Transcripts For CNBC Squawk Box 20240713

That decline we saw yesterday. U. S. Equity futures are bouncing back a little bit. S p futures indicated up if you are looking at the treasury yield the 10year looks to be yielding 39 the twoyear down at 4. 4 . The 10year, if you are trying to behalf full, that is something you point to we are down watching the close for some type of stability, it went down 2,200 or 2,100 even if it rebounded yesterday, you were hoping for a strong close. Fridays, theyve been okay. You would think maybe there would be a selloff the past two fridays thus far not been that way. Well see if things are different. We are talking a lot off camera and on camera all the closings you were talking about. That was unbelievable yesterday. I was watching a big east game i was losing and they canceled the game at half time. They canceled march madness. You saw everything, broadway and everything i was worried about the c word yesterday a crash yes that c word. I dont even like talking about 1987 that is pretty close im hopeful still that this week, we are trying to find the bottom somewhere lower and lower 28. Weve always acknowledged if it went from 20 to 30, it is possible i didnt think wed get from 20 to 30 overnight you talk about sentiment. Bad news getting there, we have been discounting. We have been discounting all week as of yesterday, is that not a flush. I hang out in pickup lines after school and you hear the talk everybody is talking about the market and the closures. My heart i went to the super market yesterday, for some reason they had a pallet of toilet paper in the back i held it dearly and im not sure why it is human nature to feel like you have control over something. On my way out, i know this gentleman. Hes got to be 80 or 90. Ive seen him. I got emotional thinking what is his life . Im a whimp. If you are vulnerable or older, think about what your life is right now. We have to bend this down. Maybe we are so many people arent doing what weve donebefore they said, look, here is the curve. This is coming to us in four weeks. They walks through the measures and said, in two weeks we are going to be asking to do this and this i think that part of it, im still not sure this is the glass half empty approach im not sure we are totally there on that part yet it is happening on the locality it caught up with our area our kids arent going to school anymore. A lot of people arent sending their kids today sports got canceled, prom canceled, sat canceled it caught up quickly this is being handled on a state by state basis someone said we had 100,000 cases in ohio. She did the population of ohio and multiplied it by 1 . I dont think that is true and being confirmed. But i think it is irresponsible to say we already have 100,000 people did you see where they said someone went to congress and said we are going to have 150 million if you dont bend the curve. That is scarey but i dont know if we need to be there yet my question to you. A wellknown Hedge Fund Manager we know well said this, the market right now is effectively where we were in september 2019. Thats where we are right now. 2018 . Of 2018 if you think the market looks ahead 12 months, do you think thats where we are right now . Thats the question. Think about what life was like then, where business was then. What the expectations were then relative to where they are now again, i know it is a glass half empty approach we dont even know if they are china or south korea put it this way, i think china and south korea were a lot better than they are today thats the worry the other thing ill say is look at the treadssury market a say, okay, good signs. Is it is unprecedented situation we find ourselves in in the old days, we would say, i saw my life flash before my eyes in this case, your Financial Life is passing in front of you and the health and safety of your family. I tell you, i hunker home now, people are home, not everybody is at college. Not everybody is happy about it. No, you cant go to the gym. I sent something to my trainer who is mad at me for not going. Like a super someone who has it would go to the gym. Im getting notice from barrys boot camp where 50 people pack into a room and they are saying they are going to sad sanitizer. Having said that. Here we are, the thief us in our little boxes here. Three big banks out with new calls on the fed and markets jpmorgan and barclays said worse case, the u. S. Would see backtoback declines. Enough to bring growth in 2020 to about zero. Jpmorgan now expecting negative 2 growth in the First Quarter followed by 3 in the second quarter. The biggest call from goldman sach once rather than split it up into two cuts. I still love that one of their head guys came on. Coming on and said, 11year bear market we are predicting it will be over. I can see you on the big monitor here you just put purell on your hands, didnt you . I did what did you touch . My computer thats how im thinking this morning. I wiped down everything too as soon as i sat down. Will you go to a restaurant this weekend unlikely. Really. Are we going to play would you rather i dont want my neurosis to i need to celebrate things. Today is an anniversary. 22 years on friday the 13th, i got married. And my sons birthday is sunday. I think a restaurant is okay. Just keep your distance, i guess. They are keeping things. There arent people ramping up that i brought my own lemons for my water this morning. Cut it at home my own coffee made at home how many people could come over and stay at your house, becky, most of your neighborhood for a couple of years . Not a couple of years but a while. We are prepped remember when Campbell Soup was out of still none of it is funny we are not making light of it. We are all in the same boat. Rarely are we all in the same collective boat. The fed and others saying they have to do more saying they should launch temporary targeted qe measures to relieve some of the stress in the markets. Talking about markets, becky it was a terrible day yesterday. It was. Markets with big losses. The dow is now 28. 3 down from alltime highs joining us now to try to make sense is chief Investment Officer and cnbc contributor peter, what do you think we dont know what earnings are going to be or what multiple to put on that i do want to say that i am a believer we should be shutting things down and flatten that curve and hopefully buy us time to get us to may and bring in test kits that will hopefully calm people down if we dont know what the earnings will be you look back to september 2018, is that where you think well be 12 months from now the first wing we focus on to clients is to have 12 months of liquidity. You are able to buy things cheaper. I focus on value the cheaper things get, the more valuable they are. We use client money to keep track of this. Who knows but having the ability to buy things on sale is attractive to most of our clients. Being looing at things that are cheaper than they were slowly, you still need dry powder if this gets worse. If things get marked down, you do have to close your eyes and assume that 6, 12, 24 months from now, well get past this. I would say that the most on sale are travelrelated stocks they are most on sale for a reason exactly the global need to travel is an unstoppable force. I think emerging asia is attractive the beaten down big energy names are attractive as well yes, it is easy to get afraid by this things that are cheaper provide the basis for better returns does that mean, you dont have any concerns of operations running out of business, running out of money, operating money. You have to get to a. 0en some of the issues so heavily discounted if they are going to have to find extreme measures of cash. The struggle has been on corporate Balance Sheets that is the most important thing now to see which companies are going to survive, make it through and which are not. Fair for me to say you sound relatively optimistic . We need to get through the next weeks we have to get through the next six weeks any such way good to see you an update now on containment efforts. Disney theme parks california, florida and paris will be closed the Disney Cruise line is suspending all departures as well Universal Studios hollywood and orlando will be closing. Disney is pushing back the release of the live action version of mulan shares of comcast and disney this morning disney shares up by 2. 5 comcast off by 6 . The nba suspended its Season College basketball abruptly ended. Can certificates canceled. Then ncaa canceled march madness. Pga canceled suspending their season saying it would delay opening day mlb also canceled spring training Justin Trudeaus wife tested positive trudeau has been selfisolating at home with his wife. They will remain isolated for at least 14 days. Lindsey graham is selfquarantining as well after a trip to maralago and a visit with the brazil yan president. In a statement, he says he has no recollection of direct contact but is being monitored as well. We have an update on americas most famous actor. Tom hanks providing an update after he and his wife were diagnosed. He tweeted this picture. He said they are in isolation. He said there are things we can all do by following advice of experts, taking care of ourselves and others he said, despite all current events, there is no crying in baseball there was a picture tweeted out. Somebody rolled in a volleyball with a picture of wilson that was a madonna movie no crying in baseball lets get to an update on the latest of what is happening with the coronavirus virus numbers. Numbers topping 128,000 cases worldwide with more than 4,700 are dead social distancing continuing schools closing from maryland to ohio banning large gatherings, including shutting down broadway in new york city, cases jumped to a total of 95 overall cases have surpassed 1,600. At at least 41 people have died. Seattle with the largest amount followed by new york and california today, a step in the right direction. Given authoritiation for a testing kit from roche saying it will have millions of tests a month available on its systems. Bringing you dr. Scott gottlieb who has been helping us understand where we are. How important is this new Testing Capacity for us . Extremely important there are other systems like this i think you are going to see a rapid succession of these. By the end of next week, youll see capacity sharply ramp up in our ability to test patients also finding the number infected with this virus. Well see a spike in the numbers. Thus far, once weve identified is that somebody has it, they are quarantined. Well go to look who else around them can be quarantined or selfquarantined for a period. In the uk, they were effectively going to stop that approach because they felt it had already gone too far thats right. Once you have a large outbreak, you assume that they have it and tell them to selfquarantine then it becomes less and less important to test everybody. If you have the capacity to test more people, you can turnover more cards you can identify it earlier. This will be welcomed ability to test more people what do you know right now about potential treatments investors are reaching out to doctors across the world there is talk about this cob contain mix with malaria mixed with zinc being tried. I dont know about that this will become an epidemic for the next few weeks what you need in the fall is a point of care diagnostics to identify outbreaks early the two that are the most positive now are the repurposed drugs. The other approach is the antibody based prophilaxis you use this on front line health care. There is a threeprong strategy. Repurpose antivirals. Do you think well be able to bend the curve here . We look at italy given all of the steps taken over the past 48 hours, do you think that will change the outcome . I think we are bending the curve given everything the private sector is doing to engage in social distancing. We need to continue these measures to make sure the epidemic is as large as they should be . With all the closures im wondering it is not clear whether it is good or bad. Did you see the ohio Health Official who said there is more than 100,000 cases now you think you would see more emergency there. J why would an emergency official say that. She multiplied 1 and said there are currently that many cases in ohio do you think that is okay . Does it help because it drives home the point that we are underreporting what is happening because of no testing or is it irresponsible . I read it and said, who let you get this job, almost it seems implausible. They may have clusters of outbreak this isnt evenly disript uted to say 1 of the population has it a congressman said 150 million americans will get infected saying that was the high end of where it could go. What you warned if we didnt bend the epidemic curve at all 70 to 150 million, where do you get that number . Why would you share that is it helpful to share that if you let it burn its way through the population without take precautions we will develop a vaccine over time scott, in any Emergency Rooms across the country, when will we know whether we are going to get overwhelmed with icu beds and Vulnerable People . Would we see that in the next two or three weeks i think we are two or three weeks away from seeing things show up there. If you look at data, youve seen spikes of people presenting. Actual flu diagnosis are baseline circulating and picking it up. Or more like people with other respiratory disease and now they are presenting it might be a mix of both. There is a spike in new york right now. I dont know what new york officials are looking at they seem extremely concerned. They should be concerned there is enough out there. I wonder if they are looking at any data scott, the other issue people ask me all the time is should i go to the Doctors Office for normal issues . Should i stay out of Doctors Offices or hospitals i would try to avoid interaction with the Health Care System, if i can hospitals should be looking at canceling elective procedures to maintain space now does that include dentists and determineologists . Im trying to avoid n nonessential health care now this spreads when it gets inside institutions and health care that is how a lot of the virus is propagated. Im sure providers are taking steps. We have less of those kinds of problems there is risk of the setting of this virus do you see this similar where we are headed could it be italy in the United States or have we already addressed it more effectively . It is tough to say. We are a very mobil population we are not going to be able to put in place quarantines like other nations have done. We are late. We are a little late in terms of getting a handle on the outbreak has already done im impressed with what cities and states have done in reacting early. Scott, we appreciate your voice. Just a voice of absolute facts and facts only we appreciate that thanks, becky yes you dont sugar coat but you also dont fear monger you are on almost every day if you can do that, it is good for us hopefully that works for you President Trump tweeting, for decades the cdc looked at and studied testing system but did nothing about it it will always be inadequate and slow for a largescale pandemic. President obama made changes that only complicated things further. With h 16r7b h 1n 1, it made things more