This is Bloomberg Business Week. I'm Carol Masser and I'm Jason Kelly. We're here every day bringing you the latest news from the world of business and finance, plus technology, politics, economics, all harnessing the power of Bloomberg Business Week reporters and editors, not to mention our hundred journalists and analysts more than a hundred and twenty countries. You can download Bloomberg Business
Week on iTunes, SoundCloud, or Bloomberg dot Com. You can also listen to our radio show weekdays at two pm Eastern only on Bloomberg Radio. Well. As we said at the top of the show, Jamie Diamond, he is a voice everyone listens to. JP Morgan earnings out today. Jamie Diamond back UH from very serious surgery, but he is back in the seed. He is as lively as ever. Let's check out a little bit of what he had
to say. The bad economy has very adverse consequences way beyond just the economy, you know, and in terms of mental health, domestic abuse, UH, substance abuse, et cetera. So we have a rational plan to get back to work, the j the things to do, UH, and you know, hopefully it'll be keen around later, but it will be mad at July August, all right, So Jing July August. That seemed to set a little bit of a tone and people, as I said, really listen to Jamie Diamond,
someone who knows this bank inside and out. We count on her for her insights. Is Michelle Davis, finance reporter for Bloomberg Jonius on the phone from Vermont, one of the hardest working reporters out there. Uh, Michelle, good to have you with us on such a busy day. Thank you. All right, So everybody checking out what j D was having to say, He seems like he's back to his
old self in in many ways. What did he say that was most notable from the perspective of not just investors in the bank, but sort of the world at large, because he's a statesman of sorts at this point. Yeah, definitely. Um, well, I think the most notable thing, just in terms of what it means for the holy economy was the fact that, you know, Jupimorgan's profit fell to the lowest more than six years. Um. He had previously said that, you know, the bank wouldn't be immune to fall out from the
pandemic and that he was predicting a Bader session. But the comments that you guys highlighted earlier about wanting to you know, get people back to work and reopen the economy were also I would say, very interesting because, um, you know something that there's a lot of debate about right now, and that I don't think anyone really knows like how soon this is going to happen. That the one definitive thing he did says he doesn't think it
will happen before May. Um. And the other thing you mentioned that I thought was pretty interesting is that, you know, after he had hurt surgery, a lot of people I thought that, you know, this pretty severe surgery would would cause him to reevaluate, you know, his life choices, possibly retire earlier than anticipated. Um. And he totally you know, knocked those assumptions away and said that he was really
eager to get back to work. But um, you know, having undergone this surgery, uh, did not change any of his his retirement plans. Um. Even though it did underscore the strength of of the banks bench and the fact that you know, managers were able to carry on without him for the for the four weeks that he was away. I love what he said, the quote that you guys have I'm walking several miles a day. I like working. I've been working for several weeks now. It doesn't really
change very much how I view the world. So he's at their front and center. I thought also what was interesting, um, not only his take, and I do agree with Jason, that we are looking at leaders, you know, that transcend their industry to get an idea of, Okay, how do we come back from this virus? When do we reopen the economy, especially when you've got such uh, seemingly a battle between what's going on in Washington versus governors on the front lines in various states, certainly here in the
New York metro area. Um, but it's interesting, you know what he had to say, because I think we are we are looking to these types of individuals to get an idea of, Okay, how do we come back? When
do we come back exactly? And something that he didn't mention today but that was in his annual letter last week is that he thinks, uh, testing, an access to testing, it's gonna be something that's going to be really crucial to reopening the economy and getting people back to work, all right, Michelle Davis, we are going to leave it there. This is Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. Well, coronavirus cases are surpassing one
ninety three million. Deaths are topping about a hundred and twenty d around the world. US docks, so they are shrugging that off because they're really rallying on signs of virus spread is easing, and there's more talk globally of countries and economies reopening. Let's talk about the realistic expectation of that. With Dr Joe and Roberts, chief Quality Officer Providence Sancho's of Health, on the phone from Everett, Washington.
