But is quite rapid the last few days and it tells us more and more, volatility it is going to be here to stay. Patient capital, as it always has, will win. You have got to look at where the secular plays are going to take place in what is a Game Changing event, whether number one or number two or number three in my investment career. These are Game Changing events. Where is the secular story going to the cute the banking area . Names like ally. More online pension purchases, as i talked about with nike. You have got to think about where is the secular story going to be we will get a cyclical rebound. That is going to be beneficial for investors. Joe i know you want to keep talking micro. You mentioned we shouldnt get too excited about hopes for the second half. We dont really know if the threedate bounce, volatile as it is, is sustainable. You mentioned a couple names. Big picture, where do you see investors have the safest cushion, the biggest margin for error, or even if they are buying out into a certain sector, they dont have to worry as much about timing . David use examples. If the first derivative of your trade is going to be a restaurant stock or consumer stock that is on the right end purchases, that is easily the first derivative. What is much further down the road is when any of us next book a cruise. That is much farther down the road. For the real safe stuff, that is going to be part of the portfolio. Were you positioned right on february 19 . Not trying to be reactive 30 days into yet again another bear market. To have some staples in the names i own our names like nestle which has its own good change going on from where they are rightsizing the company, you have an activist involved, new ceo. Procter gamble. Those are the stable names because they are good Capital Allocators generating favorable free cash flow. Along the way, i want to look at this opportunity and say it is going to be good for the consumer, maybe less for industrials, because Capital Spending may be delayed still. I want to look at the consumer stocks that are going to win. I want to look at financial stocks that are going to be the beneficiary of what people think about how we do that at home and maybe not do it themselves in the physical bank. Scarlet that is really interesting to hear your position. I specially think so, given that participation todays more muted as well. Just before the closing bell we saw volume in the dodw, present and and the net s p, nasdaq below the 20date average. David, because you are so focused on the bottomsup story come im sure you will be dissecting the corporate earnings when they come out in a couple of weeks. How much faith would you put in anything that ceos are able to say, given that they have no visibility right now because everything is a moving target and so much of their business is in flux . David sure. The visibility if you listen to Conference Calls or listen to them presenting webcast at a conference, it is nonexistent. You refer back to how did they perform in 2008, how much did they safeguard the dividend, how much do they perhaps delay Capital Spending and preservation of the dividend. Crops not share buybacks in the near term, but perhaps that would be a good source of capital allocation. For me it is who is going to preserve the dividend, who has the potential to grow the dividend, who has proven to be a good Capital Allocators in the best interest of shareholders based on the track record, whether it is many corrections miniaction such as 2018, 2016, 2011. What was the mother of all bear markets, the 2008 financial crisis, i will care about that in particular, and blended with the macro in what im seeing in terms of tempered expectation on earnings growth, cash flow growth, and what we saw today with the higher claims. Romaine david, can you talk to us about the travel and tourism industri specificallyes . Obviously they are being hit hardest by this slowdown. When you look at the hotels, cruise lines, etc. , that typically depend on people like you and me taking vacation from how much of an effort to you think we are going to see to get those industries back up and running, or are those going to be the ones that are last in line after the more central businesses . Avid it is a little bit of lifeguard, be it the fiscal and monetary stimulus starts to flow lets get back in the pool, more tempered laughingstock thatlaunching stock. You may not be an Airline Stock just yet, or cruise stock. You think of what i described as the first leg of the trade which is we are restaurants where restaurants will be picking up more modest spending. Modest spending in hotels like wyndham. Further down the road is where you dig deep cyclically. That is much farther off. As a person who pays great heed to valuation, as a investor who wants to find companies with cash flow and dividend growth, i have arguably the best valuation differentials i have seen in at least 20 to 25 years. Joe i want to drill down further on your point regarding dividend growth. There is a lot of controversy. Most of it is focused on the buybacks sighed, which are not that different from dividends from a leverage standpoint. Do you think the speed of this economic deterioration, this aack swan event, will cause change in corporate behavior and in general managers and ceos and cfos who want to keep more cash on the Balance Sheet and make their own Balance Sheet to be inherently less levered Going Forward . Is a great that question, and it speaks to the important dissection of capital allocation. We dont have Capital Spending we know that Capital Spending has been weaker, and it will stay even more delayed. Share buybacks from which i like to see because the company is voting for cash flow on their own shares, that is likely to be delayed. Shoring up the Balance Sheet is critically important. Accessing lines of credit is going to be critically important. I think for the good Capital Allocators, they are still going to maintain the dividends and where way and a period cash flow and revenues are going to be extremely stretched to find a way over the longterm to grow their dividends at highsingledigit, lowdoubledigit case. Romaine gamestop, the videogame retailer, ebs beating estimates by a wide margin. . 