track the spread throughout the world with interactive maps and charts. watch hearings with public health specialists anytime unfiltered at c-span.org/coronavirus. we are back with heather long who was here to explain to us what is going on with the economy around the coronavirus. what parts of the economy are most affected by what is going on? many of us are watching the stock market this week. even though we had a rally on friday, it is in a bear market. that means stocks have fallen 20% from their all-time high in mid february. this is the fastest we have ever dived into a bear market. not even in 2008 did we go this fast. in terms of they real economy, most of us know there have

already been layoffs at hotels across the country. we are starting to see some at restaurants and bakeries. anything having to do with travel and leisure and hospitality is on the front lines of this. the big fear is it is going to start cascading over. the other thing that makes this particular week unique in addition to the coronavirus, we have seen energy take a nosedive. a bunch of energy companies lost half of their value this week. it is just an astounding drop. there is a big concern that the energy sector now that oil prices are so low, it is cheap gas, but we have 200,000 people in this country working in that industry. some of those jobs are going to disappear. host: we have heard a lot of talk this week about a possible recession, about this country sliding into a recession.

i want you to define for us what a recession is and then tell us are we headed into one? guest: a recession in economic terms is six months of negative growth. the economy is literally shrinking. the debate is, are we going to see that right now? you usually have to see shrinking growth and substantial job losses. you needed those two things, neither of which are fun or pretty. there is no doubt that starting this week the u.s. economy literally shut down. for the past three days, i have been in my house. i have not been going out for lunch. i have not been going to the gym and doing my daily routine. when you multiply that across the country, it is an immediate shock down of every sector but health care and of grocery stores for now if they can keep the shelves stocked. definitely march is going to be negative. definitely april, probably may. the question is, when do we

rebound? i would argue we are going to go into a recession because we will see the first order and second quarter probably have negative growth, but there may be technical debates about whether we reached six months. the hope is that we are going to have a situation where it is a real sharp shutdown of the economy followed by a really sharp rebound. whether we get that sharp rebound depends on whether congress continues to act and whether people who need this relief, the sick pay and medical leave can get it and whether as a nation we can get through this and start to resume some semblance of normal life by the summer. host: you mentioned earlier that we saw a quick rebound of the stock market after president trump's national emergency declaration. we see the package working its way through congress right now. it has passed the house. we don't know if the senate will

move next week or if they move at all. is the government doing enough to turn around what is happening with the economy right now? guest: you ask any economist or wall street person, and they would say no. that is why we have seen such a dramatic stock market fall. people don't think it has been aggressive enough at the moment in the united states. what is interesting when you think back to 2008, our last panic moment took a series of actions. a lot of people criticized the government for being slow to act and doing not just one stimulus package but a series of stimulus packages to get the economy going again. i was encouraged yesterday by comments by house speaker pelosi and treasury secretary steven mnuchin.

both of them were referring to this is just the second inning in a baseball game. we are going to need more than just what is in this bill. host: earlier this week, you wrote a story that corporate defaults and personal defaults are the biggest threat right now. can you explain what you meant? guest: on the one hand, you have some callers, if nobody is coming into your bakery or yoga studio right now, you have no income coming in. a small business owner i was talking to in michigan said can i survive six months of this? no. we don't know how long this is going to continue. this could include bigger companies and airlines. this is a dramatic drop in cash flow coming in. a lot of concern if the airlines will survive this.

you have had some callers who have referred to it is great news that we got some sick pay and medical leave to give people money to get them through the next few weeks or months, but what happens if you get laid off? you can apply for unemployment insurance, but it is not as much as you are making in your regular job. you do not have enough money coming in. maybe you don't have any savings. 40% of americans before coronavirus were struggling to pay their bills. what do you stop paying first? do you not pay your mortgage or car payment? that is where this can grow quickly if we are sitting here having the same conversation in may or june. host: we hear a lot of talk about the gig economy. people holding down two or three jobs that pay less instead of one job that has insurance. how will people be affected by this? ? that is where this can grow quickly if we are sitting here having the same conversation in may or june.

we hear a lot of talk about the gig economy. people holding down two or three jobs that pay less instead of one job that has insurance. how will people be affected by this? are some of the earliest and worst impacted so far. i have been talking to different employers and workers. think about how many conferences are canceled. people need hotels and restaurants to set up the stages. beingby southwest canceled. i was encouraged to see the text of the bill that was passed last night in the house.

self is a tax credit for -- self-employed individuals. giveis going to individuals the chance to access family medical leave. able to apply for this tax credit to offset. it is refundable. the worst yearis ever and you make almost no income. you can get a check back from the government. it is a little bit of help. it is something. host: viewers can join in on this conversation. we are going to open regional lines. if you are in the eastern or central time zone, that means you will call (202) 748-8000. if you are in the mountain or pacific time zones, you can call in at (202) 748-8001.

