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First Move with Julia Chatterley
The USA Checks Could Take Months And Business Loans Aren't Ready; Prices Rise On Hopes Of A Supply Cut, But Does OPEC Agree; Flattening The Curve, Americans Are Told, More Effort Is Needed. Aired 9-10a ET
Aired April 03, 2020 - 09:00 ET
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[09:00:15]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here's your need to know.
Payments delayed. The USA checks could take months and business loans aren't ready.
Oil for one and one for all. Prices rise on hopes of a supply cut, but does OPEC agree.
And flattening the curve, Americans are told, more effort is needed.
It's Friday. Let's make a move.
Welcome, once again to all our FIRST MOVErs around the globe. Thank you for being with us once again. I just wish I had better news to give you, but
I'll give it to you, nonetheless. We now know the number of global coronavirus cases has topped one million people. More than 50,000 have also
lost their lives. Recoveries though are critical to talk about this moment, too.
More than 200,000 people have beaten this and the global fight continues. The fight continues, too, for millions of global workers who have lost
their jobs over the past few weeks.
The latest U.S. payroll report far, far worse than expected -- 701,000 non- farm jobs were lost last month. This of course is outdated because it doesn't include the second half of March when the shutdowns accelerated.
It's still much worse, as I mentioned, though, than expected.
The unemployment rate rose to some 4.4 percent. That was the steepest rise since 1975. But given what we've seen so far from jobless claims, we could
already be at a nine to 10 percent unemployment rate even now. So that gives you a sense of where we are.
It's worse though. It could take some 20 weeks for aid checks to get out there to Americans. The system for getting direct deposit information to
try and make that quicker for some people is delayed and lenders are concerned now about offering loans that might go bad and they have to take
on that risk.
Getting $2 trillion into the economy is a logistical nightmare at any time. The problem is people still have bills to pay, and I'll still argue that
outgoings like rent must be frozen in the same way that the economy is frozen, even if it's just for a short period of time. Either way, it's a
logistical nightmare, but other nations have done this.
On Wall Street, futures are pointing to a modestly lower open. Europe, also, as you can see, under pressure. Data on European business activity
plunged to the lowest levels on record. We know this. Economies have been brought to a halt.
Asian stocks with little change, meanwhile, oil prices though soaring again after a historic 20 percent plus rally on Thursday amid hopes of a deal
from the oil producing nations. More context coming right up on that.
But first, I do want to give you more context in our drivers and to a key part of the U.S. stimulus measures.
Small business loans and lenders warning they may not be ready today, despite a promise by the Treasury Secretary. JPMorgan Chase was the first
to warn it is unable to accept applications today.
Banks are scrambling for more guidance and the right paperwork. Fraud is said to be one of the major concerns.
Paul La Monica joins us now. Paul, these two things are tied. The amount of jobs that we are losing, the hopes that the money, these lending facility
that's been created here would stem some of the job losses if it could get to the small and medium-sized enterprises, but now it seems the lenders are
simply saying, we're worried about taking on the risk and perhaps being fined later.
PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, JPMorgan Chase, Julia, the largest bank in the country, they are still waiting like many other banks
for guidance and that, I think could be something that unfortunately delays this program from the Small Business Administration to really kick off in
earnest.
So I'm going to read you -- this is what Chase has on their Chase for Business website guidance for customers right now. They say, "Financial
institutions like ours are still awaiting guidance from the SBA and the U.S. Treasury. As a result, Chase will most likely not be able to start
accepting applications on Friday, April 3rd, as we had hoped. Make no mistake, we will help you, our customer with getting access to these
emergency funds."
So we really have paperwork, and you know, problems with the logistics of getting this program off the ground being an issue.
Good news, if you want to call it that is, I spoke with several other banks yesterday -- large banks, like Truist the combination of BB&T and SunTrust,
TD Bank, Wells Fargo, PNC, U.S. Bancorp -- they all said that they have many other programs that they're putting into place to step up other types
of small business loans, to not worry about the usual types of penalties that they would be charging small businesses for being late on payments,
and, you know, deferring certain things down the road because obviously, everyone is struggling right now, and these banks understand that.
[09:05:29]
LA MONICA: And the good news, as I also wrote my story, Big Banks are the problem this time. In 2008, we had to bail out the banks. Now, the banks
have to help bail out everyone else because they're in good financial shape.