difficult. Is scott gone . Scott, can you hear us . He was coming from washington. Dont know if we can get him to pipe back in. We all have wondered w. T. F. Are these tests. There is no tracking of how many tests have been done. There hasnt been a centralized place you can find this out. I dont think well be getting scott back this moment well move on for now. In the meantime, a story local here but a big deal. Manhattan Real Estate Market is slowing. Being hit by a double whammy robert frank joins us with more on that. It is local for now but does have bigger ramification hitting buyers and sellers in new york city. 44 open houses last week that were completely empty. Not a Single Person showed up. That represented 13 of all open houses averaging attendance. According to data. Seeing if buyers feel that values of real estate will further depreciation because of the virus and financial instability, they will postpone decisions to buy on the sellers side, you have them reluctant to put apartments up for sale. March is always the strongest month for listings in new york city growing 9 and in the same period, they are barely up 2 . Manhattan real estate has seen eight quarters of declines due to new development and the decline of foreign buyers. Not just that new york is the largest Real Estate Market it is the credit problem a lot of these were highly leveraged with loans if you get one or two quarters of slow or no sales, a lot of these could go into default. They are taken over and then you have a bigger credit problem thats the bigger story break that out again again not to be in the glass half empty category but to the extent that people are trying to manage risk today. Youve got about 9,000 new condo units now unsold in new york that is about an eight or nine year supply. A lot of these have been put into default and quietly turned back over. A lot of time heading into the first or second quarter. If you have a period of just very little activity then youve got these lenders sitting on buildings where the cost for break even was somewhere 3,000, 4,000, 5,000 per square foot is your break even if you have to sell them at 2,000 a square foot, then youve got a lot of People Holding the bag for real estate which attracted so much investment they now hold these loans and buildings, that will feed into the broader issue. How representative of this situation in new york is taking place in other cities . It depends. So the entry level for most of the country outside of new york is very strong lower Mortgage Rates really help the higher end of the market whether you look at los angeles, san francisco, texas, miami. There is way too much supply there is so much, prices are coming down 20 to 30 . But it is still not enough you have to look at those areas most susceptible youve got people who can buy but they dont want to coming up, major disruptions. All major sports leagues canceling or postponing the seasons. Well talk about the impact next it is march. No march madness looking ahead to yesterdays biggest losers in the dow and a cinp 0. Wereomg right back through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From using feedback to innovate. To introducing products faster. To managing website inventory. And network bandwidth. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. I cowe can do theyour screening at her house. Hi. This is the man thats going to check your eyes grandma. Cognizant ai solutions are helping Healthcare Companies advance diagnostics and prevent blindness in patients with diabetes. Everything looks good. You have beautiful eyes. [ fastpaced drumming ] good morning im becky quick live at cnbc headquarters joe and andrew are at the marketsite at times square normally what would be a big bounce dow futures indicated up about 665 points yesterday, the biggest decline we have seen back to 1987. If we had seen the market up by an 800point that would only make up about 17 of this weeks losses. Im getting questions on twitter about where i am and why we are not together im in engelwood cliffs. Im not sick we are just trying to do what work places are doing to make sure you have redundancy built in so if one site gets shut down, you can continue operating. We are all fine i went to davos with this cough . When was that . January. Youve looked at me a few times when ive coughed. When you cough, its like into the elbow. Thats how i say hi to you now the sports world now at a standstill with more seasons delayed or canceled. I wasnt with you yesterday as these things wither happening, eric it hit me and i was kind of in shock. For a while i was watching st. Johns creighton. Then i was like the big east is still playing and they just left at half time you are right that was the one game they are playing. Here they come at half time. The acc canceled that game right before tip off florida state, you are the champion, here is your trophy for the season and everybody went home. Overnight, two major hold outs canceling as well. After one day of play, the pga tour also suspending launching the league this year after 20 years, canceling the rest of their season the brandnew league said it will still pay its players the season would have ended in april. Every pro sports league, even march madness are suspended or canceled mark cuban is looking for ways to pay hourly wage workers kevin love is donating 100,000 for workers and encourages others to do the same. These executives have an understanding that theyll need to Work Together to make goods for lost media exposure, even if it takes many years to make up the difference march madness is a good example. If they lose the entire year, they have over a decade to make up this lost money when is the masters after april. It is canceled through val ar ow velaro they are still hoping they can do the masters that april date is kind of arbitrary but done with that in mind today is the 13th they are saying check back in 30 days april 13, in golf, thats the masters. The nba is looking at least 30 days out that is a key date to watch. I was hearing different conversations. Theyve hired epidemiologists. The Chinese Basketball Association were out 10 weeks. This week, theyve said, okay. We are ready to go sports leagues there is more sweat. Maybe they knowtwo weeks for school is one thing. Dont even think about it for at least a month. No march madness for you. It will be weird there is march madness, just not on the courts. We have to keep going on with our lives. Buffett talking up creighton they were getting their butts kicked by st. Johns again the whole Sports Betting industry was going to be a big tax driver for a lot of states a new jersey resident betting on that game. Saying, i hope they cancel that game because im losing money. I had a parlay with tcu versus texas or minnesota. I dont know thats a whole industry that will get shut down now it is i got a message from draft kings that said there are other things going on i dont know what. Nascar is still on schedule you going to run those without fans they need the tv money. They really want to run those races. Rutgers finally makes it and they cancel it i know. I have a chance of my balance staying relatively stable for a while. This might be a good thing for you. They are expected to lose money. I try to help as much as i can with them. Lets bring in patrick, director of sports business at Washington University in st. Louis. Youve been a frequent guest, patrick. Never in a million years would we have thought we are talking about what we are talking about today. Nothing. Nothing happening. Yesterday was my 50th birthday i thought i would remember it for other reasons. It was an unprecedented day, adam silver really led the way like he has many times the nhl has done it. I feel bad for the xfl they had done pretty well. The st. Louis team had the highest attendance it kills their momentum in the first year i had it on while having dinner and had no interest this was going to take a few years to gain traction the good thing is that at least vince mcmann put in a half a million. The folks i really feel bad for is the Service Sector employees, hotels and lodging one thing about the nba, nhl and others, they can push their season back into summer and be okay not just march madness but wrestling, hockey and other things going through omaha it is a real hit to the communities. I feel bad for the kids who will never get another shot at this absolutely. Senior day is always emotional. Now none of these seniors get to go in the tournaments now. Rutgers michigan game got canceled right before it to see parents having to console their senior wrestlers when they loose. A lot of these seniors wont have that moment what about tbs, tnt you can add up the lost revenue there . You can one thing there, can you extend the contracts one year i think that is something that would be easily negotiated draft kings, theyll take a hit. Absolutely. This year, with many states having legalized betting, it is a huge loss to handle. Especially march madness basketball and nhl, not as much action march madness, a huge hit. Espn, fox sports. They are going to be running Sports Center 24 hours a day espn will go back to the espn classic. They might make that the main fare for programming Going Forward. Talking about damage to service workers. Kevin love donated 100,000. Maybe other players will follow suit to try to help people that work at that cleveland stadium how do you think about that damage over time andrew, if these seasons are just suspended and make up a lot of the regular season games. You are right. Those ones canceled, unlike the other leagues, they will not have the luxury to push through. They cant because of the weather. Insurance, i had a conversation yesterday with the General Council of an nba team most of these buildings are covered for disruptions such as hurricanes or other things unless there is terms like infectious diseases, they may not be able to use insurance money to get back revenue. Olympics, this is still on . My understanding is that it has to be done last week of april, first of truly cancel it before the cost becomes youre right. Localized perspective, st. Louis is supposed to host the u. S. Olympic trials in the middle june if the olympics are cancelled guess what that event doesnt come you feel for these sports commissions. March madness, there were eight pods sacramento, columbus, st. Louis. It takes two or three years to get these things you bid on the event and then plan and organize. At least in that case ncaa bid these things out about four years in advance what they will do is give these host cities to host again in four years patrick, thank you. Well see you again soon under better circumstances the big news of the morning, the dow suffering its worst point drop ever yesterday, 10 drop was the biggest since the market crash of 1987, after a major selloff investors want to know how much more pain is ahead or could things turn around . Lets bring in chief Investment Officer at Citi Private Bank david, on this morning, what are you thinking well, after a day like yesterday, what youre really taking a look for is what is the government response in terms of support for some of the issues youve just been talking about, the support in two areas as you talked about, what is taking place. Information to the market about whats happening with the health care crisis. What should people be doing and what behaviors do we see we see Companies Making all sorts of decisions to flatten the curve, to spread out the period of time when people get exposed to the virus to minimize the total load on health care, moments and Health Care Providers and thats taking place. People feel very uncertain about that in markets what you want to see is centralized Government Action by the u. S. And coordinating globally with other countries to basically provide underpinning support and that goes to a few areas. Hourly workers, people who are displaced, Industries Like airlines and travel and others and potentially even insurance who need to know their support underneath them in order to be sure these things have essential cash flow, individuals and businesses to basically get through what is a known period of time. Not as if were talking about many years what happened with markets yesterday please. So the markets have now given back all their gains to the point where were effectively back were effectively living in september of 2018. I was talking about this yesterday. Then you have to say september 2018, are we in a better or worse place today than we were then december, isnt it . So, the way to look at it is this way where were we at the end of the year consumers were flushed had good savings businesses were going to be rebounding to a demand from consumers. We saw that globally when we entered the market we were in a good situation two and a half months ago. Will this push us into a recession or demand for business and consumers come back after the next three to six months thats our primary view. When you look at stock valuations and think after 2021 assuming this Government Support comes youll have huge stimulus from low Interest Rates and spending that will drive markets higher okay. David, we appreciate your time thank you very much we were talking about that yesterday, andrew. I was saying, well at least were not below the december of 2018 lows and i have a monthly chart. But it was 21,712 in that horrific december of 2018. We had that recession. At 21,712, 21,022. So we went 500 points below that now were back, right on it today with this move little rebound lets talk boeing boeing shares have been battered and bruised the new travel restrictions, questions about global air traffic demand and the ongoing grounding of the 737 max boeings value cut in half over the last year but that doesnt tell the story those shares are down 45 since march 4th of this year right now its march 13th. Joining us is bank of America Securities analyst ron epstein lowering his price target on boeing to 180 your price target is 180. That stock, looking at it this morning, closed yesterday at 154, indicated this morning up around 166 and change. What happened . Yeah. Good morning a couple of things if you look at, one, if you look at the global airlines, as we discussed, air traffic for this year probably is going to be negative this is the fourth time since anybody has been recording air traffic well have negative air traffic growth last time this happened was after the financial crisis, you know, and then after september 11th and go back to 1990 with the first gulf war thats impacting airlines. So, one, because of that theres a lot of fear from customers or from investors that customers, airlines will defer and cancel airplanes. Thats one factor. Two, it gets aggravated by the 737 situation, because were on the one Year Anniversary today is the anniversary, right . Exactly yeah, friday the 13th. One Year Anniversary of the grounding of the mack. Exactly the thing is when you with the contracts with airlines when you go out a year they have walk away rights. The fear is youre going to see some cancellations and deferrals more than you normally would because of the nature of the contracts with the the airlines. If you dont need to take that capacity today as an airline, which probably nobody does, youll probably push it out. That means the ramp of the 737 will probably