fortune--2020-03-16--The push for legal medical marijuana in the South is upending longstanding views

Facing a potentially historic vote on whether to legalize medical marijuana in Kentucky, Republican lawmaker John Schickel is conflicted.
A retired law enforcement officer, Schickel once steadfastly opposed medical cannabis, but his stance has softened. Now he says he’s approaching the question with an open mind.
“One side of me says that with all the drug abuse we have right now, why are we opening up another avenue of abuse?” the state senator said in an interview. “But the flip side of it is, if there are people who need medical attention and truly believe that it will help them, who are we to say they can’t have it?”
Schickel’s dilemma stands as yet another sign that views about marijuana are changing across the South, where efforts to legalize it have long been stymied by Bible Belt politics. While medical cannabis is legal now in 33 states, including Arkansas, Louisiana, and Florida, other Southern states remain among the holdouts.
Whether wavering resistance will lead to legalization remains unclear. After years of setbacks, the Kentucky bill’s supporters cleared a historic hurdle when the House passed the measure. The Senate appears more skeptical.
Lawmakers in other Southern states are also cautiously eyeing changes, though there’s reason for hope among advocates.
In Alabama, a medical marijuana bill won approval in the Alabama Senate as advocates make headway after years of setbacks. The legislation moves to the state House next.
And in Mississippi, voters will decide for themselves whether to legalize medical marijuana in November, after a group submitted more than enough signatures to put the issue on the ballot. But that ballot question might have competition.
The Mississippi House voted to put a second medical marijuana proposal on the statewide ballot this year. People who petitioned to get the first one there say the second is designed to split the vote and kill both proposals. The alternative proposal would go on the ballot only if it is also approved by the state Senate.
The Kentucky bill would allow doctors to prescribe cannabis that patients could obtain at approved dispensaries in forms such as pills and oils. Smoking medical cannabis would not be permitted. A regulatory board would determine what conditions would qualify for prescriptions. The House-passed version would ensure that approved conditions would include chronic pain, epilepsy, multiple sclerosis, and nausea or vomiting.
Opposition has come from socially conservative lawmakers who warn that legalizing medical cannabis would push Kentucky off a slippery slope leading to recreational use of the drug.
“Marijuana isn’t just a carefree, happy-go-lucky kind of thing you just do on a whim,” Republican Rep. Stan Lee said. “It’s a drug. And I don’t think it’s good for our society. I don’t think it’s good for our people. And I fear that’s where we’re going—step by step.”
Looking to defuse that argument, the bill’s leading supporter said he too is opposed to recreational marijuana.
“This is not about fun,” Republican Rep. Jason Nemes said after House vote. “This is about healing. This is about health.”
Other opponents are uneasy about Kentucky getting ahead of federal marijuana policy. Despite increasing legalization in the states, marijuana remains federally classified as a Schedule I drug, alongside heroin and LSD.
Others warn of aggressive marketing by the cannabis industry: “It’s an addiction-for-profit business model,” said Garth Van Meter of Smart Approaches to Marijuana, an alliance that says it promotes a health-first approach to marijuana policy.
And some say more research is needed on marijuana’s medicinal value before it’s prescribed.
“If it’s a drug, we’ll have the FDA deem it a drug and then allow our pharmacists to distribute it,” said Kentucky prosecutor Chris Cohron.
Supporters see these arguments as misdirection meant to keep Kentucky out of step with most states.
“The research has been done, and Kentucky is… behind on cannabis legislation,” said Jaime Montalvo, executive director of Kentuckians for Medicinal Marijuana.
Now the bill’s fate is in the hands of the Senate, with just a few weeks left in this year’s session.
Republican Sen. Wil Schroder is among the undecideds. He said he’s always told voters he would be open-minded, and that hasn’t changed. But he said “there’s a lot of hesitancy from members, myself included, when the federal government hasn’t acted on this.”
Meanwhile, lawmakers are hearing an outpouring of support from medical marijuana advocates who want cannabis prescriptions for their medical conditions.
Choking with emotion, Schickel said a lunch conversation with a constituent battling brain cancer reinforced his willingess to take another look. “He was very passionate that it would help him,” Schickel said.
Among the more prominent advocates is Eric Crawford, who has become a fixture at the Kentucky Capitol.
Crawford has told lawmakers he already uses medical marijuana as an alternative to opioids to deal with pain and muscle spasms, the legacy of spinal cord injuries he suffered in a vehicle crash decades ago.
“I just want to be comfortable,” Crawford said in an interview. “Medical cannabis just makes me comfortable… and takes care of my pain and spasms better than the pharmaceuticals can.”
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—Let’s remember what we learned in WWII, as well as in 2008
Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--Trial of Moderna’s coronavirus vaccine starts Monday, government official says

How early GPS gadget maker Garmin mapped out success against the likes of Apple and Google

Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.
The first participant in a clinical trial for a vaccine to protect against the new coronavirus will receive an experimental dose on Monday, according to a government official.
The National Institutes of Health is funding the trial, which is taking place at the Kaiser Permanente Washington Health Research Institute in Seattle. The official who disclosed plans for the first participant spoke on condition of anonymity because the move has not been publicly announced.
Public health officials say it will take a year to 18 months to fully validate any potential vaccine.
Testing will begin with 45 young, healthy volunteers with different doses of shots co-developed by NIH and Moderna Inc. There’s no chance participants could get infected from the shots, because they don’t contain the virus itself. The goal is purely to check that the vaccines show no worrisome side effects, setting the stage for larger tests.
Dozens of research groups around the world are racing to create a vaccine as COVID-19 cases continue to grow. Importantly, they’re pursuing different types of vaccines — shots developed from new technologies that not only are faster to produce than traditional inoculations but might prove more potent. Some researchers even aim for temporary vaccines, such as shots that might guard people’s health a month or two at a time while longer-lasting protection is developed.
Also in the works: Inovio Pharmaceuticals aims to begin safety tests of its vaccine candidate next month in a few dozen volunteers at the University of Pennsylvania and a testing center in Kansas City, Missouri, followed by a similar study in China and South Korea.
Even if initial safety tests go well, “you’re talking about a year to a year and a half” before any vaccine could be ready for widespread use, according to Dr. Anthony Fauci, director of NIH’s National Institute of Allergy and Infectious Diseases.
That still would be a record-setting pace. But manufacturers know the wait — required because it takes additional studies of thousands of people to tell if a vaccine truly protects and does no harm — is hard for a frightened public.
President Donald Trump has been pushing for swift action on a vaccine, saying in recent days that the work is “moving along very quickly” and he hopes to see a vaccine “relatively soon.”
Today, there are no proven treatments. In China, scientists have been testing a combination of HIV drugs against the new coronavirus, as well as an experimental drug named remdesivir that was in development to fight Ebola. In the U.S., the University of Nebraska Medical Center also began testing remdesivir in some Americans who were found to have COVID-19 after being evacuated from a cruise ship in Japan.
For most people, the new coronavirus causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia. The worldwide outbreak has sickened more than 156,000 people and left more than 5,800 dead. The death toll in the United States is more than 50, while infections neared 3,000 across 49 states and the District of Columbia.
The vast majority of people recover. According to the World Health Organization, people with mild illness recover in about two weeks, while those with more severe illness may take three weeks to six weeks to recover.
More coronavirus coverage from Fortune:
—How to get a refund on your Broadway tickets after coronavirus shut down
—A Q&A with WHO special envoy David Nabarro on COVID-19
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—After SXSW cancellation, Austin hotels and restaurants are bracing for a rough road
—While canceling mass gatherings, the U.K. is still aiming for deliberate “herd immunity”
—Walmart, Target, CVS, and Walgreens will loan space for coronavirus test centers
—Let’s remember what we learned in WWII, as well as in 2008
Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--Fact checking claims from the Democratic debate between Biden and Sanders

