Chief Investment Officer Americas for UBS Global Wealth Management Mike Ryan joins Yahoo Finance’s Zack Guzman to discuss the historic rise in weekly jobless claims, along with what the Trump administration should focus on once the U.S. begins to recover from the coronavirus outbreak.

Video Transcript

ZACK GUZMAN: Question of how it might impact 2020 in the election between. Right now, President Trump and the [AUDIO OUT] Democratic nominee, Joe Biden. I want to bring on Mike Ryan. He's chief investment officer of Americas for UBS Global Wealth Management. And Mike, when we look at it, how do you think that this spike in unemployment claims might start to change the landscape for Trump's re-election chances?

MIKE RYAN: Well, Zack, I think one of things you talked about right from the outset was the fact that, you know, the president's re-election really hinges on his track record for the economy and also for the financial markets. He basically has trumpeted that as his achievement record. And this has been, basically, the proof points he's used in terms of his stewardship of the US economy and also the US financial markets.

So obviously, as we start to see the economic fallout from COVID-19 more broadly, that the shutdowns are being imposed because of COVID-19, suddenly you're going to start to see some pretty significant change in terms the economic dynamics. And obviously, we've seen, over the course of last several weeks, has been the incredible volatility in the markets. Now, I've been doing this for quite a while. And I haven't quite seen this kind of a volatile market swing over the course of just a short period of time as we've seen already.

ZACK GUZMAN: Yeah, and a lot of people already kind of bracing for volatility that could have come around an election year. And now, this kind of just amps that up a bit. But when you look at specific policy proposals in the way that, maybe, Donald Trump might be bracing for these things, if he is to face Joe Biden in the actual general election here, what do you think might be the way that he changes some of those policies?

Because we have seen some areas that he could differentiate himself from Joe Biden, particularly, when it comes to drug pricing, maybe even cannabis regulations. There's a few things there. What do you think stands out as ways that he could distance himself?

MIKE RYAN: Well, first of all, I think one of the things you are going to see is that I do think the impact of COVID-19 and the economic effects are probably to change everyone's playbook a bit in terms of the policy initiatives. There are things you kind of scoped out before this. And there is going to be a different approach once we start to see the recovery process began and also how we start to see markets stabilize. But if I were looking at it from the Trump campaign, I suspect they're really going to focus on three things.

One is going to be this notion about taxes and that is their view is that, look, if we've got-- if we're coming out of this period of economic distress-- and we've had one of the biggest shocks we've seen since the Great Depression-- then the last thing we want to do is raise taxes.

So I think what you're going to see is a focus on memorializing both the corporate and the personal income tax cuts. I think the second thing you'll see is, even though there's an admission that we need significant government support in the short term to help us get out of this current economic malaise, what I think he'll also focus on is, from the administration perspective, at least, is how the ongoing deregulation is going to be important to make sure that the economy is able to sustain those gains going forward. So I think those are two areas we'll see that.

And by the way, we're in the regulatory front. This will manifest itself-- it's likely to be in areas like energy, financial services. But it's also, [? potentially, ?] [INAUDIBLE] morphed into health care and technology as well.

BRIAN CHEUNG: Hey, Mike. It's Brian Cheung here. So I wanted to ask, just in terms of investing [INAUDIBLE], we had heard, in the beginning of the coronavirus spreading in the United States, that you don't want to catch the falling knife, as we saw those 1,000 point plus drops in the Dow. We've since come back off from that because of, largely, the fiscal stimulus that's been coming from Congress, even though it hasn't even technically been passed yet.

So I'm wondering, for those that are kind of thinking about when is the right time to time the market in the equities side of things, what's your recommendation? What's your outlook on what people should be doing?

MIKE RYAN: So first of all, Brian, I think it's always-- especially during periods of extraordinary volatility, it's really hard to call tops and bottoms in markets. However, I think, in order to see a sustained stabilization in markets, there's, really, three things we're focused on.

First of all, we actually need to see this case curve begin to bend or begin to be flattened down a bit because I think that's going to be critically important because that's a precondition for a sustained recovery is that we're seeing the containment efforts bear some fruit. I think, secondly, we do need to see significant policy response. Now, we've gotten it already from the Fed.

The Fed has basically broken out the entire crisis playbook. They've employed things that we saw in the 2008, 2009 crisis. But they've gone even further.

They've expanded quantitative easing. They basically took the ceiling off that. They've created credit facilities. So I think that central bankers are doing an awful lot here. But we know they can't play the primary role.

And that's where the onus really falls on elected officials and fiscal policy. As you mentioned, the Senate has now voted on and approved the stimulus package. And now it's to go to the House for a vote. You know, we're talking about a $2 trillion stimulus package.

Well, we've argued about the stimulus package. Why this is so important in terms of the stabilization markets is because, at the end of the day, what we have is an incredible [? destruction ?] [? in ?] demand. And you need to do two things.

You basically need to help the [? backstop ?] the economy in the short term. But you also need to create some momentum so we can actually see a more meaningful recovery. And therefore, the fiscal stimulus package really had to satisfy three conditions.

One, it had to be large enough to be impactful. This couldn't be kind of working around the edges. It had to be a massive stimulus package.

Secondly, it had to be target enough to be effective. In other words, you have to direct the funds, you have to direct the resources, to the areas of the economy and to the segments of the community that's most affected. That is displaced workers, its industries, and the [? service ?] [? areas ?] in the frontlines.

And the last item here is it had to be in a timely enough manner that it's going to matter. If you wait too long, It's just going to take-- it's going to be too late.

ZACK GUZMAN: Yeah, and all those things need to apply if we are to get a phase four stimulus package as well, which it sounds like House Speaker Nancy Pelosi has not ruled out just yet either. But for now, Mike Ryan, chief investment officer, Americas for UBS Global Wealth Management. Thank you so much for joining us on that. Appreciate it.

MIKE RYAN: Thanks.