CHATTERLEY: A few issues with this for me, though, Paul, its clients. We are willing to give existing clients and that's certainly what I've heard
from one of the biggest banks. If you're a client of the bank, you can get access to money.
But the whole point of the CARES Act lending facility was a lot of lending turns into a grant if they retain employees. I don't know whether you have
any sense from those that you've spoken to whether they're willing to offer their version of loans and whether they're willing to allow any forgiveness
on this loan.
LA MONICA: Yes, I think that it remains to be seen what types of forgiveness terms will be attached to these loans, and you're right. I
think that there are so many small businesses that may not have existing relationships with some of the larger banks, they now need them.
So yes, the good news is if you're a mom and pop restaurant chain or you know, a grocer or what have you, any sort of small business that's already
doing banking relationships with Chase, Citi, B of A, what have you, you're probably as long as you've been in good standing, you're going to get the
help that you need.
But what about all of those companies that don't have banking relationships already? Will they be able to get them through this SBA Paycheck Protection
Program? That I think is the big hope because everyone is going to need some sort of financial assistance.
There aren't small businesses that are going to be able to weather this, you know, awful time that we're in right now without significant economic
and financial pain.
CHATTERLEY: Yes, the help can't come soon enough. Paul La Monica, thank you so much for that.
Now, as we've mentioned, oil also in focus. Prices are adding to the record gains from Thursday, though, they're still down around half a year-to-date,
around a half a percent -- sorry, 50 percent year-to-date. Sources tell CNN, OPEC will discuss supply cuts with Russia and other oil producers on
Monday and they say this time, the Alliance may be broader.
John Defterios joins us now. John, get my teeth into gear to talk about this and prepare myself. There is a lot going on here. The President has
suggested that OPEC Plus is prepared to cut output to a tune of 10 times the amount that they were unwilling to cut by before the price collapse.
Now, it's hurting everybody, but what's your sense of how willing OPEC Plus is here to take steps without other big oil players stepping up to and
making their own cuts?
JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Well, it is a big ask by the U.S. President, 10 million barrels a day. He was going to the high
side to 15 million barrels a day, and you rightfully said that this broke Saudi Arabia and Russia at the last meeting on March 6th over 1.5 million
barrels a day.
And we have to keep in mind, sources are telling me that the relations between Riyadh and right now, Moscow remain quite frosty. There's another
implication here to your question to me, and that is that the President seems to think that Saudi Arabia, Russia and the other 20 or so producers
of OPEC Plus will handle this on their own.
Two senior sources have told me that are part of the Alliance, this is a non-starter. You have to bring the other players to the table. The United
States, Canada, Mexico, Brazil, U.K., Norway -- if you want to cut 10 to 15 percent of global supplies right now, you cannot lean on this organization
to do it alone.
So what is taking place right now, Julia? Vladimir Putin is meeting with his major oil producers in Moscow. They should be finishing right about
now. Six hours from now, the President will have seven CEOs at the White House discussing their strategy, the support he is trying to give them.
It's a pretty easy game in Saudi Arabia, right? They just have one major producer in Saudi Aramco, but it's extraordinary to think a month ago, we
saw the price war breakout. Now, we're talking about cutting 10 million barrels a day. It seems extraordinary.
But the President trying to serve as a mediator -- a dealmaker to me proves to be a real challenge when he is trying to bring Russia and Saudi Arabia
back together.
CHATTERLEY: You know, it's fascinating because there's wheels within wheels here. The United States, very important right now, their relationship with
China and agricultural demand.
We know and believe that China is taking the time now to add to its strategic stockpiles of oil when prices are so low.
If I had to look around the world, I'd say China has the most influence on Russia, perhaps to take action here. What do you make of what's going on?
Because the geopolitics at this moment matters perhaps more than ever.
[09:10:19]
DEFTERIOS: That's what happens when you see a 20 percent drop in demand. Right? It makes for a strange bedfellows, if you will. Let's cover off
China and why they're buying oil from the United States, for example. It is cheap, and I'm sure they're getting a fantastic deal.
It helps them build their Strategic Petroleum Reserve. It actually meets the obligations under the Phase 1 of the Trade Agreement with the United
States.
But there's another thing I was thinking about Julia and that is the relationship between China and Russia. Russia signed a 30-year deal back in
2014 when they had these massive sanctions from the United States. It was worth $300 billion.
Right now, Donald Trump is proving that he can put a wedge between China and Russia. It helps China curry favor with the Trump administration, and
he says to the shale producers of the United States, look what I'm doing for you.
