Lineup of guests coming. Federal reserve vice chairman will join us exclusively in a few minutes for his first interview since last weeks fed meeting. Well also pespeak with the ceoo human there is a and a massive afternoon of earnings headlined by disney, ea, beyond meat and activision and well peek with actvisions ceo ahead of his Earnings Calls after the numbers come out as i said, were at 1. 9 with 59 minutes left lets moex fowlkes on the big stories. Meg has new developments on the treatment and vaccine front but mike, lets kick things off with you in the markets yeah, another day of fairly orderly levation in the indexes. Today its a broader rally even though its been led by the big tech stocks. A chart of the s p going 50 0 going back a year, were back up to the upper end of this crash levels last september, october, sort of going back to early 2018, an area where we gave a little friction to the rallies, but clearly, a market is acting as if big investors feel u underexposed to stocks on these rally days i would want to turn over to disney in advance of those results just to get a sentiment and valuation snapshot its moderated analysts are cautious. About 60 buy ratings. A stock like disney represents a little bit of unease about the outlook for obvious reasons, but if you go back to 2018, it was actually less bullish on net basis. New sell rating today not counted here because the firm is not counted. They look at the valuation because this is one of the issues when you have cash flow, projected cash flow declining right now. Obviously theme parks closed and studios not releasing movies and you have a lot of debt from that fox acquisition, that enterprise value to cash flow measure is going to look pretty high and by the way, the peak in november was when the stock was at 150 so right now, when its around 100, it still looks rich. Thats why a timing of a comeback is really a crux for disney right now and comcast has suffered since its earnings back to the broader markets. Again, strong correlation between stocks and the treasury yield curve. Yields are rising. Risk on equities rising, too the thing i find interesting about that given the sector constru construct, banks are at the bottom again regionals are lower. Even though yeeleds are rising and thats a disconnect thats held because of the general risk on risk off environment but its confusing longterm given what banks do when yields are rising. Youre right. Now obviously were kind of scrutinizing really small changes in yield even though theyre off the lows weaker driver of bank share but i do this think it references a little bifurcation going on in the market yes, todays a broader rally, but its not really housing relating stuff not the stuff thats credit centric thats working aside from energy getting a lift on oil prices so i dont know if we can pick it apart too much more than than that, but it seems as if its a market thats hit or mis the Growth Stocks work on the strong and weak days, but beyond that, it seems a little haphazard. North ameriasdaq composite l 1 up a record high crazy. Thanks regeneral ron and pfizer with updates. Meg. Hey, sara lets start the with pfizer and the vaccine race they announce d today along with their german partner theyve started dosing the first participants in their u. S. Clinical trial of their experimental vaccine and theyre actually evaluating four different candidates in a Similar Technology to moderna. Its messenger rna theyre dosing up to 360 healthy suspects we talked with pfizers chief scientific officer about how theyre ramping up the manufacturing even now we will have to fine tune the manufacturing process but youre talking about a number of months thats why we say we starting maybe around this period now, early may, with some early preparatory work we could have millions of doses in october tens of millions end of the year and hurricanes of millions next year and pfizer isnt the first into the clinic, but it is the Largest Company now already in human trials in vaccine development. You can see a list here of the companies that have begun. Those are the furthest to the left and others that are planning to start later this year and guys on the treatment front, regeneron providing an update they are developing a new drug to treat covid19. They plan to start human Clinical Trials of the drug in jub and say we could get results one to two months after the trial begins and they are planning to manufacture hundreds of thousands of doses in case that drug b works to have ready to deploy and that could prevent and treat disease. That stock has been on absolute fire. Wanted to ask you what you knew if anything and how much credence you put in this new study from Los Alamos National laborato laboratory the finding of a new strain of the coronavirus that looks more trans missable and dangerous the con ssensus im hearing that the research is interest, but very early i also saw u a tweet from Matt Mccarthy with a different staud di theying it looks like the virus might be mu u tating to become weaker. So as viruses mute tate and we have to watch to what happen, but it sounds early and whether there are implications for Drug Development well also keep an eye on but it sounds like Early Research thanks for that weve got 53 minutes left of the session. Up a nice 1. 9 dow up by 1. 5 after the fed, our exclusive interview with rich claireda these days, its anything but business as usual. Thats why working together is more important than ever. At t is committed to keeping you connected. So you can keep your patients cared for. Your customers served. Your students inspired. And your employees closer than ever. Our network is resilient. Our people are strong. Our job is to keep your business connected. Its what weve always done. Its what well always do. Dow up by 1. 6 or 370. S p 500 there up 1. 8 and nasdaq doing well up 2. 2 and russell up 2. 