumers and what will drive this. >> people like that experience it does feel like it changes as a result julia, thanks. coming up, the fed is committed trillions in a dozen or more programs ahead of today's meeting. is there more ahead? also, shares of starbucks moving lower today after reporting earnings showed a bigger than expected drop in same store sales but the ceo is focused on the path forward for the company. >> starting next week, here in the u.s., we are going to open a significant number of starbucks stores by early june plan to have over 90% of the stores open in the u.s. and so we are beginning to monitor the path to recovery ♪ ♪ ♪

here's the thing about managing for your business.s when you've got public clouds, and private clouds, and hybrid clouds- things can get a bit cloudy for you. but now, there's the dell technologies cloud, powered by vmware. a single hub for a consistent operating experience across all your clouds. that should clear things up.

welcome back to "the exchange." markets are near session highs rallying about 2.5% to in the nasdaq's case 3.5%, biggest mover there. let's get a check with dom chu >> kelly, seeing like you said the highs of the day for the stock market the gains broad based. no s&p sector in negative territory but the real outperformers is optimism of the path forward anything travel related, shares of carnival cruise lines up on heavier than average volume. carries over to the cruise lines, also big airline stocks watch those. then there are the really beaten up energy stocks like the oil refiner valero energy and then the consumer finance companies like capital one financial up

11% or so as the outlook of the consumer spending picture gains traction there then you want to keep an eye on the shares of facebook stock microsoft, ebay. after the closing bell in terms of earnings reports. back over to you guys. >> thank you very much, dom chu. lyft announcing plans to cut 17% of the workforce and furlough hundreds more and the information reported that uber is discussing plans to lay off 20% of the employees and wework cuts nearly 100 workers at the san francisco office but airbnb saying it's confident to have the ipo this year. i'm joined by santoosh rao and

deirdre bosa with us, as well. you seem optimistic still on the likes of airbnb. >> absolutely. thank you for having me. i think let's see how the dust settles on the other side of this whole thing but i think overall the gig economy is going to be around it's going to do very well it might take a different shape, slightly they will add a layer -- cost layer there with safety and security but i think airbnb, uber lyft will do well and a round of layoffs and understandably so. every sector of the economy is hit and cutting costs. i'm not worried of cutting costs. expected i think overall they'll come out of this stronger on the other side. >> deirdre, i look at the journal, front page today. talking about the bargain with the devil that people are furious with airbnb. i hear this all the time, as well maybe you can just say, hey, it was a learning experience for

everybody going through this but i do wonder not so much about the gig economy but the sharing economy, this part in particular sharing a home, a workspace, a car. if that has some serious challenges ahead. >> yeah. kelly, i love how the journal put it, they called airbnb the property owners that own numerous amounts of homes or apartments and rent them out, the upper crust of the sharing economy because that's really what they were, there's an economy behind airbnb with interior designers, maintenance people, cleaners but looking at the sharing economy at large i think that what you are seeing is weaknesses were already becoming exposed the coronavirus pandemic is just speeding that process up even before the coronavirus decimated demand for ride sharing you saw the public market investors demanding more visibility into paths of profitability of uber and lyft and burning through billions of

dollars a year and this pandemic happening right now doesn't give them a lot of opportunity to get on top of it so what you are seeing is demand decline, having to lay off, fire, you know, in some cases lyft this morning 17% of the workforce, nearly a fifth. so they're in a lot of trouble and while i understand that perhaps they come out of this stronger, they have to come out of this. and the rate at which many of them are burning through cash, another example is wework, i think that's still a question because we don't know how long this lasts. >> santosh, i assume that probably leaves you still a good margin, you know, to -- of money on these equities. but i guess you tell me. even though the ceo says airbnb can go public this year, you doubt that can happen. what are the valuations you think are more realistic post-coronavirus valuation cuts of 50% or more? >> yeah.

i think you know what? a lot of things are moving it's too many moving parts at this point, difficult to pin a valuation. there's a fear factor driving valuations down. i don't know if that's permanent as yet yes, some trades are going off early. according to some estimates but i think overall you'll see that things will settle we need to see some clarity as to where it's all going. if we have enough safety features in there and if there's a cure, the health risk goes away, then if the slowly business reverts back to normal which might be maybe six months, three months, we don't know yet. it depends on how things settle on the other side of this. airbnb, there's head wind. they are burning cash. they have issues that will play out, that was expected and like deirdre said, the fault lines are exposed.

