think people care about with obviously jobs and the economy being the primary short term concern. >> mike grafstein, thank you for being here. been fun all around. >> got to commend both teams. >> well managed. >> make sure you join us tomorrow, "squawk on the street" begins right now. congratulations to super bowl xlvi winners the new york giants. the world champions of football. welcome to "squawk on the street." i'm here with melissa lee and jim cramer. david faber is back at hq. ing interesting day as we come out of greece. a good jobs number on friday and the volume and the dow in bull market category. futures are down in europe as

well. the concerns persist after some of the meetings between papademos or the troika didn't go well. >> do the markets have the momentum to power through a potential greek default? still no deal in greece, even as the dow posted second biggest gain of the year. >> giants fans celebrate the super bowl win, but the automakers are riding high. now word that gm may post record profit for 2011. and new issues are found with the nefuselage, so what's issue here? amazon may be considering opening a retail store as part of a test project is there a new chapter after last week's disappointing numbers? the new spokesman for the

gay marriage movement is lloyd blankfein. he stars in a new ad, wading into a different national debate. but of course, we have to go back to friday as we start off this monday. apparently with losses. we have had the biggest best start for the s&p 500 in 25 years. we have seen it double since the march lows. pes are still low. >> right. we did get a confirmation of why we moved. i thought that's what the unemployment number is, yes, we should be going up. however, i do have to point out that we are at the exact channel where the s&p could be repelled. looking at the charts over the weekend, and just kind of struck we have moved so much that we are extended. so many different charts. i find that the most worrisome thing. >> short term overbought is what you're saying? >> yes. i just think it does matter. >> and oppenheimer asks, the technician came out this

morning, he says he sees backing and filling at this point. we have moved so far, so fast. at this point, a backing and filling as he puts it is a pause that refreshes the market. >> i totally agree with that. one of the things when i was on twitter with jim cramer this weekend, i said that we have moved too much. people say, jim, is a bare market back? the exact opposite. you have to consolidate the gains. >> then you've got economists who are also playing catch-up. david, drew mattus is raising it from 15 to 23. saying we may end the year with unemployment not at 8.6 which was the prior, but at 7.9. looking at sub-8% unemployment according to ubs. we'll see if it happens. but a lot of the economists are building the case this is something new. >> we're getting real momentum behind this economy and that will continue. when you hear the numbers you do wonder what the impact will be on the presidential campaign.

we talked a bit about this on friday obviously with that jobs number that was so surprisingly strong. but again, there are many people going out there starting to feel like there is real momentum here. we'll see. a corporate america seems to have been doing quite well for quite some time and now we're getting headlines and research that says earnings themselves are not quite as strong as anticipated. so you have to square it all. >> where are the stories coming from? it's case by case. if you go over to caterpillar and cummins, no doubt that they blow out quarters completely. go over to ford motor they didn't make the number. i find the articles to be frustrating. this is a year where some companies are doing better and yet, people want to do a broad brush. it's not working. >> broad brush is appropriate when it comes to the financial sectors. if you take 2012, the earnings commits have been coming down,

but the stocks are moving higher. according to kbw, they had a great note out a week and a half ago or so, stocks usually follow the earnings estimates in the financial sector. the stocks are moving higher this year. at some point, that has to narrow. for the market that relies so much on the financial sector that's not good news. >> no. but lloyd blankfein is making a point -- i'm not just talking about, you know, kind of interesting thing that he's doing socially, at a certain point book value doesn't mean anything until book value means something. >> now it does. >> one of the reasons i recommended morgan stanley on "mad money" i said this will not hope, given the fact that they have take an lot of charges. i understand what you're saying about financial momentum. pnc downgraded today, but first horizon upgraded last week.

