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Trading Resumes After Halt Triggered Due To 7 Percent Market Plunge; Tensions Grow Between White House And Health Officials Over Coronavirus. Aired 10-10:30a ET
Aired March 9, 2020 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
POPPY HARLOW, CNN NEWSROOM: Top of the morning. I'm Poppy Harlow.
JIM SCIUTTO, CNN NEWSROOM: And I'm Jim Sciutto in Washington.
This morning, a Wall Street tailspin, trading halted at one point this morning, this after the Dow opens with a nearly 2,000-point drop. It's about 1,600 now drawing comparisons to the weeks following 9/11. This is not just market magic, not smoke and mirrors, real concerns about economic effect here of the outbreak.
HARLOW: And the reason here is two-pronged. You had oil crash over the weekend, but mainly it is a pandemic, and that is the term CNN will now use to describe this coronavirus outbreak. It is based on hard data, growing numbers here in the U.S. and around the world.
Let's begin this hour with our Chief Business Correspondent Christine Romans, CNN Business Lead Writer Matt Egan and CNN Business Correspondent Alison Kosik is at the stock exchange, on the phone, we have Mark Zandi, Chief Economist at Moody's.
Romans, tell people what this means for them and how this is different from 2008, which is the last time we saw levels like this to crash.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: So this is the 11th anniversary of the bull market. On this day 11 years ago, it was equally terrifying, quite frankly. But that was the very beginning of a very big rally.
That's different then with the Financial Crisis, this is a public health crisis that is straining companies' supply chains around the world and hurting confidence of workers and consumers. And there is so much uncertainty that that has been sort of feeding on itself. So that's the big difference here.
We have markets around the world moving as well. It's not just the stock market. The bond market, we have never seen this kind of rush into the safety of the bond market, driving ten-year note yields to just undoubtedly (ph) 0.4 percent lows, never seen that. And the oil market crash over the weekend, just a perfect storm. MATT EGAN, CNN BUSINESS LEAD WRITER: The oil market crashing, that really was the biggest wild card, right? We knew there was this coronavirus outbreak, we knew that it's dealing some damage to the economy, and certainly to consumer confidence, to Christine's point. But then all of a sudden, out of blue, we saw oil prices crash.
And we don't use that same word (ph) lightly. But it was a crash down more than 20 percent on pace for the worst day since 1991, and that's because, one, there's lower demand, right, flights have been canceled, people aren't driving as much. That's causing a demand problem.
OPEC in Russia, they were thought to come in. They were supposed to rescue the market by cutting supply, instead, they've done the opposite. Saudi Arabia is going to pump more and they're cutting prices. They're effectively launching a price war.
SCIUTTO: They are fighting each other. There is a Battle Royale there between Russia and Saudi Arabia.
Alison Kosik, you're on the floor there, you're speaking to traders. We have seen it off its bottom at least at this point, still down some 1,600 points. What are they sensing on the market floor and are they concerned about other circuit breakers kicking in before the end of the day?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: That is a concern. I think at this point, at this moment, I think the concern about that next circuit breaker kicking in, probably we can put that off for another few hours. I think the important time to watch is going to be the last hour of trading today, from 3:00 to 4:00. That's often when you see traders try to place their final bets for the day.
The good news is that the circuit breakers worked, as the president of the New York Stock Exchange said, is the reason they're put in place, so trading can stop and investors and traders can kind of reassess and take a deep breath. So we are seeing, as you said, Jim, stocks bounce off their lows.
So we may see a lull during the afternoon, but then at the end of the day, we may certainly see things pick up again.
HARLOW: Okay. Thank you, Alison.
Mark Zandi, Chief Economist at Moody's Analytics, is on the phone with us. So, Mark, let's talk about the Fed, because this is when you need the fed to come in. The question is what can they do, what should they do when you already have such low rates?
MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: Well, they have to cut rates more. They cut rates in an emergency move last week. It seems like a long time ago now, but they cut it last week, and I suspect they'll cut rates again pretty soon. And, unfortunately, there is not a lot of room to maneuver. We're not too far away from zero. So my guess is at this point, they'll probably take it to the so-called zero lower bound. We'll get to that zero interest rate in the not too distance future. And then at that point, they don't have much more they could do, and it's up to the Trump administration and Congress to get it together and pass fiscal stimulus. That's what we'll need.
SCIUTTO: Mark Zandi, thanks very much.