be slower than people were thinking, right . So most folks like we had to the do on our model today which impacted our price target have to take down their expectation on quoteunquote troirch on the 737 because youll see a bunch of deferrals another factor that hit the stock and you guys reported this earlier in the week that it appears boeing kind of tapped out their term loan, the 13 billion term loan quicker than anybody was expecting. That made people have fear about liquidity, so on and so forth. Were out of time but very quickly do you have fear about that or your neutral rating . Yeah. I dont. If you add it all up they have about 23 billion worth of liquidity. I dont think they do have liquidity issue. Not at all ron, thank you. Great talking to you well talk to you again soon thanks. Coming up when we return, well get a take on yesterdays historic market plunge take a look at futures were looking up dow rebounding a bit here. Could open up about 763 points higher right now were back with two big hours of squawk box ahead and you should be mad at simple things that are unnecessarily complicated. But youre not mad, because youre trading with e trade, which isnt complicated. Their app makes trading quick and simple so you can strike when the time is right. Dont get mad, get e trade and start trading today. Should they downsize . Nesters now. Probably. Will they . Not as long as thanksgiving is a holiday. Planning for the future is about more than just money. Let equitable be your guide. Theres one thing you can be sure of. Theyre changing by the nanosecond. Thats why cognizant created a unique engineering approach to design and build new digital products. Learn how cognizant softvision designs experiences and engineers outcomes. Cool. Its almost like a challenge everyday to see how well i can eat and still enjoy myself all day long, i wake up every morning to see how much weight ive lost and how much better i look. Myww join for free and save 30 good morning investors waking up after wall streets worst day since the 1987 crash this is americas Coronavirus Response is ramping up march madness cancelled. Broadway goes dark theme parks closed workplace as we know it changing from the feds response to congress, debating a stimulus package. Industries hurt the worst where investors are putting money to work we have complete Team Coverage as only cnbc can bring you its friday march 13th, 2020 second hour of squawk box begins right now good morning, everybody. Welcome to squawk box right here on cnbc im Andrew Ross Sorkin along with joe kernen. Becky quick is at cnbcs Global Headquarters in inglewood cliffs lets show you where futures stand today after what was remarkable crash, dare i say yesterday. I know no, no, no. Were careful dow looks like it would open up higher with a bit of a rebound taking place now if things opened up today, right now, 768 points. Nasdaq open up 310 points higher s p 500 looking to open about 97 points higher. As markets try to recover from yesterdays big loss, which saw the largest dow percentage loss since october of 1987 with the index falling by almost 10 . Lawmakers in the white house are working to try to strike a stimulus deal to limit the economic damage from the coronavirus. Eamon javers joins us with more on that front. Good morning reporter good morning to you, becky this morning the president venting some of his frustrations online in a tweet that went out about half an hour ago heres what the president is saying the president saying for decades cdc looked at and studied its testing system but did nothing about it it would always be inadequate and slow for a large pandemic but a pandemic would never hope. President obama made changes that only complicated things further. The president here blaming the former president and cdc for inadequacies in the u. S. Testing system meanwhile at the same time were expecting today an announcement between speaker of the house nancy pelosi and treasury speaker see convenient mnuchkin for a nuisance package nancy pelosi put out a letter saying there will be some specifics including free coronavirus testing, paid emergency leave, enhanced Unemployment Insurance and strengthened Food Security initiatives. All sides, guys, are indicating this might be the first of possibly several bills for coronavirus assistance here moving forward possibly some more economic stimulus coming in the weeks to come. Back over to you i hear the bird out there sun is coming up at least. Reporter were working outside today. Were doing our social distancing part here beautiful morning so far here. Yep. Thank you the fed is inrejecting big, big amounts of liquidity by dramatically ramping up asset purchases in an effort to calm the markets. Steve liesman joins us with more i think it was earlier this week we talked about it we heard nothing about repos or liquidity or anything. Next thing we know its trillion dollars in one day, right . Reporter we started reporting monday, joe, as you remember and credit markets were seizing up some people are like no this isnt a big deal that was this week last week when we asked why we havent been you know last week when we first started mentioning, seems quiet in the repo market. That ended on monday reporter the repo market itself of in good shape. It was the derivatives and other things heres two things the fed did. When i do this be warned theres an expectation the markets and fed may do much more move number one was the fed injected trillions of liquidity as joe said to unlock the frozen bond markets that were out there. The second thing it did is it had the 60 billion of purchases it was making to increase the size of its Balance Sheet but that was only in short term bonds. Now its going across spectrum into different maturities, short, medium and long term. Morgan stanley writing this morning we think fed bought some additional time until it delivers on what we expect a cut to zero rates and announcement of a host of additional measures and pantheon writes we expect the fed to purchase 60 billion. Its a down payment on additional measures the fed will do im thinking dusting off financial crisis era programs, things like the tatp and things where the fed provides liquidity thats out there and cut rates to zero to provide the kind of economic incentive, economic stimulus that might help the economy avoid worse Case Scenario in terms of specific names and institutions where some of the dysfunction may or may not be hang, have you heard anything reporter you know, i really havent heard it in terms of names out there. What ive heard, andrew, are kind of instruments that are out there. Treasury basis rate. There are these cost currency fx swaps, ois stuff you know the kind of stuff that was sort of weighing in the background in the Financial System but then comes to the foreground as the kinds of things the other main thing i hear, andrew, are off the run treasuries theres like a ten year treasury and then the year becomes a nine year treasury. Those are the ones difficulty finding bids and thats the kind of problems we heard out there that liquidity is supposed to assist can you tell us about the steve liesm Steve Liesman euro that has been opened up . Reporter we have new technology i dont know if they do this ahead of time. Its an ipad with a light on top of the stick microphone and were just im just the beta guy. You set the books up in a nice way behind you so it looks very professional . Looks like a real studio almost. Reporter its the way the office is. Really its my office. My wifes book back there. I got my stickback there. I do my recording up here for my music, actually and when im home working looked like a push shop is that being done remotely . Reporter i dont know. I got to be careful about that if they can do that. They control it. I didnt know that okay. Reporter but i am never im never coming in to the office again, i dont think. Im sort of down on this social distancing right here. I have a 30 second commute into the office this morning. Thank you, steve. Are you wearing pants reporter you know, becky, we dont have to talk about that. Ill take that as a no. Reporter the whole suit doesnt have to go on, lets be clear about that are they getting tight, tighter . Lets go thanks steve for more on what the feds move could mean were joined by Mohamed Elerian we get 30 and then we got to think about what to do at that point and reevaluate. 28 can i round that up to 30 and get your comments . Were getting a little bit of a bounce today, 875 points the market typically, if it is getting ready to bottom, it doesnt want to let people get in at the very bottom, right sometimes you do see a sharp bounce do you think this is it or were going to perhapstest loads and make some new one . Good morning. Youre going to hear less decisive and less directive view from me than you have in the past but listen up because i think its important for people to under whats going on. And overall youre still going to hear me being somewhat cautious why am i less direct in terms of we getting, going down even more because of what you heard. Policymakers have finally woken up and they are moving and we heard about congress, we heard about the fed. And second, valuations are more attractive and third on the health side what scott said in the earlier segment about testing is important but theres a couple of things one, i dont sense this is enough of a Critical Mass. We getting closer to Critical Mass that will stabilize this but not enough because fundamentals continue to worsen and technicals are shaky second we havent solved inherent contradiction between health approach, social distancing, isolation, separation and on the other side the reality of how this economy is wired how policy is transmitted. How the privatesector operates. So this is going to be really choppy i still think long term investors should be cautious but its getting less scary than it has been for a while. Well, i mean i listen to a l litany of what you talked about and i cant help think in the past its never exactly the same but the litany in the things and the market technically starts acting one way or another and doesnt seem to matter what the fundamentals you can see some commonalities in a way a market reacts to whatever shock its reacting to. Your seeing any technical things that would indicate to you that theres some okcapitulation or exhaustion or the message were at risk was driven home to markets yesterday or do you think theres still more to learn as the Health Effects play out . Yesterday no matter which segment you looked at you saw a lot of people being shaken out you saw trapped longs trying to get out at any price you saw people i mean it was this was so much distress selling going on there was not enough liquidity to accommodate them all. So we still have people looking to get out that need to be accommodated the real question is not whether you dont have people looking to get out, its whether you have a lot of people looking to get in. Thats the key issue i cannot yet identify a Critical Mass of buyers thats key when you look back what establishes a bottom not because people stopped selling its because buyers come in size. We have to look at it on the technical side i just wonder, mohamed, when we talk to you in two weeks, its impossible to say, what do you think youll be focusing on at this point, is it the operations of the markets or the epidemic, the parameters of where the epidemic is at that point . What do you think well be talking about then will it be what businesses are still closed and what gdp looks like for that quarter . So first i hope were not talking about the function of the markets because were talk about the function of the markets then were in a bad place and i think the policymakers, especially the Central Banks have had so many incoming calls telling them focus on how markets are functioning. Understand get a better feel for technicals they are getting there my big hope, joe, is we not talk about market functioning well talk about a global recession. We have to get used to fact were going into a global recession. Hopefully shortlived but i cant see how we can avoid a global recession how come it didnt help yesterday when fed took that action first i think it helped for a while but than few things came in very quickly. It allowed people to get out remember, you have a lot of trapped loans. Remember our initial conditions. We come in from years in which this very unhealthy codependency developed between Central Banks and markets. Because of that codependency too many people bought things that they shouldnt have bought. And they bought them because there was no volatility and because we had the notion that there was a Central Bank Put that disappeared in the last few weeks. So still a lot of reset to go in terms of peoples risk positioning. In terms of the medical numbers, the numbers were going to be hearing over the next several weeks, youve seen the charts, youve seen. What the British Government has said what they are expecting, my question to you is how you think investors are going to read those numbers and read this information over the next several weeks . What would turn it around from that perspective if you look at the economy let me start with the economy. I think the economy is an easier read things are going to come to a halt ive been stressing over and over again this notion of economic stops were seeing them every where. Things just stop were seeing events that were not in most peoples analysis. Well see companies draw down credit lines were going to see a sense of this economy is grinding to a halt and the debate well have is how easy is to it restart it. Well restart it but not immediately. Thats going to cause a lot of fear, a lot of uncertainty and a lot of risk aversion look at you, andrew. Look at how youre behaving when you get taken out of your comfort zone you become more risk averse. On the economy side we still unfortunately have a leg down. On the market side, the market body a lot earlier than the economy. Its going be about this Critical Mass. About the Circuit Breaker. Its about whether we have faith that the policymakers have put forward a plan we need a plan we dont need anything upfront we need a plan of stage one, stage two, stage three i think if markets get that we can establish a bottom and not contribute to the economic downturn all right mohamed, thank you thanks for having me on youre welcome. You and Scott Gotlieb becoming very frequent guests thanks thanks, joe coming up when we return the elderly are at highrisk for the coronavirus. Well speak to the c. O. Of a Long Term Company which serves more than 2 million patients in hospitals and Emergency Care centers and later this morning you dont want to mistressy secretary Steve Mnuchkin will be life on squawk on the street lets get a check on the markets. Which are not changing we limit up. Take those limits off you didnt say that on the way down i certainly didnt. Like the uptick. Take those things off. Let it go. No they will come off and then well see what happens we wanted to point that out since you see its not changing. Sales tax, different pos systems in all seven countries. And online sales . Thats a whole other system. And different regulations. Therererealal eate e crits,s,. And we have no way to integrate all that . No. But bdo does. Peopopleho k kno