Also, I find it extraordinary. If you asked me a week ago, whether the U.S. Energy Secretary would be meeting with his counterpart from Russia and said
no way, how about the Texas Regulator on the phone with the OPEC Secretary General regularly as well.
Then we have another riff playing out here. Some of the shale producers want to have a dialogue with OPEC, be part of the solution, take some of
the oil on the market, off the market after that, and then you have the other shale producers who are pushing.
Capitol Hill is saying put tariffs on the Saudi exports and the Russian exports into the United States. Saudi Arabia has the largest refinery in
the United States, so that is a very sensitive issue.
And finally on the geopolitics, I thought this might happen. Saudi Arabia, the Crown Prince Mohammed bin Salman, Julia, he could not go against the
United States for very long. One month into the game, Donald Trump leaned on him and said, look, I backed you in Iran. I didn't make a big fuss about
Jamal Khashoggi. Do you really want to keep the price war going when we have U.S.-Saudi relations? And the answer to that is a resounding no.
CHATTERLEY: The power structure fundamentally changed when there's no demand in the world. John Defterios --
DEFTERIOS: Absolutely.
CHATTERLEY: Great analysis. Thank you so much for that.
All right, now, to the global coronavirus health crisis. More than one million people have now been affected according to John Hopkins University.
Here, in the United States, the number of cases has topped 245,000 people and more than 6,000 people have lost their lives.
White House Coronavirus Taskforce Coordinator, Dr. Deborah Birx urges every state to follow social distancing guidelines.
(BEGIN VIDEO CLIP)
DR. DEBORAH BIRX, WHITE HOUSE CORONAVIRUS RESPONSE COORDINATOR: And I can tell by the curves and as it is today, that not every American is following
it, and so this is really a call to action.
We see Spain, we see Italy, we see France, we see Germany, and we see others beginning to bend their curves. We can bend ours.
(END VIDEO CLIP)
CHATTERLEY: CNN senior medical correspondent, Elizabeth Cohen joins us now. Elizabeth, always great to have you with us. I watched this and I got goose
bumps on my arm.
The difference is we don't have a top down order for everyone to stay at home in this country. Is that what is required, ultimately?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: You know, ultimately, I think that's very helpful in smaller countries. Dr. Birx named some of
them. It's been much easier to say, everyone, please do this and you really do need everyone to do it.
If you have small communities that aren't paying attention and aren't listening to these social distancing guidelines, then it kind of pretty
much ruins it for everybody else.
The United States is so much larger and is so much more diverse than really any other country that's dealing with this. That it's just more difficult
to do.
It also doesn't help, Julia, that we don't have a single payer system in the United States. Now, we can debate all day and all night, whether a
single payer system is the way that the United States should go. But I think it's pretty clear that if you have a single payer system, you have
one health system moving in one direction. You know where to allocate resources.
In the United States, it is really kind of a free for all.
CHATTERLEY: Yes, critical part of the jigsaw puzzle here, and the cases keep rising. Elizabeth Cohen, great to have you with us. Thank you so much.
Now, the World Bank has approved emergency funds worth $1.9 billion dollars for the world's poorest countries, including three nations in Africa. This,
is the World Economic Forum warns that South Africa could become the pandemic's ground zero on the continent.
Eleni Giokos joins us now from Johannesburg. Just terrible timing. The lack of infrastructure, the lack of supplies, the lack of healthcare facilities,
even relative to the struggle that we're seeing in the West. Eleni, let's talk about South Africa first. What's the situation?
ELENI GIOKOS, CNN BUSINESS AFRICA CORRESPONDENT: Yes, I mean, it's really interesting and as you say, when you see developed economies like the U.S.,
the likes of China and some European countries being able to throw money at this, to stimulate their way out of the problem, or at least deal with some
of the financial implications.
When you look at it from an African perspective, it just gives you a completely different perspective. In South Africa, specifically, a country
that was already in recession. It does not have enough fiscal room to be able to stimulate its way out of this.
Economic growth is going to falter. You had Moody's downgrading South Africans to junk status just last week. You've got the local currency, the
rand hitting record lows across all major currency crosses. One of the worst performing emerging market currencies in the world.
Let's talk about the healthcare sector that already was stretched under the current environment and now you add in COVID-19 patients and you know, many
people say it is a disaster -- a humanitarian disaster waiting to happen.
