WEBVTT - Surveillance: Record Jobless Claims with Porcelli 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene Jay Lee. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.680 Bloomberg dot Com, and of course, on the Bloomberg Phone. Again. 0:00:27.680 --> 0:00:29.760 I'm pleased to say is David Kelly of JP Morgan 0:00:29.800 --> 0:00:33.479 Asset Management, Lead Chief Global Strategist. David always great to 0:00:33.479 --> 0:00:35.960 catch up with you in a round about one hour 0:00:36.159 --> 0:00:38.560 and a half. We're going to have some dreadful data 0:00:38.880 --> 0:00:41.159 in the United States for America. It won't surprise many 0:00:41.200 --> 0:00:43.599 people that it's ugly. It will be ugly. But how 0:00:43.600 --> 0:00:45.600 should we be thinking about some of these data points 0:00:45.600 --> 0:00:48.760 as they come in through the next couple of weeks. David, Well, 0:00:48.800 --> 0:00:52.320 I think we should not overreact to them. What we've 0:00:53.200 --> 0:00:54.760 they are going to be ugly. I mean, we could 0:00:54.840 --> 0:00:58.080 get two million new unemployment claims that would be three 0:00:58.080 --> 0:01:00.880 times the highest number we've ever scene. That could be 0:01:00.880 --> 0:01:03.320 followed up by another few weeks of similar things. So 0:01:03.320 --> 0:01:05.440 I think the unemployee rate could quickly go above ten 0:01:05.520 --> 0:01:08.440 percent UM. Ten point eight percent is the highest that 0:01:08.480 --> 0:01:10.840 we've seen since the Great depression. We could we could 0:01:10.920 --> 0:01:13.680 hit that. That's all pretty ugly, But look at what's 0:01:13.720 --> 0:01:17.120 going on in terms of government action here to try 0:01:17.120 --> 0:01:18.880 and take the sting and the pain out of this. 0:01:19.520 --> 0:01:22.959 I think the release build of the Senate just passed 0:01:23.160 --> 0:01:26.759 earlier this morning will provide the ability for a lot 0:01:26.760 --> 0:01:30.399 of workers to to get past this period and be 0:01:30.440 --> 0:01:34.039 able to pay their rent and pay their their bills. Um. 0:01:34.040 --> 0:01:36.000 And I think the idea is to rehold the economy 0:01:36.000 --> 0:01:39.000 and suspended animation until we get control of this virus. 0:01:39.160 --> 0:01:40.720 And we will eventually do that. I mean, that's the 0:01:40.760 --> 0:01:42.920 other thing. It's it's a long time, you know, A 0:01:43.000 --> 0:01:45.000 year seems like a long time to wait for a vaccine. 0:01:45.000 --> 0:01:47.440 But when we get a vaccine, this thing is done. Um. 0:01:47.520 --> 0:01:51.000 So it's not endless, um, but it is obviously painful 0:01:51.000 --> 0:01:53.080 in the interim. Let's think a little bit more deeply 0:01:53.120 --> 0:01:55.280 about that particular package. There as some people out there 0:01:55.280 --> 0:01:57.320 saying that it won't prevent a recession. While it's not 0:01:57.360 --> 0:02:00.480 designed to prevent a recession. It's about limiting the damage 0:02:00.480 --> 0:02:03.480 and building a bridge through this very very tough time 0:02:03.480 --> 0:02:06.880 and over some very troubled waters. So two big objectives 0:02:06.920 --> 0:02:10.440 for a plan like this prevent more defaults and obviously 0:02:10.520 --> 0:02:13.720 limit layoffs. Do you think it can do that? Well, 0:02:13.720 --> 0:02:15.760 I'm not sure there's actually gonna limit the layoffs. I 0:02:15.760 --> 0:02:19.320 mean it may for some companies because there is obviously 0:02:19.360 --> 0:02:21.320 a lot of this in which there's small business loans 0:02:21.360 --> 0:02:24.680 which you're which essential you get, um, you can you 0:02:24.720 --> 0:02:27.799 can the read small business grants, you can use them 0:02:27.800 --> 0:02:30.320 for payroll. So I think that may actually limit some 0:02:30.480 --> 0:02:33.280 layoffs and they may have some impact on the unemployment rate. 0:02:33.880 --> 0:02:35.520 But as you say, I mean, you know, I regard 0:02:35.600 --> 0:02:38.600 this kind of as night