knonow o. Welcome back, everybody. Caring for the elderly is take on increased importance as one of the most vulnerable groups for coronavirus. Our next guest is the leader of Inova Health Systems in Northern Virginia joining us right now is dr. Jay steven jones, the president and ceo of Inova Health Systems. How are you preparing . In our acute care hospitals, we have a system preparing this for months now so i think the public can be reassured we in all likelihood all our colleagues around the country saw this coming weeks and weeks ago. We fully expected we would be seeing patients with covid19. We saw our efficient patients over the weekend last weekend. We were prepared when we had our patients and our team pulled together at a time where a lot of things that are new to us but completely fit in to where we do our work when you say you saw your first patients how did that happen did they walk in we had a patient who presented to one of our urgent cares and had a classic history and identified over the weekend as you might have been talking about. Testing is one of the slow things so with a little bit of 24 hours it took us to get confirmation of it. The good news is we had a suspicion of it based on clinical the clinical presentation, and so the patient has done very well did that patient call ahead or did the patient just walk into the urgent care and catch you all by surprise . I dont have that detail. Whats the proper thing people should be doing i heard call ahead let them know youre come sewing you dont inadvertently expose other people one of our challenges is the fact that people of course a lot of fear out there, so we see a few people showing up purely out of that fear if someone truly believe they have covid19 is to call their doctor first and get directions that can be coordinated with the local Health Department and if appropriate to be brought into the facility thats agreed to if they are truly ill if they are not ill through the Health Department get tested and not end up presenting. A lot of patients are able to be cared for at home. We had dr. Scott gotlieb with us earlier this morning and he said that people should not be doing, interacting with the Health Care System right now if they dont need to, doing things like elective surgeries. How have you been preparing for that we believe our responsibility is to take care of all our patients and frankly the overwhelming number much patients who need care right now of course dont have covid19, and that could obviously change. This is a rapidly evolving situation. At this point we know the overwhelming majority of people who need health care are patients who of everything other than covid19. Were mindful of the infection risk cognitive individual 19 but at the same time ensuring the care of our patients ensuring the care of your Health Care Workers. What are they doing differently to make sure they are protected if these cases do ramp up . Education and awareness are key so one of the thing we focused on is assuring we ask every patient and visitor if you have any reason to have covid19 and that would, of course, be either respiratory symptoms or fever. Again the overwhelming majority of people dont have those things yet people have either one of those we quickly mask them before they undergo a more formal assessment. Weve heard lots of stories about shortages of face masks, the n95 ones that protect Health Care Workers, things like gloves and ventilators how are you in terms of those supplies right now were in good shape. We have to be mindful no one knows how long this will last. We have to come together and make sure we do the best stewardship but right now were in good shape. Thank you we appreciate your time. Good time for all of us to pull together. Want to take a quick look at the futures. Were limit up for just a moment things looked like they would open higher. Still limit up s p 500 up about well basically 5 across the board. Meantime the Airline Sector is among the hardest in the coronavirus outbreak shares of the major carriers are down as they cut capacity to deal with falling demand i want to get over to phil lebeau reporter if theres a little bit of good news theres some relief in terms of he premarket what the Airline Stocks are doing. Moving a little bit hammered some news out about a number of the carriers united and jetblue this morning. Ubs out with a downgrade of both stocks moving them down to neutral. Where is the bottom in terms of Revenue Generation also with united it still has to finalize its transatlantic schedule before midnight tonight. Thats when they are going be having the restrictions put in place. Well get some news from united. American, last night american came out and said it is cutting its International Service for the Summer Season by a third down 34 also going be retiring some 757s and 767s sooner than expected. Thats all in an effort to cut the cash flow. Save some money there. One other headline about united, there was a dallasft. Worth pilot that did test for the coronavirus. We may hear more about that. Delta is telling its customers look if youre not flying within the next 72 hours dont call us. Were being swarmed with people who are calling in who have to change flights particularly transatlantic flights so dont call unless its within 72 hours. One last chart for you guys. Take a look at boeing. This is the one Year Anniversary of the 737 max being grounded. I know a year ago nobody would have imagined the max would still be grounded but the market cap if you look at whats happened over the last year, down 125 billion boeing trading a little over 166 a share lost 48 since march 4th. Its only march 13th you look at the numbers. By the way on the anniversary of the 737 max being grounded its up 7. 7 . Thats interesting. Phil, very quickly in terms of the airline stock, people not to call unless you have a flight in the next 72 hours are the fees going to be waived at some point . Reporter yes look, ive flown in the last couple of days i heard a number of people talk at the airport how they are changing a flight. I know somebody in my family had to change a flight they did and fees were waived yes. The airlines are really working on waiving these fees. They dont want somebody coming back and say forget about it also this is such a minor concern at this point but i did hear a couple of people talking oh, my gosh im going to lose my platinum status on that. They extend it by a month. Reporter i think youll see all the airlines try to figure out how they are going to modify their frequent flyer programs in some fashion simply because their most loyal customers the ones they want to make sure they keep a lot of them wont be doing the same level of flying so they are wondering about the status phil, is that the best you got or forget about it is that the chicago version of forget about it . Reporter forget about it that was awful. Forget about it, becky reporter im going to callup Rick Santelli and have him get on the phone with you in a true chicago accent. No im looking for a new york accent thats new jersey sopranoss. Yeah there were the bridge is all connected. Anyway i digress. After the biggest one day drop since 1987, different picture this morning stocks look to rebound take a look at the percentage change from the florida day all time high. The dow, nasdaq and s p hit just about a month ago. The futures are limit up right now. Squawk box will be right back. Dont just plan to retire. Plan to live. An annuity helps cover your essential monthly expenses, so youre free to live the life you want. Find out how an annuity can give you Lifetime Income at protectedincome. Org so it doesnt make a whole lot of Financial Sense can give you Lifetime Income for them to stay in this great big house. But, well, this is home. Its where they raised their three boys. Could they downsize . Sure. Will they . Not as long as thanksgiving is a holiday. Planning for the future is about more than just money. Let equitable be your guide. 0. The markets looking to bounce back. The futures right now up sharply employment up now for the dow, nasdaq and s p 500 up by 5 as much as the futures can trade up until we get to topping bell been watching that all week with Circuit Breakers kicking in. Youre looking at markets limit up for a better idea check out the etfs that track the indexes. If they were allow tried up maybe they would trade up more the dow up 5. 2 . S p up over 5 and were watching all of this right now very closely mike santoli joins us with more on yesterdays historic day and what investors should be watching this morning. 1987 example really is the only one in recent history besides 2008 that fits in terms of the speed and depth of this decline not just yesterday but on a weekly basis. Take a look what the s p looks like going back three years. This bounce in context will be somewhere right there. Its not obviously going rebuild all that much but if yesterday was not capitulation in terms of the short term, comprehensiveness of the damage done nearly every stock down almost literally then im not sure we have a proper kind of understanding of what capitulation is if it doesnt work this time heres a look at the s p low volatility etf compared to the s p itself this gives you a sense of just how indiscriminate the selling was. Thats obviously basically performing in line with the actual s p these are the stocks that are selected because historically have been a lot less volatile. Sell everything type moment. Take a look at the fixed income side this is what you want to monitor today to see if the market is trying to come back from the brink and try to discriminate between properly punished and those caught up in the pain. This is the high grade etfs. This is the Investment Grade etf. Vastly underperforming high yield etf which has underperformed for a while that suggest as give up trade in the somewhat Higher Quality bonds but suggest some forced selling, some trapped institutional traders and all the kind of machinations in the market that the fed was trying to address we have to monitor this bounce for health and selectivity as it goes on. Futures are limit up, they can only go up 5 . Im told theres no Circuit Breaker that kicks in on the upside once it starts. You dont have that 7 limit on the upside once we get into actual trading thats true absolutely yesterday youre down effectively 10 in the dow, 9. 5 in the s p typical bounce, just a bounce, if you recovered somewhat more than half of that, that would get you more than 5 were obviously having to widen out the band how the market is by the way haefg its telling you this is not a smoothly functioning market and tremendous amount of fear but tremendous amount of, i think, of kind of pain in institutional positioning and trader force selling. Mike, thank you. Meanwhile its been a monumental week as we all know here on wall street. The dow plunging 10 making at any time worst market day since the 1987 market crash. Joining us right now is kathy wood founder and ceo of arc invest good morning to you cathie weve spoken so many times over the past several years and this pandemic was something that was not on any radar when taking into some calculations the future price of tesla and so many other stocks that you own what have you been thinking and doing this week . Thank you, andrew well, however much we hate these kinds of time periods, very difficult for everyone, we do know, our focus being only on Disruptive Innovation that innovation gained much more traction during difficult times than it does during normal times. So while our stocks, especially in the last three days have, you know, taken it on the chin with the market, we know our companies are gaining market share. This happens in every crisis it happened in 0809 so were leaning into innovation and concentrating our portfolio to either the names that have been beaten up relative to others or our High Conviction names. Youve been buying more anything youve sold weve sold actually we sold stocks that held up pretty well during, during the downturn until very recently. Like inovio, a Vaccine Company associated with the coronavirus. Weve sold a little netflix which held in beautifully. But not because our conviction in these names has gone down but because other names were being trounced and we were seeing amazing opportunities. We talked about oil prices for so long and we talked about tesla and the impact of low oil prices on the Movement Towards electric vehicles. Is your thinking changing at all . No. No the reason for that is even at these Lower Oil Prices weve done the calculation the total cost, if they translated in to gasoline the total cost of ownership of an electric vehicle compared to a like for like gaspowered vehicle is still lower and, you know what electric vehicles are better cars at the end of the day and anyone who has driven in a tesla can you just walk us through the math what does a barrel of wti crude have to cost where an electric vehicle lets talk about tesla vehicle. Tesla vehicle . Like for like so, the total whats happening here is battery costs are declining for every doubling in electric vehicle sales, the number of units produced, battery costs are coming down roughly 18 . This has happened for, you know, its happened for the last five years, five, ten years, especially with tesla pushing the envelope so those battery prices have been coming down steadily. This sharp decline in oil prices, first of all, it may not last especially now that the Oil Producers are cutting Capital Spending plans so aggressively but even at this price, really the battery cost that has pulled the total cost of ownership down and will continue to maybe if clean hydrocarbons are powering the grid, then those would go down in price too and maybe even electricity youre right. Mike, i dont know if youre still there. I want you to jump into this conversation youve been trucking to traders and investors in the past week in terms of some of these names that cathie has been in and this issue where oil stands right now. Whats interest is going into twhrks market was at its highs you would have been able to look at those select group of hitech companies. They are dominating market, overrepresented in the indexes and maybe where the excess is. Theyve not under performed as a group on the way down. If you look at things like the nasdaqed 100 this selloff hasnt so much been about oh, we had a little bit of froth in some parts of the market and taking it out its an economic shock, the sudden stop and then turning into energy on top much that the oil crash and what it means for credit now the market is for the last few days been hunting those companies that have a big debt overhang that maybe cant handle a few moves reduced or zero sales. Thats changed the story a little bit hasnt necessarily altered the broader picture where hey secular growth seems like it has a bid here obviously some of the real storied stocks, Virgin Galactic got taken apart and became a cult situation in the broader sense the established ones it hasnt been about that its been about lets run whatever length of time the economy will stall out in a sudden way run it through everybodys numbers and that hits the more economically sensitive areas and the banks than other companies i hate keeping going back to tesla. When you look apartment demand for these vehicles over