Former Vice President Joe Biden and Sen. Bernie Sanders sparred one-on-one Sunday in a Democratic debate, held without a live audience in the shadow of a growing coronavirus pandemic.
A look at how some of their claims compare with the facts:
SANDERS, to Biden: “You have been on the floor of the Senate time and time again talking about the need to cut Social Security, Medicare and veterans programs. Is that true or is that not true?”
BIDEN: “That is not true.”
THE FACTS: Sanders’ accusation is misleading. He suggests that Biden’s record shows that he would be hostile to preserving Social Security. In fact, Biden’s position has actually evolved over his long public career as a centrist senator. Cutting Social Security is not what he is proposing now.
Biden’s campaign has pointed to a long list of legislation he supported that increased Social Security benefits. But as an influential legislator who had a hand in passing major bills, he also was willing to enter negotiations with Republicans by considering a reduction in cost-of-living increases.
Often these changes were presented as a way to cut costs that would save the program.
During a 1996 candidate debate, for example, he floated the possibility of reducing cost-of-living increases and raising the retirement age to 68.
Sanders and his allies have also circulated video footage, news stories and transcripts of Biden’s past remarks. But in some cases, what appears to be a sweeping statement by Biden lack crucial context.
One of the principal examples is a clip from a 2018 speech in which Biden appeared to discuss in favorable terms then-House Speaker Paul Ryan’s comments that a rising deficit demanded action on the popular entitlement programs. However, video, circulated on Twitter by a top Sanders adviser, used only a snippet of Biden’s remarks and avoided his larger criticism over how Ryan handled the 2017 tax cuts and subsequent budget debates.
Other widely distributed videos of Biden as a U.S. senator from Delaware in 1995 and presidential candidate in 2007 show him explaining his support for a more austere federal budget, including putting Social Security and Medicare “on the table.”
“When I argued that we should freeze federal spending, I meant Social Security, as well,” Biden said during a 1995 speech on the Senate floor. “I meant Medicare and Medicaid. I meant veterans’ benefits. … And I not only tried it once, I tried it twice, I tried it a third time and I tried it a fourth time.”
The remarks were delivered in support of a federal balanced budget amendment that ultimately failed to win approval and did not relate directly to legislation that would have cut or frozen Social Security spending — or any other specific program. Yet as Biden himself acknowledged at the time, Social Security would likely have faced cuts if such a measure had been approved.
As the Democratic Party moved leftward — a development that tracks along ever-widening income and wealth inequality — Biden has moved with it. His 2020 campaign platform now calls for raising taxes on upper-income households to shore up Social Security and expanding benefits for some of the oldest seniors.
“There will be no compromise on Medicare and Social Security, period. That’s a promise,” Biden said Jan. 20 at the Black & Brown Forum in Des Moines, Iowa.
___
SANDERS: “I voted against the bailout because I believed that the illegal behavior being done by the people on Wall Street should not be rewarded by a bailout. … The Fed gave trillions and trillions of dollars in zero interest loans to every financial institution in this country and central banks all over the world. That was essentially a grant.”
THE FACTS: Sanders is mischaracterizing the steps taken by the Federal Reserve and the stimulus efforts by the Bush and Obama administrations as merely giveaways to banks and Wall Street. It’s true that banks disproportionately benefited from the bailout, but the layoffs and foreclosures of that time would have been even worse without the government’s fiscal and monetary intervention.
First, the Fed cut the interest rate that banks charge each other for overnight loans to near-zero in late 2008 as the economy was cratering. It also bought government debt and mortgage-backed securities that expanded the central bank’s balance sheet to historic highs. These were not grants as Sanders suggests, but efforts to increase the flow of money into the U.S. economy in order to halt the downturn and boost hiring, business investment and consumer spending.
Second, Sanders suggests that efforts such as the Troubled Asset Relief Program were in spirit rewarding bankers who should have been criminally prosecuted. But the loans and other initiatives stemming from TARP were about stabilizing the financial markets and other sectors of the economy. Biden correctly noted that failing to stabilize those institutions could have made the situation even bleaker for everyday Americans.
___
SANDERS: “We’re the only major country on earth not to guarantee health (care for) all people. We’re spending so much money and yet we are not even prepared for this pandemic.”
BIDEN: “It has nothing to do with ‘Medicare for All’ — that wouldn’t solve the problem at all.”
THE FACTS: Biden has a point. The coronavirus pandemic has taken countries by surprise regardless of the type of health care system that they have. Spain has a single-payer system, known as “social security” in that country. Italy guarantees coverage for all through a regionally based system. But both countries have struggled to get control of the outbreak, and their governments have been forced to take stringent measures not yet seen in this country.
___
BIDEN: I’m taking all the precautions. I make sure I don’t touch my face.”
THE FACTS: He defied two recommended precautions during the debate, coughing into his hand, not his elbow, and touching his face.
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fortune--2020-03-16--Fear and loneliness in the time of coronavirus

Computer monitors and other work-at-home essentials are in big demand in the coronavirus era

This is the web version of Brainstorm Health Daily, Fortune’s daily newsletter on the top health care news. To get it delivered daily to your in-box, sign up here.
Good afternoon, readers.
We have a tendency to focus on physical ailments when we talk about public health, especially in the sort of situations we currently find ourselves in with the coronavirus outbreak.
But, just as we wouldn’t ignore the downstream effects of a crisis like this in the business supply chain, it’s important to take the downstream mental health effects of social distancing and isolation into account.
What public health agencies had been warning us about for weeks is coming true—widespread disruptions to daily life that require people to isolate themselves in some form or another. And it’s happening at a rapid pace.
This isn’t to say that you should ignore advice about social distancing (you absolutely should not). You may not really have an option given the bar, restaurant, and public facility closures that have been announced in just the past two days.
But it also isn’t fun to spend time alone for an extended period. Humans are social animals. And I’ve been hearing from my own friends and family members about how this current coronavirus situation is, well, sort of driving them stir crazy as they’re locked up in their homes.
Loneliness is a condition in and unto itself, according to the American Psychological Association (APA). It’s an issue we’ve seen linked to everything from the opioid crisis to the rise of suicides.
So if we’re really hunkering down for the next few months as the coronavirus pandemic unfolds, it’s important to keep in mind what we can do for one another while also remaining responsible.
Reach out to your friends and loved ones. And if you know somebody who doesn’t have a person to interact with directly, maybe give them a call, text, or video chat.
Read on for the day’s news.
Sy Mukherjee
sayak.mukherjee@fortune.com
@the_sy_guy
DIGITAL HEALTH
The war game that predicted our coronavirus response. My colleague Clifton Leaf (you may know him as the editor in chief of this particular publication) has a fascinating piece on how a war game telegraphed the response we've had to the coronavirus response. The "Urban Outbreak" simulation has many implications—here's a taste: "The platform here may be two-dimensional, but the goal is the same: to raise critical questions about our readiness to respond; and to shine a light on the gaps and ineffectiveness of the business community’s current efforts on these fronts so that, perhaps, we can mount a more robust response moving forward," writes Cliff. (Fortune)
INDICATIONS
The mystery behind CureVac's coronavirus vaccine. Germany is up in arms over a coronavirus vaccine scandal. CureVac, a German biotech focusing on, well, vaccines, is at the center of it—and the story is pretty insane. We'll have a whole lot more in the coming days, but to sum it up, there appears to be an intense battle between the U.S. and German governments over an experimental vaccine for this virus and where it would be available. I encourage you to read Christiaan Hetzner's piece. (Fortune)
THE BIG PICTURE
Coronavirus dominates Democratic debate—and raises questions about health policy. If you tuned in to the Democratic debate between Joe Biden and Bernie Sanders last night, you may have noticed a theme: Coronavirus. Health care already separated these two candidates along ideological lines—Medicare for All, or expansion of the Affordable Care Act? But the debate revealed even more differences. For instance, Sanders argued that a universal health care system would do far more to help people in a pandemic situation than incremental advances; Biden retorted that countries like Italy, which have also been facing major problems, have such systems and yet haven't contained the situation. We'll be exploring this issue in more detail in the coming days.
REQUIRED READING
The greatest designs of modern times, by Daniel Bentley
Sci-fi tech tackles climate change with fake trees, by Jennifer Alsever
Here's where Goldman predicts the stock market will bottom out, by Anne Sraders
Sign up for other Fortune newsletters.


fortune--2020-03-16--Lockheed Martin CEO Marillyn Hewson, Fortune’s most powerful woman in business, will step down

Marillyn Hewson, the CEO of Lockheed Martin, the nation’s largest defense contractor, announced Monday that she would step down from her role effective June 15.
The 66-year-old Hewson, who will become the company’s executive chairman, will be replaced as CEO by James Taiclet, currently the chief executive of American Tower, a real estate investment trust.
Having held the top job at Lockheed Martin since the beginning of 2013, Hewson is not only one of America’s longest-serving CEOs, but one of the highest-ranking women in global business. Fortune ranked Hewson No. 1 on its Most Powerful Women list for the past two years in a row, above other female chief executives of Fortune 100 companies including General Motors’ Mary Barra and IBM’s Ginni Rometty, who recently announced she would retire in April.
“The timing is right not only for our company, but for me personally,” Hewson wrote in a LinkedIn post about her departure. “I have worked full time since I was 16,” she added, including at Dairy Queen as a teenager, and as Lockheed’s CEO since the beginning of 2013. “After the financial success of last year and the record $144 billion of business in backlog, the timing is right for this leadership transition,” the company told Fortune in a statement.
While Lockheed Martin would not say when Hewson gave the board notice that she would step down, a person close to the company said her decision was not related to the coronavirus outbreak nor the market’s reaction to the viral pandemic, nor did it come as a surprise. Hewson is still working from Lockheed’s Maryland offices, the person added, even as more companies send their employees home amid efforts to contain the spread of the virus.
The board’s decision to choose an outsider—and a male one—to succeed Hewson was somewhat unexpected. In an interview in 2018, Hewson told Fortune that Lockheed Martin had built a “strong pipeline” of female leaders who could potentially run the company one day, specifically citing Michele Evans, Lockheed’s head of aeronautics.
Evans has qualities that “I think [are] what you look for, whether it’s a man or a woman, to take over as CEO,” Hewson told me at the time. The rise of female talent across the defense industry “has got people to a point where now, there’s several [women] to select from,” she added. (Evans underwent treatment in the fall for what she told employees was “a significant medical issue”; she remains head of the aeronautics division.)
Hewson is one of 38 women who are currently, or are soon to be, CEOs of Fortune 500 companies, though that number may drop to 35 this spring with her and others’ departures. She’s also one of several high-ranking female leaders in the aerospace and defense industry, including Northrop Grumman CEO Kathy Warden, General Dynamics CEO Phebe Novakovic, and Leanne Caret, who heads Boeing’s defense, space, and security division.
Presiding over Lockheed Martin for more than seven years, Hewson helped build the company’s flagship F-35 fighter jet program into a powerhouse; forged a $9 billion acquisition of Sikorsky, the maker of Black Hawk helicopters; and expanded into emerging technologies such as hypersonic missiles, leading Lockheed to win billions of dollars in new contracts. She has also helped the company weather everything from criticism from President Trump (often delivered via public tweets) to conflicts in Syria and national security threats—both on the ground, in space, and in cyberspace—from North Korea, Russia and China in recent years.
Lockheed Martin stock fell more than 12% Monday—about the same as the broader market—and is down 35% from its February peak. But over the course of Hewson’s tenure, the stock has risen 212%, compared to about 67% for the S&P 500.
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—Being a CEO is more tenuous than ever. How I survived 30 years at Aflac
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fortune--2020-03-16--11 photos showing the devastating effects of the coronavirus on business