We're joined now by Mayor Bill de Blasio, of course, the mayor of New York City. New York has a spread of this -- has what's known as a community spread, so in other words, people here are spreading it amongst themselves. The biggest question, what do you need now to help respond to this and are you getting that help from the CDC, from the federal government?
MAYOR BILL DE BLASIO (D-NEW YORK CITY, NEW YORK): Jim what we've been asking for for weeks is the right kind of testing and the right kind of support from the federal government to make sure we can do more tests more quickly. We still don't have it.
FDA could approve right this minute the automation of these tests that would allow us to go from where we are now while we're doing dozens or hundreds a day to where we could be doing thousands and getting very fast results and staying ahead of this situation. That's where we need to be. Because with community spread, you know there will be more. But we don't have to be afraid of that. We can handle that. Really, we can if we get the kind of testing that allows us to know in real-time exactly what's going on.
The vast majority of people we tested in New York City come back negative. That's the good news.
HARLOW: Mayor de Blasio, thank you for being here. We appreciate it very much.
Talk to us about the concern of our city of like New York, where we all live in close quarters, we all take the subway, et cetera, right? That's where things can spread more. And I was struck hearing Dr. Anthony Fauci, head of NIH, this weekend yesterday on Fox News Sunday when Chris Wallace pressed him, could we in the U.S. see cities quarantined like in Italy. And he said anything is possible. Not probable, but possible.
How is your administration preparing for something like that? Is that even a possibility of New York City?
DE BLASIO: Poppy, it's a possibility, but I do think people are getting a little bit ahead of ourselves and we should be careful.
Right now, we have a disease that transmits -- there are two crucial facts. It transmits very directly.
DE BLASIO: Some diseases hang in the air, and you go into a room even an hour after someone has been there. This is not like that. This is a very direct transmission. You have to be very close to someone, a cough, a sneeze, spit that comes from the conversation, to be very graphic, but it has to get right into your eyes, nose or mouth. So it does not transmit that easily in the scheme of things.
The second fact is that the most profound impact is on people who have pre-existing, serious medical conditions and over 50. The vast majority of people in this city, for example, un 50, no pre-existing major health condition, if they even get it, they're going to feel like they have the cold or mild flu and they're going to be fine. So I would say is we should not want to do, with all due respect to Italy, we tried not to get to that level. We tried to be more pinpoint in our response.
Our subway is unusual because you're talking about a huge number of people packed in close. We're trying to get folks to spread that out. So we're saying to employers, if you can stagger work hours, that would be helpful. If some people can telecommute and it does not disrupt business, that's helpful. But, mainly, the point is go about your business, take those basic precautions, washing your hands regularly, covering your mouth when you sneeze or cough. And what we are seeing is that those measures really count, and then, God forbid, someone has symptoms, stay home. If they get serious, we need you to get to a doctor right away.
SCIUTTO: So this speaks to the issue of why you test and why you test more broadly, does it not? Because what you want to do is you want to identify who is sick so that they can self-separate and not get more people sick. That's an important point, is it not, because there are a lot of allegations flying back and forth about stoking panic, et cetera, but there is a reason that you want to know who has this.
DE BLASIO: You do, and, Jim, it cuts both ways. One, for the positive test, it confirms why someone needs to be isolated. So if someone is sick, anyone sick, stay home, point one. Don't send your kid to school, stay home. Let's then get the facts.
When you have a negative, you know what you're dealing with. When you have a positive, you know what you're dealing with. In fact, what we're finding is the negatives are reassuring to people and clarifying. The positives tell us if someone is going to need extra attention, particularly if they're older or they have those pre- existing conditions. Most people even who get it, a vast majority come through okay in the end except for that small percent who are really vulnerable.
HARLOW: Finally, New York City public schools, I know it's a last resort to close them. But there are parents who have the means to get childcare, et cetera, or stay home from work, but most people don't. You have over 100,000 kids in this public school system, as you know all know, are homeless. They rely on the school for food, for meals. What is the determining factor from you when you finally make the call, we're going to close or were not?
DE BLASIO: So, first of all, those kids, some are homeless, some are doubled up, tripled up in apartments, just for clarity, but, yes, it's a crucial point. A vast majority of parents I have spoken to over the years in any crisis don't want to see the schools closed. Of course, safety first, but they depend on the schools. They are a safe place for kids. And, by the way, they want their kids to keep getting educated. So, to me, it's a high bar for a closure.
One thing I think makes sense, if you have a situation in a school, a temporary closure.
HARLOW: Of one school, two schools, not all of them.