quill for the social distancing recession, 0:02:38.639 --> 0:02:40.560 you know, I mean, we don't actually have something that's 0:02:40.560 --> 0:02:42.600 going to cure the common Code where we can reduce 0:02:42.600 --> 0:02:44.679 its symptoms. And this is the way of reducing the symptoms, 0:02:44.720 --> 0:02:48.440 the painful symptoms of recession. Um, we'll have to see 0:02:48.440 --> 0:02:50.840 on the layoffs, because it works two ways. Yes, we've 0:02:50.840 --> 0:02:53.520 given incentives to small businesses not to file front employment 0:02:53.960 --> 0:02:56.680 or the layoff workers. But actually that's six hundred dollar 0:02:56.720 --> 0:03:01.520 payment um per week on eployment benefits that actually gives 0:03:01.520 --> 0:03:04.560 an incentive to workers to actually get laid off. I mean, 0:03:04.919 --> 0:03:09.079 the average unemployment benefit being paid in January five dollars. 0:03:09.200 --> 0:03:11.720 Now you're saying it's going to be nine five dollars 0:03:11.720 --> 0:03:14.880 a week. That's basic a thousand dollars a week, fifty 0:03:15.040 --> 0:03:18.000 two dollars a year. There are an awful lot of workers, 0:03:18.040 --> 0:03:21.160 particularly these uh these industries that are most effectives. We 0:03:21.240 --> 0:03:23.520 weren't making anything like fifty two dollars a year. So 0:03:23.520 --> 0:03:26.359 it actually technically makes sense for them to say the employee, 0:03:26.480 --> 0:03:28.120 thank you so much for keeping on the books, would 0:03:28.160 --> 0:03:30.440 you mind firing me please so I can connect these 0:03:30.480 --> 0:03:32.920 unemployment benefits the next four weeks four months and then 0:03:32.960 --> 0:03:36.640 and then let's talk David Kelly brilliantly said, and this 0:03:36.680 --> 0:03:39.400 goes you know, Lindsey Graham of the Carolinas was talking 0:03:39.440 --> 0:03:42.720 about this as well, which is the incentives in the 0:03:42.800 --> 0:03:47.440 perverse incentives and the constructive and that we're setting up. 0:03:47.920 --> 0:03:51.800 What is your reading on the history of this wall 0:03:51.960 --> 0:03:55.360 of money and what it does to the incentives of 0:03:55.440 --> 0:03:58.200 a nation. Well, I think I mean, at least it's 0:03:58.280 --> 0:04:02.120 temporary because you know, you want you want to prevent hardship, 0:04:02.160 --> 0:04:05.080 and if you send out a check to people in cash, um, 0:04:05.600 --> 0:04:08.320 you know at the start, that does help. But there 0:04:08.360 --> 0:04:10.600 is there is some perverse incentive there. And you do 0:04:10.680 --> 0:04:13.360 want people who can work work from home or work 0:04:13.360 --> 0:04:15.400 remotely or whatever. You know, as you say you're gonna 0:04:15.400 --> 0:04:18.560 do yoga instruction over the internet, fine do it. You 0:04:18.560 --> 0:04:20.240 shouldn't have an incentive to say, well, I can't do 0:04:20.240 --> 0:04:22.680 is because I have to go down to claim unemployment benefits. 0:04:22.920 --> 0:04:24.640 So I think there are some problems in it. I 0:04:24.720 --> 0:04:27.240 understand the creaky system. This is the only way they 0:04:27.240 --> 0:04:29.600 could actually get the money out fast, and I get that, 0:04:29.839 --> 0:04:32.559 but there is there is that problem. And and also 0:04:32.640 --> 0:04:35.080 you know, all this cash, it's not actually going to 0:04:35.120 --> 0:04:37.080 stimulate economic activity because what are you gonna do with 0:04:37.160 --> 0:04:38.800 the money? I mean, what can people do that all 0:04:38.839 --> 0:04:40.800 the fun stuff in life have been closed down. So 0:04:40.839 --> 0:04:42.799 I think we're gonna sit on it. But that also 0:04:42.839 --> 0:04:45.560 means that when the virus, when we have a vaccine 0:04:45.720 --> 0:04:47.760 and people can actually spend the money, we're gonna have 0:04:47.880 --> 0:04:50.520 a real surgeon economic activity. I have a huge problem 0:04:50.600 --> 0:04:52.800 with this, folks. And so much of this is anecdotal 0:04:52.800 --> 