Surveillance: Growth Is Likely To Slow, Kudlow Says

What is your message to fixeding managers at PIMCO this morning? Well, so, I think you kind of have to put the whole you know, coronavirus situation in perspective, um, and that is to be humble about it, because I know, you know, historically, you know, instances like this. Ultimately, you know the you know, the virus subsides at some point, and when that happens, you have economic activity that rebounds rich turns to normal. But there's a lot of uncertainty around the path to

get there. Um. The depth of the type of disruption and the how long that disruption lasts is very uncertain UM. And it's certainly possible you know that this could you know, push the US and and other developed market economies into recession before we get the ultimate rebound. Okay, well, PIMCO

had a brilliant call on this. I'm not going to give you all the credit that that PIMCO deserves, but you were certainly part of a team that was exceptionally cautious I'm g d p Uh into eighteen months ago and into twelve months ago, You're where you thought you'd be, right, Um, yeah, I mean, so you know, we were. We were more cautious on on the potential impact of you know, the trade war um, and we called it a window of

weakness late last year. Um, you know, because we thought that could you know, disrupt manufacturing um in the US. We ultimately got the trade deal, um, which we thought was a little bit better. Uh So, coming into the coronavirus, actually things the initial conditions in the U. S economy were actually you know, looking somewhat better, as were they in the rest of the world. Um. You know, actually global manufacturing growth looked like it was stabilizing and maybe

even rebounding, led by China. And now, of course all of that, uh you know comes into question now that we have you know, this coronavirus outbreak. So Tiffany, The FED you know, is trying its best, I guess is a great way to a good way to kind of phrase it. You know, with that intromediing and intermeding rate cut earlier this week, what do you think the FED is going to do going forward? And is there much

it can do? Um? Well, you know we so if you look at one way to think about this is just to look at historical precedent and if you look at the emergency rate cuts are intermeding rate cuts that we've seen, um, you know over called you know, since the early nineties, we've had seven instances of them, um, each of them. The meeting directly after that intermeding rate cut, the FED also cut um. You know. So I think by that historical precident, we should absolutely expect a cut

at the meeting in March. You know. One thing that I thought was interesting was that the you know, before the blackout period which actually starts tomorrow, we had several speakers overnight. They didn't really push back against the current market pricing, you know, which which is pricing in a probability that they could even cut fifty again, um. And you know, certainly that would be consistent with historical precedent

as well. What is the efficacy to our listeners of a hundred basis point rate cut over three cups of pimcoat coffee? What's it mean? Yeah? Well, you know, I think certainly and the Federal Reserve understands this. You know, monetary policy is not going to stop the spread of the virus. It's not going to be particularly effective against

supply chain disruptions that we expect. But what monetary policy can do, you know, and and and Powell talked about this is monetary policy can try to create conditions that, instead of exacerbating an economic shock, um, you know, they try to buffer it. So what tends to happen when you have a growth shock is that can lead to market panic, It can lead to tighter financial conditions, bank pull banks pulling back on credit, um, you know, and

that ultimately exacerbates exacerbates the economic sharks. So I think the Fed wants to try to set conditions to where they do it doesn't do that, it's going to be we'll get to next week. Keivity Welding, thank you so much. Let's talk about the virus. The number of cases globally nearing a hundred of thousand. More infections have now been reported in the United States, in Germany, and in South Korea. Finally, Clighorn of the Palladium Group, he is the health director

that joining us now from Washington to discuss all of this. Finally, let's talk about what we know and what we don't know. What we know is that we don't have enough test kids, and by extension, therefore, we don't know exactly how many people have got the virus, how fast it's spreading, what the delta is. What can you tell us, Well, that's exactly correct, thank you. Um, we don't have enough test gits in the US. We don't seem to be able to operationalize enough test gits to get them to the

right people. What do I mean by that, Well, we need to understand how many people are being exposed, how many people have acquired the infection, how many people developed clinical symptoms, and then how many people developed severe disease. Obviously, the last step is how many people die. And in the US, the last estimate I've seen is that we've only done about fifteen hundred tests so far, and there

have been quite a lot of missed opportunities. UH. In order to get to a broader implementation of testing so that we have a much better picture of the epidemiology off this virus in the country. Doctor. It's wonderful to have you with us in particularly with your decades out of Johns Hopkins University and your direct work with the government facilities. I'm not going to mince words, doctor, and