DE BLASIO: A specific targeted closure for a limited period of time, because here's the conundrum. If you're closing, waiting to hear on a test and the test comes back negative, well, of course, then you will keep that school open, even in the case of a positive. We have what we call disease detectives, our Department of Health is renowned for this, who tracks specific contacts. If a child really only had close contact with a handful of adults or kids in the school, like really close contact, that's where your concern is.
It's not the kids on the other grades. They had no -- they didn't, in any way, shape or form, interact with them. Again, it doesn't hang in the air. The fact our doctors made clear here in New York City, only minutes on the surface, this virus only lives for a few minutes.
So we are clear about the fact that we need to be pinpoint. I don't want to see mass closures. I want pinpoint response.
SCIUTTO: It's so good to have you on. We know that you're dealing with this every day and we're going to continue to share the best information we have about this, because we know this is what folks back home are interested in.
HARLOW: Thank you, Mayor de Blasio. We appreciate your time. And good luck.
DE BLASIO: Thank you very much.
HARLOW: We have a lot ahead. Still ahead, a cruise ship held off the coast of California. Today, it's going to dock in Oakland after nearly two dozen people on board have tested positive for the coronavirus. One of the passengers on that ship will speak with us next.
SCIUTTO: All right. We've been speaking about the response. There appears to be a growing rift between the White House and the nation's top health agencies overseeing the pandemic about what's necessary to do next, what that means for you. New details ahead.
SCIUTTO: Welcome back. Let's go now to Oakland, California. This is where a cruise ship held off the California Coast was finally allowed to dock today. It's beginning to disembark more than 3,500 passengers and crew. Nearly two dozen people on board the Grand Princess cruise liner, tested positive for coronavirus. They will now spend the next two weeks in quarantine at military bases around the country.
HARLOW: And what people are seeing, these are live aerial pictures from our affiliate, KGO, there in Oakland. You're looking at the buses that are lined up to take the passengers off this cruise ship to these military sites where they will be held for those 14 days. So they're preparing to go on this bus in just a few hours.
Let's talk to one of the passengers on the ship, Gina Pallotta, she is traveling with her husband. Gina, thank you very much for being with us.
GINA PALLOTTA, PASSENGER, GRAND PRINCESS CRUISE SHIP: And thank you for having me.
HARLOW: What can you tell us this morning about your situation and your husband's, who I know is diabetic, there's been an issue with him having enough of his medication? How are both of you doing?
PALLOTTA: We're both doing okay. My husband still has not received any diabetic medication, so he is actually out of his medication. We had a health personnel person knock on our cabin door last night at midnight to do just a brief health screening on both of us, just asking us if we had any symptoms, and we told her again about his diabetic medications, and she said, you know, when we get off, that they might be able to help him because they're going to have a stock of medication.
We're so very frustrated over that.
PALLOTTA: But right now, we are planning to dock at the Port of Oakland. We've been told that we will go -- because we're California residents, we will go to either Travis Air Force Base in Fairfield or in Miramar in San Diego.
SCIUTTO: This is Jim Sciutto, Gina. Thanks so much for coming on. I wonder how the information sharing has been throughout this. Have you and your husband been told about next steps, about treatment, et cetera, as you go, or are you playing catchup here?
PALLOTTA: We get, unfortunately, a lot of the details from the internet, from our friends and families, from different news shows, live news shows that we're able to watch on the ship. The captain will come on several times a day to update us, but, for example, the news about the 21 people being tested positive, we got that off the internet, and about a half hour later, the captain came on and apologized saying, we know you already know this, but.
So we've been very frustrated with the lack of information, and I'm not sure what the (INAUDIBLE) communication is. I think the biggest concern for us has been just the lack of response in getting my husband his medication.
And he's not the only one. We go out on our balcony and we are able to talk to other people in that way, and there are a lot of other people who are in the same situation as we are with the meds.
SCIUTTO: Well, Gina Pallotta, we wish you, we wish your husband the best as you get through this. Thanks so much for joining us this morning.
HARLOW: Absolutely. Good luck, Gina.
PALLOTTA: Thank you.
HARLOW: This morning, there is growing distrust between the president's political team and some public health officials. This is according to multiple people inside the White House and at the CDC. Listen to what a senior Republican official with ties to the coronavirus response tells CNN. This is a quote.
The message is if you are on the wrong side of this administration, you're gone. People are afraid. Either there was terrible incompetence or there was a heavy hand on the scale.
