The Trump administration may take targeted steps to stimulate the U.S. economy amid the coronavirus outbreak that is likely to temporarily drag down some sectors, White House economic adviser Larry Kudlow said on Friday.
Kudlow, speaking in a round of television interviews, said it was too early to determine the magnitude of any slowdown but that the nation's overall economy remained fundamentally strong and wasn't headed for a recession.
U.S. officials were concerned about people who may have to stay home because of the outbreak and lose wages, as well as about small business and airlines, among others, he said.
"We're looking for targeted measures that will do the most good in a short period of time," Kudlow told Bloomberg News.
"We're not looking at big, expensive, macro cash rebates --helicopter money from the sky that never works," he added on Fox Business Network, saying any help would be directed to "those areas that have been hit the worst."
"We are not looking at giving everybody $1,000," he added.
U.S. and global markets have slid for the past two weeks as the spread of coronavirus outside of China has raised investors' fear of the outbreak's impact as the number of cases neared 100,000 worldwide. In the United States, the death toll from the respiratory illness rose to 14.
The U.S. market slide alone had wiped out nearly $4 trillion of value through Thursday.
Kudlow said the administration needed more information first before it could act and that more details could come next week.
"We don't want to act prematurely," he told Fox.
U.S. President Donald Trump could act via an executive order, or he could also turn again to Congress, which this week approved an $8.3 billion bill aimed at efforts to boost the U.S. response to the outbreak, including money for drug and vaccine development as well as the public health efforts.
Trump signed the measure into law earlier on Friday.
He said the administration was not inclined to enact a temporary payroll tax cut, or lowering tariffs on imports, which some experts have said could ease global supply chain problems.
Kudlow again reiterated that long-term investors should buy stocks now amid the global dip in prices.
Kudlow, speaking in a wide-ranging interview on CNBC, said:
DON'T PANIC: “I just don’t want to panic. I don’t want to panic on the economy, which looks sound. I don’t want to panic on the virus, which frankly, most Americans are not at risk. And I don’t want to panic on policy measures. Let’s try to be calm and not overreact,” he added. “Can we possibly do this fact by fact, day by day? Because we don’t know what the magnitude of the economy might be in terms of a slowdown,” Kudlow added. “We don’t actually know what the magnitude of the virus is going to be. Although, frankly, so far it looks relatively contained.”
GO TO WORK: U.S. workers should continue going to work despite the coronavirus outbreak. “I don’t want to downplay anything. Worry about the effect on human beings, for heaven’s sake. But I’m just saying, let’s not overreact. In many ways, America should stay at work,” Kudlow said. “For most people, if you’re healthy, you should go to work. Go about your business. That’s our advice,” Kudlow said
AVOID SEATTLE: Kudlow said Americans should avoid traveling to Seattle after an outbreak of coronavirus in the area. “With respect to Seattle, that would be a place you would avoid for now. And (California) Gov. Newsom declaring California an emergency state, especially Northern California, I understand that. Avoid it. Exercise common sense. But the rest of the country is not suffering from those kinds of breakouts, at least not yet,” Kudlow said. There have been 14 deaths from the coronavirus in the U.S., mostly in the Seattle area. The number of infections in the U.S. topped 200, according to data compiled by Johns Hopkins University.
BUY THE DIP: Kudlow said investors who have long time horizons should continue to take advantage of the stock market’s pullback due to coronavirus fears.
This report uses material from the AP, Bloomberg and Reuters.
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