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THE LEAD WITH JAKE TAPPER
Global Coronavirus Crisis Escalates; Dow Collapses. Aired 4- 4:30p ET
Aired March 9, 2020 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JAKE TAPPER, CNN HOST: The Treasury bond today, the yield hit an all- time low.
The Treasury bond yield is the government's interest rate to borrow money. And, to reiterate, the 30-year U.S. Treasury yield fell below 1 percent for the first time in American history.
Also, the oil market had its worst day in almost three decades. And just minutes after opening, the S&P 500 plunged so far, it tripped the so-called circuit breaker, triggering a brief pause in trading.
CNN's Alison Kosik is at the New York Stock Exchange.
Alison, Wall Street has been on this 11-year rise. Are we officially starting to see the end of the bull market here?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Jake, ironically, this today is the 11th anniversary of the bull market. But we're getting close to the end of that bull market based on where stocks are now, about 2 percent away from a bear market, which would be a 20 percent drop from a recent high.
That's as we close out an historic day here on Wall Street. Much of what you mentioned, those circuit breakers being activated after stocks fell too far and too fast in the morning, putting investors on the sidelines, waiting 15 minutes to begin trading again, where we saw oil prices plunge the most since 1991.
That's when the Gulf War was in full force. And that's as Saudi Arabia floods the market was oil, despite waning demand.
And where we saw another red warning sign flash in the bond market, we're seeing yields at record lows. That's because investors are expecting a potential global recession because of the coronavirus.
So we have got all of this piling on as those worries and those fears -- and the -- no one really knows what's going to happen with the coronavirus as far as economies and businesses go. All of that fear weighing on Wall Street -- Jake.
TAPPER: All right, Alison Kosik, a very, very bad day on Wall Street. Let's bring in Austan Goolsbee. He's the former chairman of the
Council of Economic Advisers for President Obama. Also with me is CNN global economic analyst Rana Foroohar.
Austan, let me start with you.
You tweeted that the markets are more scared now of coronavirus and the oil price war than the days before the 2008 financial crisis. Are things about to get even worse?
AUSTAN GOOLSBEE, FORMER CHAIRMAN, COUNCIL OF ECONOMIC ADVISERS: Look, I hope not.
I tweeted that out when the Treasury -- the yield on Treasuries went to the lowest ever. And, as you said, even at the height of the financial crisis, there wasn't as much of a flight to safety as we saw there.
I think we got to wrap our -- grasp the reality that this virus is going to play havoc on the economic growth and especially in countries like -- rich countries, like the United States, Italy and others, where so much of the economy is dominated by these face-to-face services, which are exactly the things that get pulled down when people get afraid.
TAPPER: And, Rana, you wrote today in "The Financial Times" -- quote -- "Watching the markets these days is like watching the seven stages of grief, shock, denial, anger, bargaining, depression, testing, and, finally, acceptance. We clearly have not reached that last stage yet."
So are you suggesting you see a larger economic downturn on the way?
RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: I do.
I think that there's a very good chance that we're headed into a U.S. and global recession. I mean, we have the perfect storm here, because the markets were ready to correct anyway. Look, I have been saying that for months on your show.
If it wasn't the coronavirus, it was going to be something else, because, frankly, we have an enormous corporate debt bubble out there that was ready to burst. But we now have this decline in travel and tourism. That's responsible for about 10 percent of the global economy.
It touches one in every eight jobs in the U.S. in some form or another. Add to that the oil crisis now, plummeting oil prices. You would think that might have an upside for consumers, but actually what it's going to do is put pressure on some of those debt-ridden companies. You might see those dominoes start to fall, put more pressure on the markets.
All of this is affecting people's 401(k)s. And the truth is that we have become really addicted in America to asset bubbles to fuel growth. That's something I think President Trump has contributed to. And I don't think it's over yet. I think that unless we saw some kind
of major fiscal stimulus, at some point, I think that we're in for a sustained correction and a recession.
TAPPER: I hope you're wrong, of course, as I'm sure you do as well.
Austan, oil prices suffered the biggest drop in nearly 30 years. The president tweeted about the oil crash, saying -- quote -- "Good for the consumer, gasoline prices coming down -- unquote.
I guess that's a silver lining way of looking at it. Low oil prices might be good for consumers in the short term, but, potentially, obviously much more problematic.
GOOLSBEE: Yes, well, much more problematic, because the price of oil is going down precisely because demand is drying up and the economies are all slowing.
So the recession -- financial crisis and recession of 2007-'8-'9, oil prices plunged. That wasn't good for the economy. It was a sign that the economy was weak.
