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  • (lively music)

  • - Davos was the scene.

  • Everybody was there.

  • You have CEOs

  • from some of the biggest companies in the world,

  • heads of state, the president was there.

  • I don't remember anyone taking coronavirus seriously.

  • Everyone's always enthusiastic at Davos.

  • No one makes friends there by predicting doom and gloom.

  • - This seems to be the decade of shared success.

  • - [All] Together we can.

  • Together, we will.

  • - I was hesitant to say anything because being a scientist,

  • driven by facts and data, the absence of facts and data,

  • I didn't want to make any conjecture.

  • So I remember in retrospect,

  • I probably made statements that were perhaps too neutral.

  • I think all the right things are happening.

  • I mean, you've seen some of the actions

  • the Chinese government has taken.

  • I know critical disease control agencies around the world

  • are getting really active.

  • So we all have to wait and see there's a lot we don't know.

  • I don't think I was pressing it in saying

  • the economic trajectory of the US economy

  • would continue in 2020.

  • People are relatively confident that global growth

  • will sustain through 2020.

  • The chance of an economic slowdown

  • barring some sort of an exogenous event.

  • We had an exogenous event.

  • I guess I was right about that.

  • - I remember watching CEO of Goldman Sachs on the DJ booth

  • at a Salesforce party, just like 10 deep,

  • shoulder to shoulder.

  • It all feels like a totally different planet now.

  • These are people who should have had

  • the best sight lines in the world into what was going on.

  • These companies that have operations in China,

  • where this virus had been circulating for weeks.

  • And in retrospect, it probably should have informed

  • how we approach things here 'cause we were, what,

  • about two months behind them.

  • There was a sense that the economy was just too strong

  • and America was just too resilient.

  • Even as some parts of the economy

  • are showing positive signs,

  • what happened during the month of March

  • will fundamentally reshape American business

  • for the next decade.

  • March started on a very high note

  • and it ended with the economy just incomplete taters.

  • And that 31 days where just everything changed.

  • (orchestral music)

  • - [Woman] The coronavirus-

  • - [Man] Is fanning out across Asia and Europe.

  • - [Woman] There may be additional cases that we identified.

  • I do want to be imperative of that.

  • - [Man] Stocks, they fell hard again today.

  • Economic fears, many unknowns rattling investors.

  • - [Man] All non-essential businesses

  • shall close to their physical workplaces,

  • - [Woman] Police were called after some customers

  • started fighting over toilet paper and water.

  • - [Man] This is our new reality right now.

  • It is absolutely staggering where we find ourselves.

  • (indistinct)

  • - How'd you get that?

  • - Happy to do it.

  • Happy to do it.

  • I want to be able to get back

  • and look at it for posterity's sake.

  • We're really good at opening hotels

  • but if you were to ask me in the 36 or seven years

  • I've been doing this,

  • how many hotels have I actually presided over closing,

  • it would be a very, very short list.

  • - I'm currently sitting actually

  • in the Baccarat lounge at Bellagio.

  • This building is vacant.

  • It's a bit surreal.

  • It's very different.

  • - This is our trading desk.

  • So for our agricultural commodities

  • and you can see that it is empty.

  • Typically it's very busy.

  • It's very noisy.

  • - We designed this headquarters campus in which I'm sitting

  • for about 5,000 people.

  • Right now, there are roughly 300 people on a good day.

  • - I started putting out a Friday note to employees

  • on Friday the 13th,

  • which was most people's last day in the office.

  • It said Friday, March 13th,

  • I will stop comparing this week to last week.

  • We are in unchartered territory.

  • First, take care of yourselves and your families

  • as we run our business.

  • Follow company and local guidance.

  • Use judgment and humanity with individual situations.

  • Show leadership with people who are worried.

  • And remember, we have a company to run.

  • - I'm Chris Nassetta, CEO of Hilton.

  • - I'm the senior vice president of corporate affairs at 3M.

  • - I'm the head of manufacturing

  • for Toyota Motor North America.

  • - I am the CEO of Novartis.

  • - I'm JetBlue's president and chief operating officer.

  • - CEO and chairman of Proctor and Gamble.

  • - Chief executive officer of IMAX Corporation.

  • - I am chairman and CEO of Cargill.

  • We're in the privileged position of making food.

  • - Chairman and CEO of Goldman Sachs.

  • - Acting CEO and president of MGM Resorts International.

  • - CEO of US Wealth Management for JP Morgan.

  • - Deputy commissioner and chief operating officer

  • of the NBA.

  • - So coming into 2020,

  • the US is in year 11 of the longest economic expansion

  • since World War II.

  • Millions of jobs have been added to the economy.

  • The stock market keeps hitting record heights.

  • It looked like 2020 was gonna be another good year.

  • - [Crowd] Three, two, one.