On March 16, the streets of the Lower East Side in Manhattan were eerily quiet. The usually-bustling downtown neighborhood, like much, if not all, of the U.S. has fallen victim to the novel coronavirus outbreak and the panic surrounding it.
People aren’t going to work, stores, restaurants, happy hour, or their nail appointments. You might catch a New Yorker or two popping into their neighborhood bodega to re-up on the essentials, but that seems to be it.
As COVID-19 spreads across the globe, every corner of daily life is being hit. Not least of all, as exemplified by the decimated stock market, businesses are now feeling the pain.
Americans began self-isolating in large part at the end of last week, and public spaces have noticeably emptied. Fortune gathered photos of desolate businesses, from national chains to mom and pop shops, across the country.
This is business’s new reality—for now, at least.
7th Avenue Times Square is seen nearly empty during a regular day in New York City on March 14. Eduardo Munoz—Reuters
Employee Myra Luna Antonio closes French Quarter restaurant Cafe Du Monde in New Orleans on March 15. The 24-hour restaurant discontinued it’s seating service to comply with COVID-19 related restrictions. Jonathan Bachman—Reuters
An employee cleans the grounds behind the closed gates of Disneyland Park on the first day of the closure of Disneyland and Disney California Adventure theme parks on March 14. DAVID MCNEW—AFP/Getty Images
Apple Store employees stand outside the closed Palm Desert, Calif., store to answer customers’ questions on March 14. Apple announced stores will be closed until March 27. Eduardo Munoz—Reuters
A sign indicating that Independence Hall is temporarily closed for cleaning is posted outside the historic building in Philadelphia on March 16. In a new front to slow the spread of the new coronavirus in Pennsylvania, Gov. Tom Wolf ordered all restaurants and bars to close their dine-in facilities in five heavily populated counties starting Monday. Matt Rourke—AP Images
A delivery driver leaves a Domino’s Pizza restaurant in downtown Seattle on a bike on March 15. Washington’s Department of Health announced 127 new cases Sunday, bringing the state total to 769 cases. Ted S. Warren—AP Images
Empty shelves at a Vons supermarket in Burbank, California on March 14, 2020. Amy Sussman—Getty Images
The Times Square ticket office for Broadway shows closed because of cancelation in light of the COVID-19 outbreak. Lev Radin—Pacific Press/LightRocket via Getty Images
Chairs are stacked in a Starbucks coffee shop in New York that remained open for customers purchasing for take away service on March 16. John Minchillo—AP Images
A pedestrian passes through Brookfield Place, a retail hub at the World Financial Center in New York, on March 16. New York joined with Connecticut and New Jersey to close bars, restaurants, and movie theaters starting Monday night. John Minchillo—AP Images
A ticket stand at Busch Gardens Tampa Bay is idle on March 16. Theme parks around the state are temporarily closing to help curb the spread of the coronavirus. Chris O’Meara—AP Images
Pedestrians walk by the Castro Theatre in San Francisco announcing its closed due to a California statewide ordinance banning gatherings of more than 250 people on March 15. Justin Sullivan—Getty Images
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—How to prepare your personal finances for a coronavirus recession
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Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--Computer monitors and other work-at-home essentials are in big demand in the coronavirus era

Fear and loneliness in the time of coronavirus

This article is part of a Fortune Special Report: Business in the Coronavirus Economy—a look at the impact of the pandemic on more than 50 industries.
Only a few display-only computer monitors were left at a San Francisco Staples store on Monday. The location sold out of new ones over the weekend, something that one sales associate said never happens at that location.
But the sales surge isn’t limited to this particular Staples store in San Francisco. Both Staples and Best Buy Best Buy said they have seen a surge in sales of work-from-home products like laptops and keyboards since the outbreak of the coronavirus. Many office workers and students have been forced to quickly create home offices so they can telecommute or complete their online studies.
“As many of our customers’ working environments have been dramatically impacted with a significant shift to at-home work, Staples stores have seen an increased demand for computers, monitors, and technology,” said Michael Hurwitz, Staples U.S. retail vice president and general manager of merchandising, said in a statement.
Companies like Staples couldn’t quantify the increase in work-at-home essentials. But they did say that the rise is noticeable in recent days.
In recent weeks, big employers like Google, Microsoft, and Facebook have asked their hundreds of thousands of employees worldwide to work from home. Meanwhile, many school districts and universities across the U.S. have moved to online classes, in many cases requiring students to rely on their personal devices to complete their work.
But it appears that people are also stocking up on appliances to store their food as they stock up on their growing stash of groceries. Best Buy said it has also seen a surge in sales for refrigerators and freezers.
“Our teams are working hard to meet this demand,” said Carly Charlson, spokeswoman for Best Buy.
At the Staples in San Francisco, out-of-stock monitors were still available to order online. And that may come in handy, as Monday was the last day that Staples along with any other “non-essential business” will be open for business until April 7, according new requirements implemented by the city on Monday.
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—Inside Xerox’s audacious quest to buy much bigger rival HP
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fortune--2020-03-16--5 burning questions (and answers) about the Fed’s emergency rate cut to 0%

Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.
“Bold.” “Aggressive.” “Extraordinary.” The U.S. Federal Reserve on Sunday took emergency measures, including slashing its benchmark interest rate to near zero, to buffer the economy from the effects of the ongoing coronavirus crisis.
The Fed’s moves, coming less than two weeks after an earlier interest-rate cut, replicated and accelerated monetary policy last seen at the depths of the 2008 financial crisis. The health-related crisis stemming from the COVID-19 pandemic is very different—but, the central bank seems to be indicating, the way it’s trending is just as dire.
“We expect that the illness and the measures now being put in place to stem its spread will have a significant effect on economic activity in the near term,” Fed Chair Jerome Powell said on Sunday. “Those in travel, tourism, and hospitality industries are already seeing a sharp drop in business. In addition, the effects of the outbreak are restraining economic activity in many foreign economies, which is causing difficulties for U.S. industries that rely on global supply chains.”
So how much can the Fed really help fight the coronavirus crisis—and what do these massive central-bank decisions mean for the average American? Below, we looked at what the Fed’s decisions will—and won’t—do.
What does the Fed cutting interest rates to zero really mean?
On Sunday, the Federal Reserve slashed its benchmark interest rate to a range of 0% to 0.25% and pledged to buy $700 billion worth of government debt and mortgage-backed securities. It also expanded its “discount window” to banks and loosened its associated restrictions, hoping to encourage banks to lend out more money. Then, on Monday, the New York Fed also said it would conduct an overnight repo operation for an additional $500 billion, essentially increasing the amount of short-term lending available to financial institutions.
The central bank is hoping that all of this stabilizes financial markets, makes it easier for big companies to borrow money, and for banks to be willing to lend it out. The lower interest rates and the discount window are effectively reducing the cost of credit. By buying government debt and expanding the overnight repo market, the Fed is also seeking to increase market “liquidity,” or the amount of money that’s able to move around freely.
Why do big companies need cheaper credit right now?
Bluntly, to help them avoid going out of business. As Powell noted, airlines and other major industries are in serious trouble from COVID-19, since governments are banning travel and advising that their citizens stay quarantined at home. U.S. airlines alone employ some 750,000 people, so if the companies can’t pay their bills or get loans to cover the revenue shortfall, suddenly most of those jobs are at risk. Meanwhile, smaller businesses are equally in trouble; cities and states are mandating that restaurants, bars, cinemas, and concert venues close, leaving us all to responsibly huddle inside our homes, hoarding our toilet paper.
The rates set by the Fed help determine the price that banks charge for credit—mostly to corporate borrowers, but also eventually for your mortgage or credit card. If it’s easier and cheaper for big companies to borrow money right now, the thinking goes, these corporations can continue to pay their bills, postpone laying off workers, and avoid shutting down. All of which can stave off a recession.
About that R-word: The Fed last cut interest rates this low in the aftermath of the 2008 financial crisis. Does this mean we’re about to enter another recession?
It’s not looking good, as several economists told Fortune’s Shawn Tully by Friday. “”We’re getting closer to the recessionary tipping point,” Jared Franz, an economist at fund manager Capital Group said.
What else can the Fed do to help the economy? And would we ever see ‘negative’ interest rates here?
The Fed can’t do much more, at least in terms of interest rates. Powell said Sunday that the Fed is unlikely to cut rates below zero. Negative interest rates, which central banks in Europe and Japan have tried, mean that lenders effectively have to pay their borrowers (and depositors have to pay to store their cash). “We do not see negative policy rates as likely to be an appropriate policy response here in the United States,” Powell said Sunday.
The Fed also on Sunday announced a joint action with other central banks around the world, to ensure that other countries have enough dollar reserves on hand. And there are certain other monetary-policy levers that the central bank could pull, with Congressional approval, though that’s “not something we are actively considering right now,” Powell on Sunday.
He also emphasized that the Fed can only do so much to help small businesses and consumers in the current crisis. Monetary policy can only go so far, in other words, and can’t replace legislative measures such as the pending bill that would guarantee some paid sick leave and unemployment insurance benefits.
“We don’t have the tools to reach individuals and particularly small businesses, and other businesses, and people who may be out of work,” Powell said. “But this is a multifaceted problem. And it requires answers from different parts of the government and society.”
So what does the Fed’s interest rate cut mean for me and my family?
Short-term, not very much. It probably won’t help your favorite coffee shop survive, or allow you to find more hand sanitizer on drugstore shelves. But if you’re able to think about buying a house, you’ll probably be able to get a cheaper mortgage. Your credit card interest rates might eventually go down. On the flipside, the rates banks are willing to pay for your deposits will also go down—so those high-interest savings accounts, like the bull market, may be a thing of the past.
More must-read stories from Fortune:
—How to prepare your personal finances for a coronavirus recession
—Why the world’s stock markets kept going quiet last week
—The Fed made a bold move to calm shaky markets. But is it enough?
—Why return CEOs are usually bad news for a company’s stock
—Dormant PayPal Credit accounts are coming back to hurt credit scores
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fortune--2020-03-16--Events businesses are petitioning for help amid coronavirus cancellations

