Also spreading around the world. The who saying it is not a pandemic but saying it is deeply worrying. Before we came on air i was looking at the definition of an epidemic and a pandemic. An epidemic affects a few regions, but a pandemic is something which goes global. We have cases in italy, cases in iran, kuwait, over 12 dead in iran. Is it a pandemic . It seems to fulfill that particular criteria or definition. David what is the risk posed to beijing . They postpone the congress and language coming out of the Conference Call that was held by president xi suggests he is concerned about beijing. 170,000 people on the Conference Call, and some of the details coming out. The fear is does president xi jinping consolidate power . This is a question being asked by a lot of people. People have already seen him grab power with reducing his second term. He has unlimited terms. On. Nt to get what is going we have just gone 1 00 in the morning. There is an airy calm. When we look at what is going on with the financial markets, the biggest fall for european markets since 2016. It is almost as though it has just got real. David very well said. Terrific reporting from hong kong. Thank you very much. 1 00 in the morning your time. Now lets go to milan. What are the concerns affecting the markets is the spread to northern italy which is so terribly important to the italian economy. Explain to us what the Italian Government is doing in northern italy. Good afternoon from milan. The government here, particularly the regional governments are taking a two strand approach to the issue. There are number of towns to the city of here around the that are virtually locked down. Some 52,000 people who live in that area are not able to leave and people are not able to get in. Nonessential services have come to a halt in that area and there is a Law Enforcement presence enforcing the cordon around that area. And the rest of northern italy, communities have taken measures such as canceling sporting events, canceling cultural events, moving to close bars and restaurants after a certain hour. The approach of the governments across italy has been to limit contact between people as much possible. David what does it mean for the Free Movement of goods within the European Union . Maybe we see some borders close. Jerrold i certainly hope not. There has not been any indication of that happening yet, but there have been some cases, some isolated cases of authorities in other countries, austria, france, taking action to stop individual crossing be shirt infected people are not on board. There is not been any word on largescale border closures or anything of that nature. David thank you so much for reporting from milan. That is our colleague gerald colton. Now we go to washington with tom orlik who will give us a perspective more globally. What do economists think we know at this point . Tom at this point we are still dealing with a significant amount of uncertainty. There are a couple of points i would make. Blow tot is a severe chinas First Quarter gdp growth now appears a virtual certainty. It is also striking if you look at the forecast coming in from the street, they are coming down and down. At the end of january, people were talking about 4. 5 year on year growth in the First Quarter for china. That would already be a record low. It would be zero growth in sequential quarter on quarter terms. If you look at the latest numbers, they are pointing to growth in the 2 to 3 range in the First Quarter, even lower than people were thinking a few weeks ago, and pointing to a random 2 contraction measured in sequential terms. The second point i would make is that until a few days ago, i think economists were thinking about a blow to china and then spillovers from chinese demand and stalled chinese supply chains for the rest of the world. As youve heard from some of our colleagues in hong kong and italy, there is significant concern about outbreaks in other countries. Outbreaks in italy, outbreaks in korea, and what that means, if that happens, and we hope it does not, is that the rest of the world is not just going to suffer from weakness in china. They will also suffer as their own factories get closed down. David one of the problems is im not sure we have a model. We have a more globalized world than we have ever had. We do not know what this does to supply chains because we are more interdependent than any time in history. Tom that is completely right. If you go back to 2003, when we had the sars outbreak, china was around 5 of exports of Global Manufacturing inputs, the components which factories around the world need to finish their products. 