  • - New years going into 2020 felt like any other new year's.

  • We were seven months into our fiscal year

  • and things were going well.

  • - I was two weeks into my job as a first time CEO.

  • - We had record Box Office of over a billion dollars.

  • - You know, when we look back,

  • we see an auto market that was pretty high actually.

  • - Our sales for plus 6%, our earnings were plus 18%.

  • - We were looking forward

  • to bringing on a new aircraft type.

  • Now the Airbus 220.

  • - How we would evolve

  • the presentation of our game digitally.

  • - We were all sort of having a similar conversation

  • about like, gosh times are good,

  • but there's just sort of this haunting feeling

  • like something's out there.

  • - The pandemic showed that strong economy that it was thin,

  • it was a veneer of shrink in that companies were profitable,

  • making a lot of money and unemployment was low.

  • But it really exposed these weaknesses

  • where wages had not really moved.

  • People are not by and large wealthier than they were

  • 10 years ago.

  • - The jobs that we saw grow the most

  • tended to be of the alternative variety.

  • There's contingent work, part-time work,

  • independent work, gig work.

  • And that also brought with it a certain moment of fragility.

  • - Companies have spent trillions of dollars

  • over the last decade buying back their own stock

  • and paying dividends.

  • - Profits were growing.

  • But you might've worried about, for example,

  • the rate of which companies

  • are not reinvesting into their businesses

  • or into the economy.

  • The classic case of a lot of short-term orientation

  • without kind of big investments into the future.

  • - The modern economy, it's powered by technology

  • and it's this just in time, it's perfectly efficient.

  • And in some ways it is,

  • and in some ways that's been really good

  • for consumers in particular,

  • but the flip side of efficiency is resiliency.

  • If there's no fat baked in,

  • there's no cushion for when things get bad.

  • - [Reporter] A mysterious respiratory illness

  • has healthcare workers on alert.

  • At least 45 people have contacted the virus

  • believed to be connected to animals

  • at a market in central China.

  • P&G has people all over China.

  • We don't have plants in Wu Han,

  • we have a distribution center.

  • So as soon as this happened,

  • our first concern was making sure

  • we took care of our employees.

  • - We knew there was some sort of

  • emerging viral issue in December.

  • Our health and safety team had flagged in Wu Han

  • because we have five hotels in Wu Han, something's going on.

  • - It felt like a just China issue for us

  • because a lot of what we make is for domestic consumption.

  • And so certainly the impacts that we looked at,

  • implications that we looked at were largely limited to China

  • and perhaps parts of Southeast Asia at that time.

  • - I don't think anybody thought

  • even when this was impacting Macau in China,

  • that it would distance itself, this close to us here

  • and end up in our ultimate shutdown.

  • - So there's this disconnect

  • between the sort of bad rumblings out there

  • and the bad headlines coming out of China and across Europe

  • and the US suffered.

  • It just keeps going up.

  • I mean, it hits record high after record high.

  • In February looking back, it seems like hubris,

  • but investors often don't see what's right in front of them.

  • - Coronavirus was on the horizon,

  • but our investor day was one of the most bolish

  • and exciting that we've ever had.

  • - I remember talking to a very, very prominent investor

  • Superbowl weekend down in Miami,

  • where we had a discussion with both of us said,

  • "Boy, it seems like there's a lot more risk

  • "in this virus becoming a bigger issue

  • "than the market's pricing."

  • - On on February 11th, we've been asked to participate

  • in the opening bell ceremony for NASDAQ

  • in celebration of our 20th anniversary.

  • - Happy 20th to JBLU.

  • - I had the pleasure of appearing

  • on Squawk Box in the morning and was specifically asked

  • whether or not we were seeing

  • any impact from the coronavirus.

  • - You want to start with coronavirus?

  • - Sure.

  • - Is it really impacting things

  • in here in United States right now?

  • - For JetBlue, it's not impacting JetBlue

  • in any meaningful way.

  • Boy was I wrong?

  • And there a headline that I think will live with me

  • until I retire from this industry.

  • - The Chinese government basically shut the country down

  • and put the entire populace under quarantine.

  • (tense music)

  • Now, that had an immediate impact

  • on Toyota's operations there.

  • We couldn't make cars, we couldn't sell cars.

  • - We have over 700 screens now,

  • which is 1% of the screens in the country.

  • And Chinese new year is the biggest film going week

  • for us of the year in China.

  • We typically do 10% of our year in one week.

  • And then we heard every theater in China was closed.

  • And then a day later, they said

  • none of the big Chinese movies would be released.

  • What was the biggest part of our year

  • was reduced to nothing overnight.

  • - We produce about 70 billion doses of medicine a year

  • in over 150 countries.

  • We had to make the decision

  • to send all of our China operations home,

  • which is over 10,000 people.