bb&t, they have got some momentum. so i think again, case by case, wells fargo really strong here. >> it's the first time, david, the s&p financial sectors traded above tangible book value in a long time. >> yeah, we're talking about depressed levels, below tangible books. although, seemingly justified. even when you look at the real 2012 numbers. we shall see. you know, we're not back to true serious earnings power. seeing the real earnings power of the businesses, but we seem to be getting there, slowly but surely. yet i wonder, jim, in terms of the market multiples, some would say we already were forecasting the slow but increased growth that we're starting to see in

the economy and employment. others would say we're trading low based on what's to come. >> you want to see the money going from those recession proof going to those like alcoa or caterpill caterpillar, they're still very cheap on forward earnings. then watch technology. you know what's interesting you see texas instruments move up a lot, aeroelectronics. sea gate. it's shocking to see how low they are. in 1983, it's the last time before the beginning of the revolution in tech that you have seen those low multiples. david -- >> even with incredibly low interest rates. that correlation was blown out a long time ago, i guess. but it is something that's still worth pointing out. the ten year yield is 2%. yet, you've got multiples that are yielding well above that. >> it's absolutely true. some groups have moved a lot. a big downgrade in the housing stocks. retail has been holding up.

i still think this is a positive market that where a lot of people don't believe. a lot of people don't believe. >> you don't like that. >> yes, i like that very much. >> meantime, as we mentioned the new york giants winning super bowl xlvi by defeating the patriots. the second championship for big blue in five years. eli manning led a fourth-quarter comeback led by the touchdown by ahmad bradshaw. and the automakers are trying to aim in a big way including chrysler with the very interesting ad starring clint eastwood. take a listen. >> it's halftime. both teams are in their locker room discussing what they can do to win this game in the second half. it's halftime in america too. people are out of work and they're hurting and they're all wondering what they're going to

do to make a comeback. we're all scared. >> clint eastwood talking about halftime in america, wondering how the comeback is going to be orchestrated. people are using this to describe what may work out for the white house later this year, jim. and then it comes on top of this big spread in "usa today." they follow it up in the papers today right here. >> well, signals this did matter. jim stewart did a phenomenal piece, the new york times reporter, writer, saying that the ad last year did spur a tremendous amount of sales for chrysler. who would ever think other than apple one ad could mean a lot? they followed it up, look at the share take by chrysler. it does matter. it also i think -- i think that the presidential -- look all those republicans, every one of them, thought that the bailouts were wrong. i mean, if they were so wrong, why are so many people working at these companies? >> now the journal today saying that gm may post $10 billion in

profit for the year. more than double the previous year. margins may go to 10% which would be the highest in the industry. >> they're the ultimate overpromise, undeliver. and gursky, a lot of people think he leaks the stories, really creating the wrong kind of message. gm has to ratchet back expectations. look at what happened with ford. everyone thought ford was doing really well, bingo, it gets hammered. i do like the autos here. but david, when you look at the auto, the whole auto situation aren't you shocked by the fact that the republicans are still saying that this shouldn't have happened, and the president still is not taking any credit? >> yes. i am on both those counts. you know, when you talk to the wall street people though, they're so angry about what they claim were the contracts that were abrogated as a result of what took place. >> right. >> i mean, talk to the -- i'm trying -- any number of people

who come on "squawk box," for example. that drives them crazy. i get that to a certain extent. you have contracts, you feel like you can't trust them. but on the overall, jim, i think your point is a good one. these are companies that argue which ever way you want, ultimately stayed in business, seem to be doing better in the business. when you eliminate most of your debt that's very helpful. but have kept employed tens of thousands of people who otherwise might be out there looking for jobs, and seemed to be coming back in so many other areas as well. >> look, one of the big strengths, when you see that employment number, that is autos. we know it's not housing. that hasn't come back yet. oil and gas. it's not finance or government. autos are a gigantic part of the economy. if you get from the 14 1/2 to the 13 1/2 build, it could be as much as 15, volkswagen saying it will be 15, you are putting a

huge number of people to work. that will bode very well for the democrats in november. >> of course, that's malawi from ford, the one company that didn't get a company bailout. >> right. gm did not have good sale, gm is a chinese story. very important. >> let's talk about boeing because that will have an impact on how the dow trades today. they're fixing a fuselage problem in the dreamliner, and there's no safety concern and progress is being made. boeing also says it is sticking with its timetable to ramp up monthly production on the dreamliner to ten by the end of 2013. but of course, the context here is it entered what, 2011 into service after three years of delays. this is yet another problem for boeing. >> unbelievable story. you're watching the super bowl pregame, lebeau breaks the story. this comes back to a fundamental decision by boeing to abandon aluminum and go with composites.