the next im trying to under how you do the math. Do you say to yourself almost zero demand for the next two months, three months and gets pulled forward later or gets pulled back . How do you do it actually we believe sure, of course, sales will be hit hard here. I think thesume consumer is in shock. The saving rate is pretty high we know that a lot of people have been ordering teslas. We think teslas share as a percent of all electric vehicles and a percent of all auto sales is actually going to go up because it is the secular grower within the Auto Industry tesla is leading the charge. Okay. Cathie well talking to very soon mike, i appreciate it. Coming up a new highspeed coronavirus test has been granted emergency clearance by the fda. Details after the break. And futures, who decided on this rule futures are limit up right now we under im just kind of i feel that way. No limit up once trading starts not a 7 limit what time is it ywly 7 42. Anay squawk box coming right back obal norm, not the exception. At emerson, when issues become inspiration, creating a better world isnt just a result, its a responsibility. Emerson. Consider it solved. We were paying an arm and a leg for postage. I remember setting up shipstation. One or two clicks and everything was up and running. I was printing out labels and saving money. Shipstation saves us so much time. It makes it really easy and seamless. Pick an order, print everything you need, slap the label onto the box, and its ready to go. Our costs for shipping were cut in half. Just like that. Shipstation. The 1 choice of online sellers. Go to shipstation. Com tv and get 2 months free. Stay two nights and get a free night for your next stay. One night, two nights, free night. Book now at bestwestern. Com. Welcome back happy friday the 13th. The markets this morning look like they are going to open up sharply. Yesterday you saw the do you down by 10 . This morning its trading up by half that amount, up by 5 because thats all kit limit up dow futures indicated to open up by 1100 points the s p futures indicated up very sharply as well these are numbers that would be up 5 if you were looking at the future changes future changes are up 5 you cant trade any higher dow up 1,000 points. S p would open up by 113 and nasdaq open up about 335 i want to get to meg tirrill. Reporter after what many are calling a catastrophic delay Testing Capacity is ramping up for the coronavirus in the u. S. D diagnostics giant roche said they can provide results in three and a half hours they will have million and a half tests available currently reported cases stand at more than 1600 with 41 dead worldwide cases exceeding 135,000 with deaths approaching 5,000. 70,000 people have recovered according to data from johns hopkins. Many are asking especially here in the u. S. As numbers grow what this disease looks like and how long it takes to run its course. We do have some data from w. H. O. s mission to china. Symptoms can range from none at all to severe pneumonia. 90 of cases have fever. 70 have cough 18 shortness of breath. 14 a sore throat. 80 of cases were mild to moderate mild cases typically recovered within two weeks those with more severe disease took three to six weeks. Meg, thats all helpful. I wish i knew the mortality rate because then i could figure out where we really are or get an estimate you know what i mean i wish we knew the denominator. Thats what i meant you said 1600 in the United States how many death 41. I would think thats more like i mean not 1600 because thats such a high mortality rate if you take an average of what we think the mortality rate is what does that mean the total would be i was trying to figure that out. I guess 10,000 or so, Something Like that . Depends on whose estimates you use. You go by dr. Anthony fauci who everybody seems to trust the most, hes estimating it will shake out to be around 1 . I hope not. Can you speak to lets hope its below one again, we dont want to instill any fear i want to under. We talk about the death rate but what other damage can to be done you read the reports about other people who became sick and they didnt die but there were other complications. Thats right, andrew. You do hear about with the severe pneumonia could be lung damage were learning more about that and, you know, ill have to research it a little bit more to come back to you still a small its 80 do not manifest that thats right. 80 have mild to moderate disease not severe enough to go to the hospital for support. Okay. Thanks, meg. For more on the coronavirus latest lets bring in our guest. Joining us now is zeke emanuel, a former obama Health Policy adviser. Nobody is allowed i know from a Family Member who is home. We decided yesterday to close down the campus. I happen to have a house in washington, d. C. As well because of all the political and policy activity so im actually down here in washington youve heard the previous conversation and im sure you just, if i told you to just Start Talking and tell us everything you know you could do it and the whole segment would be filled up ill defer to you. Let me make three quick points which i think are really important. First, it is true that for any individual the risks are low especially if you tend to be younger and healthier. This is concentrated, the sort of severe side effects and mortality are concentrated on people who are over 65 and have other complicated diseases whether its emphysema, Heart Disease or diabetes. Thats the target group. The good news if you want to look for some Silver Lining young people are not really affected severely and thats really, really important second, how the Health System responds how the public Health System responds how the Health System manages these patients is critical because if you look in china recent reports out of harvard show that places that have sort of not responded, not prepared, you have a much higher complication rate and a much higher mortality rate than places that have actually prepared through vigorous mitigation efforts and have a functioning Health Care System thats not overwhelmed we have to get in the Mitigation Strategy and preparing our Health Care System so it doesnt become overwhelmed if i were to say that theres a scarce resource here its the Health Care System youre hearing everyone talk about lets push that curve down lets spread it out. Lets have the cases evolve more slowly that is important mainly to overcome or to prevent the Health Care System from being overloaded with too many cases and, therefore, have to do rationing of hospital beds, rations of icu beds and ventilateors that will be a problem the last thing i would say is its really good the roche test is coming online good that Quest Diagnostic lab company and labcorps are getting their tests online we have to pull testing out of the Health Care System because you dont want people with coronavirus going to the emergency room or going to their Doctors Office and spreading this around especially to Health Care Providers remember i said that the scarce resource here is the Health Care System and we need to protect the Health Care System so we need a lot of drivein testing. You dont want people that are already there for a reason displaced and then someone with coronavirus come in to get tested when they are already sick what has to change over the next week and a have, zeke for that to happen we need massive effort to get drivein screening so literally people can do it in ten or 15 minutes. They opened up drivein screening place in denver and reports are four hour waits. Four hour waits wont work for many, many people who have to take care of kids who have, you know, delivering food and other stuff that are essential ingredients. We really need to get it so that these drivein screenings are every where and people who are manning them are trained but they are not Health Care Workers that are taking care of people in the hospitals or at the Doctors Office with other conditions and i think that has to happen very quickly i told a western governor this yesterday. Its really essential that we take this screening out of the Health Care System so we dont infect people while they are die dieing a diagnosing this problem. You may have heard of the jetblue flight where someone had gone in for a test for the coronavirus a couple of days earlier got on a plane and flew down to florida, got the results either right before he was on the plane or on the plane finding out it was a confirmation what is going on for people thinking they are in a position to actually get a test, that theyve been exposed enough potentially to put them at risk and still going about their business and traveling this is a problem what was he thinking to fly before you had confirmation of the test one way or another we really do need people to be responsible for their own behavior this is a collective issue everyone is depending on everyone else in the community to do the right thing, and that was clearly the wrong thing. Now, having said that we should be very clear that not everyone on that jetblue flight is in serious danger and we should make quite clear there have been studies about transmission on planes, first of all, the air filter system on planes is better than the air filter system in your house. They use hepa filters and it takes out these droplets the spread of droplets is within a one meter area a lot depends how well they clean those kind of planes do you want people traveling on airplanes i actually i think were going to have to institute a lot of social distancing around the whole society to get our arms around this. To that point because were trying assess the economic repercussions of whats going to have to take place when it comes to social distancing, people not working and people fwrork home in terms of the duration of this how do you see it . Thats a really good question, and i think we need to be prepared for what im calling a yoyo response well close down and, you know, have penn go down, have other facilities send workers home at some point, you know, everyone is talking about the end of march, although we at penn its the end of semester. Then youll open these things up again and travel will begin, people will begin to drive around and youll see an increase again because people are going to be interacting. Do you think that things will open up at the end of march two weeks from now im skeptical of the that i think some organization will try that you heard two week shut down of schools. The time period is all over the place here thats one of the problems i think at the federal government. We need more consistent guidance from the federal government. People say the peak, for example, in new york and Governor Cuomo has talked about it in new york being a hot spot, peak is closer to four weeks from now yeah. So four weeks from now would be middle of april. Youre hearing thats part of my point youre hearing different numbers and different items from different places i think amazon said that people should work from home until the end of march now people are going to reassess at the end of march. And, you know, one of the things that happens without National Guidance and without clear advice is different people assess have we reached the peak, have we turned the corner and they may do it ineffectively one of the things im worried about is this spotty haphazard response rather than a systematic response. What about subways in new york city, chicago and other places thats a complication and problem. Thats exactly the problem denity is where these things spread because people are right next to each other what we mean by social distancing is fee feet around you, hand washing, no shaking your hands if we need advice about what kind of bill ill call rahm. Career problems ill call ari. You should set up a shop thanks zeke. Slack cofounder and kompany, Stewart Butterfield join us to talk about the boost his company is seeing more employees work from home later, Barry Sternlight gives us his thoughts on navigating the markets. Squawk box will be right back. Wow, do you think you overdid it maybe . Overdid what . Well planned, well invested, well protected. Voya. Be confident to and through retirement. And when you open a new brokerage account, your cash is automatically invested at a great rate. Thats why fidelity leads the industry in value while our competition continues to talk. Talk, talk while our competition continues to talk. When i lost my sight, my biggest fear was losing my independence. Mmm. Good. So ive spent my life developing technology to help the visually impaired. We are so good. We built a guide that uses ibm watson. To help the blind. It is already working in cities like tokyo. My dream is to help millions more people like me. It is already working in cities like tokyo. We see hat emerson,kthroughs when issues become inspiration, creating a better world isnt just a result, its a responsibility. Emerson. Consider it solved. I was drowning in credit card debt. Sofi helped me pay off twentythree thousand dollars of credit card debt. They helped me consolidate all of that into one low monthly payment. They make you feel like its an honor for them to help you out. I went from sleepless nights to getting my money right. So thank you. Breaking news, futures hitting their upper limits as wall street closes out on one of the most volatile weeks in history. Dow and s p 500 coming off their worse day in more than 30 years as the Coronavirus Spread around the world. States of emergency are declared and American Workers change by the hour scramble in washington to come up with a response to reeling markets and americans who want to get tested. Deep dives into the hardest hit industries on wall street and what this extreme volatility means for your money final hour of squawk box begins right now. Good morning, and welcome to squawk box here on c nobs. Im joe kernen along with sore at the Nasdaq Market site in times square becky quick is at cnbcs Global Headquarters and the longest ever u. S. Bull market is over, but let me just point out were locked up limit and its friday. The 13th. Which is a great day for me because thats an anniversary, i got married on friday the 13th happy anniversary. But at this point every day getting up, dont we all sort of just are like wondering what the day will bring i heard from other people its really hard, very difficult lately, and at least i hate to be long minded and were objective about markets that go up and go down but i dont feel that bad about hoping theres just not economic carnage and loss and everything else, and i cant help my own feelings that stabilization today is welcomed and well take it. After this yesterday the dow and s p suffered their worse day on a percentage basis since black monday in 1987 and you saw what 10 felt like yesterday. Admittedly after 20 the past couple of weeks. Think of 23 in one day. So its almost two and a half times yesterday what happened back in 1987 all three major indices are firmly in bear market territory but as we have pointed out the reason youre not seeing the futures change, the implied open is because the futures themselves are trading limit up at 5 . As you look attracting etfs it points to more than 5 jump at the top, but, you know, we open at 9 30. We dont close until 4 00. Were subject to any of the, you know, the vagaries of whats happening with this epidemic over the next, between now and 4 00 p. M buttre treasury yields which we heard so many people say it would be good if those would stabilize so an indication of fear in the marketplace maybe its doing down. Happening at the same time. Selling bonds and stocks at the same time. Almost. 