this is for world energy companies as well as offshore and marine company.my observation, the us energy companies has surged to the highest level since at least 2016. it's suggested that because of lower prices, those energy companies are facing rising likelihood of default. let's catch up with our team in india, because the country has announced they will be banning the entry of people from the eu, turkey, and the uk until the end of the month. this move comes as four more people have been diagnosed with covid-19, taking people have been diagnosed with covid—19, taking the country's total number of cases up to 114. let's ci’oss now number of cases up to 114. let's cross now to our business reporter and more by. this measure is being announced as the latest and more travel restrictions being lamented around the world. absolutely, in fa ct around the world. absolutely, in fact india tightening travel restrictions after announcing last week that it would be virtually sealing off its international borders by suspending almost all categories of visas through apr

energy companies are always seen as a reliable dividend payer.e story is retold and we are unlikely to see dividends in an energy company for a long time now. we are very negative on the sector. we don't expect -- we see fundamentals being weak. we struggle to see payments to shareholders in the foreseeable future. even before the collapse in oil price, we heard ceos talking about finding it difficult to fulfill and pay dividends. forit is very difficult energy companies. interesting -- manus: give us the interesting stat. marija: interesting stat for energy companies, the s&p 500, for 16 to 18% of market cap, now it is around 2%. stat of the day. i'm glad we came back for that. more work to do. marija veitmane of state street stays with us. coming up, the dollar's historic rally isn't over yet, according to goldman sachs. could u.s. currency intervention be next? this is bloomberg. ♪ nejra: this is "bloomberg daybreak: europe." i'm nejra cehic in london with manus cranny into body. the dollar is advancing for the first time in four's essence. it

when oil prices went into the twenty's as they did today that that's going to take quite a few energy companies down but you also have the likes of m.g.m. the huge casino operator draw down its entire credit line kraft heinz also drew down its entire credit line this afternoon that company has recently been downgraded to junk and because we have 10 trillion dollars in the corporate debt market in america you have to ask yourself where the potential sleeping giant lies and where the disruption might come from we have to remember that several years ago when it was our to october of 2018 it was none other than general electric debt which started off a daisy chain so this point we don't know but we know that this entire cycle has seen the inflation of a huge corporate credit bubble in america and that that is likely where the source of risk in the system is existing right now me mentioned 10 trillion dollars there is $4.00 trillion dollars right now that is at risk of being downgraded to junk as we speak now monetary policy is going to be very limited in its effectiveness thousands of businesses an

david: we have an energy company. we restructured to get a strong balance sheet. we put cash on the balance sheet. one of the things that is interesting about energy, if you take a step back and think about smaller energy companies around the u.s., there are hundreds of them that have exposure to various spaces. banks also have exposure to these smaller companies. have regional banks that are outright cutting risk across energy portfolios. what we have been doing at kennedy lewis, and have had some success at this -- buying the creditl revolving base facility. in 2015 and 2016, everybody was trying to buy that stuff at a discount. it is top of the capital structure, secured on all assets, in some cases secured by all the hedge portfolios. right now, you are seeing banks sell that at a discount. we have been aggressive about trying to buy those. effectively, we are doing a small rollup strategy, with smaller liquidating well portfolios that are synergistic to our platform, with the management team we have in place. we

we are beginning to hear a real reckoning coming from individual energy companies. tting dividends, cap explants. the risks are there, so give me your overall picture of how big of a risk of a default you feel there is in the energy sector at the moment? >> it is a mixed bag. a lot of these canadian energy companies have been in retrenchment mode even before the oil crash in 2014. a lot of them never got back to the good times. have are companies that high debt load for the past two years, their focus has been too paid on those debt loads. some of them are still coming into this crisis with higher debt loads and investors would prefer. in some ways, some of these companies are better prepared than they would have been otherwise. other companies have fewer levers and u.s. oil companies can pull. oilsands companies cannot really dialed back reduction. there is a certain level of spending the need to keep going into their reservoirs so that they do not get impaired. there is a mixed bag in terms of how well they are equipped to cope with this. down theirthey spent debt