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The events industry has been ravaged financially by a mass number of cancellations—weddings, corporate events, brand launches, bar mitzvahs, trade shows, and more—but thousands are banding together to demand federal aid from the U.S. government.
In less than 24 hours, a petition that requests a federal aid package for the small businesses of the events industry due to COVID-19 garnered more than 20,000 signatures on Change.org. At the time of publishing, it was up to nearly 190,000 . And the creators, the team behind Digerati Productions, an audio/visual company, are estimating they can get to 3 million.
“The damage will be irreversible for the industry,” explains Isaac Rothwell, Digerati’s national director of operations, about the inspiration for the petition. “We predict an economic disaster, resulting in the widespread exit of vast numbers of staff and business due to insurmountable financial hardships, bankruptcy, homelessness, and loss of all stable support systems. We really wanted to give a unified voice.”
Rothwell said they won’t stop until they see a response from the federal government, and a social media campaign #SaveEvents has even sprung up to share the word.
The events industry is made of hundreds of thousands of small businesses that provide a variety of services to all-things gatherings: planning, florals, design, photography, catering, rentals, audio/visual equipment, music, and more. It employs 5.9 million people, according to the Oxford Economics and Events Industry Council, including thousands of freelancers and contractors to aid with stage setup, check-in, crowd control, security, and production. These are the people behind your company’s snazzy holiday party, your neighbor’s bat mitzvah, and your cousin’s wedding as well as that business conference in Las Vegas and brand activation at SXSW in Austin. But as a result of the COVID-19 outbreak leading to rapidly expanding travel restrictions and caps on large gatherings in many states, these business owners and their teams are not just seeing current income fall, but projected revenue into 2021.
Elite Core Audio, an equipment manufacturer for live events and productions, quickly started putting together statistics on the economic impact to the industry. Within days, the fallout from canceled events has been extreme. Businesses, on average, have lost 12 events to because of cancellation, with an average loss of almost $160,000. Nearly half of the businesses they spoke with anticipate layoffs, with the majority coming to contracted labor and freelancers. The gig-based businesses of the wedding industry believe it can affect up to 37% of their yearly income—and this is just the start. The majority are majorly concerned about the future of their businesses.
The proposed package asks for emergency medicare health insurance to cover uninsured business owners, contractors and laid-off employees; $200 billion in low-interest federally backed business liquidity loans; and $100 billion in employee retention grants. Rothwell says that the latter is extremely important given the government mandated shutdown on gatherings. “As a service-based economy of live events and business meetings, we cannot sustain taking on the level of debt to support employees without any ability to perform revenue generating activities during this time of a large gathering shutdown,” he adds. To put it simply, the general lack of work, and expected work in the coming months, has dire effects on the events industry.
Thousands of events-related personnel—from bartenders to planners to venue owners—have opted in. But it goes beyond them: a comedian who needs a club to perform, a theater stagehand, a tour manager with no tour, a harpist who plays weddings. Exploring the reasons for signing include details like the “loss of $60,000” in revenue for two months and a photographer who has lost all of his events for the foreseeable future.
Digerati Productions has warehouse hubs across the U.S. and span the events industry, from trade shows to corporate events, and its team immediately saw the impact that COVID-19 was having on their vendors and friends everywhere. CEO Randy Pruitt says the tipping point came when they were doing their own disaster planning for the next three months.
“Everything ended up being our worst-case scenario at every juncture,” Pruitt says. “The petition is the only thing we could think of to help the people and companies of our industry survive the rapidly developing situation.”
More coronavirus coverage from Fortune:
—How to get a refund on your Broadway tickets after coronavirus shut down
—The oil sector takes its next hit: Coronavirus on offshore rigs
—Some of the most extreme ways companies are combating coronavirus
—How luxury designers in Italy’s fashion heartland are facing coronavirus
—Amazon tells employees to work from home if they can. Warehouse workers can’t
—Why Dollar General thinks coronavirus can help business
—Coronavirus may not be all bad for tech. Consider the “stay at home” stocks
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fortune--2020-03-16--Coronavirus puts department stores and clothing chains in peril

The coronavirus outbreak will do very few retailers any favors, but department stores and clothing chains stand to lose more than their peers.
This past weekend saw seemingly contradictory events play out: long lines were a constant at stores like Walmart, Costco, and Target as shoppers continued to stock up on household essentials and food. Target CEO Brian Cornell said on Monday the company continues to see a “sustained surge in shopping.”
But many other retailers, such as Abercrombie & Fitch, Nike, R.E.I., and Under Armour said they were closing stores for an extended period, while others like Gap Inc. announced reduced store hours. (On Monday, Kohl’s and Nordstrom also said they were cutting some store hours.) The key difference? Selling essentials consumers need versus selling discretionary items like clothing or home furnishings that people want but can get by without replacing.
“That’s the first area people will cut back on,” Neil Saunders, managing director of GlobalData Retail tells Fortune. “A lot of consumers are diverting their discretionary spending for stocking up.” There are already echoes of 2009’s Great Recession when spending on anything but necessities plummeted, punishing companies like Macy’s, J.C. Penney, and clothing chains like the Gap with sales declines almost in the double-digits on a percentage basis.
Research firm Customer Growth Partners last month forecast retail sales would rise 4.1% this year. Now it thinks that increase could be as modest as 1% if the crisis lasts into early summer.
What could aggravate things for the department stores and clothing chains is if state, county, or city authorities close malls where such retailers typically operate, or reduce hours. Last week, Simon Property Group‘s King of Prussia Mall—outside Philadelphia—told tenants the county government expected non-essential retailers in the mall to close. Simon announced a big financing on Monday, while Macerich, a major mall operator, cut its dividend because of the “uncertain and rapidly changing environment.” That most likely includes more distressed tenants asking for rent concessions.
Retailers like Target, Walmart, and Kroger are well positioned to take market share from department stores and clothing stores because of the breadth of their staples plus stock.
“That’s the benefit of Target and Walmart: they have pharmacy and they have grocery,” says Forrester researcher Sucharita Kodali. And that extra shopper traffic will help them in other categories, like clothes and home goods. “They’re not going to put a moat around the electronics or clothing sections of their stores so they’ll get some extra business.” (Last week Dollar General said it expected a sales boost from the current uncertainty as people are expected to stick closer to the area near their home.)
Walmart, Kroger, and especially Target, have ramped up their clothing and home goods selections in the last two years, meaning they should continue to take market share from department stores: Target’s apparel sales grew at a healthy clip during the holiday season, while Macy’s and Kohl’s sales were on par with the prior Christmas period.
(Best Buy so far also seems to be a winner too, as parents facing the prospect of working from home for weeks with kids out of school race to improve their home internet capabilities and buy new devices like iPads.)
Even if the coronavirus crisis eases in a few months, its impact on some retailers could be long lasting. Department stores and apparel chains typically order merchandise for the holiday season right about now. But they are doing so in a climate of high uncertainty about levels of consumer confidence and spending power in eight months, increasing the risk of over-ordering, which would lead to margin-killing discounting, or under-ordering, which means lost sales.
Another thing that can hurt some of these retailers and perhaps take some of them out if this goes on for too long: many have weak balance sheets and high debt loads, meaning any drop in sales could be catastrophic. That includes the likes of J.C. Penney (which is struggling to prevent being delisted from the New York Stock Exchange and reported awful fourth quarter results), Neiman Marcus, and J.Crew. (J.Crew has been banking on spinning off its Madewell business, but in this environment—the Dow Jones Industrial Average fell 13% on Monday—a listing is unlikely.)
“If you don’t have a good balance sheet going into this you are not in a position to weather this storm at all,” says Saunders.
More must-read stories from Fortune:
—How the founder of Jersey Mike’s started a billion-dollar business
—1 in 3 Americans were stocking up before coronavirus was ruled a pandemic
—Gap Inc pegs coronavirus losses at $100 million and counting
—Why Dollar General thinks coronavirus can help business
—What clothing companies can do to reduce their environmental impact
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis.


fortune--2020-03-16--U.K. increases social distancing measures as epidemic gains speed—but stops short of other European

U.K. increases social distancing measures as epidemic gains speed—but stops short of other European countries

