- The Washington Times - Thursday, March 12, 2020

The coronavirus pandemic spread alarm from Wall Street to Main Street on Thursday, inflicting another bloodbath in the stock market while consumers showed signs of curtailing spending and cancellations hit American institutions as big as professional sports leagues and Broadway productions.

As the number of infections in the U.S. surpassed 1,300 and deaths approached 40, major stock indexes posted another furious sell-off and plunged well into bear market territory. The Dow Jones Industrial Average fell more than 2,000 points for the second time this week, closing down more than 9% to close at 21,400 points.

Not even a decision by the New York Federal Reserve to pump up to $2 trillion in short-term Treasury bonds had much impact on the sell-off. The S&P 500 and the Nasdaq both were down about 8%.

It was the worst day for stocks since the crash of 1987. United Airlines’ stock fell 25%, and Royal Caribbean Cruises dropped 32%.

Consumer spending, which makes up about two-thirds of the economy, also was slowing in the U.S. and around the world. U.S. movie ticket sales are down, and travel and hotel bookings have plummeted.

“The line between an expanding economy and recession is crossed when investors, businesses and — most important — consumers lose faith,” said Mark Zandi, chief economist at Moody’s Analytics. The coronavirus “is especially corrosive on that faith and is thus a serious threat to the record-long economic expansion.”

The National Hockey League and Major League Baseball joined the National Basketball Association and Major League Soccer on Thursday in suspending their seasons until further notice, sidelining hundreds of employees at each venue in addition to lost ticket sales, not to mention the lost food and drink sales both inside and outside the venues.

The NCAA canceled its March Madness basketball tournament after major conferences canceled their championships.

In New York, Broadway theaters went dark at 5 p.m. as the governor banned all gatherings of more than 500 people.

In Washington state, Gov. Jay Inslee banned gatherings of more than 250 and Seattle public schools closed for two weeks. Maryland closed schools for two weeks and banned gatherings of more than 250. Ohio closed its schools for the next three weeks.

Colleges across the nation were switching to online classes.

Carnival Cruise Line said it is halting all Princess cruises for the next 60 days. Apple warned its retailers about a lack of parts from China.

Across the country, dozens of conferences have been canceled, causing lost business at hotels, restaurants and other service sectors.

Dr. Marty Makary, a surgeon and professor of health policy at Johns Hopkins University, said the pandemic’s rapid spread in other nations shows that the alarm is justified.

“Based on the current trajectory of the pandemic, all U.S. schools are at risk and may need to be closed, public gatherings like NCAA tournament games may need to be postponed, businesses should have their employees work from home whenever possible, and hospitals should staff up,” he wrote on MedPage.com. “I don’t like it, but that’s what the data are telling us to do.”

Stock markets took their third steep dive this week after President Trump announced Wednesday night that he was banning most travelers from Europe for 30 days, as of Friday, to prevent the further spread of the virus. Travelers from the United Kingdom and Ireland are exempt, as are U.S. citizens returning home.

The president said Thursday that he made the difficult decision because “I don’t want people dying” from COVID-19, the disease caused by the coronavirus.

“I made a very tough decision,” Mr. Trump told reporters in the Oval Office. “Whether it affects the stock market or not, [it’s] very important, but it’s not important compared to life and death.”

The president said the stock market “is still much higher than when I got here.” The Dow stood at 19,827 points on Jan. 20, 2017.

Mr. Trump acknowledged that the travel restrictions will have a “big impact” economically beyond the airline industry.

“It’ll be a big impact, but it’s a bigger impact, and it’s also a human impact, which is more important, frankly, than the financial, when you lose thousands of additional lives,” he said.

The president said the U.S. “will make the turn” in its battle against the unusually lethal virus.

“The question is when, and the question is how many people will die?” Mr. Trump said. “I don’t want people dying. That’s what I’m all about. That’s why I made these decisions. It’s something I had to do.”

The president said he hadn’t decided whether to invoke special emergency powers under the Stafford Act, which would release up to $40 billion in aid for dealing with the impact of the virus.

“I have a lot of emergency actions I can take,” he said. “We’re in great shape. We want to keep it that way.”

He said the administration also is looking at granting paid leave for workers affected by the outbreak, and he called again for a payroll tax cut, which congressional Democrats oppose.

Mr. Trump said he doesn’t support the relief bill from House Democrats, which includes extending unemployment insurance and making free lunches available to children whose schools are closed.

“There are things in there that have nothing to do with what we’re talking about,” Mr. Trump said. “It’s not a way for them to get some of the goodies that they haven’t been able to get for the last 25 years. I happen to think that a payroll tax cut would be a very good idea. It distributes it very evenly among middle-class and other workers.”

The economy, which was surging until the virus hit, is closely tied to Mr. Trump’s reelection prospects. The president said Thursday he has canceled several campaign events over the next week, including in the battleground states of Colorado and Florida, after insisting for weeks that the virus wouldn’t affect his campaigning.

“We have a lot of things that we’re moving around because of what’s happening, and because I want to be here,” the president said. “This is the nerve center. I want to be right here. I don’t want to be flying around in airplanes all over the place. I want to be right here. It’s common sense, like washing your hands. Keep a little bit of distance away.”

But he may not have kept a safe distance soon enough. A Brazilian official who met with the president at his Florida resort last weekend has tested positive for the coronavirus, Brazil announced Thursday.

Fabio Wajngarten, a spokesman for Brazilian President Jair Bolsonaro, tested positive for COVID-19. Mr. Wajngarten was photographed and appears in videos standing close to Mr. Trump and Vice President Mike Pence at Mar-a-Lago during meetings with Mr. Bolsonaro.

The president said of his encounter with the infected man, “I’m not concerned.”

Republican Sens. Lindsey Graham of South Carolina and Rick Scott of Florida, who also were exposed to the man, decided Thursday to self-quarantine. Mr. Graham was being tested.

White House press secretary Stephanie Grisham said officials are awaiting the outcome of tests to confirm the Brazilian’s initial positive result.

“Exposures from the case are being assessed, which will dictate next steps,” she said. “Both the president and vice president had almost no interactions with the individual who tested positive and do not require being tested at this time.”

• Dave Boyer can be reached at dboyer@washingtontimes.com.

Copyright © 2023 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.

Click to Read More and View Comments

Click to Hide