0:04:55.640 incomes from you know, the experience along the way. How 0:04:55.680 --> 0:04:58.200 is it a a David Kelly a zillion years ago 0:04:58.240 --> 0:05:00.520 on a Livia blanch Yard still it up and put 0:05:00.560 --> 0:05:02.240 up a chart and he said, look, there's been a 0:05:02.320 --> 0:05:05.720 huge drop here in nominal GDP and real g d P. 0:05:06.240 --> 0:05:10.040 Here's the glide path back and someday out there we 0:05:10.120 --> 0:05:13.200 get back to normal. Can we just assume that X 0:05:13.320 --> 0:05:16.400 number of quarters or years out everything gets back to 0:05:16.480 --> 0:05:19.880 normal and the government basically gets to lower the depth 0:05:19.920 --> 0:05:23.560 that wasn't cured in the heart of this crisis. Well 0:05:23.760 --> 0:05:26.480 we could. So the first part. Can the economy get 0:05:26.480 --> 0:05:29.240 back to normal? Absolutely? Once you know, they may be 0:05:29.279 --> 0:05:31.400 slightly different companies. There will be some companies that die 0:05:31.400 --> 0:05:33.760 in there some companies that's that will be born. But 0:05:34.080 --> 0:05:36.520 once we have the old clear here on the disease, 0:05:36.560 --> 0:05:38.760 this economy will want to get back to full employment. 0:05:38.760 --> 0:05:40.919 And I think it can do that now, whether the 0:05:40.960 --> 0:05:44.840 government has the discipline to fade to fade out all 0:05:44.960 --> 0:05:46.919 these these things and take the hard choices which it 0:05:46.960 --> 0:05:49.000 hasn't taken to this point. I mean, remember in the 0:05:49.040 --> 0:05:51.960 last few years before this, we were running a boom 0:05:51.960 --> 0:05:54.240 economy and we ran up a depit to almost five 0:05:54.279 --> 0:05:57.400 percent of GDP, which is utterly reckless. So we do 0:05:57.520 --> 0:05:59.160 that in the best of times, Do we really think 0:05:59.160 --> 0:06:01.360 that we're going to have the splene to Washington to 0:06:02.279 --> 0:06:05.159 cut the depth afterwards. I'm pretty skeptical of that. So 0:06:05.200 --> 0:06:07.360 the economy and get back to normal, But I don't 0:06:07.360 --> 0:06:11.159 think that's Washington is going to be disciplined, John, Tom, 0:06:11.279 --> 0:06:12.800 you say yeah that many times I ask you, we're 0:06:12.800 --> 0:06:15.480 going to ask a question, you can ask you a question. 0:06:15.560 --> 0:06:19.360 I'm just joined David Kelly. John, I'm getting used to 0:06:19.440 --> 0:06:22.040 this working at home. I bet you are, and I'm 0:06:22.080 --> 0:06:23.640 sure ever one of the studio I was getting used 0:06:23.680 --> 0:06:25.960 to it too. It might not want your home, they 0:06:26.000 --> 0:06:27.960 might want to keep you there, David. Great to have 0:06:28.000 --> 0:06:30.920 you with us on the program. Key of JP Morgan 0:06:31.320 --> 0:06:36.119 Asset Management. Let's bring a temple Sally shown. We NBC 0:06:36.160 --> 0:06:39.479 Capital Markets chief US economist Tom We knew the number 0:06:39.720 --> 0:06:41.320 was going to be bad. There's a lot of economic 0:06:41.360 --> 0:06:45.240 pain behind that economic statistic. Walk me through how we 0:06:45.279 --> 0:06:47.640 should be processing a number like that in the weeks 0:06:47.680 --> 0:06:50.560 to come. I mean, let let me first start by saying, honest, see, 0:06:50.600 --> 0:06:51.640 we thought that there was a risk and that we 0:06:51.680 --> 0:06:53.680 could be even worse than that. Um, you know, we're 0:06:53.720 --> 0:06:56.200 we're we're trying to I's we're in a period where 0:06:56.320 --> 0:06:58.240 sort of the standard economic data that we all like 0:06:58.320 --> 0:07:00.680 to look at, economists like to look at. UM. You know, 0:07:00.760 --> 0:07:02.480 that's that's not really gonna be very helpful right now. 0:07:02.480 --> 0:07:03.920 So we're trying to find sort of you know, let's 0:07:03.920 --> 0:07:06.480 call it alternative data that that we can sort of 0:07:06.520 --> 0:07:08.479 scour to try to get a sense for you know, 0:07:08.560 --> 0:07:12.080 