you can always text us at (202) 748-8003. we are always reading on social media, on twitter and on facebook. questions that i have to ask is what about the people who were intending to retire this year and who are now looking at their 401(k)? of looking attake my 401(k), and i immediately decided not to do it again anytime soon. what about those people that were hoping to retire this year? what does it look like in the retirement sector? i feel your pain. obviously we are hopefully not retiring. it is tricky. i was a journalist. i worked in the investment industry in the u.k. and london. you have to understand that

today you are looking at the 401(k) or whatever your retirement pension smaller than a month ago. are not only in stocks. they are also in the bond market, each has had a pretty good rally. it is important to remember that you're hoping to maybe he retired for 20 years or 30 years. retirement.l do it is almost guaranteed you will be in a better place with your finances in 10 years and hopefully five. the market always bounces back, even if you put your money in on the worst possible day just before the great depression in 1929, all of your money would have been earned back within 13 years. that is a long time. if you are sitting here thinking

i'm retiring in a few months, i have hopefully 20 more or 30 more years to live, you are going to earn that money. host: we know the house passed their coronavirus package on friday. one person says i have not looked, but is there anything for me? what is in this package that individual americans can look and say this is going to help me in my economic situation right now? making the testing free. to tests could cost up $1000. that is a lot for anyone. that is supposed to be free now. we will see if that happens. the second thing that is important is the people who lose their jobs. in the coming weeks, we have

already seen some of that in these hotels. there is $1 billion for unemployment insurance to beef that up. is that going to fully compensate you? that is going to ensure you have a couple hundred dollars coming in. is key forhing people debating if i should stay work?r go into pay. is now mandatory sick you can take up to two weeks off, and you will be paid your full wage. months take up to three off and be paid up to two thirds of your pay. independent contractors get a tax credit of the equivalent amount. workers have been calling for this for years. we finally got it, at least for the coronavirus.

are you hearing, have you heard of any additional provisions that would come from the senate that would be added to this bill? guest: that is a good question. there was a lot of focus from republicans on helping small business and making sure this does not just become small businesses that are already struggling to pay their bills now have to pay sick pay. that is why you see the tax credit. it is actually refundable for small businesses. if a small business does not have a tax bill that is high enough that make sense, they would get money back from the government. that was a big focus. republicans are really cheering that victory. the question is, are republicans going to be interested in this bill?

everybody hates that word they allowed. it is for the airline industry or the cruise industry or the energy sector. predictedoldman sachs in the last few days that 30% of energy companies not survive this. they will either be bankrupt or merged. a lot of pain is expected. i don't think we're going to see a bailout in this bill. keep an eye. host: let's let our viewers keep an eye on this situation. let's start with john calling from virginia. thank you for taking my call. yesterday the people around the president was walmart and cvs. i do not believe this money will go to the small business.

those people will benefit. stevene trust mnuchin, who took advantage of the housing market collapse? he put people in that situations. saying we talking about socialism is not good? what we are doing now is socialism, and we are trying to .elp the rich people could you please give me some answers? is right that it the government will pay these companies that were standing with the president yesterday to do the testing for drive-through testing in their parking lots. in that sense they will benefit. when you look at this bill, if a

small business is getting a tax credit, a big company cannot take that away from a small business. there is some relief for small businesses. billions also approved of dollars worth of loans for small businesses. small businesses have been telling me, why do i want to take a loan when i am already feeling cash-strapped? there may be more discussion about how to help small businesses. ofn you look at the art secretary mnuchin's career, there is a lot to analyze. when you look at it from the political side, nancy pelosi and treasury secretary revolution have formed this unique relationship in the past year. they have negotiated almost all of the bipartisan deals. all of the debt ceiling work, and now this cheap package has come from those two.

i look forward to seeing more stories about how that relationship works. i heard about people who were on airplanes and listen to nancy pelosi talk for hours with steven mnuchin. it is a very unique relationship. i think there is perhaps some trust on both sides. the last thing, the socialism, a lot of wall street people were joking about this. even on cnbc, there were basically calling for these socialist measures. is me what is really unique this is a groundbreaking moment for worker benefits in this country to suddenly have sick pay for everyone else at family leave for everyone else. it is only designed to exist during the coronavirus outbreak. i think this opens the door

potentially to these benefits staying around. is that socialism or not, that is another debate. host: president trump was asked yesterday in his rose garden is conference about possible assistance to the cruise industry. let's show you what was said. [video clip] >> i can tell you it was an industry that was very badly impacted by what is going on with the virus. it is a great industry. we will be helping them and the airline industry if we have to. asking, wehould be want to make sure our airlines are very strong. one day it was not looking so good. host: what kind of assistance will specific industries be getting because of coronavirus? bailout makes a

lot of republicans uncomfortable. we did a little bit in 2008. we did a $15 billion bailout for the airline industry after 9/11. what can we see in the short term? italy is a good model. did is they immediately passed a big tax cut for some of those industries that have been harder hit. i think that can probably be on the table for some of these industries. whether or not the government actually gives them cash is more dicey. the people would much rather see it come in the form of a tax cut. what is interesting about cruise lines, some of these companies are not u.s.. also half of the workers in the cruise industry are based in florida.