95. Thats not far from 1 which would be almost kind after milestone from where we were we got all the way down to. 4. We have Team Coverage of the Coronavirus Crisis worldwide as the illness impacts the business community, every day life, andrew, investments. Eamon javers is in washington with the latest on the u. S. Governments response to the virus. Claudio is in italy which is on an Unprecedented Nationwide Lockdown phil lebeau is in chicago covering the chaos in the Airline Sector mike santoli is at the New York Stock Exchange on historic market moves weve seen all week well get torch. First, those we have some breaking news. Youve been hearing of events that got cancelled almost by the hour events that have been taking place over the next month or two. Berkshire hathaway is adding to that list. They put out a press release saying it will be holding its annual meeting as scheduled on may 2nd but shareholders will not be allowed to physically attend Warren Buffett regrets this action but said large gatherings can pose a threat. It will be streamed biya hy yah its possible one or more journalists will be present to ask some questions submitted to them were deferring a decision on that matter but encourage you to dont send your questions the home andrew is one of those journalists, im one of the journalists. Well figure out how this exacts well see if were there in person maybe remotely well figure it out. This adds to the number of events weve seen either cancelled or made private or gone virtual because they dont want big crowds gathering. Meantime, becky, i want to get over to eamon javers who is in washington right now. The Trump Administration response to the virus and the latest there reporter good morning, again. We do expect well see some leadership here this morning in washington from speaker of the house nancy pelosi and treasury secretary Steven Mnuchkin. The expectation is there will be a deal announced later today on a new package of aid coming from capitol Hill Nancy Pelosi sent a letter last night detailing some of the elements that are going to be in this new piece of legislation she hammered out with the treasury secretary she said free coronavirus testing is top of the list paid emergency leave for workers. Enhanced Unemployment Insurance. Strengthening Food Security initiatives, thats through the s. N. A. P. Program so a host of actions being contemplated on Capitol Hill Senate for its part said it will stay in next week postponing its recess in order to deal with the bill thats coming out of the house of representatives he we should see that announcement later today thats Nancy Pelosis version of whats in this deal. We dont have a complete text yet so Steven Mnuchkins version will be very important and as you know we have him on cnbc within the next hour at 9 00 eastern time so well be able to ask him exactly what sells in this deal that nancy pelosi may not have listed in her letter last night. Some action coming the president seems reluctant to issue that National Disaster declaration. He says if i have to i have to maybe more minor elements of it are things he would consider but nothing from the white house on that. Lets move to the federal reserves response fed taking extraordinary action with a plan to inject more than a trillion dollars into the market Steve Liesman joins us now with more what does this mean . What are the real reasons that they are doing this and how it will impact things reporter it was really about frozen bond markets among other things and a whole bunch of internal financial machinations that were going on there was difficulty in placing some of the off the run treasuries there was an issue with money markets getting out of short term bills going into longer term bills because they are looking to lock in duration. I want to turn the conversation. You know how the market works. What has the fed done for me lately theres additional talk this morning about the fed after the this historic absolutely massive move doing more. Let me show you some things were talking about here one everybody agrees the fed is not done yet thats the first thing second the thing is the fed to cut rates to zero. Ill show you the probabilities in a second. Third looking for more qe, 60 billion that the fed is doing now in purchases across spectrum might be expanded. Possibly he rekindling some crisis programs. Morgan stanley says we think fed has only bought some additional time until it delivers what we expect to be a cut to zero rates and an announcement of a host of additional measures. Theres a 63 chance that at the march meeting which i guess is just next week that fed cuts 100 basis points and 37 chance and these are moving around, obviously, that the fed goes i guess what do you want to call it, the full monty 37 , 125 basis point cut or to the zero to 25 basis point range. One other thing im hearing, david tepper the Hedge Fund Investor says the fed need look at the issue of credit lines businesses have taken down their credit lines because, helped them with their business one reason they took them down because in 08 the banks withdrew them before they could. They were and the down maybe 2. 5 trillion of potential Business Credit lines out there. The banks need to offset these risks. Thats not the big issue its the nonbanks that provide the credit lines hes looking for a program that would allow these nonbanks to offset the risk of credit lines that are out there guys, every one of these crisis reveal new things you didnt think of in the financial industry here we are once again with another crisis faend has to step in, in a big way the machination in the Financial Market are that they cant take care of themselves what were seeing with treasuries, how much of that is directly related to what we saw the fed do yesterday it could be, beck injuriy, au cant look at the treasury market how you look at the stock market it could actually be a positive sign with yields ridesising wit little bit more liquidity in the market we have to wait until things settle out to get a sign from the yield alone. One of the things were looking to figure out what the heck is going on is big spread we have situations normally they are very thin but they widened out a lot especially on off the run treasuries there are some cases here becky where the spread are wider than they were in 08 meaning that theres nor illliquidity than there was back then. You saw what the fed did on a liquidity basis was bigger than it ever did in 08 at least specifically aimed at the repo market some places are worse. Many one reason treasury secretary mnuchkin talked about this theres more treasury out there. Its triple of what it was in 2008 because the deficit has risen. Thats an issue that requires, i believe a bigger fed response. Unless you think im not paying attention i did notice you used phrase full monty on a morning when youre not wearing pants. Reporter becky, you brought that up. Stay with us. Well have more. Joining us Jason Furman Harvard kennedy professor and nathan sheets who pgim fix income and former treasury official nathan lets start with you. These moves from the fed i think that steve nicely framed the issues. What the fed is doing is taking out the crisis era playbook and we saw that with 50 basis points in a meeting last week and were seeing it this week with the massive liquidity injections but i think its right to think of that as a down payment on zero rates and qe at the meeting next week. And then in addition given the significant liquidity stresses that were seeing in markets i mean frankly its like a meteor has hit Bond Market Liquidity over these last few days i think that is going to be rolling out its liquidity facilities, i think well see the swap lines activated the fed has a meaningful toolkit here and i think it can be supportive i think ultimately well need support as well from fiscal policy, but the fed is gearing up or pretty powerful arsenal of responses, i think whats the state of bond market right now you said its been rocked in the last few days. Is it better after this fed move well, i think that the announcement yesterday from the fed, i think that we are slowly digesting what it meant. That on its face, it seemed to emphasize the liquidity aspects, which were helpful but the issue is getting the liquidity to the parts of the market that are most necessary but i think as folks have reflected further on where the fed is, the commitment of the power of the fed, i think that were increased confidence. That they are going to do more i think that is likely to help unlock the liquidity in the market but ultimately, i think were going to need to see these purchase and were going to need to see those, those facilities actually, actually activated lets talk about the fiscal policies you would like to see nathan has been covering what the fed should do, what Monetary Policy should do you obviously were in the Obama Administration when there were a lot of different actions that were taking place. You have seen things like the things that are talked about this time around, the payroll tax cut and i dont think youve been incredibly supportive of a plan like that because of what happened the last time around when we tried it yeah. So, first of all let me just say the thing i find most comforting at this moment is it appears to me from a distance and i dont know for sure that nancy pelosi, Speaker Pelosi and secretary mnuchkin are working really well together one of the important things that happened in 2008 was then secretary paulson and then Speaker Pelosi worked well together they did a fiscal stimulus at the beginning of 2008. They worked together on t. A. R. P. What were going to see here we need to take a number of different steps. If they reach this deal that Speaker Pelosi says they are close to reaching thats important. It will include nutritional assistance, Unemployment Insurance, paid leaving, testing and whats really important more assistance to state Medicaid Programs so that they dont cut them back in the face of a Public Health crisis the problem is that just the first part of what were going to need to do on fiscal policy, its going to being a great but not nearly large enough. I think the way to scale it up now is cash. Large amounts of cash. To who. Large amount per household. I would give to it everyone. Last week i said 1,000 an adult, 500 a child based on the developments over the last week. I would be more than happy to double that. Jason, i thought the issue with this time around is that even people who have money dont want to go out and spend because they are afraid of what happens with the virus wouldnt it be better to have targeted stimulus meticulous go to workers to make sure they are covered if they are sick, making sure businesses that need small or low interest loans to make sure they can continue to keep their business afloat during these times . Wouldnt that make more sense . We should do all of that. Everything you just said we should do. My experience from last time is if you try to get too cute with the targeting, try to be too careful you can craft a lovely proposal and it ends up with fewer people signing up than you expected, it ends up missing a lot of people who nietd. You wouldnt think of this as a conventional fiscal stimulus this is not write people a check and spend money on a cruise line to help the u. S. Economy these are people whose income going down a lot of people will see their incomes go down. A lot of them a payroll tax cut wouldnt reach you wouldnt means test it . If you want to cutout the top 5 of people thats fine but i would make it simple and do it for everyone you could phase it down at the top. Thats not a problem the other thing we have to remember here is the economic problems could persist after we get the virus under control. If we can get it under control in two months it will be okay. If it lasts six months or longer you will see business Balance Sheets in bad shape. People who have been parted from their jobs it takes a longtime for the economy to recover from that getting cash now might help the economy next year as well too. So, last thing i would say, becky, think of it as an interest think of it as a loan federal government can borrow money now at a negative real rate effectively lending people money. Of course tax will be higher down the road. Were spending lower down the road to pay for this but, you know, thats a good deal with Interest Rates where they are right now jason, thank you for joining us today nathan thank you later this morning dont mistressy secretary Steven Mnuchkin well be speak live with jim cramer death toll from the virus in italy has topped 1,000 the country locked itself down bars, restaurants and cultural sites closed or closing. Only food stores and pharmacies remain open. Nbcs claudio joins us now with more and good morning, claudio. We saw you yesterday reporter good morning. Yes. Not only the businesses are closed across the nation and only Grocery Stores and pharmacies are open, things and services are closing down by the day. Today weve been told airports will be shut down and thats creating a lot of confusion on whats closing and whats not. Yesterday the vicar of rome issued a statement all churches in rome will be closed and dispensed the faithful from abiding their religious duties this morning the pope during his private mass said that while it is a bit of a drastic measure and that instead taking drastic measures is not always a good thing, he said that every single pastor in the church should decide for themselves on whether to keep the church open or closed depending how they feel they can protect their faithful from the spread of the coronavirus. What were seeing is the effects of the coronavirus outbreak is having on italians, as you said the death toll and number of people who are testing positive is skyrocketing but the effect its having on the economy like yesterday as you saw in the states, but yesterday was really a dark day, perhaps the dark jet day in the stock market here in milan the stock market dropped by 17 thats the biggest one day drop in the history of the index. Today last time i checked it bounced back up 14 just showing you what damage this outbreak and the Strict Lockdown rules are having on the economy of this country. Okay. Thank you so very much back here in the United States a growing number of employees have been told to work from home. Companies practice social distancing to stop the spread of the virus. Joining us right now is ceo of slack. Slack reported results yesterday. Revenue for the Fourth Quarter topping analysts estimates but guidance disappointed even with slack citing uncertainty surrounding the coronavirus. Good morning to you. I have been living on slack these past couple of days. Lets talk first about the impact of the virus and whats going on and then we can jump into some of the guidance and earnings issues which i know you want to talk about as well what your seeing in terms of work from home taking place and how do you think that will be just not just for next