how how how the backdrop is UM evolving on a 0:07:12.160 --> 0:07:14.560 on a live basis. UM. And you know, one thing 0:07:14.600 --> 0:07:16.600 we found was this this sort of interesting piece of 0:07:16.640 --> 0:07:19.360 data from something called home Base. UM. The whole home 0:07:19.360 --> 0:07:23.320 Base is basically a company that that allows UH small 0:07:23.360 --> 0:07:27.240 businesses to to you know, manage schedules and etcetera, etcetera. UM. 0:07:27.280 --> 0:07:29.160 And so when when when we were looking at that 0:07:29.240 --> 0:07:31.360 recently UM. And the great thing about this data it 0:07:31.440 --> 0:07:34.440 actually comes in daily UM. And when we were looking 0:07:34.440 --> 0:07:36.440 at that data, I mean that that data really started 0:07:36.440 --> 0:07:37.680 to scare the heck out of us. I mean we 0:07:37.680 --> 0:07:39.520 we literally thought that you could see a five to 0:07:39.600 --> 0:07:45.600 ten million claims number today. UM. So so three million UM. Honest, 0:07:45.680 --> 0:07:50.120 I think relative to expectations, UH is is actually pretty modest. 0:07:50.160 --> 0:07:51.600 And in fact, you know, I think that's the futures 0:07:51.600 --> 0:07:54.040 are even responding to it. I mean futures are taking 0:07:54.080 --> 0:07:56.760 back some under decline. So, um, look, I think the 0:07:56.800 --> 0:07:59.240 reality is as we go forward on a go on 0:07:59.320 --> 0:08:01.560 a go forward basis, you know, I think that this 0:08:01.640 --> 0:08:05.040 is just the beginning of claims remaining incredibly elevated. Um. Again, 0:08:05.160 --> 0:08:07.200 I think that will like this home base, I think 0:08:07.200 --> 0:08:10.720 are are are really indicative of some real payment labor 0:08:10.720 --> 0:08:14.800 back drop, Tom Persolle, what is the average income of 0:08:14.840 --> 0:08:18.160 those three points three million people? What kind of jobs 0:08:18.240 --> 0:08:21.640 are those? You have a some rough statistic of what 0:08:21.760 --> 0:08:24.480 the average take home pay is of all this? Well, 0:08:24.520 --> 0:08:26.240 you know what what I would say. What I would 0:08:26.240 --> 0:08:28.280 say is this if you look at you sort of 0:08:28.320 --> 0:08:30.239 where some of the again, if we if we were 0:08:30.280 --> 0:08:32.199 just using this, I mean, I'm giving these guys this 0:08:32.280 --> 0:08:34.000 free plug, you know, if we keep on using this 0:08:34.040 --> 0:08:36.560 home base. Um, I think it's really interesting if if 0:08:36.559 --> 0:08:38.520 you look at some of where where the really big 0:08:38.559 --> 0:08:41.280 declines came from, some of the really big declines came 0:08:41.320 --> 0:08:43.200 and see what we would define a sort of more 0:08:43.240 --> 0:08:46.960 of the you know, the lower income areas. So you know, 0:08:47.000 --> 0:08:49.640 food and drink, um, you know that saw some very 0:08:49.679 --> 0:08:53.760 sizable declines. Um, personal care saw some very sizable declines. 0:08:54.040 --> 0:08:57.199 So right now. I think it's very easy to make 0:08:57.200 --> 0:08:59.320 the case that a lot of the jobs that are 0:08:59.360 --> 0:09:03.160 being lost are in the lower income spectrum. Tom. One 0:09:03.200 --> 0:09:05.520 thing that we've been talking a lot about is the 0:09:05.600 --> 0:09:08.480 speed of this happening and the speed of the response 0:09:08.600 --> 0:09:12.000 or lack thereof, in terms of trying to prevent companies 0:09:12.040 --> 0:09:15.120 from laying people off to start with. And perhaps one 0:09:15.160 --> 0:09:18.319 way to read this number is the layoffs have already 0:09:18.400 --> 0:09:20.920 begun to such a degree in mass that there is 0:09:20.960 --> 0:09:24.160 a question how much is reversible At this point, we 0:09:24.200 --> 0:09:27.280 are expecting the bill to pass in Congress shortly. But 0:09:27.480 --> 0:09:30.000 from that perspective, given the fact that we're seeing the 0:09:30.080 --> 0:09:34.000 layoffs already taking place in a mass way, how concerning 0:09:34.080 --> 0:09:37.400 is it that this damage is irreversible in the short term? No, 0:09:37.559 --> 0:09:39.839 I I I yeah, I wouldn't take that that that 0:09:40.000 --> 0:09:42.160 tapped on this. I would say that if in fact, 0:09:42.320 --> 0:09:44.280 I would even take the opposite view. I think if 0:09:44.320 --> 0:09:47.599 you actually you can seem the massive amount of layoffs 0:09:47.640 --> 0:09:49.680 straight away, and then you can start to plane out 0:09:49.760 --> 0:09:52.480 on on some level. Right, So the question then becomes 0:09:52.679 --> 0:09:55.520 how long is social distancing going to remain in place? Um, 0:09:55.559 --> 0:09:58.200 you know, again, the degree which it is in place 0:09:58.280 --> 0:10:00.720 right now. Um, and and and that's where this is 0:10:00.720 --> 0:10:03.880 a very time sensitive conversation, which again I think it's 0:10:03.880 --> 0:10:06.400 an idea that is being is elusive to a lot 0:10:06.440 --> 0:10:09.360 of folks. So if this goes until the end of April, right, 0:10:09.400 --> 0:10:12.000 let's say, you know, extreme social distancing in the United 0:10:12.040 --> 0:10:14.080 States goes to the end of April, um, you know, 0:10:14.200 --> 0:10:16.760 then it's really easy, you know easy, then you can 0:10:16.760 --> 0:10:20.280 actually come to a reasonable conclusion on what sort of 0:10:20.280 --> 0:10:22.360 growth is going to be um, you know, and and 0:10:22.400 --> 0:10:24.880 so again this is really illustrative. So so just bear 0:10:24.920 --> 0:10:26.720 with me for a second. So right now we're looking 0:10:26.760 --> 0:10:28.679 for you know about let's just end say round numbers 0:10:28.679 --> 0:10:31.559 about ten percent decline in Q two growth. And that's 0:10:31.559 --> 0:10:34.440 assuming that severe social distancing basically starts to come to 0:10:34.480 --> 0:10:36.679 an end towards the end of April, you know, sort 0:10:36.679 --> 0:10:40.280 of beginning of May. If we slide that out, we 0:10:40.440 --> 0:10:43.360 slide out social distancing, extreme social distance to the to 0:10:43.400 --> 0:10:45.800 the end of May instead, then all of a sudden, 0:10:45.840 --> 0:10:49.240 O minus ten becomes minus right, So do you see 0:10:49.280 --> 0:10:51.720 the time center. So there's sort of a sliding scale 0:10:51.760 --> 0:10:54.360 on this, and that's why I say time sensitivities is 0:10:54.400 --> 0:10:57.080 critical because if all of a sudden, you know, uh, 0:10:57.080 --> 0:10:59.920 you know Dr Fauci or or um uh, you know, 0:11:00.080 --> 0:11:02.000 any of the other folks that that are talking about 0:11:02.000 --> 0:11:03.760 the numbers, if all of a sudden they say, hey, 0:11:03.800 --> 0:11:07.760 it looks like the numbers are starting to um stabilize. Um, 0:11:07.800 --> 0:11:10.360 you know, we're getting toward the peak. Once you get 0:11:10.400 --> 0:11:12.800 toward the peak, whenever that might be, that's when you 0:11:12.800 --> 0:11:14.920 you can actually start to have the conversation of Okay, 0:11:15.200 --> 0:11:18.000 now we can talk about how we're going to reopen things, um. 0:11:18.080 --> 0:11:20.480 And so to me, that's that's that's a critical part 0:11:20.559 --> 0:11:22.680 part of this conversations all about time. So if all 0:11:22.720 --> 0:11:25.360 of a sudden that happens in the next handful of weeks, UM, 0:11:25.400 --> 0:11:28.120 then I don't think this necessarily has to keep on 0:11:28.240 --> 0:11:30.480 going south. I think you can actually get some stabilization. 0:11:31.080 --> 0:11:32.800 To be clear here, then you can't really have a 0:11:32.840 --> 0:11:34.800 second half call until we get to the end of April. 