2 individual Market Movers shares of Norwegian Cruise Line plunging after the Company Raised the b oblty of bankruptcy in a new filing, about its ability to continue and warning it may be at risk for default and expects that report a loss for the quarter. Down 22 wendys stock declining after the analyzed every menu and found that 18 of locations have listed all beef items as out of stock. The shares are are down 1. 2 the index dropping in april. The first time thats contracted since december 2009. Joining us now to discuss the economy and actions the fed has been taking, Federal Reserve vice chairman on news line. Glad to be on the show. Hello. Why do you think the economy is performing so much better thousand u lets talk about the economy and were living through the most severe that weve seen in our lifetimes and its not a typical downturn. Recovery could begin in the and a half of the year and that today is my forecast but what we said in our statement is this pandemic does pose really considerable risk to the outlook and the course of the economy is really going to depend upon the course of the virus and the mitigation effort, what i can say about the fed is were using our full range of tools, our rates, Balance Sheet, Forward Guidance and lending facilities to support the economy through this time and our policies we think will be very important in making sure that the redown will be as robust as possible but were in for a period of some very, very, very hard and difficult data that weve just not seen for the economy in our lifetimes. Thats for sure. So are you saying though its realistic to see a positive print on gdp as soon as the Third Quarter . I think thats certainly in the range of possiblility. Again, its going to depend on the course of the virus. Its a range of views among economists and forecasters out there, but certainly thats one thats a possibility. Thats my baseline forecast. To be appropriately humble as we are navigating through this period what about the job picture. What do you think about how high the Unemployment Rate is going to get and how many of those jobs can come back when economies reopen unfortunately, the Unemployment Rate is going to surge to numbers that again we have not seen probably since the 1940s. We know that from the initial claims data that around 30 Million People have filed for claims in the last six weeks and so the numbers well be getting soon will be very, very elevated as i said, the course of the economy will depend on the virus and a range of scenarios, but there can be a rebound in the economy once businesses reopen and people return to work. But i think realistically its going to take some time for the labor market to fully recover from this shock but thats very uncertain at this point. But i do think recovery can commence in the second half of the year in the meantime, the fed b has been putting its measures in place and so has the federal government weve seen actions like ppp and other forms of Economic Relief do you think its enough to bridge us to the reopening, to keep people on payrolls and businesses open in a meaning fu way or is there going to be to have more there if the government in terms of Fiscal Relief let me talk first about the fed then a bit about fiscal policy were using all available tools. Weve cut the policy rate the zero. Since march 17th, weve announced nine new facilities to support the flow to households and businesses we think we are building a brinl r fbridge for these facilities until the economy can recover by stepping in and supporting lending. Weve p seen some evidence that its encouraging the private sector to lend in particular, weve seen a lot of issuance in the Corporate Market the cares act was essential because you know the fed has Lending Authority but not Spending Authority so what we can do is lend money to compani companies, we cant transfer income to households and firms the cares act, paycheck protection and Unemployment Benefits and other provisions was very, very important to the economy. And it may well be the case depending on how the economy evolves that more policy support will be needed from the fed and possibly also fiscal policy. Swr just depends on how this evolves. Before this crisis, over the past five or six years, theres been a lot of analysis on how far the ecb and bank of japan have gone with their monetary po policy and some criticism in part because of the decision to buy Corporate Bonds and even equities in japan. How much do you regret the fed had to go that far this time even it was needed is it a shame that you had to go that far well, i would not use those words. I think that none of us alive today have seen a like this and under chair powells leadership, the community was united that we needed under very unusual circumstances, which is the language used in our legislature that we would set up these facilities now theyre temporary. Indeed all the facilities that we have set up are scheduled to expire september 30th of this year in term of new lending. New loans we make will remain outstanding. So this is Emergency Authority this is an emergency it is Emergency Authority and at the point h that the economy has weathered and rohrered from this, we at the appropriate time will scale these programs back so its not really a regret. Its what we need to do given the nature of the shock and as i said, these are emergency facilities that are very timely and needed at this point and will be scaled back at the appropriate time when were through this difficult period. None the less, do you think u theres going to be a longterm impact on how market par participants price risk . You know i think that it would be to forecast Something Like this pandemic and again, we think this is an unusual circumstance we can discuss more the way these facile theties are are set up as you know, the congress in the cares act appropriate ed funds o the treasury for the