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

no energy companies. on the personal side, it is the same thing. you had colors in the last hour who have referred to its great needs -- great news that we have sick pay and medical leave pay to try to get people some money to get them through the next few weeks, even months, but what happens if you get laid off? you can apply for unemployment insurance, but it usually will not be as much money as you were making in your regular job. what does that mean? you do not have enough money coming in. and if you cannot dip into your savings -- maybe you don't have any savings -- 40% of americans werebefore coronavirus struggling to pay their bills. do you not pay your mortgage? do you not pay your car payment? that is where this pain can grow quickly if we are having the same conversation in may or june where people have not been able to get back to work. host: you hear a lot of talk gigt the economy -- the economy. people holding smaller jobs -- i should not say smaller jobs, jobs that pay less. how will people in the gig economy be affected? guest: they

route for us nebulous but all powerful government structures have disappeared replaced by an energy company that fights up everything. as players we feel the powerlessness of the individual. we can only. the way conway gets more and more lost in debt and dependence but we cannot advance his fight. this until such as of god so. that the game doesn't stage protests or evolves and that would be an obvious choice that the individual fights back against the structures instead the basic mood of the game is melancholy the characters just tell each other what the fates is but they don't say how they could change the system it's assist him in. the game just leave a sense that utopia could be around the corner a way out of powerlessness can perhaps be found in community with others. i would like to pursue the project. we're up against really difficult challenges. sort of unlikely to work but it's worth doing anyway he when we find ourselves in a town somewhere near a rootsy euro what do we do now where do we go it's up to us here you have. a way. i leave you with a short on mars to the swedish born o

energy companies oil prices now half of what they were in january that's a risk for debt ridden u.s. energy companies all of this is playing in the minds of investors on the one hand the continuing hits from these restrictions on the other hand not a clear path forward in terms of financial stimulus investors were hoping for some indication from the president what he would do to protect businesses he did. say in his remarks that his administration would provide financial relief for workers who are ill or caring for someone who is ill but still not a lot of details there we're waiting for congress to come up with something there's the usual delays between republicans and democrats in congress so all of this weighing on investors with no clear path forward and looks like another down day for wall street thank you christine salumi the update from wall street there and not just in the u.s. the stock exchange in brazil has halted trading for a 2nd time you see there 11 and a half percent it is down now that's where it's been paused it did plunge as much as 15 percent earlier in the day an

the credit markets are telling you that the energy companies are under stress but no. but again. we are two and a half weeks into what was a huge pivot in this economy. i just think the question that investors have to ask themselves is will this pass and how long. you know, a year from now, are we going to be sitting here talking about the coronavirus, are we going to look back and say there was, you know, it wasn't -- it was like a bad case of the flu? i'm not a doctor. i'm just trying to tell people to be calm. i'm seeing a lot of panic right now. the biggest mistake i have seen in my 35 years in this business, especially when you get to a bear market, is everyone says oh, then i need to sell. they might be right for the next 5% down but they will miss the next 20% up. that is where real money is lost. liz: absolutely. that is definitely right on point. ron, i'm really glad you are here with us. we are watching all of this and more. one quick question. you have been on the washington, d.c. fed advisory council linked to the federal open market committee. the fed meets one week

of stress for energy companies.o.ld get worse saudi arabia planning to boost oil exports further from april may, reaching record day.llion barrels a what have we learned today from saudi arabia? >> we knew they would produce going up toion 12.3 million barrels a day. the export number which is a record. 10 million barrels a day. that's huge. you look what they've been under seven.s just they are ready to drown the market and bring prices lower. some of the gas and oil fields and put more exports. this is having direct impact on the price. theave wti-brent both in 20's. guy: how much higher can they go in terms of export production? >> already 10 million barrels a day, we'll see prices fall. even if theyow is, were to go higher, where does this oil go? we have towns quarantined, flights grounded, demand picture is serious destruction. we're seeing some 8 million barrels a day lost on side.mand where does this go? there's going to be nowhere to put it. reserves filled to the max. i think now, 10 million barrels is eno