You've been very delicate out this. There is a party of the ways between the President of the United States and the people like you representing the institutions of science in the government. How do we get this fixed by Monday morning? How do we get the virologists to be front and center and advising the public given the messaging

we're seeing from the executive branch. Well, one way is to activate mechanisms that are tried and tested by for example, the Ebola Academic where we have a platform in a country, and the US of course does have such a platform. Uh.

It's called the One Health Platform. It's a whole of government, very articulated system from top to bottom, where the government in charge, the executive branch as well as branches of government that have responsibility for health and safety, are coordinated with state governments and local government wants and there is a plan of action that allows people to take actions without doing it on their own. And this is something that we have not seen in the last few days

in the US. We definitely need more coordination. As I said, uh, the ability to test people is a critical part of understanding the epidemiology off of virus. I mean this is very important, folks. Just to give you the local field ard our world headquarters. Two of our major prep schools collegiate in the Spend school are actually closed today. Is they clean those buildings and we all have our you know, individual local community stories. Dr I look at the complexities

of the test kit. It's c d C and I don't want to get into a discussion of RNA or DNA dynamics, which your expert in. How complex are the test kits? How easy are they to replicate, manufacture in introduce to the public. Well, these tests are are viral nucleic tests. That is, they're actually looking for proteins that are in the virus and using a method called PCR,

which is poliminaries chain reaction. So essentially you take some human tissue which comes from your nose, your mouth, your throat, your tra chia and you subjected to this test where you're looking to amplify these bits of viral RNA. So it's an r T PCR tests. Uh. The results should be available in twenty four hours. The problem is we have not licensed or leveraged the private sector enough to

get enough test kits out to the American public. And this is in stark contrast to for example, China and South Korea. South Korea has done over a hundred thousand tests to date. Uh, they're using their own homegrown tests. R T PCR is actually not that hard to do. You simply have to have the facilities to get the primers made and to get them out to the people

who can run the tests. Now, a new step occurred over the last couple of days where private sector developed tests can in fact be used, and that is going to rapidly increase the number of tests available in the US. Doctor our countries with universal healthcare more capable of dealing with dealing with this far ast than those that don't. Well.

I think in terms of planning, we mentioned planning that the idea is to do enough risk assessments so you can plan appropriately and and and then to have a risk communications strategy that avoids fear and confusion, which is what you get when you don't have an articulated plan. And we you know, some of the volatility in the

stock market we're seeing represents fear and volatility. And uh so, in order it for um systems health system to respond appropriately, they must have as part of that plan identified the number of rooms, for example, in I c U s that can provide the kind of complex respiratory care for patients who have severe disease and who are at the risk of death. These are primarily older people who have

concomitant illness and who developed pneumonia after they become infected. Now, in many countries, even highly developed health systems that are single payer health systems like the UK, if you had a sustained epidemic over time, it would really stress the system so that you would have to bring into play new new respiratory I see us. The problem in the US is we are a system of systems, so as far as I know yet, we do not have a coordinated plan for an expanded epidemic where we would need

more respiratory I see us. But this is wonderful because of time. I've only got one more question, and I'm gonna be very delicate here. I'm at home with my daughter, afterthought, and we're washing our hands with soap and water, singing happy birthday. I mean, that's what has come down to this weekend. Let me go to the most jinguistic racist idea right now floating around to get our viewers worldwide through the weekend. The number one thing collapsing in America