And the same goes for the rest of the continent. You know, you spoke about $1.9 billion being allocated by the World Bank. $1 billion is going to be
going to India, $900 million to some African countries.
But African Finance Ministers, Julia, gave us a reality check earlier this week, and they are talking about $100 billion that will be needed to deal
with COVID-19.
And apart from that, they were also asking for debt relief, because they need to create fiscal room to help African economies that are going to be
falling apart because of this.
CHATTERLEY: Yes, it's a drop in the ocean and more lives will be lost. Eleni Giokos, we will keep checking in with you on this story because it's
critical. Thank you so much for that update there.
We're going to take a break here on FIRST MOVE, but coming up, Ford's new models, the ventilator. We will hear from the company as it undergoes a
major retooling in order to save lives.
Plus, could an antibody test be part of our salvation? Citi seems to think so in the push to get the world back to work. That's next.
(COMMERCIAL BREAK)
[09:20:00]
CHATTERLEY: Welcome back to FIRST MOVE live from New York where futures are pointing to a mostly flat open on Wall Street. Before the bell, we had
those non-farm payroll reports for the United States for March, a backward looking report. This is key.
It doesn't include data from late March where we saw the shutdowns really take hold. It was a dismal read, nonetheless. More than 700,000 non-farm
jobs were lost last month. That's the first month of job losses in a decade. The economic fallout of these measures continues.
In the meantime, car makers and other manufacturers are ramping up production of things like masks, gowns and ventilators amid a critical
shortage of medical equipment.
General Motors aims to produce up to 10,000 ventilators a month. Toyota is going to start 3D printing face shields. Tesla imported more than a
thousand ventilators from China. Ford, meanwhile, partnering with GE Healthcare to deliver 50,000 ventilators in the next 100 days.
Joining me, one of the people leading Ford's efforts to achieve that, Jim Baumbick is the Vice President of Enterprise Product Line Management at the
company.
Jim, I know you are incredibly busy, you and your team, but thank you for making the time to chat to us. Talk to me about how the company went from
recognizing there was a health crisis going on to saying, okay, we can retool, and we can help fight this crisis.
JIM BAUMBICK, VICE PRESIDENT OF ENTEPRISE PRODUCT LINE MANAGEMENT, FORD: Yes, thanks for having me, Julia. You know, there's a famous expression in
Oregon, it is -- go like hell. And we saw this incredibly urgent need support medical first responders, as well as patients in a very short order
to meet the surge demand, and that's exactly what we're focused on. It is how fast we get the right level of equipment out to these people that need
it the most as fast as possible.
CHATTERLEY: Can you explain exactly what you're making here and is there any way to help facilitate doing what you're doing quicker?
We've heard from medical device companies that there are components within this that are hard to source and that are complex. Is there any way this
can be organized better to help you produce more faster?
BAUMBICK: Yes. So I think this is really what was inspiring us, it is this really urgent need in April, May and June. It meant that we had to look at
various different design alternatives with our partners at GE Healthcare and identify those that we could actually focus on to move very, very
quickly.
One of the challenges in the medical industry is they're effectively set up for a relatively low volume of production, not thousands; and the need here
is much higher orders of magnitude.
And so that was actually the thinking between taking the best of what we know as an automotive manufacturer, we know to scale that volume and
matching that up with the expertise of GE Healthcare.
And so, we can focused on a design that was really meant for the purpose or at least, would suit the purpose of these COVID patients with a low level
of complexity, and one of the challenges here is the more complex the machine, the harder it is to scale, the more components.
And so that's really why GE Healthcare with their clinical expertise helped us lock in on this Airon design that we could actually move very, very
quickly on and leverage what we know best and that's building parts at scale and volume -- and so that's what the team's actually doing right now.
CHATTERLEY: The White House has lauded loaded the efforts that you've made specifically Peter Navarro, who is the Defense Production Act coordinator.
Can I ask what role if any, the government has played in what you're achieving here? And do you have buyers? Do you have people that are going
to buy these ventilators or are you simply going to produce and that will come later?
BAUMBICK: Well, certainly, Dr. Navarro has been helpful in giving us a sense of the demand and giving us information so that we can focus on where
the biggest and greatest need is for ventilators.
You know, overall, I think everybody is just trying to address the issue and it is a very large issue, and one of the biggest challenges is time is
the enemy because it's urgent.
Meaning, April, May, June and July are these critical periods, and you can't think traditionally around a typical product production or annual
volume. We need the volume now.
