“So I guess my question is -- what everybody wants to know is -- how much will earnings be down? And, nobody can answer that question because we don’t know how bad the coronavirus is going to get and we don’t know how severe government reactions will be to it.
“But clearly things like shutting down travel between U.S. and Europe has an impact on the economy, and consumer and business sentiment, so the consensus for global growth this year, which is 8%. It’s not going to be that, it’s going to be negative. But, will it be -2%? -3%? -10%? What’s it going to be? So that’s why markets are so volatile.”
More Severe
Shaun Roache, S&P’s Asia-Pacific chief economist in Singapore:
“Markets had hoped Trump would provide the circuit breaker to this vicious cycle we’ve seen in markets -- but he just didn’t deliver.”
“If you’re a country that’s going to do a big fiscal stimulus, but the biggest economy in the world isn’t, what might happen is that your currency appreciates against the dollar. In this sense, we need to see a globally coordinated response.”
“The danger is risk premiums continuing to rise and the economic downturn will be more severe than thought if the U.S. doesn’t give more concrete details.”
No Outstanding Feature
Jun Kato, chief market analyst at Shinkin Asset Management in Tokyo:
“Markets reacted initially by selling on the fact as details were pretty much within expectations but lacked an outstanding feature. It’s a disappointment reaction.”
Missing Tax
Ben Emons, a managing director at Medley Global Advisors
“What is missing is the certainty of a payroll tax cut, payroll tax holiday near-term,” he said. “I think that is what the market wants to see because such measures keep the economy afloat as the outbreak intensifies.”