they were working through them but i think they will settle it. i think what this has done is really exposed all that. we need them to come out stronger on the other side and the market will force them to. the sharing economy is a part of our lives, of our economies and i think they will come back -- they will innovate and come out stronger on the other side. >> deirdre >> i disagree that you can't put a pin on the valuations. you can. they're becoming very, very clear. airbnb last raised equity at a $16 billion valuation. about half of where it last raised money uber at less than $55 billion market cap one point it was pitched as a $120 billion company it was worth $76 billion on private markets lyft trading far below who's the biggest investor in these names, the backer of the

sharing economy? that's softbank. you have the look at the role that they have played in boosting up these valuations that now seem very, very much at odds with how public market investors and even some private market investors are putting on them. >> real quickly, is there any company to invest in now because of coronavirus i'm thinking of the likes of instacart. >> i think that the delivery companies have come out strong in this whole thing. they have proved themselves so we're investors in postmates a number of other companies and there are opportunities at lower valuations so i think there's great opportunity for investors to get in here at a time when there's some uncertain selloff, unwarranted selloff. it's all reflecting the fear factor in the economy. burn point almost a death sentence with the coronavirus an that's going away and saw the press conference just now. i think things are opening up. i think the valuations will pick

up, as well, as we get more clarity on the other side of this whole thing. >> all right well maybe an opportunity like you said thank you for joining us. >> thank you for having me. >> and deirdre, thank you for the great reporting, as well. we have got some breaking news on the small business lending program. what's going on, kate? >> hey, kelly. sba just sent out a new notice to its lendering saying that to ensure access to the ppp loan program for the smallest businesses, starting today at 4:00 p.m. sba systems will only accept loans from lending institutions with asset sizes less than $1 billion please note lending institutions with sizes that are above $1 billion can still submit ppp loans outside of this time framer and lenders larger will be able to submit loans today outside of that 4:00 p.m. to midnight window. that's preserved processing time for smaller lenders.

sba and treasury say they're going to re-evaluate whether or not a similar reserve time frame is necessary in the future but here they're reserving a processing window for smaller lenders with less than a billion dollars in assets. there's been some concerns of potential loan prioritizations kelly? >> and this suggests that the people in charge that share the concerns an eight-hour window starting at 4:00 p.m. today. kate, thanks. up next, we're going to get to the bold market calls of the day and why an uptick in consumer deliver ris might not be good for u.p.s. here's the biggest gainers on the dow tayod boeing now 9.5%. we're back if two. ♪

dad, i'm scared. ♪ it's only human to care for those we love. and also help light their way. it's why last year chevron invested over $10 billion to bring affordable, reliable, ever cleaner energy to america. ♪

welcome back here are the calls of the day. we begin with the name

everyone's watching. tyson foods downgraded to neutral to $66 despite the meal oriented portfolio, they face headwinds from the plant closures and higher costs still saying the government reopening calls helps them in the long run interesting one, this one, u.p.s. downgraded, lowering the price target to $85 saying while covid-19 grown the consumer oriented delivery business might not be good for u.p.s. meaning higher costs an the structural decline in profitability under way and the shutdown accelerated it an shares down less than 1% today. under armour with a sell and a $5 price target with a negative trifecta losing relevance, management turnover and limited brand building resources shares with up nearly 3% nevertheless on the reopening talk trading over $11 we're just moments a i way from the fed's rate decision.

while rates may remain unchanged, there's the role of shutdown financier the remarks at the 2:30 news conference monitored closely the key things tlienor xto st f, and... let's get started.

(music fades in) hey! -hi! ♪ ♪ ♪ ♪

we're moments from the fed's decision on interest rates has the fed already done too much joining me now is greg giff and bill lee greg, welcome. we haven't even seen the main street program get off the ground yet and yet the market is turning bullish lately. >> yeah. you have to give the fed some credit for that because the fed obviously can't solve the

pandemic much less reopen the economy but i think its programs dpon straited it won't allow a liquidity crisis among corporates to be a solvency crisis and had an impact o that's clearly had a positive impact in the credit market and spilling over to the stock market i would love to hear what jay paul has to say in half an hour from now when he comes out of this meeting obviously what he's going to do with fed policy is going to be important. i mostly want to hear what he thinks about the economy there's so much uncertainty out there and he is one of the people that people still trust to give it to us in a candid way. >> bill, i thought your observation here was interesting that the fed missed an opportunity to distribute funds authorized by the c.a.r.e.s act more efficiently what do you think we're learning as we navigate this early period >> the fed learned its lesson to go in big and go in early from 2008 it's managed to reassure markets that everything is going to function right but what it didn't seem to take into account were the bureaucratic snafus and loan

issuing policies of these big banks, and that's sort of misdirected funds and clay dela funds from sbg being disbursed we could have had a whole host out there issuing these funds and had it securitized since the fed was in the markets reassuring everyone that they're going to be a buyer of last resort even in corporate main street loans, we had a guaranteed market. the distribution would have been done much more effectively, efficiently, and fairly. >> but i think bill is most certainly right about that, but fed would have gotten all of this criticism about simply bailing out big business and not helping main street. they specifically chose to call this a main street lending program and aimed at companies with 500 to 10,000 employees that is vast swaths of america that can't necessarily issue the kind of debt that bill is talking about the fed purchasing so i understand the intent here, but do you think it's going to