there's always been suspicion, the aluminum people put this out, that the composites do not hold up over hot, cold, hot, cold. composites people say that's ridiculous, this is how you get fuel economy. but lebeau said holy cow, this decision to abandon aluminum is coming back to haunt them. >> it's early days, jim. they're not saying this is a problem they see on the other -- >> you're right. but just the composites have been the problem the whole time. i thought they had licked it. you know, lebeau does not go out idly. he's better than that. >> no, it is a different way to make a plane. you're going for lightness as opposed to durability the way aluminum has been tested over the decades. >> boeing is a great company, they'll solve it. the stock is not in the position at 76 to be able to handle the story. >> yeah. >> that's all. >> another big story, amazon, the question is it about to go

the brick and mortar route? the online retailer is planning to roll out a retail store in seattle within the next few days. the main emphasis would be on selling e readers and tablets, as well as the growing amazon line of exclusives. we are talking one small store in seattle. but if it's centered around the reloose of the kindle fire 2, there will be speculation about whether there's a new chapter for amazon. >> look, amazon needs to do something. the stock started to trade up on friday. we get this piece of news. one of the things that you really have to be careful of, again, apple, apple, apple, we know that when amazon puts out this -- the new kindle fire, remember the announcement that apple had about textbooks. that was a seminal announcement that apple meant to be big. media didn't take it big. if you can get children involved reading books and, you know, students involved reading books on ipad, once again, i keep coming back to game, set, match.

i think amazon is terrific, i know a lot of companies are building a lot of parts for the kindle fire. but apple is too hard to take on. >> we should be clear, this report is from a blog. so we don't know if this is going to happen, but it strikes me that a successful etailor to move into bricks and mortar it would be tough. >> they have to reassess their tech strategy by having a physical presence it would change the advantages they do carry in states where there's no distribution center. >> look, best buy is getting killed by the tax. we always talk about the show room issue. but you know what, when you avoid sales tax, you do it. those of us who live in new jersey when you buy something in new york, your first instinct is to say, ship it to my home. come on, when you buy -- you don't -- >> i'm going to ship it to your home, cramer. >> it's not tax dodge.

this is not like private equity. >> it's tax avoidance, not evasion. >> i was a clown who pays a 45% rate. i was revealed as a complete moron. >> happens once again. >> it's going to be interesting. i mean, again, we're not trying to make a big deal of it, but it gives us an excuse to talk about a company that people like to talk about. finally, if you want the -- >> lloyd blankfein, jumping into the hot button issue that you wouldn't associate with wall street executives. he has been tapped by the human rights campaign to be the first national corporate spokesman for same-sex marriage. washington and maryland set to hold legislative votes this year. look at the message that blank fine recorded. >> i'm lloyd blankfein, chairman and ceo of goldman sachs and i support marriage equality. america's corporations learned long ago that equality is just good business. and is the right thing to do.

join me and the majority of the americans who support marriage equality. >> wow. i didn't see that at the super bowl. >> no. >> online for now. >> between a bud ad and doritos, no. >> interesting choice for blankfein and the movement. >> i think interesting is the word. typically blankfein is not someone who wants the spotlight in any way shape or form. in the last couple of years especially he's pulled back from that in every way, including not even giving us an interview. >> but when you go to the charity there he is. he pops up at many a charity. >> he may be on the social circuit. that's one thing as opposed to

going out there publicly on an issue that divides people. regardless of whether you agree or not, as the chairman and ceo of a major financial institution. i think it's an interesting choice that he's made here. and surprising. in some ways, not surprising that he supports marriage equality. surprising he'd do so publicly. >> i wonder what shareholders' reaction would be. this is a divisive issue. i would imagine that some shareholders may not be supportive. >> i doubt anybody sells their stock. i might be wrong. but that decision chain would be a hard one to say we're selling the stock because lloyd blankfein had an ad on youtube. >> he takes a pay cut, he does this ad. >> yeah. >> i mean, i think that the company is finally saying, look, we put a lot of stuff behind us, we're better guys. but we're also not part of a broad right-wing conspiracy. he said -- >> listen, with goldman sachs, brought in somebody who used to work for treasury.