77 was the average of analyst estimates. This company like most other companies suspending its Forward Guidance at the moment. The news for the fourth quarter, the Company Managing to get costs under control, scarlet, and move a little bit higher on the etf matter. Metric. Scarlet gamestop jumping is interesting because a lot of people are playing video games they just cannot get to gamestop to buy video games. I am intrigued by something you set about how you want to look at how companies survived the 2008 financial crisis and what they did to get a sense of how they might manage the current challenge. Do you think there is going to be a delay in companies succession plans and transition plans to new leadership . People who have been there since 2008 and can recall what happened, and companies will be reluctant to put younger people with new ideas in place until we are past the worst of it . David scarlet, if i could get personal, this is my ninth bear market. I will see a couple more in my lifetime, i believe. There is a lot to be said for i was there in 2008. I was a Value Investor in years like 2000. I was there in 1987. I dont know if the makes me any better. In the stackslmer of situations, i certainly hope. You can connect that quite well to the ceo and cfo, who are seasoned allocators of capital, n see the shareholder to a better return as a result of it. i want to go back to sorry, time want to go back to something that you were talking about, which is the lightspeed reaction by the Federal Reserve and the congress to deliver this hugesized stimulus, and even though it does not look like it may refer main street, what we saw over the last two weeks by washington, d. C. , standards was in fact moving fast. For the Health Crisis continues to rage. We know there is going to be major strains on municipal finances. That is going to have to be something addressed. Do you worry at all that d. C. s appetite for crisis fighting will slow down as his acute phase of the crisis slows a little bit and partisan right court comes back partisan r ancor comes back and we dont get those 960 votes and d. C. Is not as agile as it needs to be to address the fundamental crisis . David sure, joe, i applaud washington for being much faster than they normally are in these situations. You think of physical policy fiscal policy history, you are halfway to the end of the recession before you start to get fiscal stimulus. Here we are, which earlier in the game. Beyond that, i have always thought as a Portfolio Manager if i managed portfolios expecting washington to do the least amount to fix a problem, that has been one of the getting forces and portfolio management. But recognizing in the near term, two dollars trillion in stimulus done the right way 2 trillion in stimulus done the right way, sums up thumbs up. Joe our thanks to david sowerby. That does it for the closing bell. Whatd you miss is next. This is bloomberg. Romaine live from bloomberg World Headquarters in new york, this is whatd you miss. I am Romaine Bostick, and im joined by scarlet fu from her home, and Joe Weisenthal will be joining us later in the hour. Scarlet we saw u. S. Stocks round off a threeday advance closing your session highs. Treasuries rose to the dollar weakened for a third day. Romaine lets start with breaking news. Kb home earnings crossing the wire here. Q numbers. Y beating 1 this is the quarter that ended at the end of february. Revenue was 1. 8 billion. That is vs. A drop of 4 on a yearoveryear basis. Dont expect any guidance for any of these companies. If you want to snapshot of how strong some of these companies were prior to the impact of the economic shock, there you have it. Kb home was doing fairly well. They have a buildtoorder model. We will see that wave on things Going Forward. Scarlet all right, thank you so much for that update on kb home. We will keep an eye on that one. Back to our top story which is the coronavirus, and how cases around the world are accelerating. We know the race to find some kind of cureo r treatment continues to regeneron is at the forefront of developing a potential cure. I would like to welcome the cofounder and chief scientific officer at regeneron. Thank you so much for joining us. It is wonderful that Companies Like regeneron are working to find some kind of treatment and we can some point look ahead to a vaccine or a treatment that will a test that will allow us to figure out who has been exposed and who has immunity and how quickly it might come about. It could be a drop of what come all of that. That is wonderful. As long as there is a holdup at the fda, those tests will not see the light of day. What accounts for the holdup at the fda . In terms of all of our efforts, i have to say the fda has been a spectacular partner. As you may know, we have two nearterm treatments. One approach is something that could be a substitute you nih that vaccines will be a year away. We have something that could be available for testing within a couple of months and maybe show efficacy in that timeframe. We have treatment and Clinical Trial last week. All of this was done an incredible partnership with the fda. Woodcock, who heads the drug division, they were talking to us at midnight on a weekend partnering with us and in hand to make sure that our treatments could be tested in the most safe and effective way. From our perspective, fda is a great partner. They are protecting the public to make sure that anything that moves forward can be done in a safe and effective way. Romaine