And so effectively, that's been the driving force behind our thinking and information is critical and getting it to -- whether it's the
administration or some of these large hospital first responder consortiums, to make sure we can get that equipment distributed to the right places and
get it to the men and women on the frontline.
CHATTERLEY: Jim, it's a tough question, but I'm going to ask it. We've heard about an effective Hunger Games going on between states, buying the
ventilators that they need. Are you going to decide who you give what and when and will that come down to the highest bidder or will you make
different decisions?
[09:25:03]
BAUMBICK: No. Well, number one, that's why we teamed up with GE Healthcare. They are very well experienced in the distribution of this critical
ventilator equipment and we're going to leverage all of their expertise to get it where it needs to go, and certainly we're coordinating with the
administration and other really critical sources through GE Healthcare's expertise.
Our focus and our mission is that, to make sure we can make high quality product at scale to meet a surge demand and work in partnership with GE and
that's exactly why we reached out and we kind of combined the best of both of our companies to kind of meet this immediate demand.
CHATTERLEY: Great to hear. I want to ask you something else because you're a car company and at some point, we hope we'll get the other side of this.
You've suggested that perhaps car makers and the White House needs to consider what we saw during the financial crisis, which was a cash for
clunker scheme to try and re-galvanize demand for cars when we come the other side of this. Have you spoken to the White House about this yet? And
if not, when will you?
BAUMBICK: No, really, Julia. We are just focused on the race -- and the race is focused on saving lives. That is the most important thing that is
driving every action we're taking.
Certainly, the team is preparing for when operations restart, and hopefully we get back to a very vibrant rebound with the economy and others, but the
most immediate task that we have to focus on is helping both the patients that are afflicted with this really deadly virus and of equal importance,
making sure we're doing everything that we can to help our first responders and these incredibly brave men and women, the real heroes that are fighting
this fight on the front lines trying to save people's lives.
CHATTERLEY: Jim, I couldn't agree more. Thank you so much for joining us this morning. Thank you to your team, for your efforts in trying to save
lives. Great to have you with us.
BAUMBICK: Thanks so much. This is part of Ford's DNA and we just want to make sure we're here to help in any way we can.
CHATTERLEY: Thank you. Stay in touch, please, and stay safe. We're back after this. You're with FIRST MOVE.
(COMMERCIAL BREAK)
[09:30:22]
CHATTERLEY: Welcome back to FIRST MOVE where U.S. stock markets are open for trading for the final time this week and we do see a lower start to
this session. Before the bell, we found out that the U.S. posted its first month of job losses since October of 2010. It's a somber reminder of the
toll that the global health crisis is taking on workers and on the economies around the world.
We were bracing for a bad number and more up-to-date numbers have come in far worse. Of course, this doesn't capture the second two weeks of March
when we saw the shutdown orders really taking hold, so that's what you have to bear in mind.
It was worse than we were expecting. We're losing about half a percent as you can see for U.S. majors.
What about the oil markets this morning, too? Well, both Brent and U.S. crude are extending their historic gains from Thursday on hopes for an OPEC
Plus production cut.
OPEC is holding an emergency meeting with Russia and some of the other oil producers on Monday.
Remember, executives of the oil industry are meeting at the White House, of course today, too.
Now other business headlines, Tesla is reporting better than expected first quarter delivery numbers in this extremely challenging environment for all
the automakers.
The electronic carmaker delivered more than 88,000 vehicles, still some 20 percent below last quarter's record levels. Shares of Tesla surging in
early trading today. Wow, that's a bright spot.
Okay, Dow one of the world's largest chemical producers is expanding its handling sanitizer production to help find the global coronavirus crisis.
The company's plant in Germany was already making hand sanitizers, and now, four additional plants around the world are joining in with the effort.
The company says most of its sanitizers will be donated to health systems and government agencies.
Dow's CEO, Jim Fitterling joins us now. Jim, fantastic to have you on the show. Just explain the moment where you realized, it is one of the top
three chemical companies in the world. You have the inputs that are needed to help and decided to take action.
JIM FITTERLING, CEO, DOW: Good morning, Julia. It's nice to be with you. Our team in Stade, Germany realized that the German government needed some
help, and we supply a lot of materials that go into many products like disinfectants, antiseptics, hand sanitizers, cleaning products, and so they
swung into action and basically repurposed the line to make hand sanitizers in Germany.
