Name: How COVID-19 is impacting the economy
Uploaded: 2020-03-20T10:11:54.000Z
Duration: 3 min 35 s
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more now on how Corona virus is impacting the economy.

Joining me now is Mark Zandi, chief economist at Moody's Analytics.

Mark, good evening and thank you for joining us.

First of all, I want to get a sense of what the odds are that this tips us into recession.

And how should the government respond uncomfortably high?

I'd say they're better than even odds at this point that this is gonna push us into recession.

The Federal Reserve needs to cut interest rates.

They have a bit more to go here, and I think they will over the next few next week in the week thereafter.

But they don't have a whole lot of room to maneuver.

So the onus will quickly switch to the president, President Trump and Congress to come up with some fiscal stimulus tax cuts.

Spending increases help to the folks that air being hardest hit.

If that doesn't come pretty soon, if it's not an aggressive stimulus, recession will be very difficult to avoid.

We've seen massive volatility over the past few weeks.

Could these wild swings start impacting the broader economy, specifically the job market?

Sure, I mean, even today, just today's action was sliced $2 trillion worth of wealth for folks that own these stocks.

And in total, we've lost close to $7 trillion wealth.

So that's going to make these people the people who are relying on this is their retirement nest egg baby boomers.

You know, many people in their fifties and sixties think twice about going out and spending their now gonna have to think about Saving Maur, spending less to be prepared for retirement.

So is that has an impact on spending business to see that, and that's gonna have an impact on their hiring and potentially layoffs.

Give us your best and worst case scenario on economic impact from the Corona virus.

Well, the best case scenarios we skirt through the Trump administration, gets it together and passes along with Congress.

A hefty stimulus package in the next few weeks and we make it through with some damage certainly won't feel very good.

Be trying, but we'll make our way through worst case scenario.

You know, there's a lot of dark scenarios here, so hopefully the administration can work together with Congress and pass something soon.

What's your best advice to the average investor during all of this volatility.

I mean, for most of us, you know, your should have a long term horizon.

That means more than 10 years the stock market goes up.

You should not be focused on that of your boomer like may in your fifties and sixties.

But when we're through this, you shouldn't.

But when it's all over, you should sit down and really think about how invested you are in the stock market, because again it goes up and it also goes down.

And if you're closing in on retirement, you don't be caught with a down market and mark just quickly before you go, I'm just curious.

Are you more concerned about the potential fallout off the Corona virus on the markets?

Or I don't even know if we could make a distinction between the two at this point.

No, no, I mean both, but obviously these disruption the virus is going to create, you know, people are gonna get sick.

They're kids not going to school so that stay home, businesses are going to get disrupted.

The travel, tourism, industry, international trade.

And that's the thing that's causing so much angst on Wall Street.

All right, Mark Zandi, Thank you so much for your insight tonight.

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