You might recall the first US case of the virus was confirmed in Washington State at Providence Regional Medical Severn Center and Everett, which is that part of that Providence St. Joseph's Health System UM. Dr Roberts, nice to have you here with us. There is an awful lot of talk about reopening UM economies around the globe, and at the same time we're hearing a lot of individuals including JP Morgan Chase CEO, Jamie Diamond also the governor Massachusetts. Everybody says,
more testing, more testing. How do you see it? Can we reopen without doing more testing? Um? Yeah, So thanks for having me really appreciate it. Um Carol, Um, I do think uh testing uh is going to be a requirement for us we opening. We already are talking about just on the healthcare side, about what the world may
look like as we slowly reopen our systems. Um, We'll look ing at the backup of things like surgery for slow growing cancers that had been put on pause as we responded to the acute pace, and folks are going to need that care. The question is how do we deliver that care in a safe way. We have certainly figured out how to isolate our COVID patients from all
other patients. We know that our emergency rooms in our and our surgery departments are free of COVID because we've done such a good job of testing in the hospitals. But because testing is still limited, we just are not able to know where our communities are and how many people are infected out in the community, which is really difficult than to know exactly how quickly we should all come back online. And so Dr Roberts. Help us understand from from your perspective and for a layment like myself,
what does effective testing and tracing look like? What what could have you know regular person? You know, a regular well person reasonably expected in terms of our daily lives going forward if we get what we need in place. So if we have testing available, and that's both testing for people with infection, either before they have symptoms or active symptoms. So that's one set of tests, and the other set of tests are the test for antibodies shows
who's been infected. We need both. We have some We have pretty we have improving testing on that active infection side. We still have gaps on the antibody side. But once we have those, then we can go into communities, test people randomly in a sampling of a statistical sample, and then understand more deeply where the infections clusters lie. So a small community might have a lot of infections of
asymptomatic people. We might have communities or areas of communities that we have a lot of immunity built up, and it will be important to know that in both in these economic discussions and in the health care discussions. All Right, so you're talking about test to see who as the antibodies test to see who has had the virus itself or who might have it. That's a lot of testing. Um,
do we have the tests out there? Is it just a case that our medical community understandably is consumed which is taking care of people right now that have the virus? Is that why we're not getting things down to what's the hold up? So we don't have those tests right now? So the medical community is going on the proposition that until proven otherwise, people could be effect infected. So we deliver our care in with a lot of equipment to keep everybody safe. But on the broader economy, is you, um,
we don't have the test yet. We don't know what the best antibody test is going to be. We have
quite a few out there on the market. Um, this is a complex virus to test for, so when testing the antibodies, we have to know which antibodies are the ones that are going to be correlated with immunity to the future covid infection if any M and so Dr Roberts in just a sort of minute or so, we have left, what have you learned that may be given that you guys were ahead of the curve, as it were, You dealt with this earlier than even though the infection
may have been the same, you certainly dealt with it earlier than we did here on the East. Because what have you learned that that you know, we might be thinking about and especially maybe for some of the folks who are listening in areas where it hasn't really hit yet and may still. Um, I'll tell you what I have learned is communities come together in a crisis. So despite what decisions are being made on a policy level, we see communities coming together to help one another out.