are Chinese restaurants. Would you order Chinese take out this weekend? Would you go into a Chinese restaurant? I mean, if that's the height of the paranoia we're facing right now, I want to hear from you, as a Johns Hopkins expert. Can I take Chinese takeout this weekend? Yes? You should one, because you're helping the economy too. Because the very notion of just having Chinese food and increasing your risk for coronavirus is to me borders on racist. So I think, yes,

you should have Chinese food. I hope it's good Chinese food that you're going to have. Uh, and lather up because twenty seconds with soap and water, the secret is in the lather So if you don't up, Yeah, it's those bubbles that break down micro organisms. That's great. That's good to know it will be your guy and I have to write so dcor, this has been extremely valuable. We look forward to speaking to you again. Drygaring with

Palladium Group is their health director. Hugely informative place decide that why aren't get on the bond market now? Jeff Rosenberg, City of PM on black Rock Systematic Fixed Income Team, Jeff, fantastic to have you with us. Your first take place. Well, I think you said it. It's you know, the most um you know, irrelevant payroll report we've had in a long time. I'd love to talk about the payroll report because it's some good news and as you said, it

doesn't really matter. It's backward looking. It does remind us of how strong the economy was going into this coronavirus. But this this information is dated. That's why it's not market moving. I guess what you can say is at least it's not bad news. If it was bad news into the coronavirus fears, who knows how the panic might have accelerated. But this is a reminder of the strength of the economy going into the shock. What we had

last week was the monetary policy response. I mean, obviously we had it this week, but last week's declines in the equity markets prompted this week's monetary policy response. This week's equity market response, next week's story is the fiscal policy response, and that's what we're gonna be talking about. I think we're gonna move to that conversation because there's a very limited amount of what monetary policy can do, and it's gonna be much greater about the focus on

fiscal policy. If we get a strong, coherent, robust response, I think that could be very beneficial. But to the earlier question, we don't know what the demand side shock is to the supply from this supply side shock, but you need a fiscal policy response to to address that. Monetary policy is limited. Jeff, to your point about momentum, and this is something that Jim was talking about too, that the momentum was there in the U. S economy

before this shock. Why does that matter? What does that tell you in terms of the shape of the recovery and the scope of the recovery. Well, it tells you that you you have the ability to limit the damage to the economy because you're dealing with a shock from a position of strength as opposed to dealing with a shock from a position of weakness and a position of

vulnerability from a fundamental economic perspective. Now, I think what's going on in terms of the financial markets is that you had a shock from a fundamental economic perspective to a financial market that was very vulnerable. You had complacency, you had valuations at very high levels, you had very little cushion, So a lot of the drop is coming from very high levels. If we think about it from the fixed income perspective, a lot of the widening and

credit spread is coming from very tight levels. You're getting big moves and spreads, but the levels that you're at are hardly anything near recessionary type levels. They're getting you back into kind of fair value, mid mid expansion kind of level. So there was a bit of over uh. If you look at the delta, the change looks very aggressive, but it's coming from a very tight level. So financial markets were a bit more vulnerable, the economy was much

more resilient. You can make the argument that stocks are not pricing in a recession pe multiple still very high. Bonds, however, are do you think that bonds are overdone, that they're over bought at this level. No, I I think you gotta be careful about, you know, bonds pricing in a recession versus bonds pricing in a pre emptive policy reaction. Uh,

and in some sense forcing that preemptive policy reaction. That's the kind of strange world that we're in, is that is that financial conditions matter so much to the FED that the bond market reaction is in anticipation ation of the FED reacting to financial market conditions, and so the bond market is kind of previewing where the Fed is going to go. We saw that this week with fifty basis points. You're seeing it again with another fifty basis

points anticipated. So you know, does that predict recession? Not sure? Does it predict policy response absolutely? And then the question is is the combined policy response again monetary and fiscal, enough to forestall the recession. Jeffrey Rosenberg with us, of course, with his wonderful strategy work at Black Rocket. Of course, the mathematics of Carnegie Mellen as well. Jeff I want to go Matthew right now. I've got a fancy log