And based on their work, we expanded that to four more locations around the world. And so we'll be making 200 metric tons a month of hand sanitizer,
mostly for hospitals and for donations to governments who are going to need them.
CHATTERLEY: It's incredible because it was in the initial stages of this, there was an immediate shortage, I think all around the world as people
bought this and then were hoarding it and we were concerned about the healthcare sector and the frontline workers in particular here.
Jim, is the company bearing the cost of this. You just mentioned the word donate
FITTERLING: Most of the material that we'll be making will be donated. We are supplying obviously other producers who are making materials and many
of them have ramped up production as well. And others in the chemical industry are stepping up to help out.
So there's a big move to try to mitigate that shortage and we'll be at this for as long as there is a need. I think this is going to obviously last a
lot longer than the month of April. I think we'll be doing this for a while.
CHATTERLEY: How are you coordinating, getting the supplies of sanitizer to the frontline workers and the healthcare systems? Is anyone within the
government who is organizing this or are you again, just doing this yourselves and dealing with them directly?
FITTERLING: Our government affairs team and our public affairs teams around the world are plugged in to their local, state and Federal counterparts,
and so they're working very closely to find out where the need is the greatest and where we can get those materials the quickest.
We obviously have to look after our own sites as well, so we want to be able to continue to operate our sites because we are critical to many
industries that are going to continue to run through this pandemic and then we have to look at also suppliers and customers and communities to make
sure that they're able to help us to continue to be safe.
CHATTERLEY: You raised two very important points there for me. One, how are you protecting your own workers? And you're a giant company. You have
operations in in China as well. What did you learn from that experience that applies everywhere else? And what are you seeing there now
specifically?
FITTERLING: Well, in the China phase, and in our previous experience with SARS, and I was in Asia during that time, working -- sheltering in place,
working from home became the first line of defense. And so we quickly went to a work from home status. It happened to occur during the Chinese New
Year. So some people were not at the office sites anyway.
But we ran the plants that we could run and we had everybody else work from home, and that containment phase lasted about two months. And I think we're
in that phase right now in Europe and in the United States, where we've been working from home at Dow for the last three weeks.
Anybody that can work from home and critical workers who we need on the frontline to keep the plants running and to ship our products are reporting
into the sites.
They are checked. We don't allow visitors on site, so we are being pretty strict about that. We're doing temperature checking as people come into the
sites to make sure nobody has a case.
And if somebody does have a case, obviously they go home and quarantine and get treatment and we would continue to pay them if they test positive for
COVID-19.
CHATTERLEY: Which is good news for those workers in particular. Jim, how confident are you that after two months in China, the reopening that we're
seeing, the information that we're getting, your ability to protect your workers is enough?
FITTERLING: Well, I look at the order book and I looked at March and looked at April again and I would say, we're at about 80 percent of where we were
pre-COVID with China, so if I compare the current order book to last year, we're about 80 percent levels.
And it's gradually opening back up. Some industries, obviously quicker than others. I would say the automotive industry has been one of the slower ones
to come back. And that is what I think we're going to see here too, is that you just don't start and stop these plants so quickly, and you want to make
sure that it's safe for everybody to come back.
The information we get in China is relatively good. I'm not so much focused on the number of cases and the mortality rates, but more what's happening
in the local community. How many cases do we have? How many people need to be treated?
In fact, we managed through the Asian situation so far, without having any cases.
CHATTERLEY: Very quickly. Jim, do you think given the reaction that we've seen in in Europe, and in the United States, we'll be able to restart in
two months, or do you think it's going to take these nations longer to restart?
FITTERLING: We'll take it a step at a time. You know, my -- our planning right now is that we will be work from home and essential workers at the
sites for the month of April and May, and I think that's good planning.
Obviously, we're all hopeful that things develop positively, we get good treatments, and we see the caseloads peak and start to decline. We're
starting to see Italy flatten a little bit right now. And so hopefully, we'll see that start to decline.
But we're not going to jump too soon here. We're going to need to make sure that it's safe for everybody to go back, and we'll probably be working on a
phased transition.
So I'd say after containment, we'll be in a return to work phase where we phase people back in and probably the back half of the year kind of a
return to normal phase.
CHATTERLEY: Yes, it's going to take some time. Jim, thank you for everything that you're doing there. The Dow, CEO, Jim Fitterling. Thank
you.
FITTERLING: Thank you.