I think the one -- there is one glimmer of optimism for a virus business cycle, let's call it, rather than a normal business cycle, which is, let's say the coronavirus behaves like the flu virus, and it is of a season, and then, by the summer, the infection rates go way down.
There is the possibility that this thing comes roaring back in a way that is not normal for a business cycle that's driven by other things.
TAPPER: And, Rana, let's talk about the travel and tourism industry, because it's been hit hard by coronavirus fears. Airports, train stations in some spots of the world -- we're showing some images now from Northern Italy. They're virtually empty, ghost towns.
TAPPER: You see this as one of the heavier dominoes leading to a possible recession?
If you look at what's driven the global economy over the last several years, travel and tourism has been a huge part of it, and in particular Chinese travel and tourism, which, of course, has completely dried up.
But this is one of the things that has really been a big part of the global growth story. So, to have that hit, and to affect consumption in such a profound way, I mean, think about it. Nobody's going to be traveling in early summer vacations, or many fewer people. That's going to continue to put pressure on the oil market, on the energy market. It all snowballs together. What worries me -- and I agree with Austan
-- there is that silver lining that you could have a big demand surge if the virus were brought under control. That's possible. But are stocks going to go back up? I wonder about that, because I think that there's just this corporate debt picture out there.
And we're just beginning to see how those dominoes are going to fall. And if stocks don't go back up, I think you're still going to see consumer spending, which is two-thirds of the economy, be pretty low come November.
TAPPER: All right, Rana Foroohar and Austan Goolsbee, thank you so much. Appreciate it.
ANNOUNCER: This is CNN breaking news.
TAPPER: Breaking right now, we have some brand-new CNN polling on how the American public is responding to the coronavirus pandemic and how Americans feel about President Trump's leadership during this crisis.
Let's get right to CNN political director David Chalian.
And, David, let's start with the coronavirus itself. How do Americans feel about the potential personal impacts?
DAVID CHALIAN, CNN POLITICAL DIRECTOR: Well, we asked, do you think you're going to see people infected in your local community?
And look at this, Jake. Add this up; 55 percent, a majority, say it's very or somewhat likely that they're going to see a local case of coronavirus in their community.
Are they prepared for that if somebody in their family gets sick? We asked them that as well. And we saw nearly seven in 10, 68 percent, you see, when we asked on the next question here, if, indeed, somebody in their family member gets coronavirus, are you prepared? Sixty-eight percent very or somewhat prepared if indeed somebody in their family gets coronavirus.
TAPPER: All right. Well, that's some good news, at least in terms of the majority of Americans feeling prepared.
How do Americans think that President Trump and the federal government are dealing with this pandemic?
CHALIAN: Yes, this is not a great number for President Trump. You see here his approval rating on handling of coronavirus is 41 percent; 48 percent disapprove.
And, Jake, I'm sure this won't surprise you. But like everything else in Washington and as it relates to President Trump's standing with the American people, this is driven by partisanship.
Take a look here. You see that 79 percent of Republicans approve of the way the president is handling the coronavirus outbreak; 84 percent of Democrats disapprove. Look at this independents number in the middle. That's always a good guidepost; 37 percent approval among independents for the president's handling of coronavirus, 47 percent disapproval.
He's minus 10 points here with independents. I also want to just show you. We asked whether or not people are confident that the government can prevent a nationwide epidemic. A majority are somewhat or very confident. Only 18 percent say very confident.
But add in the 39 percent, you get to 57 percent, a pretty decent majority, who are very or somewhat confident that the federal government can prevent a nationwide epidemic here.
TAPPER: All right, so confidence in the government, if not in President Trump overall. I'm guessing this is a poll that President Trump won't be tweeting out.
But let me ask you, David, this -- the polls on his handling of coronavirus, pretty negative. A plurality says it disapprove. Does that affect President Trump's overall approval rating right now?
FOROOHAR: Take a look; 43 percent is his overall approval rating; 53 percent disapprove. This number basically doesn't budge. Look at it over the last six months. You can see how consistent President Trump is, 43, 43, 43, 42, 41, 39, all within the margin of error here.
This is not yet -- and, again, this poll was taken through Saturday night -- not yet having an impact on the president's overall approval rating, Jake.
And, of course, let's look at that number, now that we're in an election year, and look at where he measures up to his modern-day predecessors at this point in the election year, March of the election year.
Donald Trump is down here. He's right between George H.W. Bush and Jimmy Carter, not company you want to keep in an election year. You will note that both of those presidents, they only served one term, Jake.
TAPPER: Yes, that's not a good neighborhood.
David Chalian, thanks so much. Appreciate it.
A live look now at the Port of Oakland, where the Grand Princess cruise ship just docked after being trapped at sea for days due to the coronavirus. Passengers are not going home just yet, however.