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The British government announced a new set of restrictive social distancing measures Monday, in response to what officials said was an acceleration of the coronavirus epidemic in the country, particularly in London.
The new measures include advice that all people should avoid social contact, especially those in groups that are more vulnerable, and that people should refrain from visiting pubs, restaurants, and theaters. The government also said in a now daily televised update that it would no longer provide emergency and police services for large events, contradicting government briefings over the weekend that mass gatherings would be actively banned beginning this week.
The government also asked all people who could work from home to do so and to avoid all but essential travel. It also recommended that all households self-isolate for 14 days if one person in the home exhibits coronavirus symptoms. Previously the government had only asked individuals exhibiting symptoms to self-isolate for seven days.
“Many people, including millions of active people over 70, may feel, listening to what I’ve just said, that there is something excessive about these measures,” Prime Minister Boris Johnson said. “But I have to say I believe they are overwhelmingly worth it to slow the spread of the disease, reduce the peak, to save lives, minimize suffering, and to give our NHS the chance to cope.”
The announcement came after a weekend in which the government faced substantial pressure over its approach to tackling the virus, which has diverged sharply from other European countries, and comments over targeting “herd immunity” and ending testing for those who are not in the hospital.
The government also appeared to be responding to criticism of the communication style, with regular televised press conferences supplemented by background government briefings to news media over the weekend, which helped fuel confusion on the U.K.’s approach.
But the acceleration in measures also marked the fact that the country’s infection rate appears to be “on the fast upswing, or just about to get there” and that London was the epicenter of the outbreak, according to Chief Medical Officer Chris Witty.
On Thursday, Whitty said the U.K. was currently behind the infection trajectory of Italy, Europe’s hardest-hit nation, by about four weeks. Three days later, on Monday, he said the U.K. was now three weeks behind Italy. In the U.K., 1,543 people have tested positive, and 55 have died.
Still, the U.K. government, which has increasingly stood apart from countries including Germany, Spain, and France in not imposing more restrictions to address the epidemic, stopped short of many widespread measures.
Schools in the U.K. remain open, and while the public was advised to avoid large gatherings of any kind, as well as pubs and restaurants, those venues and events are still permitted. Johnson said he was not planning on making the new recommendations legal requirements—enforceable with fines or imprisonment as other nations have done—even though he said the government had ample authority to do so if necessary.
“Most people would accept that that we are a mature, grownup, liberal democracy where people understand very clearly the advice that is being given to them,” he said.
Johnson said closing schools, as well as even more stringent measures, such as locking down entire cities, as has happened in Italy and Spain, might be necessary in the future, but that it was not yet the right time to impose such measures.
The announcement came the same day as lockdowns accelerated across continental Europe, with Germany following France announcing the widespread closure of public venues.
The U.K. has also not committed to as extensive a testing regime as has been implemented in some other countries, such as South Korea and Singapore. Officials in Singapore and the World Health Organization have criticized the U.K. and a few other nations, such as Switzerland, for not carrying out far more extensive testing.
Whitty said that the U.K. was currently trying to test all intensive care patients and all patients in the hospital with pneumonia, and that it was trying to increase the number of tests and labs so that family doctors in the community could conduct tests. But he said that the test the U.K. is currently using cannot reveal whether someone has previously been infected with coronavirus and perhaps been asymptomatic.
People should expect to need to follow newly announced recommendations for many weeks or months, Whitty said during the press conference.
“We’ve said all along this is a marathon, not a sprint,” Whitty said. He said that people in vulnerable groups should expect to have to practice social distancing for at least 12 weeks and maybe longer.
“The next weeks and months are going to be extraordinarily difficult.”
The government also played down earlier comments that its less stringent policies were part of an effort to try to develop “herd immunity” in Britain.
In response to a question about herd immunity, Sir Patrick Vallance, chief scientific adviser, said the U.K’s policy was to “flatten the curve”—reducing the number of cases at the peak of the epidemic to avoid overwhelming the country’s National Health Service—and that has always been the only goal of the government’s policies.
Herd immunity occurs when a large enough segment of a population has immunity to a virus, preventing its transmission to the rest of the group that does not have immunity. This is usually achieved through vaccination programs, but it can also occur when a large number of people are infected with a virus and recover, provided their bodies produce long-lasting antibodies.
More coronavirus coverage from Fortune:
—How A.I. is aiding the coronavirus fight
—How the coronavirus could upend America’s business relationships to China
—The best Twitters to follow for reliable information on the coronavirus outbreak
—3 months before the coronavirus, a war game showed we weren’t ready
—How mainland China’s closest neighbors have kept coronavirus cases so low
—Couples are scrambling to prepare last-minute wedding alternatives
—SARS taught Taiwan how to contain the coronavirus outbreak
Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--The Dow posts its biggest one-day point loss ever as nothing can stem the coronavirus panic on Wall

The Dow posts its biggest one-day point loss ever as nothing can stem the coronavirus panic on Wall Street

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Another day, another massive freefall.
The S&P 500 fell 324.89 (12.0%); the Dow Industrials was down 2,997.10 (12.9%); the Nasdaq lost 970.28 (12.3%) and the Russell 2000 was off 172.72 (14.3%). The Dow’s drop represented the largest one-day point loss ever.
There was also a twist today. “This market has moved beyond coronavirus and into credit crisis,” said Frances Donald, managing director, chief economist, and head of macro strategy at Manulife Investment Management.
It comes down to the Federal Reserve’s Sunday surprise, starting with a drop to a 0% federal funds rate that it will maintain “until the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”
Additionally, the Fed will effectively resurrect quantitative easing, purchasing $500 billion in Treasurys and $200 billion in mortgage-backed securities, and expand its repo operations, in which it purchases Treasurys on an overnight or short-term basis to provide more liquidity to markets.
Some felt the efforts were more a miss than a hit. “The Fed hoped that the market would take solace,” Allen Sukholitsky, founder and chief macro strategist at Xallarap Advisory, wrote in a note to Fortune. “Instead, the market became suspicious.”
“This makes it look like the Fed is panicking,” Sean O’Hara, president of Pacer ETF Distributors at Pacer Financial, agreed in a note to Fortune. “What normally would look like something reassuring, is now looking like we all should be much more worried than we were.”
Others disagreed about the intent.
“The Fed’s moves were not designed to be a panacea for the economy or financial markets,” Greg McBride, senior vice president & chief financial analyst at Bankrate, noted to Fortune. “Instead, they are acting aggressively to prevent further tightening of credit markets and have cut interest rates to near zero to set the stage for low cost borrowing once the virus has passed.”
What has worried the Fed was contracting liquidity and lowered ability to sell bonds in the Treasury bond market, a critical part of the global economic system. “What the Fed has been doing … [is] making sure liquidity continues and that markets can function properly,” said Collin Martin, fixed income strategist of the Schwab Center for Financial Research.
Others were worried that there’s no more ammunition. “The Fed has nothing more to do now and there’s nowhere to go,” said Melissa Brown, global director of applied research at financial intelligence service Qontigo.”
Conditions are “moving away from garden variety recession to a financial crisis,” Donald said. The worry is whether there is enough liquidity to keep global financial systems working they way they should.
For equity markets, the question is what investors will do now. And what governments will implement in terms of fiscal stimulus.
“No policymaker can help us avoid the recession that is coming,” Donald said. “But policies can help us come out faster and stronger if they’re targeted in time.”
The good news, such as can be found, is that the bottom, while not quite here, seems on its way, and that could be a sign for investors to buy.
“When the market is so bad and you believe it’s only going to get worse and panic is running everywhere—when panic has peaked, that is a good time,” Donald said.
However, “I don’t think panic has peaked,” she added.
More must-read stories from Fortune:
—How to prepare your personal finances for a coronavirus recession
—Why the world’s stock markets kept going quiet last week
—The Fed made a bold move to calm shaky markets. But is it enough?
—Why return CEOs are usually bad news for a company’s stock
—Dormant PayPal Credit accounts are coming back to hurt credit scores
Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--As coronavirus spreads, is this weekend’s historically low box office Hollywood’s new normal?