0:11:34.880 --> 0:11:37.520 Would that be fair? I mean, well, I have to 0:11:37.559 --> 0:11:42.000 have a second half call getting a really clear look 0:11:42.000 --> 0:11:45.079 at the outlook. Yeah, Jonathan, I think you're you're hitting 0:11:45.080 --> 0:11:47.559 the nail on the head. It's really difficult to know 0:11:47.600 --> 0:11:49.840 what the second half is going to be until we 0:11:49.880 --> 0:11:52.520 all know what what social distancing and the degree to 0:11:52.600 --> 0:11:55.319 which we are willing to take that UM is going 0:11:55.360 --> 0:11:57.760 to look like UM. But right now, again, if if 0:11:57.800 --> 0:11:59.560 our view that you know, this is basically an end 0:11:59.559 --> 0:12:03.160 of April beginning of May UM issue, then you know 0:12:03.240 --> 0:12:06.080 you can easily have a rebound in in the second 0:12:06.120 --> 0:12:07.760 half of the year. Can we just talk about where 0:12:07.760 --> 0:12:09.640 we've got to in the space of a month, Tom, 0:12:09.679 --> 0:12:13.480 It is absolutely remarkable. We started this month with FED 0:12:13.600 --> 0:12:17.520 funds in and around where once seventy five, and we've 0:12:17.520 --> 0:12:20.040 cut down a hundred and fifty basis points. We've got 0:12:20.120 --> 0:12:25.120 Quee helicopter money and an initial jobless claims print three 0:12:25.280 --> 0:12:27.400 four or five million that some people think we might 0:12:27.440 --> 0:12:29.400 get in the coming weeks as well, in the space 0:12:29.440 --> 0:12:32.160 of a couple of waste. Tom, Yeah, it's been dramatic. 0:12:32.160 --> 0:12:34.679 And again, I think the others have tried to make 0:12:34.679 --> 0:12:37.440 this point, UM, including us and and and I'll try 0:12:37.440 --> 0:12:39.120 to make it again. I think what we have to 0:12:39.160 --> 0:12:41.120 keep in mind is that you know, this is something 0:12:41.160 --> 0:12:44.400 that that we're forcing, right, We're forcing this right, We're 0:12:44.440 --> 0:12:47.120 we're we're making people stay home. I mean, it's it's 0:12:47.160 --> 0:12:49.200 it has a critical idea. You know, if this was 0:12:49.240 --> 0:12:52.400 a stand you know, standard recessions are are very different 0:12:52.400 --> 0:12:55.000 than than than what we're living through right right now. Um. 0:12:55.040 --> 0:12:56.640 You know, this is something in a lot of ways 0:12:57.280 --> 0:12:59.480 because of social distancing. You know, we have we have 0:12:59.600 --> 0:13:01.760 created a dynamics obviously for our health. I mean, it's 0:13:01.800 --> 0:13:05.120 something we obviously need to do. Um. So again that's 0:13:05.120 --> 0:13:07.040 why I say it depends how long that goes on 0:13:07.120 --> 0:13:09.480 for because you can unwind it. Um, It's just this 0:13:09.600 --> 0:13:11.559 a question of time. The longer it goes, the more 0:13:11.640 --> 0:13:15.720 damage you're gonna you're gonna leave in its wake. Yeah. Well, 0:13:15.840 --> 0:13:19.079 Tom Vinnydale Juda is making a really good point. Hats 0:13:19.080 --> 0:13:21.600 off to the state agencies for processing all of these 0:13:21.600 --> 0:13:24.320 claims and the idea that you know, all of these 0:13:24.320 --> 0:13:28.000 people did file to receive unemployment benefits and they are 0:13:28.000 --> 0:13:31.120 going to be receiving some income in very short order. 0:13:31.360 --> 0:13:33.600 Is there any silver lining in that that you can 0:13:33.600 --> 0:13:37.920 take away? You mean, meaning what the fact that they're 0:13:37.920 --> 0:13:40.560 going to be receiving their unemployment insurance benefits. I mean 0:13:40.800 --> 0:13:43.360 that that basically is long that it's not a huge 0:13:43.400 --> 0:13:46.280 disruption completely to the point where people won't be able 0:13:46.360 --> 0:13:48.640 to afford food unless you live on the Upper east 0:13:48.679 --> 0:13:52.839 Side next to Tom. I mean, you know, far be 0:13:52.960 --> 0:13:55.600 it for me to um to to you know, judge 0:13:55.600 --> 0:13:57.560 how other people are going to deal with any situation 0:13:57.840 --> 0:14:00.240 that I'm not here to do that. You know, I'm 0:14:00.280 --> 0:14:02.240 sure that this is going to be extremely painful for 0:14:02.240 --> 0:14:03.880 for some people, and some people will be able to 0:14:04.000 --> 0:14:06.480 endure it. I'm just fine. You know that that's for 0:14:06.520 --> 0:14:08.560 other