chart of two year yield. The abruptness, the first derivative moves a second derivative acceleration that we're seeing has been extraordinary. The Greek letter for this is gamma. Should our listeners care about gamma? Does does the abruptness of all these moves really matter forward? Well, you know, there's a lot of technical aspects to financial markets that encourage this rate of change and acceleration. At a conversation, another terminology for

gammas convexity. You have a lot of convexity in the market. I mean, this is a remarkable world where you know, the the financial people want to talk about uh, the virus, but the but but but you can have the doctors wanting to talk about refinancing their mortgages. And so when you're refinancing your mortgage, what you're getting is a lot of that gamma in the market. It's a huge marketplace, it has a lot of dynamics, and it's one of

the factors behind the accelerated move. Certainly, there's a fundamental factor, which is the expectation for policy change, but it gets exacerbated by these technical factors of a demand for duration. When the rest of us are going to look at this as an opportunity to refinance our mortgages, when we do that, the demand for replacing that interest rate risk drives these rates even or so there's a lot of that going on in the bond market. That's just quickly

from me. My final question, just picking up on the pace of this move two mondays ago, the higher session for the two year yield on the thirty year yield is south of that right now in the two years now only forty six basis points. When things move this quick, and I want you to take me inside the tentacles in the market. When things move this quick, the things bright. Well, that's the question of financial vulnerabilities, right and and you know in the in the rate market, part of that

rate hedging, that's a very liquid market. It's a very liquid market. It's a functional market, and it's not breaking, but it's it's bending. And when I say bending, it's accelerating the moves in terms of the breakage of the market. Where you have greater vulnerabilities is really in different parts of the fixed income market where you see liquidity and cash flows and difficulties of refinancing. That's a bit what the preempt of monetary policy is partly to address. Let's

make sure there's ample amounts of look quidity. There's no technical defaults because someone can't get access to liquidity. And you certainly see that in a global perspective when you look at, say, for example, the Chinese response and the fiscal monetary policy response to ensure that small medium enterprises are getting access to rolling over as they're having a

short term cash flow issue. So those policy interventions can help in those circumstances prevent markets from breaking and exacerbating losses where they otherwise wouldn't need to occur. Mr Rosenberg with us. He is a senior portfolio manager of black Rock and their systemic fixed income team. Jeff, I want you to go short term systemic right now. I call it the trust market, folks. This is well inside the two years space. It is a trust of overnight money. It is a trust of three day money, it is

a trust of ninety day money. How's the trust market doing, Jeff Rosenberg? Um, I'm not sure. I'm totally fall allowing uh that. But if you're talking about short term confidence, short term confidence is evidenced by the short term paper market into the weekend. Yeah. I mean, look, the short term markets are are fine. There's a there's a demand for cash, there's a there's a flight to quality, there's a flight out of risk. That's what the markets are saying.

That's uh, a normal expected reaction to a lot of panic and a lot of uncertainty and a lot of risk that people have had in their in their equity portfolios. And we looked at equity allocations over the last five years from you know, some of the data sources that

provide you kind of aggregate holdings. Everybody's equity allocations have drifted higher, uh, not a huge amount, but they've been willing to drift higher because it's been a great fundamental market and you have this outside shock that no one predicted, and you came into it. As I was saying in the earlier section, you know, the economy came into it resilient, but financial markets came into it vulnerable. And so what

you're having here is a forced rebalancing. And then as part of that forced rebalancing, the beneficiaries are our cash and safe haven assets and bonds. As we're as we're clearly seeing and and you're also seeing that now in terms of the relative underperformance of higher risk segments of the equity markets. With the exception of some weird days last week, you're seeing that again today. Reads, utilities, interest rates, bond proxies doing better. That's all, you know, normal behavior,

but it is reflective of this de risking portfolio. And it goes, Lisa, right to where your wheelhouse. As we do this, folks of the futures back over to negative ninety four. Lisa, that's right to the spread study you've been looking at all week. I'm just wondering, from your perspective, do you think that the corollary for this is two thousand seven No, no, and and and really, guys, let's not do this. Let's not panic people. Uh, In in that way that what happened in two thousand seven eight