2020, as we face this coronavirus outbreak, china accounts for 20 of Global Exports of manufacturing components. Aere is a risk of a virus in particular place, especially in china, having the severe global impacts. Much more significant now than it was 20 years ago. I think you put it well. This is a litmus test for the capacity of a Global Economy to show resilience in the face of this kind about break. David thank you so much for reporting. That is tom orlik reporting from washington. Now it is time for a check on the markets. I do not have to ask the effect of what we are talking about on the markets. Abigial we are looking at a brutal selloff. Stocks looking for their first date their worst day since december of 2018. That is the degree of the selling pressure. The best day for bonds on back to june of 2016. That was the brexit haven bid. That is the degree of haven buying we are seeing. All of this as investors are saying to themselves, this is not sars. A week or two ago folks were betting on the idea this would go away quickly. It is not known. We do not know what the impact will be on the Global Economy. Will it extend beyond a quarter or two . David this is different from december of 2018. That time we were not sure what was causing it. This time we know what is causing it but we do not know when it ends. Abigial it is infinite and the possibility for tragedy because doctors do not know how it is being spread. If it continues to spread and continues to force various companies to shut down manufacturing, it will continue to eat into the corporate profit outlook. At the end of the day, that is what stocks trade after. On the trade war, we have lots of headline volatility. That never affected the corporate profit outlook. In this case, we could see the corporate profit outlook hit in a significant way. In that case, stocks should come back to earth. Much more of a saint evaluation. There is been so much fear of missing out. A lot of these indexes are so far above their moving averages. The faang index has been 3 above its 200 day moving averages, telling you how far overextended. That was on falling momentum, which tells you there will be a crashed similar to what we are seeing today. David we will keep you apprised of the market as it develops. In the meantime we will turn to Mark Crumpton for bloomberg first word news. Mark former movie mogul Harvey Weinstein has been convicted of rape. A jury found weinstein guilty of rape and criminal sexual act, but acquitted him on the most serious charge of predatory Sexual Assault. On friday jurors signaled they were having trouble reaching a verdict on that charge. Weinstein still faces Sexual Assault charge assault charts in los angeles. Like millions of tourists who come to india, President Trump and his wife visited the taj mahal. He called the 17thcentury white marble mausoleum truly incredible. The president began his trip by saying the u. S. Would sign military deals with india work 3 billion. He spoke in a cricket stadium filled with about 100,000 people. The white house is getting ready to respond to an urgent budget request to address the deadly coronavirus outbreak. The department of health and Human Services has tapped into an emergency Infectious DiseaseRapid Response fund, and is seeking to transport more than 130 million from other hss accounts to combat the virus. A white house official says a response could come this week. In germany, Police Say Dozens of people are injured, several seriously, after a car slammed into a crowd at a carnival parade. The driver was arrested and German Police say they believe he deliberately rammed his vehicle into the procession. It happened 175 miles southwest of berlin. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am Mark Crumpton. This is bloomberg. David . David coming up, nevada is in the rearview mirror. South carolina is looming. We talk with our Political Panel about Bernie Sanders on a roll. This is balance of power on Bloomberg Television and radio. In nevada we have put together a multigenerational, multi Racial Coalition which will not only win in nevada, it will sweep this country. David this is balance of power. Underestimated the size of a Bernie Sanders victory in nevada. We welcome Emily Wilkinson with what we learned in nevada. What did we learn . Emily Bernie Sanders was far and away the winner. Sanders come in strong, setting him up for a strong showing in South Carolina and super tuesday. David we will talk about South Carolina and super tuesday in a minute. Pause on the latino vote. Somethingdemonstrate about Bernie Sanders ability to reach out to latinos . Absolutely. You hear democrats talk about being a big tent. Talk about the need to make sure they are not only getting white voters but black voters, latino voters. Here you saw sanders do very well with latinos. A lot of people are looking forward to South Carolina to see how he does with black voters. Was is a demographic that very strongly in favor of joe biden initially. Recent polls shows his lead is slipping. David many thanks to Emily Wilkins of Bloomberg Government from washington. We turn now from the nevadas to the South Carolina future. With our Political Panel of james dickey, chairman of the Texas Republican Party coming to us from austin, and here new york, our bloomberg political contributor she needs a note. Zaino. Nne there was a time we thought joe biden had a prohibitive lead in South Carolina. If Bernie Sanders can winner take a strong second, is he stoppable . Strong if he even gets a second in South Carolina, that gives him so much momentum for three days later as we into super tuesday. We are focusing a lot on the debate tomorrow night in james clyburns endorsement on wednesday. But as we saw in nevada, those endorsements mean less and less on the ground. The polymeric union was not endorsing, yet the latino vote the polymeric the Culinary Union was not endorsing, yet the latino vote came after Bernie