what the market has been telling energy companies and investors for a while with contracting valuationsrewriting the stocks. if we got a russia-opec reconciliation over the next month or two, would that be good for oil prices? absolutely. what a change what is company to to do? somewhat. but you will not be able to trust. for the health of the businesses, u.s. companies, value over volume. they have to think about what they can do internally to make sure they don't fall victim to this again. vonnie: our thanks to you on what must be an incredibly busy day. our thanks to dan pickering. on the's get a check markets, starting with the hydrocarbons, oil down at $ 32.95. this is bloomberg. ♪ are down 6.5% on the dow jones industrial average, the worst-performing stock index today. mark: i'm mark crumpton with bloomberg first word news. officials are cracking down on companies they say are trying to trick the public into buying fake rotavirus cares. the fda and the federal trade commission say seven companies are not only breaking the law but are putting patients at risk by falsely claiming t

energy companies have been taking a real hit lately on the one hand you've got less demand for oil and on the other hand this ongoing price war between saudi arabia and russia the u.a.e. and saudi arabia are ramping up production even as demand falls this is very troubling for us and energy companies which are very heavily in debt and also suffering from these lower prices president. announced other measures in addition to the travel ban but they were very general he said that the administration would provide financial relief for workers who are ill caring for others due to the virus or quarantine but there weren't a lot of specifics there yet he kind of kicked the can down the road to congress. they still have to come up with the plan congress is due to go on recess next week so all these moves seem to be not quite specific enough for investors who are looking for a more robust response to stem their concerns and it looks like it's going to be another rough day the markets are 80 down the s. and p. at least in one major indices to end indexes down more than 20 percent from session hig

a big fear you're going to have massive defaults and contagion through the market led by the energy company and secondly, if we do get a rebound in the global economy and this potential global recession is not nearly as bad as feared you get some hope on the demand side none of that looks really likely in the short term and that's obviously why you're seeing the sector and the commodity get drubbed this week. >> it's going to be tempting to try to scoop up what could be perceived as good value, bargains, whatever, as far as the energy stocks go is it time yet, do you think too soon >> i mean you really have to stay with the quality on the balance sheet. that's the key you have to work under the assumption oil will be lower for longer, is 30 the bottom who knows. if the depths of this is continue -- not like in the u.s. we're cranking out a lot of oil. you can't just flip the switch and this stops overnight it will take a long time before the u.s. takes oil off the market more supply is going to be added. the demand side is going to be week go with those companies where they have the balance

energy space. when you have other big companies you have seen before, there are a few prudent bets in energy managementpanies downgraded from high-yield, that will be the eye of the storm. heady feel this affects your world? what happens? francis: what you want to do is invest in businesses with a strength the balance sheet to take advantage of a dislocation, any that takes place. good businesses continue to grow because of their strength the balance sheet. the competitors might have too much leverage, they might have to sell the part -- sell a part of it. they might have to use this environment in that way during what is perceived to be a difficult time. that is what we are doing. the funny part about all of what's going on in my head today is that three weeks ago, a month ago, things were expensive. we were worried about certain extremes in the market and the risks associated with that. they i'll most feel like good news is the risk in the market right now and if we get an inkling of good news out there, the market has the opportunity to move much higher. alix: we do have a headline that the ecb's le

energy company shares took an especially hard beating prices threaten to plummet so low the trading was suspended for 15 minutes for the 1st time in more than 10 years. prices nosedived all over the world on monday starting in asia mainly due to fears about the economic fallout of covert 19 in tokyo the nikkei index lost 5 point one percent. in the markets a crushing and economic activity start trouble on the field. over the weekend the oil price fell to 30 percent the biggest drop since the start of the ninety's i'm less the round the world are deeply worried about the impact of this kind of a fall. you know i think the timing couldn't be worse so we are already in the. worst sentence ever seems to subprime crisis consumer confidence but dampened global growth outlook has been caught a few times because of the trade war last year and could be 19 days yet this trading room in paris was also filled with red numbers people are asking are these the harbingers of a global financial crisis or are we in the grips of one how will the markets pan out over time through a pretty sure it's always