was very unique. And why you saw that happen in commercial paper markets and in the credit markets was because the center of the crisis was in the financial system. Right, let's calm people down a little bit rather than rilling them up. This financial system is much more resilient to an external shock of coronavirus than to an external shock of subprime mortgages, which was an external It was central,

and it broke the financial system. And that's why you saw the commercial paper markets blow up and create more panic and more uncertainty. Those markets are resilient, they're operating as they should, They're reflective of flight to quality. But the issues and the concerns are not there. The issues and the concerns are with the uncertainty over what a virus does to economic activity. We're all feeling it in terms of we're getting emails from our schools. Are they

shutting down our companies where we're working. That's where the panic is. Let's not panic people in other areas where there is into panic. Those markets are working well. There's more resilience. We will get through this once the uncertainty of how bad the impact of the economy is, and as I said earlier, we're gonna need a little bit of help from our policymakers, and we're going to get it in terms of a fiscal policy response that will be robust and will help to offset the demand side shock.

And we'll wake up and we'll see what the payroll report is reminding us of, which is, Hey, we came into this with a pretty resilient account and resilience will be our source of strength when this uncertainty pass. Half a million jobs in ninety days is and excuse me,

in sixty days is a big number. Jeffrey Rosenberger, Black Rock, thank you so much for the White House is here on the Charlton fold in place to say we joined on Blindberg Television and on Blindberg Radio by Larry Cardlo, National Economic Council Director Larry and I must be exhausted, give me a twot so far this morning, so let's get straight into it. The good news is the labor

market going into this growth scale looks pretty decent. Yes, right, by the way, I feel great, and thanks for having me back on the show, Jonathan, labor market looks excellent, very strong, and incidentally, most sectors in the economy look strong. We're through the first two months of the of the first quarter, right, so we got January and February, and some of the China influence is already affecting us. But

the numbers are probably better named by thought. Um you maybe two and a half to three in the first quarter. I know as a realist um economic growth is likely to slow in the second quarter and maybe the third. I don't want to get too far ahead of it because some of these UH virus numbers in China coming way down outside China not so much. But I'm just saying the U. S economy is very strong. Two hundred seventy three thousand jobs and as you know, Jonathan, with revisions,

three hundred and fifty thousand jobs, that's a blowout. And wage rates still rising, and you know, the blue collar boom we've talked about still there. From these data, middle income, lower wage people are out performing their managers. Unemployment rate three point five across the board, every single demographic group, So that's awfully good. Housing is improving, building is improving yet a lot of construction jobs in this report, and

a pickup and manufacturing. So yes, the economic base is strong. The fundamentals of the economy is strong. We are going to see some issues coming up from the coronavirus. I get that, but I think for the United States this is gonna be temporary problems, Larry, not a time to panic, but as time to be prepared, and I hope it's temporary as well. We've seen the right cuts from the

federal Reserve, an emergency fifty basis point cut. What's the administration working on to complement that, you know, any of our fiscal policies, uh, sect term munition, and I'm talking about it. Treasury and NBC and other groups are helping us. We're in the camp, Jonathan, that wants timely and targeted micro measures, not large sweeping you know, hundreds and hundreds of billions of dollars UH, that don't affect incentives and

don't affect growth in any permanent way. You know, we're worried about people who may have problems with jobs in wages because they have to stay home. We're worried about small businesses, for example, that might need some help to get through this if it turns out. We're worried about certain sectors of the economy. Airlines coming to mind, but I don't want to get too deep on that that

might need some help. We're looking for targeted measures that will do the most good in a short period of time, not large macro kinds of solutions which don't help economic incentives and have no permanent impact on growth. We want to just get through this and help folks as much as we can in a targeted way. Alowry, that's music to my ears, because we've got a bit of a problem here. This can be temporary, it's a one off shock.

