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Now what?

The worst one-day decline in U.S. stocks since 2008 rattled markets yesterday and ushered in a dangerous new phase to a public health crisis that is threatening to become a global economic disaster. Italy imposed nationwide restrictions on travel, South Korea put limits on short-selling and investors looked for signals that policymakers in the U.S. and elsewhere are prepared to act aggressively to contain the financial fallout.

President Trump floated economic stimulus measures like a payroll tax cut and legislation to protect hourly workers who miss work because of the coronavirus. And an unusual joint statement by America’s financial regulators urged lenders to “work constructively with borrowers and other customers in affected communities.” The Fed also suggested giving banks leeway if they bend the rules to help affected customers. Treasury Secretary Steven Mnuchin said, “This is not like the financial crisis where there is no end in sight.”

The administration invited Wall Street executives to the White House on Wednesday, with attendees expected to include representatives from major banks, including JPMorgan Chase, Bank of America, Goldman Sachs and Morgan Stanley. (JPMorgan’s Jamie Dimon, who’s recovering from heart surgery, will send a top lieutenant, Gordon Smith.)

The moves appeared to revive the markets. S&P futures are up this morning, as is the price of crude oil — the catalyst to yesterday’s sell-off. In a note to clients this morning, Paul Donovan, the chief economist at UBS Wealth Management, attributed the bounce to investors feeling “presumably relieved the administration is noticing the problem.” And observers were at least pleased that stock market protections like trading circuit breakers worked as designed.