SCIUTTO: That coming from a Republican, who should note.
With us now, former U.S. Secretary of Health and Human Services Kathleen Sebelius. We appreciate you taking the time this morning. It's great to have you on.
KATHLEEN SEBELIUS, FORMER HEALTH AND HUMAN SERVICES SECRETARY: Sure. Nice to be with you.
SCIUTTO: So let's begin there, if we can, given your experience as HHS secretary, with the federal government's response so far, because we've had a lot of doctors come on saying the first criticism being not testing quickly and broadly enough and not getting those tests out. Is that now changing, in your view, and what are the consequences of having delayed that early response?
SEBELIUS: Well, there's no question we were not out ahead of this disease. We had a month between China's identification of a novel virus and some activity in the U.S. beyond talking about closing down borders from China. That was a month that's now gone. We've had a second month. This disease was presented in early January. We're now in early March.
So we still have a limited number of tests. As far as I can tell, CDC has now taken down the testing information that they had on their website. That's not a very helpful sign. But we're no longer in containment phase, we're in identification phase and trying to figure out where the hot spots are in this country.
Frequency and pattern are the two keys to epidemiology. You need to know how many people have the disease, out of what base of the population. So you need to test broadly. And then we need to know what the patterns are, who is most susceptible, who this disease might be lethal to. We don't really know either of those things from the United States population, and that's a pretty precarious place to be. HARLOW: Secretary Sebelius, we heard the U.S. surgeon general yesterday on with our colleague, Jake Tapper, say that we are shifting into what he calls a mitigation phase. I didn't totally understand what that meant. So I think a lot of people actually understand what the difference is. What does it mean to you?
SEBELIUS: Well, we had an opportunity, as I said, to get out ahead and see if we could literally try and identify the early cases as they showed up and isolate folks. We've missed that chance because of some testing glitches, and we didn't move aggressively enough.
So now, we're really trying to identify areas where the disease is presenting. We need to do broad testing in those areas to figure out what portion of the population in Seattle, what portion of the population in some of these hot spots actually have the disease and then try and do a, you know, social distancing, potential quarantining of some of the patients. Mitigation is really slowing down the spread as much as possible.
I'm struck by a couple things. I don't hear any conversations with other world health leaders. This clearly is an international crisis. We were on the phone constantly with our counterparts throughout the world sharing information about what we knew, what they knew, what was being presented. I haven't heard, really, any of that.
Secondly, I heard the president say at CDC, and you just had an interview with the ship passenger, there are 3,500 people who have been isolated on a ship where we know there are cases presented. They have been held on the ship, and the president said in part it's because he doesn't want his numbers to go up. These are individuals, first of all, they're not numbers. They are live human beings.
And secondly, we know there is disease there. The best thing is to get them off the ship, not keep them on the ship. And the underlying health conditions, the woman who just talked about her husband not having diabetes medication, I mean, that just exacerbates this.
So we're kind of going at this backwards. We want big numbers because we want to test a whole lot of people to figure out what -- how serious this disease is. And we seem to be restricting the testing and restricting the information.
SCIUTTO: Let's talk about that information, just how important it is, in your view, because it's not just isolated here. You had Kellyanne Conway saying last week without offering evidence somehow that the disease has been contained. And, of course, we've seen as the number rise that that to be proven false, and the president as well trying to downplay this even as a plot.
For people at home, I imagine, they want the hardest, most factual information. How important is it for the government to be speaking with one trustworthy voice on this?
SEBELIUS: Well, I think it's really important for the politicians to stop talking and let the scientists tell us what they know and what they don't know. Both of those pieces are really important, because that changes day-to-day, when people get some confidence that they're getting accurate information, how many tests have been done, what does it look like in populations, how fast could it spread, how long we might be dealing with this. That's the piece also that I think is really important to understand.
Dr. Fauci says it's a year from a vaccine, not three months, not six months.
HARLOW: At least.
SEBELIUS: And the American public should want testing to go on to make sure the vaccine is safe and it's effective. So that year, what are we going to do over the next year, how do we cope with this, what are other countries doing?
All of that needs to come from scientists, not from the politicians.
HARLOW: Absolutely. Secretary Sebelius, we really appreciate your time this morning. Thank you.
HARLOW: Up next, we are keeping a very close eye on the market. Look at the selloff on Wall Street as it continues. Trading has resumed after being halted when the market took a nose dive off more than 7 percent this morning over coronavirus fears and a major plunge in oil prices.