5 things to start your day

[Bloomberg]( Follow Us //link.mail.bloombergbusiness.com/click/19682547.230861/aHR0cHM6Ly90d2l0dGVyLmNvbS9idXNpbmVzcw/582c8673566a94262a8b49bdB87aa3626 [Get the newsletter]( More central bank action, more stimulus promised, and more market volatility. Rate cuts The Bank of England cut its [main rate by 50 basis points]( to 0.25% this morning in its first emergency move since the financial crisis. The announcement was accompanied by a package of measures including a new lending scheme and the reduction of the countercyclical capital buffer for commercial banks to 0%. Governor Mark Carney described it as a “[big package](” and said that QE remains part of their policy toolkit. Iceland also [reduced rates by 50 basis points]( this morning, and the European Central Bank is expected to [announce its own targeted measures]( alongside its scheduled policy decision tomorrow. Stimulus Also in the United Kingdom today, Chancellor of the Exchequer Rishi Sunak is expected to announce fiscal measures to help the economy as part of his [first budget at 8:00 a.m. Eastern Time](. European Union leaders got a stark warning from ECB president Christine Lagarde in a conference call yesterday where she said failure to act on fiscal stimulus risked the “[collapse](” of part of their economies. In the U.S., details of a promised fiscal response [have yet to emerge](, with President Donald Trump saying he wants a payroll tax holiday [extended through November]( so taxes don’t go back up before the election. Sponsored Content by Global X ETFs What Tech’s Evolution in the 2010s Can Tell Us About the Decade Ahead The 2010s were a decade of phenomenal innovation, led by the transition to mobile and the rise of big data. As we enter a new decade, explore our analysis of what [revolutionary changes]( may lie ahead over the next 10 years.  Up and down again The volatility that has [dominated global markets]( recently shows no signs of slowing down. Yesterday’s [rally into the close]( in U.S. markets was not repeated in Asia where both the MSCI Asia Pacific Index and Japan’s Topix index dropped by more than 1.5%. In Europe, the Stoxx 600 Index was 1% higher at 5:40 a.m. as stimulus hopes in the region rise. [S&P 500 futures dropped 2%](, the 10-year Treasury yield fell to 0.713% and gold was higher. Biden wins Joe Biden’s sweeping victories in Democratic primaries mean he now holds an [almost insurmountable lead]( in the race for the party’s nomination. Friday sees similar contests in Florida, Ohio, Illinois and Arizona that could effectively end the race. The worsening [coronavirus outbreak]( is hitting campaigning, with both sides [scrapping rallies]( and Sunday’s scheduled face-to-face debate now going ahead [without a live audience](. Coming up… Headline U.S. inflation for February is expected to be shown to have slowed to 2.2% when the data is released at 8:30 a.m. Core inflation, which strips out volatile fuel and food costs, is forecast to remain unchanged at 2.3%. Speaking of volatile fuel prices, the oil market [continues to have wild swings]( based on [Saudi Arabian production news](, so today’s U.S. crude inventories data at 10:30 a.m. will be closely watched. The February budget statement will be published in Washington at 2:00 p.m. What we've been reading This is what's caught our eye over the last 24 hours. - Coronavirus conference gets canceled [because of coronavirus](. - U.K. health minister [tests positive]( for coronavirus. - Chances of a [U.S. recession]( climb above 53%. - The UN’s [state of the climate report]( paints a grim picture. - Putin isn’t as [immune to the oil crash]( as he’s letting on. - Yes, [you should work from home]( to help fight virus spread. - Solved: The mystery of the [expansion of the universe](. And finally, here’s what Joe's interested in this morning There's a [stylized chart that's going around](, which neatly demonstrates the importance of mitigating the spread of the virus, even if doing so doesn't change the overall number of people who will get infected. The key idea is that if the spike happens all in a short period of time, the hospital system will be overwhelmed, and there will have been many preventable deaths. In the other scenario, where the spread is slowed, the medical system can (theoretically) handle the emergency. It's a useful chart to keep in mind when discussing how the government can use its fiscal firepower. It's true that in the U.S., there's no financial restraint on federal spending. You can see it in the bond market -- it's screaming for more spending. Everyone should realize this by now. But as advocates of Modern Monetary Theory point out, governments still face a real resources constraint. Even if U.S. healthcare were to go to a 100% single-payer regime, there would simply be a limit on how many people can have a hospital bed at any given time. This is true under any system -- public, privatized, or some combination of both. So what can our unlimited fiscal firepower buy us right now? In order to slow the spread of the virus, people need to stay in. Events need to keep getting cancelled. This will clobber swathes of the economy. This is where cash helps. Putting money directly into the pockets of the people mean they can still eat and pay rent when they're not working. This would, in theory, slow the spread of the virus and prevent our real resources from hitting the breaking point. The economy consists of both money and things. And too often we think of affordability strictly in the monetary sense and we use crude measures to do so. So we look at things like "debt to GDP" or "trillion dollar deficits" to give us some indication of how maxed out we are. But those numbers don't tell us anything about actual economic capacity and what we can afford. We can afford to spend a heck of a lot of money right now to soften the blow to the economy. We can't afford to let virus cases all spike in a short period of time. Photographer: Weisenthal, Joe Photographer: Weisenthal, Joe Like Bloomberg's Five Things? [Subscribe for unlimited access]( to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close.  Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](.  You received this message because you are subscribed to Bloomberg's Five Things newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( Bloomberg L.P. 731 Lexington, New York, NY, 10022