Sanders. You see him putting resources on the ground in South Carolina where he did terribly and 2016, but may have a strong showing in this primary. David there been times it sounded like the president is rooting for Bernie Sanders to be his opponent. Are you rooting for Bernie Sanders . James i have talked with the president s campaign and folks at the rnc. We have been universal that it does not matter, sadly, which of the socialist policy advancing candidates the democrats put forward. As you look on the debate stage, there is not an inch of difference between them. Bernie would save us that because he admits he is a socialist and he credits terrible failed socialist and communist countries and he praises them. That would save as a step. I think the Democratic Party as well on their way to burning themselves down. David i have to pause. You believe there is no different between the moderate positions of some of the Democratic Candidates and what Bernie Sanders is saying . You do not think there is any difference in Medicare Fraud and an enhanced and Affordable Care act . Democraticy single candidate for president has admitted they are willing to repeal and replace obamacare. They are admitting that the last giant Government Program they put forward was a complete and total failure for average americans. Theinor different minor differences in what theyre proposing is a replacement, but everyone is proposing repealing and replacing with a another baker government handbook. David i would like your thoughts. That Program James says was such a failure was the basis for them to win the house representatives in 2018, as i recall. Jeanne absolutely. If theyre able to hold the house and make any gains in the senate, it will be based on that. I would suggest that if you look at the democrats position, they do not want to repeal and replace. They have been a clear they want make itthe act and better or enhance it if they are in the moderate lane. If they are in the Bernie Sanders or Elizabeth Warren lane, i think there is a big difference between the moderates and the progressive, and it is about 50 trillion. There are huge differences among democrats on health care. What they all agree on is they want everybody to be covered, either through obamacare or through medicare for all. David i want to take up one pole with you that says Bernie Sanders would do the best against President Trump and the state of kansas. He would lose by two points, but would do the best of any Democratic Candidates. Does that square with how you understand the texas voting public . James absolutely not. What we are seeing on the ground is a ton of excitement on the republican side, not on the democrat side. There are hard numbers to back that up. Democrats can only get 1400 candidates in the entire state of texas. We on the republican side have 3106 candidates in our primary across the state. In early voting, even though the democrats are the one with the highprofile president ial race, even though Bernie Sanders and a bunch of others have been here and work your, we are seeing more votes on the republican on the democratic side. We saw this in fort bend county, in House District 28 just last month. The democrats were all over the almost all of the president ial candidates were there fighting for the democratic candidate. We took an eight point suburban win in 2018 when entered into a 16 point pounding last month. David it sounds like he is confident about the state of texas. Where you think texas is . Jeanne i think texas is still a red state and it will be a red state. We have seen some advances with beto orourke or others. Moving is the operative word. I do not think it is there yet. This is a race that will be decided in states like your home state of michigan, wisconsin, pennsylvania, florida, ohio. When you look there, that is why the establishment democrats are scared of Bernie Sanders. They fear a democratic socialist agenda will not play well on the states that matters. That is what we heard jim clyburn saying on all of the sunday shows. This is a concern of the establishment. Democrats will have to battle it out the next few weeks. David the next 10 days. Many thanks to genies a note and james dickey to jeanne zaino and james dickey. Still ahead, we are keeping an eye on u. S. Markets. Stocks down more than 3 across the board. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. I am david westin. U. S. Stocks are sinking today amid mounting fears about the coronavirus. Kailey leinz is here with more. This is a red day. Kailey it is a severely red day. All three major averages down more than 3 . For the nasdaq we are down nearly 4 . This is the worst day for the majors since 2018. A lot of conviction behind the selling. Above average volume. Usually so far in 2020 days we were down, volume was higher. That is not the case today. You see how risk off the tone is when you look outside equities, the 10 year down 10 basis points. We are at 1. 35. Just a few basis away from a record low. You are seeing that safe haven play out in gold as well. Futures up 1. 7. We are nearing 1700 an ounce on gold. Just a few weeks ago we were at 1500. This is a swift and vicious flood out of equities and into safe havens. David it does not look like anyone is buying any dips. Tells about Health Care