we see energy company after energy company cutting back on capital investment.e they really taking out? they cannot go back very easily. >> so, for the likes of saudi arabia the cost of production is very low. they can produce a barrel of oil but that is not the same case with the shale. torequires anywhere from $25 $35 a barrel to be commercially viable. with prices consistently kind of level,own below the $25 many of these companies are essentially facing -- they are having to produce at a loss and that is not sustainable. many of the credit lines are already stretched. they are not able to go to equity markets, not able to go to debt markets, so you could see a lot of crashes and bankruptcies going forward. david: we hear about the cost of extraction but there's also something called the fiscal breakeven point which is higher for saudi arabia than russia. how much does vladimir putin have on him in respect his own budget? credit, over its the past few years have worked to kind of reduce the reliance on oil revenue. 2014-2015 after the oil crash. whereade some

company. people say, wow, you build these beautiful trucks it is true we have the most beautiful advanced semi trucks in history. but we're an energympany, and why is that important? as you scale up, these people will dump billions of dollars into trucking. we didn't want to just be selling a product where someone can come in and build it cheaper. our moat or essentially what sets us apart from everyone is we're setting up the largest hydrogen network in the world, 700 stations every truck sold by our competitors will fill at our stations that's what is important i hope everyone sells hydrogen trucks and competes and builds trucks cheaper than we do. >> the first move is we're amortizing the cost of building the network with the trucks on order. once we build these stations, it will be interesting to see if there's an overbuild at all. in the first move advantage is we have the higher infrastructure so that's different than just selling trucks. >> what do you view -- you're a long-term investor, having known you for many years how long do you expect the value, the spring fund to be involved what do you see in terms of gestation per

energy companies are seeing their shares sold off dramatically as the price of oil plummets.'s bring you more detail on the market turmoil. a dramatic price war has broken out between two of the world's oil producers, opec and russia. while prices have plunged and thatis while prices have plunged and that is spilling over into as av that is spilling over into as a's stock—market patrol lower. let's go to a asian business hub. talk us through what is happening. you pretty much highlighted it at the start of the programme. all of those equity markets here in asia are making various deep washes. that crash and oil prices adding to the panic with energy firms taking a battering against the backdrop of the rapidly spreading virus which is spanning 50 years over the state of the global economy. these are some of the worst falls in oil prices since at least the start of the 1991 golf ball according to bloomberg news. trading falls asa bloomberg news. trading falls as a result. a sea of red with tokyo, sydney, manila, all plunging as much as 6% today. hong kong, mumbai, singapore, se

companies. airlines and energy countries would refine customer. >> we want to stress test these companies. how they perform under weak conditions and how their balance sheets are protected now. no question, still a ton of uncertainty going ahead around the airline sign with the delta and southwest. jack: jack, you and broughton look to the entire market and said when you're shopping for bargains in that crazy market, what should we take customer. >> were always looking for earnings growth, with the price relative to the earnings. i think right now, even if you're buying stocks change and think about a bond buyer or lender. salmon to look at the balance sheet i would look at the cash flow statement, i want to know this is a company is going to be able to endure a sharp collapse in commerce if we haven't for a quarter to. time by cash companies like apple, amazon, brookshire recently did some financing or they had a billion euros at a 0% coupon. cc people waving free money that the company that can hang around. and maybe buy some things on the cheap if we have a sharp downturn. jack: what is

. >> with energy companies -- i would under line robert's point in a sense some of the shale producers, that's only place where i see with a smal smaller perspective than roberts, but all of the banks have loaned likes of diamond back and hal burhalhalliburton when we saw cn about oil price monday, number one dropping segment was energy, number two was banks. >> i am really nervous about this idea many of you talk abo about. about helping the industries, where does this stop. you have you know, the energy companies, then airlines, then cruise ships, then what about restaurants? and banks? i just don't know where it ends, i think that is the wrong approach, i think -- hope david tonight when donald trump gives his address, this is long overdue, i think she should basic -- he should call out nancy pelosi say i want a suspension of payroll tax, i want it now, get me that bill in 48 hours, i am worried about spending programs that are not going to work, trump should put oh, us in o -- onus on pelosi, . >> you and i have chatted about this i respectfully disagree. i think that whole heartly

