[Bolduan:] The markets are plummeting once again over the coronavirus and fears of the coronavirus. Right now, the Dow is down 788 points. This is the seventh day of the same picture with the index yesterday suffering its worst single day point drop in history. CNN's Julia Chatterley is at the New York Stock Exchange. Julia, help everyone understand what is happening today.
[Julia Chatterley, Cnn Business Anchor:] I'll do my best, Kate. Great to be with you. Uncertainty, that's what's continuing to drive what we're seeing in these markets. And it is a global story. I can show you the United States, markets here further into correction territory. So more than it 12 percent down from recent highs. It is the speed of the shift we have seen. A week ago, as we have been saying all week, we were talking record highs, now we're talking about correction. That's what is jarring global investors. Europe, also having another tough session. They're also in correction territory. I think the big question here is, what is going to hold us in here. At some point, we'll say, look, we moved too far, we've priced in the coronavirus risks and investors watch it spread around the world. But it is tough to get the feel that we're at that point now when we have a lack of information. People that I speak to here are saying, look, the conversation is evolving to action, leadership. We need to hear more from the White House. We need to hear perhaps stuff from central banks here. Does the Federal Reserve, Jay Powell, come out this weekend and say, look, we stand ready? I think for people watching the screens, watching the red, context here is important. You and I were talking about Larry Kudlow earlier this week, White House adviser, saying buy the dips. Today, he came out and said a short-term plunge like this won't have a long-term effect. History is on his side. With big events like this, markets end up being be much higher in a year's time. But that doesn't help us today, Kate. More pressure.
[Bolduan:] History is hard to keep in perspective when you look at a week like this. Julia, great to see you. Thank you so much. Joining me now with more perspective, William Foster, vice president and lead U.S. investment analyst at Moody's Investment Service. Its' great to see you, Bill. Thank you being here. Thanks for coming in. We knew last week there was a coronavirus. What changed this week? What surprised you?
[William Foster, Vice President & Lead Investment Analyst, Moody's Investment Service:] Well, what changed we thought it would be isolated to China. And now it's gone global. And there's the risk of a global pandemic. In the worst-case scenario, that can lead potentially to a recession. And so that was not priced in last week
[Bolduan:] Yes.
[Foster:] in the markets. And it is being severely priced in.
[Bolduan:] It's also the speed, right? Not just how steep the drop off has been. It has been the speed that seems to be concerning everyone.
[Foster:] The speed is very abrupt. There are multiple factors. Coming off such highs.
[Bolduan:] Yes.
[Foster:] Profit taking, a whole bunch of factors contributing. There's also structural features in the market, too. Market changed in terms of the players in the market. There's a lot of machine-based trading
[Bolduan:] Right.
[Foster:] Fear controls more markets. That probably has something to with it. But this is fear. This fear and the uncertainty of the global implications of the whole economic ramifications of a pandemic.
[Bolduan:] It also shines a bright spotlight on how many American companies depend on China, depend on China in a huge way. Some of the information that was coming out today, the FDA is reporting a shortage of an yet to be named, an unnamed drug due to production issues in China because of the virus. Apple's forecasting iPhone shortages, Coca-Cola saying artificial sweetener is now in short supply. I'm sitting here reading the headlines and thinking, is there any sector not getting hit like this?
[Foster:] There are few. Most are. G.M., Nike, the entire tourism industry. This has major global ramifications. Now, it's not just China. Korea announced it will be shutting down some factories, Japan shutting down schools. This is really impacting the global supply chain. And that has major ramifications for global economy.
[Bolduan:] Absolutely. I want to play something for you. This gets to everyone sits there and says, what do I do about what do I do with this information, rather than just watching the numbers. The president's acting chief of staff, he offered up this advice this morning when he was asked about this. Let me play this, real quick. Listen to this.
[Mick Mulvaney, Acting Chief Of Staff:] I got a note today from a reporter saying, what are you going to do today to calm the markets? Really, what I might to do to calm in the markets is tell people to turn their televisions off for 24 hours.
[Bolduan:] Mick Mulvaney, that might his attempt at humor. Would that do the trick?
[Foster:] That's the trick, turn it off, that's one option, sure. But I think, most importantly, is people need to stay safe and healthy, right?
[Bolduan:] That's exactly right.
[Foster:] That's the most important thing.
[Bolduan:] We talk about markets, and impact on investment. I think first and foremost, is getting the right information out. Don't turn your televisions off.
[Foster:] Yes. Maybe not travel to where you intended to travel before but be precautious.
[Bolduan:] Be precautious. Thank you for coming in, Bill. Good to have your perspective.
[Foster:] Thank you.
[Bolduan:] Thank you. Coming up for us, as the coronavirus outbreak, U.S. cities are the front line of defense here. Are they prepared? We'll ask the New York City health commissioner, next.