CHATTERLEY: Talk to you soon and stay safe. We're going to take a break. Coming up on FIRST MOVE. What's the key to the lockdown in the global
economy?
Well, a new report says we're just weeks away from a solution and it's not a vaccine. We will speak to the report's author to get the insight.
(COMMERCIAL BREAK)
[09:42:32]
CHATTERLEY: Welcome back to FIRST MOVE. Here's a current question being asked I think on a daily basis. When will life go back to normal? A vaccine
would be a surefire solution, but that could be many months, if not longer away.
Now report by Citi suggests there might be another solution. It involves testing for antibodies on big scale. Catherine Mann is Global Chief
Economist at Citi. She joins us now via Skype.
Catherine, great to have you on the show with us. Talk to me about your mass testing for antibodies solution. At its heart is something called
serology, which might be new to some of our viewers.
CATHERINE MANN, GLOBAL CHIEF ECONOMIST, CITIGROUP (via Skype): Well, let's make clear that this was a joint report by a doctor who is the head of our
-- out of London office, and the economics of it, which is the what I do, the global chief economist, so I'm not going to pretend to be a doctor here
or a medical doctor or to understand all of the details with regard to antibodies.
But I think what the point is, is that mass testing of people, we would be able to identify if somebody has already had the virus. That's the first
step. The mass testing is the first step, have they had the virus -- determine that. And then to evaluate, if they've had the virus, the
antibodies, does it identify define them as being immune and not contagious.
And if those steps are fulfilled by this new serology strategy, then we could talk about having workers go back to work and to restart the economy,
at least the working part of the economy, by identifying people who are -- have had the disease, have the antibodies, are immune and not contagious.
Those are a number of challenges, and I think there are also economic challenges having to do with -- it's one thing to get a country back to
work like in a factory, or in a warehouse. It's another thing to get people back what we call is -- to get back to play. In other words, restaurants,
entertainment, hospitality, tourism, these sorts of things.
That's going to be harder to do even under this antibody strategy, and for an advanced economy that has a large services sector. It's still a
remaining question about getting back to play.
[09:45:09]
CHATTERLEY: Yes, play requires confidence and at the heart of that is being on top of the health crisis here. I appreciate your point about you're on
the economic side rather than the scientific, but for me the biggest assumption here and I'm not sure whether the science is there yet is
whether even if you have the antibodies in your system, i.e. you may have had this coronavirus, but you didn't even know it, whether you're in fact
immune and still can't perhaps either catch to gain or pass on the virus to someone else. Are we sure about that?
MANN: Well, the science is moving very quickly towards understanding those key elements that you know, antibodies, yes. Immunity, yes. Not contagious,
yes. So these are the science elements and there are a number of different places that are pursuing this strategy in order to get clarity on that,
because it is crucial from a science standpoint.
But again, I think it's really important to also to think about the economics of this and that first, you would have to, in some sense, one
reason why we're having all of these lockdowns now, is because we're concerned about overwhelming the health system with everyone getting it.
And so unfortunately, in order to get the antibodies, you have to get the disease. So we haven't solved that particular problem about the concern
about overwhelming the healthcare system, and you know, the associated greater mortality rate that is a consequence of overwhelming the health
system. That's the front end of this, even if we get the science right, the front end.
And as I say, the back end, which is getting people back to work and play. These are really key challenges because, you know, teams are very important
in the workplace. Everybody -- a member of the team would have to have had these antibodies in order to be part of the team that goes back to work. Or
maybe you have to hire new people that do have the characteristics for both the job as well as the characteristics of their health. That's for the work
part.
And then as I say, for the play part, restaurants, it's not just the workers in the restaurants, but are you going to have like a passport at
the door in order to only allow people in who have got the coronavirus passport?
You know, from the standpoint of getting back to play, which is a key ingredient of getting back to normalcy, the conduct of the economy. Getting
back to growth rates, very important ingredients in advanced economies is this social interaction, which ultimately is all about groups. So everybody
in the group would have to have the passport.
So I think there are some challenges in implementation, and those challenges in implementations have implications for how long it might take
for us to get back to normalcy.
So if we could do that, though, if we can get back to normalcy, the difference in potential cost to the global economy and individual economies
within that -- individual companies, making it more granular in the family, huge, huge difference between seven percent of global GDP and one percent
of global GDP.
These are the kinds of numbers that getting this done delivers for us.