And that's a wonderful part of a crisis, as painful as a crisis is. The second piece that I've learned is that our country has to prepare better for pandemics. We've always prepared well for things like hurricanes and earthquakes, but this is something of a totally different magnitude that we have to be thinking about always. Do you think we are thinking about it? Are you hearing from you know, folks that you work with on a federal in a state level, that we're thinking about it? Better only got
about thirty seconds, Uh not yet? I think so. I think it's not the time to have that discussion. I think one thing settled down, we'll all have to sit down and be honest with one another about how prepared we were and how prepared we need to be. Yeah, and let's not right, you and we can't go back like We've got to make this part of our emergency planet going forward. We have to hope for the best and plan for the worst. Absolutely well, we really appreciate
your work and your colleagues there. Dr Joan Roberts, Chief Quality Officer Providence St. Joseph Health on the phone from Everett, Washington and Carol, As you said, I mean, these guys have been an invaluable resource resource for us. Dr Roberts and her colleagues, especially Dr Amy Compton Phillips who joined us in the early stages of this to help us
understand what was going on. I felt a lot smarter in terms of being able to deal with it, even sort of from a community perspective, knowing what they know and what Dr Roberts had to said about the different kinds of tests that need to be done and that we just don't even have those tests yet to be able to do it is really important to understand this is Bloomberg Business Week with Carol Masser and Jason Kelly
on Bloomberg Radio. We've been talking about this a lot on air, about where we are in the financial markets. Bull market, bear market. It's a fair question. Let's put that to Michael Reagan. Mike is Bloomberg Markets Live Blog senior editor joining us from New Jersey. Uh and he
has this story in the magazine this week. So Mike talk to us because we've seen quite large moves in both directions for the equity market to the point where we were in a bear market and then we came back and then we technically could have started a new bull market. But I don't know where are we? Well, right, Carol, It's kind of there's not really a textbook definition to say, Okay, this is what a bull market or a bear market is.
But the sort of rule of thumb that everyone uses is obviously, once you drop from a peak, you're in a bear market. But a lot of people think that if a bull market can then be defined as a gain from that low. So we have seen that, we've seen the SMP up more than from it's it's low
in one on March. The problem is that the worst bear markets in history are famous for having episodes where the market rebounds significantly more than say it happened during the financial crisis at the end of two thousand and eight and in the early two thousand nine, but ultimately
the low as yet to come. UM. Historically, if you look how long it takes for the SMP to find that bottom, to find that low point in a bear market, it take usually takes a long time, something like three hundred and seventy trading days on average, according to some numbers trunched by my colleague Cameron Christ. So obviously there's a lot of disparity in that. UM. Look at say the crash of nineteen nine, the bottom wasn't uh found
until ninety two UM. In the two thousand and eight nine example, you know the market peak in two thousand and seven, the low wasn't found until two thousand and nine UM. And if you go all the way back to seven that that was the shortest time it took to reach a low. It was something like seventy four
trading days. So if you look at this episod so that low we reached in March was only about twenty three days after the last record in the sp so historically it would just be unprecedented to see that low reached in such a short amount of time, right, all right, So Joel Weber also with this editor of the magazine, and you know, Joel, it it falls to you, lucky for us and maybe unfortunately for you, to sort of synthesize all of this and and understand the financial markets
in the context of the economy and the world of business. And we are reminded so often that the markets are not, uh, the economy. How did you approach this story? Well, first of all, it's great to hear Mike's voice. It feels like it's been way too long. And well, well we talked to you yesterday, so you know, I'm getting lonely. I'm getting lone you know, look like I think the backdrop for everything for a lot of people here has
obviously been unemployment number. But you know, here in the middle of all this, obviously the markets trying to figure out what to make of it, and the numbers that Mike um has in this story, you're just staggering to you know, go from this like highest high to lowest slow and just like a matter of days, really, Um and and I what I see when I look at it all is the markets trying to figure out what it all means. And um, you know, it really wants this to be over the other thing. And I think