end up -- are they going to be able to distribute the 600 efficie efficiently? >> first of all, i don't think we should be blaming the fed that we have with the small business lending program, which does not involve the fed that is entirely funded by the treasury and in fact, you might argue that some of the administrative problems that the sba has been having actually vindicate the decision of the fed to go slowly it hasn't even launched the main street lending program yet as for the corporate lending programs, they're already having a positive effect. but that said, as they roll out these programs, absolutely, they're going to encounter some of the problems that you and bill have just discussed there will be people who said the program was too scatter shot, gave money to people who didn't need it and those who will say it was too narrow and didn't get to where it was needed let's err on the side of doing too much and it will be a nice problem to have at the end of this process, we're saying, we helped the economy too much. >> you know, bill, at the same time, like gregg said, there has been a ton of criticism about the ppp program and i definitely think it's going to play into

the election season this fall in terms of who gets the blame for how that was administered, even if the majority of the funds were well administered the impression everybody is left with is that the money was misappropriately allocated so how does the fed, which has been trying to take comments and not repeat those mistakes, they're still going through the banking system how do they avoid the same outcome? >> i think they're hoping to promise a lot and do very little and i think that's the notion of having to allow a lot of financial institutions, banks, and non-banks a package small business loans and then have a market created for it, and have fed be one of the buyers that's one way to distribute small business loans much more effectively than having to go to chase and all these large banks, where they get chopped out by chase's great clients. >> that's a great point, use the securitization, but bundle up the small business loans and sell them off. you always come with great ideas, gregg i'll leave it with you, a clever thing that bill just said, is it better for the fed to have to promise a lot, but do very

little they haven't even launched some of their corporate bond support programs yet, because the market just simply knows that they have a backstop they can just say, whatever it takes, and not have to do much >> don't you remember when mario draghi said, we will do what it takes, and believe me, we'll be at nuts. the eurozone crisis was over before they bought a single bond look, the central banks have this amazing thing that's called a printing press and if they're willing to run that thing fast, they can do a lot. >> that is -- that is food for thought, as we get this decision today, guys. all right, thank you both. bill lee, greg ip with some bigger-picture thoughts on the fed's involvement here we're just moments away from one of the most anticipated fed meetings and press conferences ever on the back of the massive action they've announced and initiated lately i'll join tyler mathisen for live coverage on the other side of this brk.ea

and welcome back, everybody, to a very special edition of "power lunch." i'm tyler mathisen we are just moments away, as you probably know, from a fed decision on interest rates something, nothing, we don't know we're expecting it right at 2:00 p.m. and we will have full team coverage as that news breaks the markets are in rally mode, we should note, despite gdp in the first quarter of this year contracting the most since the financial crisis under normal circumstances, that would not be good news but investors instead are focused on a positive trial. data coming out for jigilead's coronavirus drug, remdesivir and we will have more on that in just a moment or two but let's start with what to expect out of the fed and from fed chair jerome powell, when he has his press conference at

about 2:30 eastern time. it has been an historic month of intervention from the federal reserve. david kelly from jpmorgan, mona mahonage from allianz global join us right now. we're very happy to have both you've here. david, i'll let you start off. it has been a month lying no other for the fed. what should we expect today? action, no action, is what really matters, the statement and the press conference >> yes, i think it's all about messaging, i think the fed wants to show some empathy, acknowledge the extraordinarily weak situation the economy is in right now. i think they want to express some determination to do whatever is necessary to help the economy through this very difficult period and i do expect that jay powell also will express some optimism that we will get through this and that the economy will bounce back strongly in 2021. once we have dealt with this medical issue. >> you know, mona, kelly was just having a very interesting conversation with her prior

guests, including greg ip, where she said, does the very fact that the fed says, we'll do whatever we need to do, mean that maybe the fed won't need to do whatever it needs to do >> yeah, you know, clearly, the messaging from jay powell is important. it's always been a driver of the markets. i think many people would like to hear what they're thinkin about for the second half of this year. you know, keep in mind, back in march, we didn't get the usual summary of economic projections, the fed's view on unemployment, even inflation so i think a lot of people would be interested to hear how he's saying the path of recovery, if any. and also, it would be interesting to hear what he thinks of market conditions currently. clearly, he might even take a little bit of a victory lap. he'd had financial conditions ease quite a bit we've seen the vix and a lot of volatility indices come down from their peaks clearly on the credit side, investment grade and high-yield spreads have also come down from spiking highs higher

>> we are very close to that decision and i'm going to toss it back to kelly, who has a much better read on exactly the number of seconds until that decision we should point out that the dow is up 550 points, kelly. >> yes, it is. and the nasdaq is up -- it's the outperformer today, up 3.5%. also keeping a close eye on rates near historic low. steve liesman here with the historic fed decision. steve? >> kelly, the federal reserve saying it's leaving rates unchanged at that range of zero to 0.25% and saying it's going to keep rates there until it's confident that the economy has weathered the impact of the coronavirus and is back on track the federal reserve saying in a statement, it is committed to using the full range of tools. and you've seen that in the programs that have been announced. they will continue to purchase treasuries, the fed says, and mortgages in the amount needed, end quote. an