specific purpose of vesting in these lending facilities to support the economy through this period. So theres a lot of you know, theres a lot of structure and legislative language behind these programs what about the criticism that you know, the programs that youve designed, the nine of them and the action youve taken has really helped wall street much more than main street i mean the fed is familiar with these. We saw it back in 08, 09 but the fact the market has soared while unemployment claps are soaring. The fact the credit markets have cleared up and Companies Like carnival can borrow and people are still getting furloughed left and right i think the economy is going through an as chair powell said today, this is really a heartbreaking development were seeing with in particular in the labor market so were certainly aware and attuned to that. But i would say about main street obviously is supporting the economy and these new facilities providing these programs including the main Street Lending facility that weal be launching soon and the other facilities for example in town in which case well be supporting Consumer Credit in our programs were buying a lot of mortgagebacked securities and a lot of folks in homes. So i think the broader picture is is that we are providing support to main street and we dont want to minimize the difficult challenge the economy faces near term. We are providing the appropriate support and we are continuing to the economys on the road to recovery. Especially for main street so youre clearly putting in a lot of liquidity to a lot of different xacompanies. You cant lend to insolvent companies, junk rated companies before this crisis what kind of bankruptcy picture do you think is going to emerge out of this crisis in this country . Well, i think its too soon to tell. I think its going to depend upon a number of factors here. In economic downturns, there are those events were in recession and so some of that is going to be inevitable i think our focus as policymakers is to make sure the economy recovery when it begins is as robust as b possible but we cant minimize that we are in a recession here and of course it is a global recession as well and thats an additional factor how permanently scarred do you think the u. S. Economy is going to be as a result of this pandemic well, sara, i think the honest answer is i hope its not scarred. I think that theres that risk depending on the depth of this recession and the contours of the recovery im hopeful and the fed is doing everything we can to minimize the amount if any offor scarring, but again as weve emphasized given the nature of this shock, its going to be essential that fiscal policy also continue to provide support through the economy as well and in particular, that can help to sustain the capacity of the economy through this period. If we do head to another shutdown or downturn or sec wave as so many prominent doctors say is inevitable in the fall, what else can the Federal Reserve do . You have nine programs rates at zero. Open ended qe. What other b rabbits can you pull out of the hat . Well i dont know about b rabbit but we have a toolkit that were deploying now and we can deploy more as needed in the future certainly in terms of our lending. Certainly in terms of our Balance Sheet and certainly in terms of our guidance. And you can be assured that we will be doing that is there a limit to what the fed can do well, there is not a statutory limit. Our Balance Sheet is a decision we make as a committee u under the appropriate guidelines and under the particulars, lending against credit in the expectation that we can repay o expand those lending programs. Congress appropriated more than 400 billion in the cares act for the purpose of investing in these fed lending pha a silties. And only b about half of that has been allocated now so theres certainly more that can be done on those programs as needed we appreciate the time. Thank you so much. Thank you, sara i just to add as well, we did see the market just slip a little bit during that interview. Whether its reacting directly to his comments or not we did see if we can get the intraday chart up. Theres the dow ticked down around the start of it where there was some sort of modest outlook for the economy saying that its only going to begin in the second half. The its very tiflt to forecast and this is a r srt of once in a lifetime type scenario, but as you can see, only up 1. 2 now on the dow. Meantime i thought actually his comments were encouraging in the fact that the fed is all in and even willing to do even more when it comes to expansion of f the Balance Sheet or stimulus theyve provided more programs. Not out of bullet s and that the stand ready to do so to bridge he didnt talk about permanent scarring, which many we talk to on our air, strategists, economists, say theyre worried about. The permanent shock this could have on the economy. Absolutely. Towards the end of the interview suggesting theyre ready to do r more either way, were off the highs o the sessionful still up 290 points on the dow. Meantime, breaking news on air bnb. Air bnb is laying off nearly 1900 employees that accounts for ant 25 of the its workforce. Brian chatske poke to employees today and told them of the decision he says theyre going back to its roots. That means slowing the pace of investment on things like professional hosts and bringing more hotels on to the platform a big push that it has made over the last few years he says theyre collectively living through the most harrowing crisis of their lifetime and as it began to unfold, quote, Global Travel came to a standstill he says the business has been hit hard with revenue this year forecast to be less than half of what it was in 2019. Of course in response, air bnb has raised 2 billion over the last month or so when talking about how he knew these actions were ready, he said it began clea