we are looking to fund midmarket energy companies looking to fund our growth. ty over the last several years and accentuated now. this shows what you dabble in. companies that are not a startup but not big enough to ipo or get taken out. you're in the middle range. why do you see that is a good opportunity? chris: that's right. riverstone is a 20-year-old firm focused solely on the energy markets. initially it was private equity only. about six years ago my partners and i started the business to create a middle-market energy lending firm within riverstone. banks love to lend to energy companies, or they had until recently been very interested in putting capital apps the energy sector. the high-yield markets have traditionally loved energy. your charger showed with spreads widening, certainly cause for concern, but that is the highest part of the high-yield index. high-yield investors do like energy companies. in the middle market was not anyone there. we looked to be the middle-market replicating what other direct lenders had done in other sectors and we like th

airlines and energy companies are really feeling the pain, which companies can weather the storm andn stand up to the coronavirus crisis on the barron's roundtable tonight my colleagues have been

airlines and energy companies are really feeling the pain, which companies can weather the storm anddetermine what stocks can stand up to the coronavirus crisis on the barron's roundtable tonight my colleagues have been

a new way after communism ended and state subsidies dried up as well as working security for energy companies he runs a small business selling preserved meat from its kills. thus the nautilus and the bees are oh and i fell over going to hear. somebody. but my data. says fleiss yeah this is. what's worse and worse life for the bronx a built believes the east was hard done by after reunification between have been avoided by a few hours of my knowledge found in a micro cough or dear to come home fuming you when you try to do what you are not happy about you have a daughter do not think of our part. time vomit fall foul child. people learn to rely on each other and they don't like being pressured by outsiders less food i know they get on his dolls its vast marketing dollars its holes he allows it does. fine shaft as this is are marked and yes by my left but i'm noble from god it does on my own. i didn't either. must then concede. lend us the democracy ones of us and the condition vanzant of was your holiday. view as formal why doesn't view of. central intelligence who is fresh beauty of. the inno

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a new way after communism ended and state subsidies dried up as well as working security for energy companies he runs a small business selling preserved meat scripts kills. us that's a neutral to be 0 and i know you're going to hear. somebody. but my data. says fleischer yeah this is very important for those of us. bronx a bill believes the east was hard done by after reunification between have been avoided by a few hours of my knowledge found in a micro cough or dealer to come home fuming your nutritional value are not happy about you have a dog. vomit fall foul child. people learn to rely on each other and they don't like being pressured by outsiders less food i know they get on his dolls it's marketing dollars it solves the laws of does is. it. fine shaft as this is unmarked and yes by my left but i'm noble from god it does on my own. i didn't our . bus then can see. the ones of us and the condition vanzant of was your heart of the. former. why doesn't your. senate. do you believe new orleans. on good as a spend. 2 days before the threatened protest loose ations a staging a counter approac

resistance of the vix, the high yield spreads blowing out above the 2016 highs when a lot of energy companies did go broke as well as the defensives relative to cyclical sectors which have gone parabolic and look like they're approaching levels that typically would indicate a peak. the gold to oil ratio measures near term deflationary pressure. we're having an enormous spike in that ratio. it tells us the pressures are huge but we will i think get a bounce very soon in the stock market. >> keith, how about you? tactically as barry was saying, what's your playbook >> yeah. we've been seeing similar things where levels of s&p about 2500 was pricing in a typical recession. i think the struggle for investor this is not typical and we just downgraded our q2 gdp forecast for the u.s. in negative 9.5%. you know, mirrors of the financial crisis playbook for me looking for krir suts breakers. number one, it's all about the coronavirus thus far, tracking new cases. we put out a daily search tractor for symptoms and sentiment that could potentially lead that. and then also the announcement of the fda to

sanctions of russian energy company rosneft an attempt to stop the nordstrom to pipeline to germany by flooding the market and sinking prices russia sees an opportunity to crush the us shale industry which is dangerously levered to the hilt russia is also fed up with cutting production output time after time while u.s. shell producers each time up production to fill in the market as a result saudi arabia cut its crude price as much as much as 6 to 7 dollars per barrel and is looking to raise its daily output by as many as $2000000.00 barrels per day as it too is ready to fight for market share the u.s. oil and gas industry is facing attack from 3 sides falling prices from reduced demand a global movement to divest from fossil fuel and crushing debt loads the industry has about $86000000000.00 of rated debt due the next 4 years and as analysts have warned before below $50.00 per barrel many companies will be unable to service their debt obligations this in turn has the banking sector as these companies start defaulting big banks including j.p. morgan city group wells fargo and goldman a