we're seeing that even today. Um, it's just desperately wanting to like get around the corner. And I'm not so sure that that, you know, And that's part of what Mike has in the story is like I'm not so sure. Um, you know that's gonna be. Um what we what we get to loose through? Um. But you know, Mike, I think the other thing, and this is in your story as well, Um, is the poster of Jerome Powell that you have on your wall, Um, which is a joke,
but but you know it could happen. The The other thing that's happening here, obviously, is that traders know you do not fight the fit. Yeah, and that's where you know, as much as I just cited a bunch of historical precedents, it's very difficult in this current situation to really go back and compare it to anything in history because it's so unique. It's so unlike anything we've seen in history. Um. And the response from the Federal Reserve and the government
that quick, massive, do whatever it takes. Response from both the Fed and Congress is is completely unprecedented in the history of you know, economic cycles that the markets had
to work through before. So part of you know, one of the things that really caught my eye this week was that Goldman Sachs, their strategist, came out and said they think there's a good chance that that low is the load that it's been set, that this stimulus from the Fed and the Congress is so great, um that regardless of how ugly the data is gonna be coming
up and and it's gonna be nasty. I mean JP Morgan estimating something like a fort contraction in GDP, I mean, just a head around that, right, I know, it's just mind boggling uh to think about. And you know, the earnings, the dipping earnings, it's going to be just as bad, you know. I think it's like a thirty some percent
UH decrease expected in the second quarter. UM. But when you have that much support from the Fed, when you know, sort of suppressing interest rates, buying up all sorts of assets to keep that liquidity flowing, it's very hard to put a d faith into those historical precedents because of this uh you know, unprecedented response that we're saying. But you know that said, there's just a lot of bad
news that we sought to work through. Um it's it's really hard to imagine this market continuing on this sort of V shaped recovery that it's in. Well. And the thing is, you know you're right and if one are the big gifts out there, as you write in your story, is if infections come back a second time, I mean, then all bets are off. What I wanted to ask you, though, Mike, is the rally as respected when it's courtesy of the
FED and policymakers and big stimulus programs. You know, there were there will always be people that sort of um roll their eyes, were you know, pinch their nose that at the notion that the FED is doing so much, um to support the market. Fed. Let's get to mean, what else could they do? This is such a shock to the economy there, you know, they had to respond aggressively, uh and with force, as did the Congress and the government. UM. So I think eventually there's you know, the worry about
a day of reckoning. What does this all mean? Down the line, how does the FED ever exit from this uh great support it's given to the economy. Um, when do we know it's it's sort of healthy enough to begin exiting? And what happens then? I mean, we already saw sort of a crack in markets when they started raising interest rates and started on winding their quantitative using
uh from the last cycle. So you know, I think that the concern is not that they're doing it, but are they sort of pushing the kicking the can down the road and creating a problem with the deal with eventually. Yeah, alright, Mike Reagan, always good to catch up with you, writer, broadcaster, podcaster extraordinaire. Check out his podcast. Check out j Powell Poster. Come on, Mike, you can come clean with us. We are going to still love you. Yeah, exactly, We're gonna
love you even more alright. Check out that Story's on the Bloomberg Today and on Bloomberg dot Com in the upcoming issue of Bloomberg Business Week. This is Bloomberg Business Week with Carol Messer and Jason Kelly on Bloomberg Radio. We're also watching some big political news today, so let's get into that with Jennifer Epstein she's political reporter at Bloomberg News. She's on the phone from Washington. So Joe, So, Joe Biden Um getting a big endorsement from his former boss,
Barack Obama. We've got a little snippet of what Mr Obama, former President Obama had to say. The kind of leadership that's guided by knowledge and experience, honesty and humility, empathy and grace. That kind of leadership doesn't just belong in our state capitals and mayor's offices. It belongs in the White House. And that's why I'm so proud to endorse
Joe Biden for President of the United States. Choosing Joe to be my vice president was one of the best decisions I ever made, and he became a close friend, and I believe Joe has all the qualities we need in a president right now. So Jennifer, Okay, nice, thank you.