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Hollywood’s never quite faced a threat like coronavirus, which made itself known at the box office this past weekend as moviegoers kept away and theater chains grappled with the ever-shifting logistics—and much-debated ethics—of staying open amid the unprecedented health crisis.
As feared, U.S. movie ticket sales plummeted to a historic low this weekend, cratering out at around $55.3 million, down 44% from last weekend, this despite the arrival of three new movies—Vin Diesel vehicle Bloodshot, horror-satire The Hunt, and faith-based drama I Still Believe—in wide release. By some estimates, that’s the lowest ticket sales have been in two decades.
Onward, Disney-Pixar’s fantasy adventure, held at No. 1 but collected just $10.5 million, a grim figure that constitutes a 73% drop from the film’s opening last week. Adding $6.8 million outside the U.S. despite the widespread closure of theaters in traditionally sturdy markets such as China, the film’s made $101.7 million so far. All of this is unprecedented for Hollywood but particularly galling for Disney and Pixar, which have historically relied on a steady stream of family audiences to offset second-weekend drops. Still, no one could blame most parents for keeping their kids home with public fear escalating around this epidemic on a daily, if not hourly, basis.
In a divide that says much about differing domestic attitudes toward coronavirus, faith-based drama I Still Believe fared the best of the new releases despite a comparatively minuscule budget and ad spend. The title, a romantic drama starring Riverdale‘s KJ Apa and Girlboss lead Britt Robertson, made about $9.5 million over the weekend and can already be considered a hit by virtue of its lean $10 million budget.
Harder hit was Bloodshot, Vin Diesel’s would-be franchise starter for Sony in which he plays a bionic assassin; it earned about $9.3 million domestically and will almost certainly finish stronger overseas, where it took in a still-anemic $13 million. Worst of all, The Hunt, which Universal and Blumhouse tried to market as an “event” title after its “liberals-vs.-deplorables” premise attracted controversy last summer—struggled to find an audience, making just $5.3 million. Blumhouse is famed for keeping its budgets trim, but this result surely stings, given the wealth of social-media attention afforded to The Hunt and an extensive marketing campaign that tried and failed to capitalize upon it.
As industry folk despaired at this weekend’s dismal returns, uncertainty reigned across the film industry, one of many threatened on a practically existential level by the spread of coronavirus. Gathering strangers into a darkened theater to watch movies has never been a riskier proposition for audiences, who have the option of staying home—and in an increasing number of states have little choice in the matter.
Though the majority of cinema chains in the United States remained open as of press time, AMC and Regal have both slashed seat capacity in theaters by 50%, spacing out moviegoers in accordance with the CDC’s “social distancing” guidelines. On Monday, AMC took the additional step of limiting screenings to 50 people, but some expect such half-measures will do little to prevent a probability Hollywood is increasingly aware could be just days away: a coast-to-coast movie-theater blackout. On Sunday, closures of theaters in industry epicenters New York and Los Angeles brought this anxiety to new heights.
Amid the turmoil, NBCUniversal has beaten its competitors out of the gate in pivoting to a day-and-date streaming rollout for its next major summer title, Trolls World Tour (opening April 10). The colorful animated sequel by Dreamworks Animation was previously shifted to that April date after No Time to Die abandoned it, but dire returns for Onward likely cemented the studio’s thinking that family-targeted features are in no way immune to the panic surrounding coronavirus. And if the worst does come to pass and movie theaters are ordered to close across the country this week, on-demand viewership will become studios’ only recourse toward earning revenue on recent titles. NBCUniversal, in announcing the Trolls strategy, also noted that it will be making its currently out Universal titles, including The Invisible Man, Emma., and The Hunt, available on digital platforms starting this Friday. The titles will be available for a 48-hour rental period, at a suggested $19.99 retail price.
March is traditionally a doorway period for Hollywood, smaller titles gradually ceding ground as studios ready their summer blockbusters for April openings weekends often north of $80 million and sometimes much higher. But as theaters seemingly teeter on the edge of closing their doors nationwide, many studios have opted to yank their highest-profile releases off the schedule.
A Quiet Place II, originally due out this Friday, is now postponed to an unspecified date. That’s also the case for James Bond entry No Time to Die, rescheduled for a hopefully more stable Nov. 25 release. F9, the ninth Fast and Furious entry, has shifted the furthest of any blockbuster yet, moving an entire year to next summer. Meanwhile, The New Mutants and Antlers, both courting a slightly older demographic, have seen their releases postponed. And Mulan, Disney’s pricey live-action adaptation of the animated classic, was late to move from its opening in late March, but with movie theaters long-since-shuttered in key regions like China, its delay was perhaps always a foregone conclusion.
All eyes are now on Black Widow, Disney’s Marvel entry starring Scarlett Johannson as the titular super-spy. As of press time, it was still dated for May 1, but as the days tick on, it seems increasingly impossible to envision any studio—let alone one as crippled by coronavirus as Disney—will risk opening a film of that size.
The worst-case scenario for Hollywood, and one that seems ever more likely, is that coronavirus will usher in the summer that never was, a box-office shutdown that will not blow over—as some optimists have predicted—by as soon as next month.
As coronavirus testing becomes more widely available across the United States in the coming weeks, known cases of the virus are expected to skyrocket, particularly in major cities and densely populated areas. And as cities continue to enact measures aimed at curtailing its spread, from shuttering restaurants to banning public gatherings, it remains unclear how many Americans are already infected, and whether many of these measures were implemented too late to prevent massive outbreaks of the virus.
In China, where the coronavirus outbreak was first reported, movie theaters have remained closed for weeks, with no clear timeline for reopening. In Hollywood this week, and the barely foreseeable future, that remains perhaps the most daunting element of coronavirus and its already-seismic impact on the movie business. With the true scale and severity of the virus on the American public only expected to become visible this coming month, it’s hard to predict when its effects will stop being felt.
More must-read stories from Fortune:
—Don Cheadle on Black Monday, Wall Street in the Trump era, and hope about the climate change fight
—How Netflix’s Lost Girls upends the conventions of serial killer movies
—Heartbroken SXSW filmmakers look for alternatives after coronavirus cancellation
—Diao Yinan discusses The Wild Goose Lake, his Chinese motorcycle noir
—How coronavirus is affecting the global concert industry, including SXSW and Coachella
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis.


fortune--2020-03-16--President Trump tells older Americans to stay home, all ages to limit gatherings to 10

The White House on Monday urged all older Americans to stay home and everyone to avoid crowds and eating out at restaurants as part of sweeping guidelines meant to combat an expected surge of coronavirus cases.
President Donald Trump and the coronavirus task force released the guidelines as the U.S. government moved to try to blunt the impact of the virus, racing to bolster testing and aid even as financial markets fell and Americans scrambled to reorder their lives.
Among the new recommendations: Over the next 15 days, Americans should not gather in groups of more than 10 people, schooling should be at home and discretionary travel and social visits should be avoided. If anyone in a household tests positive for the virus, everyone who lives there should stay home.
The president, in an appearance in the White House briefing room, when asked when the pandemic would subside, said that “if we do a really good job” the crisis could pass by July or August, a far less optimistic take than in his earlier predictions that it could be over within weeks.
“We will rally together as one nation and we will defeat the virus,” Trump said. “We can turn the corner and turn it quickly.”
The president also, for the first time, acknowledged that the virus, which has battered the global markets, may send the nation’s economy into a recession, a potentially brutal blow for an incumbent in an election year. He also, without providing details, said of the administration, “we’re going to back the airlines 100%,” a note of reassurance for an industry crippled by travel bans and fears of spreading the virus.
Trump, who adopted his most somber tone yet when discussing the crisis, acknowledged that it was “not under control” in the United States or globally but said he did not yet plan to call for domestic travel restrictions. He said the U.S. will probably be dealing with this pandemic until July or August.
The administration did not immediately define what an an older American was in terms of the recommendation to stay home.
More coronavirus coverage from Fortune:
—How to prepare your personal finances for a coronavirus recession
—The coronavirus could upend America’s business relationships to China
—The best Twitters to follow for reliable information on the coronavirus outbreak
—3 months before the coronavirus, a war game showed we weren’t ready
—How mainland China’s closest neighbors have kept coronavirus cases so low
—Couples are scrambling to prepare last-minute wedding alternatives
—SARS taught Taiwan how to contain the coronavirus outbreak
—How A.I. is aiding the coronavirus fight
Subscribe to Fortune’s Outbreak newsletter for a daily roundup of stories on the coronavirus outbreak and its impact on global business.


fortune--2020-03-16--Bridgewater’s Ray Dalio thinks 0% interest rates will be “harmful”

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Count Ray Dalio among the skeptics when it comes to the Federal Reserve’s efforts to prop up a coronavirus-hit U.S. economy.
The Bridgewater Associates founder penned a 4,000-word LinkedIn post on Monday giving his thoughts on the current economic volatility and the U.S. central bank’s efforts to contain them. In particular, the billionaire hedge funder expressed concerns that a “hard 0% floor” could prove counterproductive for many asset classes, and will deprive the Fed and other central banks of the ammunition to take further action if needed.
“Long-term interest rates hitting the hard 0% floor means that virtually all asset classes go down because the positive effects of interest rates falling won’t exist (at least not as much),” Dalio wrote. “Hitting this 0% floor also means that virtually all the reserve country central banks’ interest rate stimulation tools (including cutting rates and yield curve guidance) won’t work.”
Dalio added that 0% interest rates would also diminish the impact of central banks’ “printing of money and buying of debt assets,” and could also spur “real interest rates [to] likely rise because there will be disinflation or deflation resulting from lower oil and other commodity prices, economic weakness, and more credit problems.”
With credit spreads potentially rising as a result, Dalio said debt service payments to “weaker credits” would also rise “at the same time as credit lending shrinks,” which would further spur “deflationary pressures and negative growth forces.”
“God help those countries that have these things and a rising currency, too,” he wrote.
To address some of these issues, the Bridgewater head called for “big fiscal stimulation” on the part of the federal government—but bemoaned the fact that lawmakers have yet to take such action, and appear unwilling to work together to do so.
“Our biggest economic risk comes from the possibility that our elected officials (who are the ones who control fiscal policy) will handle it badly,” he wrote. “It’s tough enough to know what to do during a big crisis and then do it boldly even when there aren’t divisive politics. With the divisive politics, it might be impossible.”
Yet Dalio holds hope that lawmakers, including President Trump are “moving into the ‘whatever it takes’ mode” as far as addressing the current crisis—despite his assertion that “talk of a payroll tax cut” falls wide of the mark as far as addressing “where the problems are.” He also noted that most of the measures pursued thus far, including an increase in subsidized Small Business Administration loans, “will need to be much bigger” to proportionally address economic headwinds. “Thus far, there has not been much debt support to industries that would go broke due to this shock,” he wrote.
In addition to slashing interest rates to near-zero, the Fed has also taken measures to pump liquidity into the markets for U.S. Treasuries and mortgage-backed securities and to allow banks and depository institutions to more easily lend to businesses and households in needs.
Despite Dalio’s reservations, some Wall Street economists on Monday said that they believe the central bank still has ammunition to take further action if needed. Jefferies chief market strategist David Zervos noted that “there are plenty of bazookas left in the [Fed’s] war chest,” while UBS economists think the Fed will likely increase the amount of liquidity it pumps into securities markets through its quantitative easing initiatives.
More must-read stories from Fortune:
—How to prepare your personal finances for a coronavirus recession
—Why the world’s stock markets kept going quiet last week
—The Fed made a bold move to calm shaky markets. But is it enough?
—Why return CEOs are usually bad news for a company’s stock
—Dormant PayPal Credit accounts are coming back to hurt credit scores
Subscribe to Fortune’s Bull Sheet for no-nonsense finance news and analysis daily.