It will fade. But what will determine how temporary this is the kind of tools we have ready to deploy to how pessimese to have some people who are struggling if they've got to stay at home. So walk me through the policies, the actual policies. You're having the discussion. When do we start to get some results, Um, stay tuned, stay with us. We may have more to say about this next week. You know, I think we need to do this, Jonathan, when the actual facts come in. Now

we're getting reports from industries. We had the airline people in the White House earlier this week. President Trumps talking a lot of major UH sectors across the economy. We just want to keep gathering as many facts and information as we can before we come up with the specific But we are looking at this and as I say, temporary and targeted to get through this, which will be God willing a temporary virus a problem. You know, that's

our approach. We're not looking for big picture, gigantic packages that will not help growth. We've learned in the past and will be Um, you know, huge budget busters and Larry, something you've said concerns me though that we're gonna wait.

We're gonna wait to see what the data says. And what I've seen so far is not just the administration, but signs coming from policymakers elsewhere that they're just being held hostage by say what happens in the next move in financial markets, and they haven't got the tools ready to deploy when they need to. This should be the planning stage. We should be ready to go if we seriously got no policies ready to deploy if things get

worse next week, the week after uh MA sure answers. Yes, we can move very rapidly, and we're doing a lot of homework right now on all these points, Jonathan. I don't want to put them out publicly because I understand, but it's still my confidence because we have a moment now where there's a real lack of confidence, Larry, and you know me, I don't like to lay it on thick. This isn't about making people fearful of things. I just

think there's a lack of confidence in global officials. Not on the medical side, and that's not for you and I to discuss today, but on the economic side. Talk to me about the policies have we've got payroll tax cuts ready to go. Do we have a targeted lending program to west some he is ready to go? Do we have a tax forgiveness season ready to deploy if we need to. We have made decisions on some of that. Again, peril tax cuts, we can debate the pros and cons.

I lean against them. We've tried them in the past. Temporary tax that costs a lot of money, you know, six fifty billion dollars. They don't last. There's no incentive effect because they're temporary. Again, Johnathan, I think the basic view here amongst my colleagues is temporary and targeted. So if cash injections are needed to help folks who are at home because of the virus one way or another and lose a paycheck or two, we want to help them.

If small businesses are in our condition in certain parts of the country, we can inject some cash. That could be true in farming, that could be true in manufacturing, that can be true in transportation and a lot of other places. So to pull that trigger will not take much time at all, and probably we'd like to do it internally. You know, if we can buy executive order. We just got the eight billion dollar package from Congress. That's good helping us on the on the medical side

of this very important. Thank them, Thank them for it. We may need to come back. If we need to go back to Congress, we will. We won't hesitate, but we we are in the playing stage. And by the way, uh, you know, Secretary Manuition reminds me the G seven just had a very important conference call and all these big countries are making their own plans as things develop in those countries. So I don't want to be premature, but yes, this can all be done in a very timely way.

We just need, you know, information gathering is very important, Jonathan, and I will say this to you with respect to the job's report today, which was a blowout number. I mean, employment is blown out under President Trump, way beyond what anybody thought possible. But that good income numbers, good consumers spending, good housing numbers. Let's not assume the worst. You've got

a menu of options here, alright. Some options are negative, some options are either less negative or rather positive, and I want to, you know, wait and see how that plays out. The same is true with the actual medical reports on the contagion of the virus. But let's just wait and see. Let's not extrapolatest case. And I don't want to teach you how to be a policy make you a far more experience than me. But you know what this is about. You hope for the best, you

prepare for the worst. You've told me to ready some move quickly. Let's talk about threshold. I've got a bond market, we deal to all time loaves. I've got crewed down seven on my screen right now, my Bloomberg terminals lighting up. It's lighting up. It's the threshold is what will determine you to move and deploy those tools that you say are ready to go in a timey fashion. Does the market dictate that? Does the data dictate that? What dictates that? Well, look,