President Obama took them long enough. Yeah, you know, President, It's kind of a weird thing because President Obama made clearer even before Joe Biden got into this race just about a year ago at this point, Um that he wasn't going to endorse anybody until the whole primary had been decided by the orders of the party, and yet you know, there's still this kind of thing where it's like, Okay, this guy was your vice president and close friends for
the last eight years, um, you know. So there was sort of an expectation and in a little bit of a dishonest argument sometimes from President Trump another Republicans saying well, if you know, they clearly see why Biden shouldn't be president, or or Obama would be endorsing him already, which is you know, um, you know, but disingenuous. But here, uh,
you have this endorsement from Obama today. It was really an effort, I think, to get Democrats and people who are persuadable to vote for Biden to start thinking seriously about doing that, um, even if they supported Bernie Sanders or somebody else in the primary. But now the focus is solely on beating Trump in November. Um, and that's where all the energy for anybody who doesn't like Trump
needs to go. And President Obama's view all right, So speaking of that energy, Jennifer, how much energy do we think we'll see from former President Obama, maybe former First Lady Michelle Obama really out there? Um, and I guess out there is a relative term in this current environment, right, Um, what is it going to look like now that the Obama's are engaged? Yeah, well, I think out there is part of the challenge, because there is out there is
the inside everybody's respective home in front of the camera. Um. Because presumably, sorry to interrupt you, but like presumably in a more normal world, this would have been done in a huge rally, you know, like an Obama you know, sort of a classic Obama get them all riled up,
you know sort of situation. Right. Well, you know, I covered the Hillary Clinton campaign in T six team for Bloomberg News, and back then it was actually done similar way where there was a video put out by Obama and then that was very quickly followed by the announcement of a rally that he was going to do with Hillary Clinton that I ended up having to get rescheduled,
and it finally did happen. It ended up being not a great It was a complicated newsday otherwise, so it was not didn't have as much of a splash as maybe they wanted to, but it was still a big rally in North Carolina in Charlotte. UM that got plenty of media attention and obviously that can't be done this time. Um, you know, it's unclear whether we're going to be able to have any kind of you know, big traditional rallies at all between now and November, for for Biden or
for Trump. Uh. So in the in the meantime, I think that you will see UH Obama do some more things digitally for Biden. I think that the exact terms of better to be determined. I think it will be around the message and getting people support Biden, but I think it will also be fundraising. Uh that's an area where uh Biden has a lot of ground to make up for. Um, he's he's you know, hundreds of millions of dollars behind uh, the Trump campaign and the Republican
National Committee in fundraising right now. And UM, you know, digital stuff costs money. It's not like somebody just sits at their computer. And how important that goes into it?
How important is that in this race? I mean, I know, I understand advertising and political advertising is very persuasive, very important, But I feel like you've got a president who has a four year track record or three and a half year track record, right, and so they've got that and either people like that and want another four years or theyre going to be those who don't like it. Is it as simplistic as that this time around? Well, I think that there are there are a lot of people
who are sort of in between. They like certain things that the president has done, not other things. They may have voted for him the last time and having a bit of remorse, or they might have not voted for him the last time and regretted that, or be sort of on the fence where they say, well, you know, my pocketbook is doing well. Let's say even amid this this crisis, that they're still doing well because its tax breaks and maybe they're even trying to find a way
to maximize the stimulus money for themselves. So they say, okay, I'm doing well, but I don't agree with how the overall coronas virus response has gone. Or you know, there are a million different permutations of that are actually probably
you know, a hundred fifty two million. However many people end up voting in this election, you know, for everybody to a specific different choice um, and you know it does cost money, not just for the ads, but just to have to have the outrage run getting getting people out to vote, which is a big piece of this is going to be if Democrats are gonna win, it's going to be because there is a significant surgeon turnout, likely UM and that that will take a lot of energy.
There's also gonna be the complication of the extent to which UM mail and voting or really voting or other accommodations are made. UM. You know, we don't. It's hard to know whether there's going to be another surge in coronavirus in the fall, and whether that will have already started fall er winter, and whether that it will already have started by November three. Yeah, absolutely, all right, We're gonna leave it there. I love Jennifer Epstein. Follow her
on Twitter at jen Epps. She is on top of it, one of our top political reporters, as she said, has the context of covering election, and it's going to be fascinating to compare and contrasts throughout. We're going to be keeping in touch with her. Yeah, votes, online, endorsements, tweets, all of it. Thanks for listening to Bloomberg Business Week. You can subscribe to the podcast on iTunes, SoundCloud, or
Bloomberg dot com. You can also listen to our radio show every weekday at two pm Eastern, only on Bloomberg Radio