fortune--2020-03-16--Crowdsourcing support during social isolation

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Cancel culture has a whole new meaning.
New restrictions around gathering in public are happening on a minute-to-minute basis across the world. In the U.S., where the rate of testing lags behind other countries, the local announcements feel like a drip-drip-drip of bad news.
The Centers for Disease Control and Prevention (CDC) has recommended that gatherings of 50 people or more be cancelled.
At press time, some 13 states—California, Connecticut, Illinois, Indiana, Kentucky, Maryland, Massachusetts, Michigan, New Jersey, New York, Ohio, Rhode Island, and Washington—have closed bars or wineries, most have asked for either reduced occupancy for restaurants, or to limit their service only to takeout or delivery.
And it increasingly looks like most schools will hold their classes entirely online for the rest of the semester, a terrible burden for kids from under-resourced homes, or with inadequate access to WiFi or technology.
But as everyone scrambles to stay sane inside, there are crowd-sourced moments of real sweetness to enjoy.
We have learned that Italy has the world’s largest inventory of balconies, from which communities are singing and enjoying music together. Even dancing. Imagine that.
Sometimes it goes better than others.
Crowd-sourced support is becoming the way of the world, which is an encouraging sign.
Jackie Borchadt of the USA Network reports that kids in her Columbus, Ohio neighborhood have been giving impromptu cello recitals on the porch of elderly neighbors who are stuck inside. Nice idea! And celebrity PSAs have become an entertaining form of social pressure to flatten the curve; nobody wants to disappoint Warriors star Stephen Curry after all. And who doesn’t feel better knowing that Arnold Schwarzenegger is sheltering in place (like, in his kitchen) with a pony named Whiskey and a wee donkey named Lulu?
Embrace the #QuarantineLife and find binge-worthy show tips, comfort food recipes, and work-from-home productivity advice. There’s also homeschool support for folks who have suddenly housebound kids, ideas to help low-income college students cope with sudden quarantine, and lots of little ways to spare a thought for people who are suddenly financially vulnerable—like artists who rely on concerts or exhibits for their income, and who are now facing financial ruin. (One idea is to donate back any refunds to music venues and ask them to pay the artists and crew who are suddenly out of a gig. If you have cash to spare, consider supporting The Actors Fund.)
True, we’re in danger of pushing the GoFundMe economy to the brink, but the creativity and generosity is insp iring.
But it’s a lot to manage. So, I’ll leave you with wise words tweeted by Barbara Whye, Intel’s Global Chief Diversity and Inclusion Officer:
“Leaders, listen: your employees are juggling lots. So breaking it down:
1) some are dealing with worry about their elderly parents
2) some are dealing with daycare, K-12, or university closures
3) some have wi-fi access issues.
So [please] don’t act like all [is] normal tomorrow. #empathynow.”
Let’s make empathy a trend.
Ellen McGirt
@ellmcgirt
Ellen.McGirt@fortune.com
On Point
The World Health Organization and the World Economic Forum launch a COVID-19 task force The COVID Action Platform now has more than 200 corporate members, including Alphabet, Nasdaq Inc., KPMG, and HP, according to Business Insider and is focused on three main priorities:
Galvanize the global business community for collective action
Protect people’s livelihoods and facilitate business continuity
Mobilize cooperation and business support for the COVID-19 response
"COVID-19 is causing health emergencies and economic disruptions that no single stakeholder can address," Klaus Schwab, founder and executive chairman of the World Economic Forum, said in a statement.
COVID Action Forum
Joe Biden promises to name a female running mate, and a Black woman to the Supreme Court It was a bold moment in last night’s audience-free debate, and welcome news for anyone who was hoping for a woman on the ticket in any capacity. But while there have been some interesting women on the ticket for VP in the past, (Winona LaDuke, Geraldine Ferraro, Sarah Palin), there have only been two African American Supreme Court justices, both male. Vox offers five potential jurists here, only three of whom are well known to raceAhead. Who would be the best choice for veep? House Majority Whip James Clyburn has some ideas. Political analyst Amber Phillips has a shortlist below.
Washington Post
The 100 best-designed products of the modern era In 1959, Fortune tapped the Institute of Design at the Illinois Institute of Technology (IIT) to create the first-ever survey of designers, architects, and teachers to come up with a list of the best of modern design. That alone is a fascinating snapshot of an era, heavily dominated by European and Scandinavian aesthetics. (Number one was the 1950 Olivetti Lettera 22 portable typewriter, designed by Marcello Nizzoli, from Ivrea, Italy.) But to mark the 60th anniversary of the list, Fortune teamed up with IIT again to create a new list, which has greatly expanded the category of objects to be considered (like interfaces and services), and now includes entries from Africa (only one) and East Asia. You’re probably reading the list for its top spot, but do click through for the masterclass—and debate—on design-thinking you didn’t think you needed.
Fortune
On Background
Why not have a Netflix party? A little known Chrome extension called Netflix Party, which lets Netflix subscribers “watch” a film together, complete with a side chat, is getting a new look. Looking for recommendations? Check out Letterboxd, the social network for film-watchers.
Netflix Party
World-class museums are offering great virtual tours Google Arts & Culture has teamed up with over 2500 museums and galleries around the world, to help them create meaningful experiences with their digital collections, including “street view” walking tours of their facilities. Participating institutions include Amsterdam’s Van Gogh Museum, London’s National Gallery, and the Whitney Museum of American Art. Here’s the top 10 virtual museums. More below.
Fast Company
Ken Burns is a good sport The filmmaker asked PBS to stream his epic series Baseball for free, “so we can participate in the national pastime together,” he tweeted. “And please look out for those with greater needs. Play ball,” he said.
Baseball on CBS
Tamara El-Waylly produces raceAhead and manages the op-ed program.
Quote
"We are all out of doors, and my companions have brought down their mattresses, and are lying along the shade of the east wall, talking quietly and pleasantly; the usual sounds of the workmen on the quays of the town are still, our harbor-guard lies asleep in his boat, the yellow flag of the lazaretto clings to the staff, everything about us breathes tranquility. Prisoner as I am, I would not stir willingly to-day."
—Nathaniel P. Willis, an American author visiting Europe whose reporting was interrupted by a quarantine against smallpox, in The New York-Mirror, August 1832.


fortune--2020-03-16--Stock buyback reckoning: Those trillions spent on repurchases just evaporated

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Well that was a bust.
For the past several years, America’s corporations have been by far the biggest buyers of their own stock. From 2016 through 2019, our big cap enterprises repurchased a staggering $2.5 trillion in shares, according to a November study by Goldman Sachs. Last year’s outlays of $480 billion in dividends and buybacks by the S&P 500 amounted to over 100% of their free cash flow––and by the way, buybacks now far exceed dividends as corporate America’s favored vehicle for what’s known as “returning cash to shareholders.”
Buybacks are indeed a good idea under two conditions. First, the company can’t find profitable ways to reinvest part of its ample earnings, generally the case with big, mature businesses from automakers to consumer goods purveyors. Second, management perceives their shares as a bargain. For example, if their stock is selling at an 19 price-to-earnings multiple, and the brass believes that its real value is more like 22 time earnings, then if they’re correct, handing each shareholder a bigger ownership stake through buying back shares at a discount will enhance their returns in the future. That practice follows Warren Buffett’s maxim that repurchases are smart when a stock is selling below its “intrinsic value.”
But keep in mind, investors themselves only translate buybacks into cash if each year they sell the percentage of their shares that equals the percentage by which the buybacks lowered the company’s share count. I’ll save you from all the math, but if you own stock in XYZ Corp, and management repurchased 5% of its shares last year, you could sell 5% of your shares, pocket the cash, and still own the same percentage of XYZ you held the year before.
But this marvelous formula only works if valuations were reasonable when companies did the gorging, and don’t reset at much lower levels.
We’ve just experienced just such an epic repricing. At its all-time high on February 19, the S&P traded at a lofty P/E of 24. As of the market close on Monday, March 16, that benchmark has dropped to 17.0, a number that based on record earnings that will soon retreat, still looks frothy.
Remember, the purpose of buybacks is to raise earnings per share and hand investors capital gains. As an investor, if you’d sold a portion of your holdings every year and banked the gains, you’d be a lot better off than if you’d held all of your stock. If you didn’t sell anything, you’ve ended up owning a bigger and bigger percentage of, say, XYZ, and XYZ is now worth 30% less than than it was three weeks ago. The fall in the share price far outweighed the increase in your stake. Because the selloff is so steep and broad, a giant portion of the erstwhile benefits of the $1.25 trillion in buybacks since August of 2017, when the S&P stood at today’s levels, have evaporated.
So repurchases suddenly look like a raw deal, at least in the short term. In the long-run, it’s not yet clear. For example, the big banks, including J.P. Morgan, Bank of America and Wells Fargo, were purchasing at PEs in the low to middle single digits, and incredible as it may seem today, those buys may look well founded a couple of years from now. (For now, eight of the largest banks announced they are suspending buybacks to free up capital to lend to businesses and consumers.)
On the other hand, the big four airlines, United Continental, Southwest, Delta and American, lavished $31 billion on their own shares from the start of fiscal 2015 through 2019, equal to two-thirds of their net earnings. In every case, their shares were higher when at the start of that five year period than they are today, generally by a lot; shares are down around 70% at both American and United. Their shares were mostly above the 2015 starting point during the entire time they were buying in all that stock. It’s unlikely that staunch loyalists who didn’t cash in shares each year will ever see any benefits from that buyback extravaganza.
Conclusion: Markets have reset prices based on the view that the world is a much riskier place than it appeared just three weeks ago. That makes what management touted as great deals for years look terrible today. In many cases, CEOs and boards should have known better, and returned those billions in dividends instead. The selloff has revealed the dark side of buybacks. When stocks get repriced, the gains from repurchases vanish in a hurry, with in many cases, little prospect of returning.
More must-read stories from Fortune:
—Here’s where Goldman Sachs predicts the stock market will bottom out
—Why the world’s stock markets kept going quiet last week
—The Fed made a bold move to calm shaky markets. But is it enough?
—Why return CEOs are usually bad news for a company’s stock
—It’s time to start preparing your personal finances for a recession. Here’s how
—Dormant PayPal Credit accounts are coming back to hurt credit scores
Subscribe to Fortune’s Bull Sheet for no-nonsense finance news and analysis daily.