Then, how does self-quarantine work? And do you need to think about doing it?
This, plus more of your coronavirus questions answered, that's next.
Stay with us.
TAPPER: In our health lead, a live look now at the Grand Princess cruise ship, which docked in California minutes ago, after being held off the coast for several days, with 21 people aboard testing positive for the novel coronavirus.
This is the same cruise ship President Trump leaving at sea because he, quote, likes the numbers where they are, unquote, and did not want to add to the numbers of infected Americans in the U.S. But now, those Americans are back on U.S. soil where the death toll is currently 26, and more than 650 people have tested positive across 35 states plus D.C., as CNN's Nick Watt now reports.
NICK WATT, CNN CORRESPONDENT (voice-over): Barred from port for five days, at least 21 coronavirus cases on board, the Grand Princess finally pulls in.
DR. ANTHONY FAUCI, WHITE HOUSE CORONAVIRUS TASK FORCE: First of all, there are some children there who are compromised. They want to get them off.
WATT: Every passenger will be treated and quarantined at military bases in California and beyond.
TERESA JOHNSON, PASSENGER ON GRAND PRINCESS CRUISE SHIP: We may have to stay on the ship for a few more days. It's going to be a lengthy process.
WATT: Meanwhile off Florida, a sister ship, the Caribbean Princess, now under a "no sail" order because two crew members were previously on ships with a positive case.
Up in Washington state where 19 have died in this nursing home and beyond echoes of a nationwide concern that a lack of early testing hurt containment.
Debbie de Los Angeles' mother who died says they're still waiting on her test results.
DEBBIE DE LOS ANGELES, MOTHER DIED IN NURSING HOME: They said, well, tests were short. There was a shortage.
WATT: The nursing home says all remaining residents have now been tested.
Colleges and school districts in Washington state, California, and New York, among others, closing classrooms, the empire state now taking the initiative, using prisoners to manufacture up to 100,000 gallons of hand sanitizer a week.
GOV. ANDREW CUOMO (D-NY): Because you can't get it on the market, and when you get it, it's very, very expensive. WATT: Last Monday morning, there were 89 confirmed cases in this
country. Today, we top 600. The virus now, in more than 30 states.
FAUCI: There's still a lot that's unknown about where this is going.
WATT: Overseas the picture even worse in Italy where more than 450 have already died. More than a dozen cities and nearly 16 million people now on lockdown. Those who leave risk three months in jail. A Missouri woman recently returned from Italy is presumed positive.
DR. SAM PAGE, ST. LOUIS COUNTY EXECUTIVE: The county health department instructed the patient and her family to self-quarantine.
WATT: Saturday her father attended a school event. A county saying they'll obtain a court order to enforce that quarantine if necessary.
Here in Oakland, more potential positives now stepping ashore.
ARCHIE DILL, GRAND PRINCESS PASSENGER: I feel like the government didn't really have a plan and they're just making this up as they go along.
WATT: And once all the passengers have been unloaded from the Grand Princess, the crew will take it somewhere out to sea to serve their quarantine, exactly where remains unclear.
Jake, you mentioned the death toll here in the U.S. now 26, that is because we just had some more sad news from here in California. A woman in her 60s died and from up in Washington, a woman in her 70s, another in her 80s, another in her 90s also have succumbed.
Interesting to note that the vast majority of people who are dying from these virus are over 70 years old. That's the demographic most at risk. That's the demographic we are seeing hit the hardest -- Jake.
TAPPER: All right. Nick Watt in California, thank you so much.
Joining me now to discuss is Dr. William Schaffner. He's professor of infectious diseases at Vanderbilt University Medical Center.
Doctor, thanks so much for joining us.
So, Dr. Anthony Fauci, one of the country's top experts, is suggesting those at risk of getting coronavirus should practice social distancing. Take a listen.
(BEGIN VIDEO CLIP)
FAUCI: The ones who get in trouble at a high rate of people with underlying conditions, heart disease, lung disease, kidney disease, diabetes, particularly the elderly, if you fall into that category, you shouldn't wait for anything, you should be doing what some people are calling social distancing, which really means stay out of crowds. Don't do travel. Above all, don't go near a cruise ship. (END VIDEO CLIP)
TAPPER: All right. Those -- those are warnings for people over 60 and people with underlying conditions.
What else do our viewers watching right now need to know?
DR. WILLIAM SCHAFFNER, PROFESSOR, VANDERBILT UNIVERSITY MEDICAL CENTER: I think it's important to do exactly what Tony has said. People who are older and people who have underlying conditions need to look at their lives and say, what is it that we can do to avoid crowds?