couple of weeks but potentially into the future thank you for having me happy friday the 13th. Were seeing a lot from all different kinds of customers and we have 110,000 customers. And i would its a bit all of the above situation. Theres a lot of people who are moving to remote work or work from home situations for the first time a lot of executives who are struggling out how to manage and operational performance. A lot of questions, a lot of uncertainty. I think the actions of companies have been fantastic. A lot of energy. Employees for those business are willing to help. We have a great collection of resource weve scaled up a program to give people oneonone consultation our Customer Success teams are very interactive with customers. Giving web areas and training. In some sense slack was built for this, not specifically for remote work but communications and communication is foundational to how a business operates are you of the view that once this panic and virus subsides that this will change work and remote work for a very longtime . I think it will definitely have some permanent impact from where we sit today theres not a lot of visibility into the future and you think about just what it felt like yesterday compared to wednesday. These moments like the tom hanks, nba thing where suddenly the psychology shifts and people have a different kind of perception of what the next couple of weeks will look like looking too far ahead its difficult but i think it will have a lasting effect. Can we talk about the guidance that did disappoint the market did it. We came in with a great quarter, great year, 57 growth in ref news 47 growth in billings. Huge beat on both for the quarter and long term i think were very optimistic. You put yourself in my position on a day like yesterday well have to give guidance at this point and the further out you get, kind of this cone of uncertainty that gets bigger and bigger as you project into the future we cant average out the upside from that and down side. We have to be responsible and prudent and guide to something we feel very confident theres pressures on both side i got an email from a cto last week who signed a huge contract one of the biggest Asset Managers in the world. Hey we just signed but this is the last ipo we signed before the door shut. If we see clamping down on spending at the same time youll see a real surge in interest from existing customers and new customers. See a surge in new teams created and people checking out slack for first time its hard to balance two how are you seeing the competition given what microsoft is doing with teams and what google is doing. We feel great about that. Teams has been out for three years now and theres enough time has passed and because of the reception we got it from, from the analysts last night our thirst quarter result report as a Public Company and just huge. 80 yearonyear growth for Million Dollar plus customers. We added 300, 100,000 plus customers in the last year and winning headtohead over and over again five biggest yields last quarter. Theres a report in politico this morning that the white house and Trump Administration considering teleworking. Are you expecting the president to become a client not expecting the president to become a client, the white house. Theres some technical rules, 1867 speech act or Something Like that i dont think you see the white house using any Cloud Service in the future. However you look across federal government, one of the wins were proudest of in the last quarter is veterans affairs. They are the biggest integrated Health Care System in the United States think about the pressure they are under. A lot of elderly patients and managing through that kind of crisis in an environment where you have people work from home honestly i think about my own experience stuff is changing every day. We have 1300 employees in san francisco. Just last night School Districts are shutting down schools. People in that situation where they were battling over Kitchen Table space where they are working from home now they will have two or three kids in the house as well and not an easy situation to manage. Disruption in supply chains, restaurants shutting down. Travel so its just such a dynamic environment. Anything leaders can do and employees can do to drive alignment and ultimately agility. You need to be agile and responsive stewart, good to see you. Please stay safe and healthy out there and we appreciate and hope to he see you again very soon. Same to you one of the hardest hit industries amid the coronavirus outbreak obviously the airlines. Phil lebeau is covering that story from chicago reporter the Airlines Stocks are showing a little bit of relief this morning. Im not sure anybody is building a whole lot into that because these guys have been destroyed as you look at the Airline Index the key sque there do the airlines have liquidity they need to with stand this plunge in demand. Now for foreseeable future and were talking about next couple of months most believe they do will they need terrorize capital as we go out several months and if demand does not pick back up. Couple of airlines specific stocks to look at today, lets talk about American Airlines last night they came out and said Summer International summer schedule will be down 34 . Another headline with american is that a pilot based in the dallasft. Worth area has tested positive for Coronavirus Airline says the pilot is doing well but this will raise those questions about whether or not the entire air travel system worldwide is going to have to face greater scrutiny. United airlines and jetblue both were downgraded to neutral basically the question is where is the bottom in terms of demand take a look at shares of boeing. One year chart here because this is the one Year Anniversary of the grounding of the 737 max and if you go back over the last year this is a company that has lost 125 billion in market debt thats the focus not just boeing but the airlines lets see what happens especially after getting hammered yesterday stay with us. American air pilot has tested positive for coronavirus joining us now dennis hager, the chairman of the Communications Community of the airline employments association. The union of American Airlines pilots and a pilot himself dennis, i hesitate to think this is a solitary case among pilots and i would imagine Flight Attendants as well are at risk and it brings up new questions about, about what the Airlines Industry needs to do in this world we live in right now clearly, it does. I know becky has spoken of it since our interview. We talk about protection we lacked as american and gave our pilots great concern should they test positive as we have heard in this particular case. So good news is while our Management Team has protection about 24 hours ago theres positive engagement. The name of the game for our employees on tarp and at the gate is there arent any onerous disciplinary actions taken if they feel uncomfortable coming to work or sick. Stay home if youre sick other groups have point systems. During normal times say a management desired leverage point for employees. But were in extraordinary times. Were hopeful that this type of clearing the deck those type of policies will be rescinded and you just cant make an isolated decision and work well with one work group and let the other carry this thing through so were seeing positive action, obviously. Its changing every day. But well be looking for that Going Forward during these very serious times. I dont know if everyone has thought of pressure not only pilots but Flight Attendants feel to show up. I mean if a pilot doesnt show up for work how many people are affected so you would say in general, that if you have like what seems likea cold or if your symptomatic or not that serious you would go to work as an american Miles Per Hour pilot or Flight Attendant how do you change that in what is now a totally different situation and thats what you were actually looking for from management thats a great point. For every flight as a pilot we have to check off a box that im fit to fly if i have anything thats distracting me of body or mind to fly taxpayer craft safely i can engaging that flight our Flight Attendant, obviously our front line defenders in safety if we have to evacuate the aircraft or taking care of passengers they dont have that selfassessment but they have that responsibility. Gate agents. Think of all the contact you have with the gate agents. The entire system and anybody, if youre sick stay home if youre uncertain, stay home the idea of controlling this so policies that work against that maybe not by intent have to be fixed do you get paid if you dont go in, in any of those situations you do have a sick day. Most airlines do american we do as well but its kind of like having if you have a bank but if someone is standing at the door saying if you use this, and we suspect youre using it without rightful cause theres punishment you have a tendency to stay away from bank. Its human nature. How concerned are pilots in industry one way or the other about some of the speculation and trump even has hinted at it. Theres a need to effectively shut down even more travel inside the United States its a serious concern. Controlling this is the number one game those with the direct information from the white house under the cdc make those decision, and hopefully working closely with the airlines because this is something thats going to take all hands on deck and certain decisions will be made, be made to call to question but not an endorsement of any particular action but much rather have a conversation about how they overdid it. Thats how we act in the cockpit, do things conservatively because of consequences are very serious. I want to add one more thing delta and american and other airlines are talking about the efficiency of these hepa filters and they are he correct. They are extraordinary the but they have to be actually running. So at american were very pleased they directed pilots that while were on the ground and boarding the aircraft we have those systems on. So it sounds nuance but get everyone to look at every area you used not to have those on because of efficiencies but now you do have them on . Thats correct. Actually in our checklist not to start the unit that creates the airflow for that until ten minutes prior to our departure is that for efficiency because the aircraft during normal times is a safe environment but under these extraordinary times boeing has recommended to run that system any time folks are on tarth airplane i as a captain have always done it as a comfort. Now its a broad based policy. Dennis, we appreciate you spending time with us and helping us tuned nuance. The president , President Trump just tweeting this morning quote, if you want to get money into the hand of people quickly and efficient lir let them have full money that they earned, approve a payroll tax cut until the end of the year, december 31st then youre doing something thats really meaningful only that will make a big difference we should tell you, you dont want to an interview with Steven Mnuchkin the gang will be talking to him about that payroll tax cut and his conversations with nancy pelosi about what comes next we just got a little bit of economic data. Import price Rick Santelli is in chicago looking at the numbers many have suspected we have deflationary pressures until we get much of this resolved and see the demand side again which would bring inflationary data bears that out. Import prices were wouldnt half of 1 following a slight revision up. 1 of 1 with respect to january take out petroleum actually up. 2 import price yearoveryear down 1. 2. Export prices month over month, down 1. 1 twice expectations and the yearoveryear export numbers down 1. 3 both those follow positive numbers that were slightly he revised on the yearoveryear which is most important and export prices we move up from one half to. 4. Demand side should be coming and well see higher price activity. We have our preliminary march university of michigan coming up at 93 basis points in a ten year its range has been 76 to basically 71 to 87 it settled a 30 year bond range today has been 139 to 178. Its currently at 157, it settled at 129 last week these maturities are up. Everything is saying oh, my god its horrible. Im glad the fed came in ill liquid markets are part of the process. Becky, back to you coronavirus testing one of the most Critical Issues for those on the front lines fighting this illness. The Cleveland Clinic is in the process of developing a covid19 test that takes hours to get results into stead of two or three days with us now is the ceo of the Cleveland Clinic and, doctor, thanks for being with us this morning tell us a little bit about this test why its faster than the existing ones out there. Good morning, becky thank you very much for having me our test is not a new test we really did not invent the test this is the same test that was described in many other countries, the test thats being used worldwide the only difference here is that my colleagues at the Cleveland Clinic, were following the directions issued from cdc that describe the nature and structure of the test and then we reallocated our internal service and telling and people to develop it inside house to. The test gives our patients the results faster just because its being done on premises is that emphasis on the people aspect of that or emphasis on the Technology Aspect of why you can do it faster emphasis is on both ends. One has to have the appropriate sophistication of the underlying Laboratory Equipment and obviously the people that know how to structure tests, to me t measure it and implement it appropriately. How many tests can you do on a daily basis we can do 500 tests on a daily basis and ramp it up to 1,000 tests a day next week. Doctor, we heard from a lot of people they would like to see drivein screening so youre not necessarily putting Health Care Workers on the front line at risk by having someone come in is that how it will be implemented or will be need go to the doctor owes office. I cannot emphasize, i can not stress enough how spoiimportantt is for people with symptoms or who are ill to call first and contact their providers first and then if the screening is notices do it in a facility thats outside of hospital walls. This is something well be implementing in a short order here at Cleveland Clinic as well meaning people could get it in a drive up scenario yes, exactly. It will work first of all we have to screen patients. We have to determine whether the test is needed or not. Once the screening is completed then we can do the testing in an outset facility that will be accessible, essentially, a drive through model that youre describing is the screening process has been so frustrating for so many people if you dont fit these very strict guidelines that theyve had to this point and maybe those are starting to loose jean bit, who is to say now that we have Community Spread at this point that you havent been exposed at any point absolutely. Theres no doubt in anybodys mind that exposure and spread of virus is much greater than initially anticipated and the reason for that is because we simply until now have not really had a capacity to test as many people as we would like. As were learning these