people to comment on. But what I would say 0:14:08.640 --> 0:14:11.440 is it's very clear given some of the plans that 0:14:11.440 --> 0:14:13.800 have been coming out of Washington d c UM that 0:14:13.880 --> 0:14:16.160 you know, obviously individuals are focused. I mean, they're going 0:14:16.160 --> 0:14:19.160 to upsize unemployment insurance claims, uh, the the amount that 0:14:19.200 --> 0:14:21.360 you can get. They're also going to extend out the 0:14:21.400 --> 0:14:24.560 period over which you get unemployment insurance claims. So there, there, 0:14:24.600 --> 0:14:26.920 there's a lot, there's a lot being done. Chairman Palm 0:14:27.080 --> 0:14:29.920 and NBC earlier this morning speaking to Main Street Tom 0:14:29.920 --> 0:14:32.520 for Sally Tom, we've been critical of the chairman in 0:14:32.560 --> 0:14:35.240 the past. Your take on his performance and the Federal 0:14:35.240 --> 0:14:37.880 reserves moves over the last couple of weeks, it's not 0:14:38.000 --> 0:14:41.000 need to see some signs of success. Yeah, No, Jonathan 0:14:41.200 --> 0:14:43.960 I'm a I'm a fan. I like what they've done, um, 0:14:44.360 --> 0:14:46.720 you know, and I'm i'm I'm obviously not talking about 0:14:46.800 --> 0:14:48.640 is today's show appearance. Um, you know, I mean in 0:14:48.640 --> 0:14:51.800 just terms of the bigger the programs up there laying 0:14:51.800 --> 0:14:54.720 out there, I think that they were aggressive. Um. You know. 0:14:54.840 --> 0:14:57.680 They they didn't wait. Um, they had a lot of 0:14:57.680 --> 0:15:01.760 these teat up already because of the the financial crisis. Um, 0:15:01.920 --> 0:15:04.360 and so they just started unloading. I mean in a 0:15:04.360 --> 0:15:06.360 lot of ways. It was funny in a lot of ways. 0:15:06.400 --> 0:15:08.920 They put that these some of these programs so quickly. Um. 0:15:09.840 --> 0:15:11.480 I got a phone call from from one of our 0:15:12.000 --> 0:15:13.960 front end traders and they said, hey, we don't know 0:15:14.000 --> 0:15:16.800 what the settlement instructions are for one of these programs. Um. 0:15:17.040 --> 0:15:19.120 Because the programs were just coming out with in mass 0:15:19.120 --> 0:15:21.480 and so quick, um that some of the data weren't 0:15:21.640 --> 0:15:25.360 um easy to find. So I'm I'm a fan. I 0:15:25.680 --> 0:15:27.360 think a lot of what they have put a lot 0:15:27.400 --> 0:15:31.320 of stimulus in place between monetary and fiscal authorities. And 0:15:31.320 --> 0:15:33.440 and again, if we're right that this thing can actually 0:15:33.480 --> 0:15:36.120 if we can start to see easing, not not a 0:15:36.120 --> 0:15:38.960 completely going away, but in easing and social distancing UM 0:15:39.120 --> 0:15:41.360 by the end of April beginning of May. UM, there's 0:15:41.360 --> 0:15:43.400 so much stimulus in place, and I think calling for 0:15:43.760 --> 0:15:45.800 a pretty a pretty good rebound in the second half 0:15:45.840 --> 0:15:48.280 a year. It's not a stretch what in the second half. 0:15:48.320 --> 0:15:50.720 Quite clearly, the FETES objective would be to provide some 0:15:50.760 --> 0:15:53.200 stimulus for recovery, but in the media term, it's to 0:15:53.200 --> 0:15:56.400 provide some easy to financial conditions and to really target 0:15:56.480 --> 0:15:59.280 what's happening with market functioning ill market functioning. Tom. Some 0:15:59.320 --> 0:16:01.440 of the problems of last couple of weeks, have they 0:16:01.480 --> 0:16:04.520 eased a lot a little bit. What's your assessment of that? 0:16:04.800 --> 0:16:07.000 You know, my my assessment speaking with some of our 0:16:07.000 --> 0:16:10.280 traders is that they're they're starting the process of easing. UM. 0:16:10.320 --> 0:16:12.320 There's there, there's no question about that. That That doesn't mean 0:16:12.320 --> 0:16:14.520 that the problems are gone, but you have to start 0:16:14.560 --> 0:16:17.280 somewhere UM and and the somewhere as things things seem 0:16:17.320 --> 0:16:20.560 to be getting better from a from a liquidity perspective, UM, 0:16:20.600 --> 0:16:23.280 it's not that they're they're they're they're completely healed, but 0:16:23.320 --> 0:16:27.240 they're they're starting the process of getting better. Top of obvious. 