there have been a lot of pleas on social media by doctors and hospital workers asking people who had covid19, recovered from it, to come back in and submit their blood, the idea that there may be some antibodies in the blood that could be beneficial to the Research Going on out there. Can you explain in a nutshell what they are asking for and why that might be key to fighting the fires . The virus . Dr. Yancopoulos when you get a vaccine, the vaccine is like giving you a weakened form of the virus to make your body make antibodies. It is an immune response. If you have beaten the virus, your body has made these antibodies. Decades been shown for is that if you could actually purify the most active antibodies that are generated by a vaccine or an individual and p urify them and grow them outside the body in these largescale viral reactions, they could be given back and they are much more potent than trying to treat somebody with somebody elses serum. But because people are so desperate, we are going back to old time approaches that do work. Theyre just not as effective as giving a purified antibody. Our approach which will be in patients quickly by june, is giving this very potent. Ied clonednt purif and i body and give it back to people. In the meantime, people are so desperate that they are using approaches that had been used decades ago. They can work in some cases, they can have raise a lot of concerns and safety concerns, and they are not as effective as these. It is a real stopgap measure and maybe you can give what is called convalescent serum from survivors and see if you can use that to help people who are fighting the disease now. Coming up with the actual antibodies and growing them of, drawing it outside of the body, to refine them and giving them back, that holds a lot more clear, likely hope. The approach was used to come up with the effective treatment for ebola that validated by the World Health Organization trial in the congo. These tend to be much more effective approaches that can really concentrate and give much Better Benefits than the convalescent sera approaches. Romaine all eyes on you and your industry. Chief scientific officer and cofounder at regeneron, we thank him for his time. Coming up on this program, the Senate Passing the historic cmis relief bill. Senator mark warner joining our program. From new york, this is bloomberg. The house votes tomorrow on the bill that the senate just past, that 2 trillion stimulus bill that is so needed for our economy. We might be getting ahead of ourselves, that this could pave the way for a fourth stimulus bill as well. We want to turn to chief washington correspondent Kevin Cirilli, who is standing by with a key senator. Kevin thank you, scarlet. We are joined by senator mark warner, democrat from virginia. You look instrumental in working with the Small Business aspect of the stimulus bill. If you are a small or mediumsized is this on her composure do call to access these grants and loans . Sen. Warner if you are a business below 500, which provides loan forgiveness up to 10 million pending the payroll amount, and for payroll and overhead, you have to go through it for either an authorized lender in your community or you should encourage your existing relationship to clear bureaucracy and allow any later to become sbacertified. I have concerns whether the sba can move this quick enough, but that is if you are under 500. 500to10 a ,000present employer, we will put together a loan that has sixmonth principal forbearance and loan cap that 2 . That will be utilizing the direct Lending Facility that the fed has. Whether you are a small employer or large employer, middle in between, we have created a tax retention credit up to 10,000 per employee. That will cover up to 50 of the cost up to 10,000 of salary. Even if they are fru urloughed during this crisis period. It is a bit of a mixandmatch. The most genuine of the business is is under 500. They may not pop up at all. Lending was the facility because they need support as well. And then the facility which will go over the whole market and buy commercial paper for larger institutions. Joe senator pending istor, forward 60 days from now, is that when you have the next round of economic stimulus . Sen. Warner when you do a package this big, and i think your audience knows more than trillionis not a 2 package when you add in the fe s leveraging of the many, we are talking it over 6 trillion package. The spike in the unemployment numbers, we are going through a patch unlike any time in the history of our economy. I think you will see certain areas where we made mistakes in this bill, something dissipates this fast for five days. I want to give some credit to secretary mnuchin. He in many ways helped save the date from what was going off the rails. Without his work we will have package on a fixit almost immediately, and i would argue that if we continue to see the virus loaded up the tank for two to three months, we will make a judgment even sooner than 60 days, whether it needs to be the starting process of another reload. Kevin senator, i have more questions for you that i will get to offline. I will toss it back to my colleagues in new york. Romaine Kevin Cirilli with senator mark warner. We will talk about the Global Supply chain. A lot of talk about that. This is bloomberg. Romaine interesting look from our folks over there at quicktake. Lets it to first word with ritika gupta. Ritika President Trump is considering a plan to rank counties according to the risk of coronavirus outbreak. He is planning to return the nation to work by easter. He says the new guidelines could be used in maintaining decisions on using or relaxing social distancing and other mitigation measures they put in place. House Speaker Nancy Pelosi tells bloomberg she has no doubt whatsoever that the stimulus bill will pass friday. She says the vote shou