>> i don't think that's all done yet, is it? >> no. i hesitate to think that lucas is still there. but i do think this is another chapter in goldman trying to get back a veneer that they're socially oriented which is what they used to be. and they kind of seemingly lost it. >> right. well, under gus. well, they have for many years. but i would agree if you sense a plan there is a plan. that's the way goldman draws it up. nothing is by chance. >> when we come back, former continental airlines chief. back in a minute. [ male announcer ] the draw of the past is a powerful thing.

but we couldn't simply repeat history. we had to create it. introducing the 2013 lexus gs, with leading-edge safety technology, like available blind spot monitor... [ tires screech ] ...night view... and heads-up display. [ engine revving ] the all-new 2013 lexus gs. there's no going back.

twitter time today, we've got a me mow to madison avenue on the back of yesterday's big game. if you had to drop all of the kids and dogs from your super bowl ads, what would be your next trick? tweet us your ideas. we'll air your responses throughout the show. our handle is @ cnbcst.

ttd#: 1-800-345-2550 what every trader needs. ttd#: 1-800-345-2550 like streetsmart edge, ttd#: 1-800-345-2550 the intuitive trading platform that thinks like a trader. ttd#: 1-800-345-2550 access dozens of workshops and webinars ttd#: 1-800-345-2550 -and talk over your strategy with dedicated ttd#: 1-800-345-2550 schwab trading specialists. ttd#: 1-800-345-2550 plus, traders get up and running faster ttd#: 1-800-345-2550 with a personalized introduction to all that schwab has to offer. ttd#: 1-800-345-2550 talk to chuck and get it all for $8.95 per trade. ttd#: 1-800-345-2550 open an account and trade up to 6 months commission-free. ttd#: 1-800-345-2550 call 1-800-979-9011 today. ttd#: 1-800-345-2550

five minutes before the bell, ahead of the market open. you said you weren't going to formulate any ads off the super bowl ads, but i thought a super dynamic played out. pepsi versus coke. pepsi had a number of ads and coke pulled out the polar bears and that was i. >> frito lay, they report this week. one of the things that we have all learned is that coke has gotten their halo. and pepsi has been considered a second tier player. i think that pepsi, the doritos ads, they have spent no money and then developed great ads. i thought game, set, match was

for pepsi. and frito lay has to step up here. that's the key to the numbers. >> game, set, match and pepsi in terms of the ads won. but in terms of the stock from the investment standpoint it sounds like coke is the winner in. >> pepsi is going -- it's had a run. several times pepsi has run ahead of the quarter and there's disappointment. this has to be the breakout quarter for the ceo. >> ahead of the other earnings, disney and sysco. >> people are saying that theme parks -- i know we work for universal, but this is harry potter versus same old, same old. >> full disclaimer. >> smash. >> get it started -- >> you haven't mentioned it once yet. >> the voice yesterday. >> "squawk on the street" back in a moment. s level the playing.

take the privileged investing tools of wall street and make them simple, intuitive, and available to all. distill all that data. make information instinctual, visual. introducing trade architect, td ameritrade's empowering web-based trading platform. take control of your portfolio today. trade commission-free for 60 days, and we'll throw in up $600 when you open an account. sadly, no. oh. but i did pick up your dry cleaning and had your shoes shined. well, i made you a reservation at the sushi place around the corner. well, in that case, i better get back to these invoices... which i'll do right after making your favorite pancakes. you know what? i'm going to tidy up your side of the office. i can't hear you because i'm also making you a smoothie. [ male announcer ] marriott hotels & resorts knows it's better for xerox to automate their global invoice process so they can focus on serving their customers. with xerox, you're ready for real business.

on december 21st, polar shifts will reverse the earth's gravitational pull and hurtle us all into space, which would render retirement planning unnecessary. but say the sun rises on december 22nd and you still need to retire, td ameritrade's investment consultants can help you build a plan that fits your life. we'll even throw in up to $600 when you open a new account or roll over an old 401(k). so who's in control now, mayans? you're watching the opening

bell there. on this monday morning. brown & brown celebrating $1 billion in revenues, congratulations. and the centennial commission commemorating his 100th birthday. and happy also to ronald reagan who would have been 101 and to our friend tom brokaw. happy birthday to tom. >> perfect. >> so as we kick off this week, going to be busy. as we said a lot of earnings. already some news regarding netflix and coin star and verizon. >> coin star teams up with verizon. suddenly people think, look, maybe verizon buys them kind of thing. when you look at the press release, i don't think it's monumental. but netflix trades on everything. i was thinking they trade off of binge buying. it looks like it's been trumped by coin star. >> yeah.