lessons quickly the indications for screening and testing evolving as well. Okay. So screening at this point whats your best understanding of what you would have to have experienced in order to say, to say, okay, you qualify for the test so, the steps actually relatively simple. Vast majority of patients who had symptoms and symptoms include fever and cough are most likely going to have a flu were still in the flu season. So the screening involves first the understanding of the stoympm of the patient and then test for flu. If patients have flu then we answered the question. However if the test for flu comes back negative the next step is to test for covid19 no chance covid19 and flu could be simultaneously existing in a patient very unlikely the answer to that is we do not know it for certain but unlikely we would have a person infected with both viruses. But that knowledge is emerging as well. Doctor, we talked about the testing issue earlier today. One of the things thats come up is the approach that the uk seems to have transitioned to just yesterday, which effectively went from trying to identify people through testing to a quarantine method around all people that then came in contact. Basically youre finding equivalent of patient zero and then identifying everybody that they were in contact with over the past week or two to effectively saying that no longer is going to work. Do you think that is where were going move here in the United States as well very possibly i think to put it in simple terms, the simplest advice we can give to our patients or your viewers is that if youre sick stayathome if you think that you need medical health, please contact medical professionals via phone or telemedicine platforms that allows to you get appropriate medical advice without really getting to a medical facility. That would be the first and most essential step that would allow to us episcopalian people who are sick at home to limit the spread of disease and hopefully lower the number of the patients that are ultimately going to need hospital care doctor, when do you think well be at a point where anybody who needs to get test requested. Obviously were far behind right now. When do we catch up . Were catching up very, very rapidly. I was on the call with the fda and cms yesterday and fda has appropriately adjusted its guidelines for testing which will allow laboratories like ours in large hospitals to develop testing capabilities internally and by doing so i hope that well be able to catch up with the demand thats out there. Okay. Dock, to i want to thank you for your time today. By the way the test we heard from roche which takes only three hours is that similar to what youre doing, using technology and people to speed the process. Right now a lot of processes in laboratories heavily dependent on the workforce meaning a large part of the testing is done manually what we are learning is that there is an automated capacity that is being built with new technology thats being developed and shaped by supplies like roche where we can scale an ability to test faster have you had any cases of coronavirus at the Cleveland Clinic yes just yesterday we had five patients who tested positive what was the situation . Did they just walk into your accident care, walk into er, give you a heads up ahead of time some of them gave us a heads up ahead of time because they a known exposure we were prepared to take care them some of them walked into our emergency room are your workers, Health Care Workers protected that dealt with them. Our Health Care Workers are protected. As this knowledge of this disease continues to evolve, so we evolve our measures were putting a lot of emphasis to make sure initial screening and testing is being done outside of the hospital so that we can protect our Health Care Workers as well as the patients inside hospital. Doctor, thank you for your time today thank you very much for having me. Thanks, becky meantime if youre just waking up right now futures are limit up so if you want to get a sense of how well open check out these etfs looks like we open up higher than that. Dow etf looks like it will open 6. 25 higher s p 500 looking to hop about 5. 5 higher and you can look at the nasdaq looking in the same vein as well i want to get to mike santoli who is down at the New York Stock Exchange he joins us with some charts that investors should be watching right now mike looking to map this cascade lower at todays budding bounce on a two year chart of the s p 500 to scale this in magnitude i mentioned this yesterday this decline didnt respect any of the standard levels that you might have thought it could pause out or bounce out along the way. However well bounce here gain at the open somewhere more than half of yesterdays decline less than faith maybe theres some significance yesterdays drop did stop in this general zone of the 2018 loss in december we spend very little time during that v period under the 2,500 level. Even though we bottomed at 2350. Some people had been saying that might be at least on a short term basis a close your eyes and buy because enough damage has been done in the short term. Looking at a long the term chart, 12 year chart of the volatility index, only thing that compares is october of 2008 so, of course, as you know, that was thats right of that initial shock of the financial crisis. It was not the low for stocks as we know. Thats when it started to bump along. Became more of a two way market. Ultimate low was later in 2009 most intense selling happened in october of 2008. Everything i look at in terms of urgency, pervasiveness of the selling and hedging activity only handful of clusters that compare. 2011 near a good bottom and that period in 2008, guys im glad you said the general area i feel better. Yesterday i was watching 21,7 in december of 2018 we closed at the dow is more dramatic on that front i thought we breached it during the close yesterday i was hoping that we would get up back above that december but as you said now we know for sure close enough for government work, we know given the testing we know what that means. Anyway yep all right, thanks i want to get to jim cramer who is back at cnbc headquarters this morning and we look like were going to get some gains here at least gain Something Back from yesterday. Listen, i callback because i was a Hedge Fund Manager during the period of the crash in 87 vicinitying the crash went from 2246 in the dow down to 2,075. On terrible tuesday there was no price discovery. We pieced it together. Jim stewart pieced it together and came up with 1400 at one point until the fed came out and said listen well give you all the liquidity you want then we rallied 4 p00 points. Then we opened up, then down and finished above where we were on black monday then the following day we were also up too. The lesson was, open up, then go down and then come back because the fed said something i dont know if they will do something today. Be aware it was not a perfect bottom on terrible tuesday thats what i wanted to ask you. Do you think we hate bottom . How do you think about even understanding how and when that could be i think were in a recession. There are very few place were a service economy. Two third of the economy im not seeing a lot of people doing what are part of the service economy. We went down to about 2,345 s p during the bear market that was in the 122418 period were still in that. Entirely possible we could lose another 150 points in the s p just to get back to where we were thats reasonable. Again, it was a great buying opportunity. Bottom of terrible tuesday her here would be terrible friday if we reproduce that but not the opening. Jim, i saw your comments earlier that, you know, you are never comfortable after a day like yesterday with any upward movement but we have been locked up limit right so does that give you any take any solace in that, this could be a lasting bounce and it was overdone yesterday i think it would be overdone with the speed that it did it, but i think theres a lot of components where the earnings have to estimates have to come down a great deal when you have estimate cuts, stocks cant go higher take disney as a classic example. I think disney is a buy because im waiting for them to close the theme parks, and they did today. But theres always people who dont mow aboe know about these, and people are like holy cow, they closed the parks . I want to see ceos who will say i want to buy my stocks. On terrible tuesday, the 3m came out and said im going to buy a lot of stocks. Were not getting that maybe thats because ceos bought stocks higher. Hope springs eternal, jim i dont want to be dire or anything, but when you have a scary felt almost as bad as 87 yesterday, and it coincides with the closings, people have not factored in the closings they came one after another yesterday. So i i dont know you always have to retest the lows, but that just seemed overdone maybe we get some positives. The Cleveland Clinic, the roche sure. I have faith in our scientists i think dr. Fauci has done a tremendous job theres trillions of dollars on the sideline waiting they got what theyve been waiting for. Theyve got the opportunity that theyve said no to how can you not start buying here unless you just are so fearful. Thats when Warren Buffett says you must buy he bought in world war ii and it looked like we would lose the war. Sternlich is coming up. I like barry. And i think mnuchin will say some good stuff. Joining us to talk about the violent market weve seen this week, barry sternlich, ceo of Starwood Capital group, which has 60 billion under management and chairman of sh hotels and resorts. I know when our people talk to you, i think you intimated that you would like to calm things down a little. Yeah. After this morning, looks better how are you feeling . You have a lot of businesses when i agreed to come on last night and i saw the futures down 700, i was a little worried about coming on. This thing started in china, too bad it incident start in western europe we didnt trust anything but today its through china xi went to wuhan, 44 apple stores are reopened. It is finished there it will be finished here sooner or later this will be a vshaped almost for sure you will see 2. 5 , 3. 5 gdp growth in the Fourth Quarter this will be really bad really fast i ran starwood through sars, through the financial crisis, hotels came back everything back. This will be faster. This is a health care scare. All the bad news is roughly out there. Why is it going to be v shaped three huge stimuluses. First, global rates are through the ground the credit markets are a little tight right now, but they will loosen up. Banks are still lending. Rates are first. Second, oil. Oil is a big tax cut for consumers. Rates for the consumers, too, but Mortgage Rates are dropping. Third, the government will do something. Theres going to be stimulus packages left and right. Theres a huge shortterm problem. Its going to be huge, 20 of the economy works in service, tourism. Our Hotel Occupancies will crash in resort markets. Theyll bounce right back. Its not as bad as you think i actually asked our mall head of our mall group last night, how bad is it in the malls . I expected the traffic to be down 90 we had 1. 4 Million People the week before or two weeks ago were at 1. 2 million were down 7 . One of our malls is up were doing this to ourselves. Doing the right response shutting down events i was at a broadway show two weeks ago. Were shutting this stuff down its good actually its terrible shortterm the markets have to look through this assets are cheap, like 97 of the companies that are paying dividends, theyre paying a higher dividend than the twoyear for us, this is a buying opportunity. Were looking at assets still super cheap that are way below replacement costs. Barry, people are canceling hotels left and right. What do reservations look like this week in miami, 85 occupancy. New york city last night, 66 . L. A. , 70 . Were getting future cancellation its going to be rough were shutting restaurants and room service well get through it i gather why some of those occupancy rates are as high as they are for this weekend one case of coronavirus in dade so, one case tell me what the reservations look like a week, two, three weeks out. Also people want to understand that piece of it im expecting that zero negative gdp growth this quarter. Well go through the floor this is a global 9 11 in travel and hospitality. Its going to be really bad. Our new york sheraton in 87 was pretty bad as youll note, given the occupancy of the hotels youre talking about, whatever measures were taking are not necessarily nailing the social distancing issue, at least just yet why are you not looking at italy as the example or does the italy example portend good things to you . No. Italy has a screwed up Health Care System. We have a much better Health Care System. I think i could be wrong. 99 of people wont pass away from this. We know the target market is the elderly. Its going to be awful illprobably get the flu i had a runny nose this morning back up you have a im dont i dont have the flu im kidding. Well have all our groups canceled all the big groups cancel. Some people are still coming to warm weather because theres stories that maybe the virus dies at 80 degrees maybe florida is not a great example. But its going to pass its going to be terrible. Were preparing for cash flows will be down 50 in the Hotel Business for some period of time, maybe 80 but for the year, i expect a recovery americas blessing is its optimistic and we react. Were panicking. Ive seen pictures of empty store shelves. Im on the board of estee lauder, their physical stores went to zero in china, then online orders skyrocketed. The same thing will happen in the u. S. It will recover. I dont think because rates are so low, you can afford to pay interest when youre paying libor plus 100 when libor is zero thats what happened in the financial crisis we needed that liquidity here we have zero Interest Rates. So we can get through a lot with 1 100 million loan at 1 , that a Million Dollars. Hotels can make a Million Dollars. You will see youll see a lo of dislocations and a lot of people will lose their jobs. Thats where government has to focus. You thought things were frothy the last few times you were on. I thought you were crazy. Youre saying these are much better values. You have all these businesses, but i dont think things are a lot cheaper than they were we are we couldnt buy anything pricing was stupid. Right we werent buying anything. We were buying some apartments which are fairly insulated 30 seconds. I think theres interesting opportunities. We are buying. Its crazy looking for yield glad you came on. Star properties announced a 4 400 million stock buyback for jim cramer we are buying our stock back thank you thank you for everything you just did we made it to friday squawk on the street is next join us next week. Be safe. Good friday morning. Welcome to squawk on the street, im carl quintanilla, cramer and faber are at cnbc Global Headquarters. The treasury secretary moments away as Central Banks, businesses and governments respond to the covid19. Futures are limit up after the worst day for the dow in 87 tenyear about 92 basis points s p down 27 from the record close on february 19th since then, 9 trillion in