0:16:27.480 --> 0:16:29.560 My best to you in the team over obviously anti 0:16:29.600 --> 0:16:31.120 you and yours as well. Tom always great to get 0:16:31.120 --> 0:16:35.400 your thoughts on this program or just cough a lot. 0:16:35.600 --> 0:16:39.960 Let's go this is important. I had a lot of 0:16:40.000 --> 0:16:43.280 really good emails about coughing. And the good news is 0:16:43.320 --> 0:16:45.720 they brought in a nurse. Surveillance brought in a nurse 0:16:46.360 --> 0:16:49.720 and she's from an island self of Manila for one 0:16:49.720 --> 0:16:54.320 of the tribes, the Manyan tribe, and it's I'm drinking 0:16:54.480 --> 0:16:59.520 some teeth. It's absolutely undrinkable. I mean, dr Leslie vinjer Murray, 0:16:59.520 --> 0:17:03.440 would this teeth it's got it's got in its stuff 0:17:03.480 --> 0:17:06.800 from the Central Park reservoir and what's kidding? That's it's 0:17:06.840 --> 0:17:10.119 why your coffee totally drink up any something stronger than that. 0:17:10.160 --> 0:17:12.440 This morning, let's bring in lens of Leslie Vinja Murray 0:17:12.440 --> 0:17:15.440 Showery Channel House head of US in America's program, Leslie. 0:17:15.480 --> 0:17:18.280 Fantastic to catch up with you. The Senator grink on 0:17:18.359 --> 0:17:20.320 a bill with this guy through the house with these 0:17:21.640 --> 0:17:24.440 oh absolutely, you know. I think there was a question 0:17:24.440 --> 0:17:26.800 of whether it would go through without anybody needing to 0:17:26.840 --> 0:17:29.040 come back. It looks like that's not going to happen, 0:17:29.040 --> 0:17:31.040 but it sounds like they will vote tomorrow morning. It 0:17:31.080 --> 0:17:33.680 will go right through and UM the President Trump will 0:17:33.680 --> 0:17:36.960 find it office. Is an extraordinary package comes out an 0:17:36.960 --> 0:17:40.520 extraordinary time. UM. There have been a lot of concessions 0:17:40.520 --> 0:17:43.840 on both sides have been up. It's bipartisan, you know, 0:17:43.920 --> 0:17:46.000 some of the lessons of two thousand and eight. But 0:17:46.040 --> 0:17:48.560 the Democrats have drawn that have and they've used to 0:17:48.640 --> 0:17:51.600 push for oversight of that money that's going to be 0:17:51.720 --> 0:17:54.639 used to you know, to give loans two small and 0:17:54.680 --> 0:17:58.000 medium sized businesses to to you know, think about helping 0:17:58.080 --> 0:18:02.320 the airlines industry. The woul have been incorporated into UM, 0:18:02.359 --> 0:18:04.440 into the package. So I think we're seeing a lot 0:18:04.480 --> 0:18:07.200 of you know, a lot of concessions because people recognize 0:18:07.240 --> 0:18:09.680 that there needs to be a response to an economy 0:18:09.680 --> 0:18:13.000 that's basically being shut down by this pandemic. Dr Vin Jamura. 0:18:13.040 --> 0:18:14.879 A lot of eyes are on the United States, in 0:18:14.960 --> 0:18:18.679 part because it is the becoming quickly becoming the epicenter 0:18:19.119 --> 0:18:21.600 of the coronavirus, and also because it is the world's 0:18:21.600 --> 0:18:25.080 biggest economy. There is a question about calling it a stimulus, 0:18:25.080 --> 0:18:28.040 that that is inaccurate. This is an effort to plug 0:18:28.119 --> 0:18:29.720 a bit of the whole. How much of the whole 0:18:29.720 --> 0:18:32.280 will this plug if this is it, if this is 0:18:32.320 --> 0:18:34.600 the stimulus, if you want to call it that that 0:18:34.720 --> 0:18:37.400 we get, how much does it sort of stave off 0:18:37.440 --> 0:18:41.359 the decline? Well, look, we can't answer that question until 0:18:41.359 --> 0:18:44.640 we have some sense of how effective the response will 0:18:44.680 --> 0:18:48.520 be to dealing with the real problem, which you've rightly noted, 0:18:48.720 --> 0:18:52.000