CHATTERLEY: I just wanted to pull out some of the points that caught my eye, you believe that healthcare providers could supply 60 percent of the
working population with an antibody test -- this is in the United States -- by the end of April, 95 percent by the end of May.
And obviously we don't know at this stage, what kind of proportion of the population may indeed have this immunity. But Catherine, I want to flip it
on its head, exactly to your point there. If we don't do this, if we don't have some kind of phased getting people back to work because they're immune
What are we looking at in terms of time to get back to play, to use your term full play? Do we do it by the end of this year?
MANN: One of the challenges here is that the virus didn't come into every country at the same time. And you know, if it had, then we could talk about
an evolution of the virus and the lockdowns and the return to normalcy and it would all be on the same calendar schedule.
The problem is, of course, it's gone around the world, and so we talked about countries being a month behind or two weeks behind in terms of the
evolution of the virus.
In the United States, we talk about the coast versus the interior, even geographical differences in terms of its pace of getting worse and
infecting the population.
So that means that not only do we have to consider getting back to play in the first country which is China, the first location where the virus
appeared and we can say that China, we can look at data that tells us that China is about 90 percent back to work, I think your previous speaker was
talking about his own order book and so forth.
[09:50:20]
MANN: So 90 percent back to work, but only about 60 percent back to play, and we are now in January, February, March. Yes. And so that is for China.
They're substantially ahead of other economies.
So your question is, will we be back to normalcy by the end of the year? We will be back. We are hoping that we will be back to some normalcy, but I
think it will take time. If we peak in the United States --
CHATTERLEY: Catherine, I have to interrupt you there because we are out of time, but we will get you back. Brilliant to get your insight and getting
back in play. My key takeaway, the challenge of that. Catherine Mann of Citigroup. Thank you so much.
MANN: Thank you very much.
CHATTERLEY: All right, thank you. After the break, putting governments and major institutions under the spotlight and asking time to act, are they
doing enough? Stay with us.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. A new segment, Time to Act: Are Institutions and Governments Doing Enough? Richard Quest and John Defterios
joins me now.
Guys, this is going to be a new segment that we're going to do every week on FIRST MOVE. John, kick us off. What do we need to see? What more?
DEFTERIOS: Well, I think, Julia, the biggest challenge we have right now is populism ruling the day here and not global collaboration. So what do I
mean by that? If you go back to recent history, the global financial crisis of 2008 to 2010. The G-20 was the vehicle and we actually unleashed
collaboration between the U.S., China and the European Union to solve the problem.
It was a dormant institution that was brought back to life. They talk a very solid game right now about the $5 trillion that are on the table here
by the G-20, but that money is not being spent internationally. That's a disappointment.
Even during the fall of the Berlin Wall, you knew everything was going to be okay. We had European countries coming together, the United States was
extremely engaged. They funneled money into Eastern Europe very quickly.
This is a global challenge. It needs a global response, not those cocooning and looking after their own at this stage.
CHATTERLEY: It's a global crisis. We need global action -- Richard.
RICHARD QUEST, CNN BUSINESS ANCHOR, EDITOR-AT-LARGE: I agree with John, and I don't agree with him. He talks a good game in terms of what needs and
should happen.
But the political realities of life mean that at the moment, national governments are more concerned with ensuring their own house doesn't
collapse first.
And there is a certain logic to this, by the way. If a major OECD country were to fail in a substantial way, then the rest of the world, the
developing world would suffer much greater in the longer run.
[09:55:11]
QUEST: So I understand the logic that John is putting forward. But at the moment, the priority for governments has to be the restoration and the
protection of their own people and economies.
And at the same time, and this is the impossible, this is the three-card trick, Julia that you can't do is at the same time, ensure the developing
world is maintained and protected.
CHATTERLEY: It's such a great point. Everyone knows how to behave, they just don't know how to behave and get reelected. We need broad action and
people are understanding that every life matters. No lives matter more than others.
We are going to talk in more detail next week about this. This was just an introduction. This is going to be the segment Time to Act. Gentlemen, we're
going to push them to do more. Thank you so much.
[VIDEO CLIP PLAYS]
CHATTERLEY: We are just about wrapping up the show. But what I'm leaving you with here is the New York Fire Department saying thank you to medical
workers outside Elmhurst Hospital in Queens. Heroes, not just in New York, not just in states around America, but in countries all around the world.
Be kind to yourselves and each other. We'll see you here on FIRST MOVE on Monday. Stay well.
(COMMERCIAL BREAK)
[10:00:00]
END