drives ahat also little bit of why there is so much focus right now on helping that industry in particular. we have someone who tweeted a question i have not heard yet. stella wants to know what is all of this doing to the national debt and deficit? no doubt when we are talking these big numbers like what we are seeing starting to come out that it is going to add to this year's deficit and the national debt overall. i have been someone who has been writing about the concerns for the debt for years. now this isright the moment to spend money. this is about keeping americans literally and economically so they don't lose their home

and car. this is the time when we need government. this is protecting our nation and military. this is the function of government. that is why you are not seeing even people who normally scream about deficits and budget concerns, you are not seeing that right now. darius fromtalk to washington, d.c. good morning. caller: good morning. thank you for c-span. i love your objectivity. one thing about virus, they are highly democratic. everybody can be affected. on spiritual to go on a cruise to portugal at the end of april. i canceled. i was actually going with oceana cruise line, which is under norwegian cruise line. i just canceled that cruise. they gave me a $10,000 credit.

i worked at usaid for four years. that was during the ebola virus. the thing to look at from that prices, now in rwanda they have no cases of coronavirus because they have established manually pumping washing stations they use to disinfect. you look at nigeria, nigeria has one case. that came from italy. we have to look at how this virus has spread. got the memo. they shut everything down. the united states was very obstinate about change. we still want to go about our daily lives and not worry about the economy or how this is

impacting a socially. we are hardheaded people. there has been a lot of talk. our correspondent tweeted yesterday that in senegal they are doing drive-by testing already in four hours. clinice cleveland mayo it takes 12 to 24 hours for them to do it. there is a lot of debate about why the united states and china have had such a hard time with this response. those questions are going to remain. we need to be looking at other parts of the world to see what have they done that we can borrow? host: president trump has not always been the biggest fan of the federal reserve and jerome

powell. guest: that is putting it politely. does he view the role of the fed right now? guest: this is a tense relationship no doubt. the present honestly believes the real economic response needed to come from the federal reserve. the fed normally cuts interest rates, which makes it cheap to get a mortgage. you have people trying to refinance their mortgage right now because rates are so low. the other thing we saw in 2008, it can help to stabilize the market. it does not mean they are literally giving banks money, but they are providing short-term loans to these banks to ensure that they have enough to do their operations

and buy and sell bonds. change? all of this economists across the political spectrum have been screaming at .he white house there is uncertainty. making it cheaper to borrow money does not do much if you don't want to leave your home to even go look at a house that you might want to buy. that is why people are saying this really needs to be a federal government response, meaning the white house and congress to get the health crisis under control. needed is to get money into people's hands. there was a republican economist who just put out a blog. he said that the best idea right now economically would be to 500 or $1000s

checks. hands sointo people's they can pay their immediate bills and when all of this hopefully blows over, they will be motivated to go out and spend again. let's go to randy from virginia. caller: hello. good morning, america. it is just hard to know where to start when there are so many children that are out of school. that is my biggest concern. there is no more important issue than their physical and mental health. this is one of the reasons i started my small business was to help educators and professionals with prevention and connecting the dots from school and neighborhoods. we are setting up

intense. we have mobile education facilities and the like. we just need to mobilize those. thated smaller platforms can solve big problems. america needs to mobilize. guest: i think he is exactly right. that is what gives me hope this morning. we are starting to see creativity around the worldgueso address this and keep society going. i was watching a video online this morning from sicily, italy. they are locked down. they were having a block party with these pots and pans. tentsave been setting up to make these mobile schools in a smaller setting. that is what gives me hope about humanity and the united states.

let's talk to randy from california. good morning. caller: thank you very much for c-span. you kind of stole my thunder on monetary policy. all of this is mostly fiscal policy talk. i had heard the fed was going to get together this week and possibly cut more interest and my question is i had heard that bonds can be specifically targeted on these interest rate cuts so the bonds benefit rather than a general interest rate cut. is that true? guest: the caller is right. meetingral reserve is tuesday and wednesday on interest rates. here is what happened in the last two weeks. two weeks ago, the country had an interest rate of 1.75%.

the fed made an emergency rate cut last week to bring that down to just under 1.25%. on wednesday, it is expected we will go to zero. that is a pretty dramatic move. it is trying to keep confidence going in the economy and to make it as cheap as possible to borrow for businesses and consumers. the bond market is interesting. 2008 is a playbook from about what the fed can do to try to keep the banking system and the financial markets stable and to help banks if needed. bond sidencern on the is whether corporations might go belly up. moment -- they cannot buy

corporate bonds and a wider range of securities. it has been suggested that they have that power and ability. thankwe would like to heather long for coming in this morning to talk to us about the announcer: washington journal, five everyday with policy issues that impact you. sunday morning, we will discuss campaign 2020 and the role of moderate democratic voters with senior political analyst brian gallas. about support for bernie sanders. conservative radio host will be on to talk about president trump's 2020 campaign

strategy and his handling of the coronavirus outbreak. watch "washington journal" live on sunday morning. join the discussion. is easy to follow the federal response to the coronavirus outbreak at c-span.org/coronavirus. track the spread in the u.s. and throughout the world with interactive maps, watch briefings and hearings with public health specialists, anytime, unfiltered at c-span.org/coronavirus. hours, we willw show you portions from two days of hearings about the investigation into wells fargo. the new ceo led off the first day.