fortune--2020-03-16--The next Great Recession has already begun

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Remember the 2008 financial crisis? Well, the next Great Recession began this past week, as the U.S. virtually shut down its economy to prevent further spread of COVID-19.
First, the NBA suspended its season, followed in rapid succession by the NHL, the MLS, the MLB, and most recently, the PGA’s cancellation of the 2020 Masters golf tournament. Then Broadway closed down, followed by cancellations at nearly all major venues. Businesses told their employees to work from home. In Minneapolis, the normally-packed Mall of America parking garages are virtually empty. In New York City, Mayor Bill de Blasio just limited all restaurants, cafes, and bars, to takeout and delivery.
President Donald Trump’s Friday declaration of a national emergency seemed almost anti-climactic. Meanwhile, stock exchanges have been indicating a coming recession for two weeks, as stock prices have gyrated wildly, falling 20% until a partial recovery on the heels of the President’s announcement, according to analysis of data for the Dow Jones Industrial Average on Yahoo Finance. After the Federal Reserve’s emergency cut on Tuesday of 50 basis points, or half a percentage point, of interest rates failed to stem declining equity prices, the Fed followed with another cut on Sunday evening. This time it lowered rates to 0% (an additional 100 basis points), alongside pumping $700 billion of liquidity into the economy. In spite of those dramatic moves, the stock market plunged further on Monday as investors questioned whether further rate cuts will stimulate people to buy new homes or automobiles, or companies to increase their capital spending. Who would possibly be signing off on new capital investments right now?
Policy makers should accept the reality that the best way to make this a short, sharp recession is to focus entirely on stopping the spread of COVID-19. The U.S. federal government should ask Americans to voluntarily quarantine themselves in their homes until the peak infection period passes, as many states have already done. This would cause the spread of the disease to end faster and therefore allow a normal resumption of economic activity to occur sooner. This requires a containment strategy wherein most Americans, except essential workers, self-quarantine in their homes. Such a decision will result in major reductions in the U.S. consumer economy, except for online purchases and essential food and pharmaceuticals, but it may prove to be the fastest way to get through the recession.
The question now is how long this recession will last. In economists’ terms, will it be a V-shaped recession, an U-shaped recession, or an L-shaped recession? Let’s examine these possible scenarios.
A V-shaped recession would indicate a sharp downturn for the next several months, followed by rapid growth in early 2021. In this case, the economy would follow a pattern similar to the early 1950s, when the American economy dipped down for 12 months, followed by 12 months of recovery. If the U.S. gets coronavirus under control through swift containment measures, then that offers the greatest probability of a V-shaped economic rebound in 2021.
The Great Recession that started in 2008 followed an L-shape as it took nearly four years for recovery to pre-2008 levels. Drawing out the response to COVID-19 may simply increase the odds that the U.S. plunges into the much more severe L-shaped recession, which lasts a long time with only mediocre growth on the rebound.
Rather than trying to avoid a recession by keeping things running in a pseudo-normal manner and thereby accelerating the spread of coronavirus, the Trump administration should take the bitter medicine now of pushing for self-quarantines. In doing so, it may save the health of the American people and the American economy.
Bill George is senior fellow at Harvard Business School and former chair and CEO of Medtronic. He is also author of the book, Discover Your True North.
More opinion in Fortune:
—Four lessons from the coronavirus
—Let’s remember what we learned in WWII, as well as in 2008
—Combating coronavirus starts with keeping health workers well
—Coronavirus may finally force businesses to adopt workplaces of the future
—Curing HIV and sickle cell falls short if the most vulnerable populations are left out
Listen to our audio briefing, Fortune 500 Daily


fortune--2020-03-16--How a biotech startup working on a coronavirus cure got caught in a tug-of-war between the White Hou

How a biotech startup working on a coronavirus cure got caught in a tug-of-war between the White House and Berlin

A little-known German biotech outfit operating out of a sleepy university town near the Black Forest has grabbed the world’s attention after being plunged into the center of a political tug-of-war between President Donald Trump and the German government over a potential coronavirus vaccine.
In the race to find a medical breakthrough to the pandemic, the startup, CureVac, said earlier this month that its proprietary technology has found suitable candidates that could lead to a treatment, and that it aims to start clinical trials in early summer. CureVac has received funding from the Bill & Melinda Gates Foundation.
The company came within Trump’s circle when its then-chief executive, the American Daniel Menichella, met with the president at the White House recently. Menichella was there as part of a coronavirus task force meeting to discuss how to stop the spread of the deadly outbreak that poses the biggest crisis yet to Trump’s presidency.
According to a bombshell report that broke this week in German weekly Welt am Sonntag, Trump was so convinced by the CEO that he was willing to fork over a reported $1 billion to acquire rights to any promising vaccine the company could produce.
The news created a storm of outrage in Germany as fears rose that Washington would exert exclusive control over the production and distribution of the potential cure to the detriment of the rest of the world’s population.
Federal Health Minister Jens Spahn promptly took to German state television on Sunday night to ensure that in the case of any successful trials, any vaccine developed by the company would be made available to everyone who needs it.
“We’ve been in very good talks with the company over the past two weeks,” he told ZDF program Berlin Direkt before implying that the issue, which only came to light on Sunday in the German media, had already been dealt with. “Today’s report comes with a bit of a time lag.”
In a sign of what’s at stake, the European Commission on Monday announced it had offered CureVac an €80 million line of credit to help it “scale up development and production of a vaccine against the coronavirus in Europe.”
The German-born commission president, Ursula von der Leyen, said in the statement: “I am proud that we have leading companies like CureVac in the EU. Their home is here. But their vaccines will benefit everyone, in Europe and beyond.”
Germany on edge
The report comes at a sensitive time. Just as coronavirus threatens to hit the export-reliant German economy, conservative politicians, including Spahn, have been jockeying for control of the party after Chancellor Angela Merkel’s successor stepped down as head of the Christian Democrats.
CureVac’s majority owner, a billionaire philanthropist that co-founded German software giant SAP, and owns German first-division soccer team TSG Hoffenheim, said however he ruled out the deal as soon as he heard of it.
“For me, it was self-obvious that a German company cannot develop a vaccine that is then exclusively used in the U.S.,” Dietmar Hopp told Sport1 in an interview published on Monday. Asked how the talks had progressed with Trump, the 79-year old German said CureVac came to him to gauge his reaction. “They asked me what I thought of it all, and I knew immediately that this wasn’t an option,” he said.
In a strange twist, however, the Tübingen-based company’s itself has denied it was approached. In a statement on Monday, CureVac rejected all allegations made in the press, adding that it “had not received an offer before, during and since the Task Force meeting in the White House.”
The comments were then tweeted by the U.S. embassy in Berlin as proof there was no truth to the controversial approach.
Adding to the confusion (and drama), CureVac had announced only last week it was replacing its American CEO, who joined in 2018. Founder and former CEO Ingmar Hoerr is back running the company.
When asked about the report on CNBC, Trump advisor Peter Navarro not only did not deny the allegations, he spoke of a broader strategy to bring production and supply of key medications to the U.S.
“What I can speak to is this broader interesting issue of how dependent the United States of America is on the global supply chain, not just for its medicines but for its medical supplies and medical equipment,” he told the business channel on Monday, before adding that he was working on a piece of legislation based on Trump’s “Buy American” campaign pledge.
“The President personally asked me to move quickly on this issue. The essence of the Executive Order, which we hope to get to the finish line by the end of the week, is to bring all of that home so that we don’t have to worry about foreign dependencies—70 percent of our advanced pharmaceutical ingredients comes from abroad.”
This would then encourage the major governmental customers for medicines, medical supplies and equipment such asa Veterans Affairs, Health and Human Services and the Department of Defense, to all shop domestic.
“We need them to buy that from American producers on American soil,” he told CNBC.
For now, it looks as if any potential CureVac vaccine—should it ever develop one that gets regulatory approval– would be made available for everyone, and not just Americans.
Speaking to reporters on Monday after announcing wide-ranging restrictions to leisure activities across country, Merkel was quick to take credit, along with CureVac owner Hopp, for deescalating the situation.
“The issue has already been resolved as we said on the weekend. The federal government took care of this at a very early stage,” she said.
This story has been updated to include the European Commission funding statement, and comments from Commission Ursula von der Leyen.
More must-read stories from Fortune:
—Bitcoin bloodbath: What people are saying about the crypto collapse
—Bill Gates cuts formal ties with Microsoft, marking the end of an era
—The best Twitters to follow for reliable information on the coronavirus outbreak
—Dormant PayPal Credit accounts are coming back to hurt credit scores
—WATCH: Best earbuds in 2020: Apple AirPods Pro Vs. Sony WF-1000XM3
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.