If you're a religious person, maybe you should be reverent at home and not join the congregation. Go shopping in the off hours, that sort of thing. Don't go to the bridge club right now and sit for hours across the table with a variety of different partners.
Play virtual bridge at home.
Do things that don't take you to crowds. Don't go to that concert, don't go to that basketball game, don't get on an airplane. Not right now. Postpone those pleasures.
TAPPER: About an 8-year-old with asthma? Is that somebody who has an underlying condition who should be kept off airplanes and out of crowds?
SCHAFFNER: Well, fortunately, first of all, the coronavirus doesn't affect children nearly as badly as it does adults, particularly older adults. But a child with asthma shouldn't go to maybe a birthday party right now or those sorts of things. They'll be going to school, but avoid unnecessary not very important events.
TAPPER: State governments such as New York, California, have asked thousands of residents to separate themselves from the rest of the community to help contain the virus. When should someone self- quarantine?
SCHAFFNER: Well, quarantine is very serious. That means lock yourself up away from everybody else. We're not asking that for the average person. Just think carefully about avoiding crowds. Sure, have a couple for dinner or go out to a nice little restaurant. Very good. But just don't go to the philharmonic this weekend.
TAPPER: A woman in Missouri tested positive for coronavirus and her family was told to self-quarantine. Her dad broke the self-quarantine, went to a father/daughter dance with his other daughter.
Can the U.S. really do this by the honor system, or does the U.S. government, state governments need to consider doing what they do in Italy, which is actually threatening penalties for people who violate the self-quarantine? SCHAFFNER: Well, people who violate particular self-quarantine orders
can by the order of local judges be sent back to quarantine and instructed to stay there. That will take a judge's order.
For the most part, most people are going to try to participate in this to some degree. Look at your own life and see what kind of group events you can avoid. And let's all work together to keep us as healthy as possible.
TAPPER: The surgeon general, Dr. Jerome Adams, told me this weekend he believes the coronavirus is contained in the some parts of the country. It's spreading nationally, but in individual parts of the country it might be contained.
Do you agree with that? Might it be premature the say that? What do you think?
SCHAFFNER: No, I agree with the surgeon general. However, we're rolling out testing. And the next week, week and a half, it will tell the tale -- is this virus actually widely distributed? Do we have positive tests all over? And is it spreading all over, or is that still focal?
We need lots more testing to tell us exactly where we are at the present time.
TAPPER: Dr. William Schaffner, thank you so much for your time. We really appreciate it.
SCHAFFNER: Thanks, Jake.
TAPPER: A look at how President Trump's alternate reality may be impacting the administration's response to the coronavirus. That's next.
TAPPER: In our politics lead --
(BEGIN VIDEO CLIP)
MICK MULVANEY, FORMER WHITE HOUSE CHIEF OF STAFF: He does like to argue.
(END VIDEO CLIP)
TAPPER: Do you remember -- in our politics lead today, do you remember a week and a half ago at CPAC, the Political Conservative Action Conference, when President Trump's then chief of staff, Mick Mulvaney, you see him there, accused the media of overhyping coronavirus fears in an effort to, quote, bring down the president?
Well, it is probably worth pointing out that since then, a CPAC attendee has been quarantined after testing positive for the virus and at least four Republican members of Congress who attended the event are in self-quarantine today after interacting with that attendee.
Senator Ted Cruz of Texas, Congressman Doug Collins of Georgia, Paul Gosar of Arizona, and Matt Gaetz of Florida. Gaetz just five days ago apparently thought it was amusing to tweet a photo of himself voting for coronavirus funding wearing a gas mask. Gaetz, we should point out, was also just on Air Force 1 with President Trump this afternoon.
And as CNN's Kaitlan Collins reports, advisers to President Trump are trying to encourage him to stop minimizing the potential problem as his former chief of staff and Matt Gaetz once did.
KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT (voice-over): The number of coronavirus cases in the United States is skyrocketing, but some people close to the president worry he's not taking it seriously enough.
In dozens of tweets today, Trump dismissed concerns about the spread and blamed the news media for the plunging stock market. Some advisers fear he's underplaying the potential danger with comments like this, comparing it to the common flu which experts say is predictable and well-known, while the coronavirus is not.
But as Trump downplays the impact of the outbreak, his top health official insists they're taking it seriously.
ALEX AZAR, SECRETARY OF HEALTH AND HUMAN SERVICES: Make no mistake, this is a very serious health problem. Nobody is trying to minimize that.
COLLINS: The president spent his weekend conducting business as usual, in between being briefed by the vice president, he spoke at a fundraiser at his palm beach club, golfed with Major League Baseball players and hosted the Brazilian president for a big dinner with friends.