both will dictate that, but we we can't. We Look, you've got myself, Terry manution, others President Trump for that matter. We all have a lot of market experience. We all have a lot of private sector business experience. So yes, of course we watch financial markets. On the other hand, you have to watch the actual data on the ground, economic data, the health data, the virus related data. So

that's we have to do that. We can't just make a move because the bond does thus, you know, in two hours on on Thursday or Friday, we can't do that. We're watching it. We're trying to We're trying to do our homework and watch everything. I just want to say though, Jonathan, again, I'm not the medical expert. I am part of the task force. I'm in constant touch on a daily basis with our really experienced uh C d C people and others who have done such a fabulous job. I mean,

I gotta give him a lot of credit. They're all over it. Um. Most Americans are not at risk. That is their view. Most Americans are not at risk. The biggest risk cohort is, in fact the seniors, the elderly folks, and they need to be extra cautious. The younger you are, the less risk you're facing. And most Americans over recover

rather easily should they get the virus. I want to put that out because my point is if you're healthy, if you're healthy, and you exercise common sense about washing your hands and clean excess for sneezing and coughing and things of that nature, and you avoid the obvious places where there are travel advisors. But most Americans are healthy and should go about their business. That's what I'm saying.

The data is suggested. I respect to you a lot, and you know that, but neither of us a medical professionals and have a duty a care to my audience that neither of the medical professionals, and I want to focus on the economic data, not the data is from the virus. On the economic data. It's clear already the delivery times in the p M eyes are stretching, gout, they're getting longer. We've got a supply chain issue. An easy way of addressing the supply chain issue would be

to drop some of the tariffs. Why are we not talking about that? You said it's about the data. There's an easy policy response, there's no follow through. Why not, um, just quickly, the supply chain data shows some slowdown and deliveries. Yes, not huge, imine airge Jathan, not yet, not huge. It may be out there, but so far really quite manageable. UM with respected terror policy, I've not heard the President and mentioned that it's done seen beyond the table right now.

We would undoubtedly like to focus much more our our domestic issues, whether they're economic issues or their health related issues. So the tariff question is not being addressed at the present time. But Larry, final question, can you see why this is a problem for global markets right now that the president is signing a bill and the only policy initiative is talking about is coming rates again again in the fete to stimulate and you and I and I

know you know this. There's a policy ready to go to offset a lot of fear out there at the moment, whether it's justified or not, and there is a reluctance to deploy it. And I just don't understand why. Well, Jonathan, we have to be thoughtful and careful and analytic. We want to do We don't want to willy nilly throw three hundred four hundred billion dollars with a thousand dollars check to every mark that kind of stuff about, and

it doesn't work in the past. Moving tarists, I'm not talking about helicopter drops, you know, regarding the s s A. Removing tariffs. Uh. Not everyone agrees with your analysis. Uh, it's something that thus far as not surfacing. Yet. We like our China policy and we like the fact that China has cut its own tariffs. And by the way, when this virus period ends, as it will, You're gonna see a major export boom from the United States to China that is going to grow the economy by at

least another percentage point in the years ahead. And I wouldn't be surprised if we saw that towards the end of the year. Regarding other measures that I mentioned, measures that would be timely and targeted towards individuals or small businesses or perhaps some industrial sectors, that's on the table. We are in the planet, we are in the discussion and planning phase, Jonavan. Again, we have to exercise some caution and analysis. We are in touch with everybody in

the economy, every single sector. They're coming to visit us on a daily basis, and the President is deeply involved. And my hats off to the Vice President who's leading this healthcare task for us. So Johnavan, don't be impatient. You've got to exercise some judgment before you jump in. But we're on it. Trust me, we're on it. I'm telling you this morning, probably more than has been put out publicly, we are on it, and we are looking

at these various targeted approaches. Larry, you know I respect you and I appreciate your transparency today and thank you for giving us your time. Larry could that the White House National Economic Castle Director. Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm on Twitter at Tom Keane before the podcast. You can always catch us worldwide. I'm Bloomberg Radio