you are a binge viewer. >> i am. >> you understand the practice. >> this is one of the shows, one of the great themes, whether it be homeland or killing, we allow the other people, particularly the scandinavian to develop programming or israeli and we do it here. this is the first one they're letting be done by scandinavia. i don't want to discount netflix but it's run 50 points on the end of the back squeeze. >> we talked about at the up to -- at the top of the show, the 20% of the moves and transports and added to that an update of fdx today. >> fdx has to carry the loads for the rails. the rails as it's been called, do not want to see natural gas this low because the rails are cold plays. fdx said the upgrade is very interesting. because u.p.s. said domestic is strong, we're recommending fdx. kind of wide. no real share take. >> we have earnings today.

humana and hasbro. >> look, this group has been a disaster. we don't talk about it enough. a lot of talk about about how they're sperndzing more -- spending more money on healthcare and not enough on enrollment because not enough businesses. last week, chipolte cfo said on my show, the obamacare is going to hurt all employers who do not offer the kind of health benefits that obama wants. >> hasbro, 20% dividend hike. what you like to see. >> toys are working and they're working big. if you want to see what a dividend looks like, i have to here from david faber. that company has been a disaster coming out of the chute. suddenly, they have something to write home about. >> overall, after friday, you said the multitude of bears out there need to start changing their minds. >> well, look, they're going to be emboldened by the fact that the market can tread water. they don't have enough to take this market down unless iran

erupts. >> really? you think it's more geopolitical -- >> i think iran remains to be matt lauer fabulous interview with the president. what was the focus? iran. i think that's the correct focus. i think everyone in the government worried about iran. >> and syria. apparently closing down the embassy, removing the personnel. >> geopolitical matters here. maybe we're focusing too much on greece, not enough on the middle east. >> volume on friday, highest since december 16th. >> good to see. >> well above the average for the year so far. >> beginning to see money coming out of bonds which makes sense into stocks. couple pieces this week about how dividends they're not fixed income the way people think. i hate those articles. because fixed income had given you nothing here. cds, nothing here. i went to the first national bank of general mills i'll take that any day of the week. >> finally, gold is off 20 bucks today even though morgan stanley still sees the average at

$1,845. average for next year, $2,175. >> it correlates with this, gold up for 11 straight years. i call your attention to rand gold, the stock is flying. they are willing to find gold in places you and i are uncomfortable being at. i loveb their ceo, he called me a sissy because i said i would not be willing to work with his mines are. he looks out for sissies. that was a total smack down by me. i felt like a new england patriot does this morning. >> don't go there. let's head over to melissa and bob across the floor. >> bob is watching, no surprise, greece, and a greek default is actually on the radar. >> we have another deadline that has passed here. the amazing thing, greek default is in the air. everybody is actually talking about it. and the markets are what me

worried? they're alfred e. neumann. sovereign debt in europe, yields are down. prices are up. earnings season was not great. the markets are fine. >> can you argue that the p.e. up 14 despite this run that we have seen is still historically low? so therefore we are discounting a greek default. >> 14 or 15. yes. i think 14 or 15 is certainly close to a historic average. but given this market, i think it's rather remarkable that it's up there. i think it is rather remarkable. so here's the important thing here. the big deal is the big negotiation is green the car taker government and the politicians. the socialist and the conservative and the far right parties. they are announcing -- trying to get to a tentative deal, 20% cut in the minimum wage. i talked to my mother about all this all the time.

my mother, said why can't they agree, the company depends on the austerity cuts? imagine, the imf is negotiating with the united states to give us a deal. they want cuts in social security and cuts in the minimum wage and they want the democrats and the republicans to sign off on this at the same time three months before a presidential election. mom, do you think the republicans and the democrats are going to stand arm in arm, going to this? it seems unlikely, but they have got to do it. well, yes, all right, but no doubt -- there's a very good reason why some people are saying chaos or default may be a better alternative. they have to stake out a position. opposition to the other parties. if elections are in april how do they get re-elected? so it's chaotic, but understandable why they're not coming together on the an agreement. i want to move on and talk about china. you and i were just talking about china. we just saw some very interesting numbers or commentary. the lunar new year, sales

numbers are coming out. this is a big gift-giving time. >> particularly jewelry, gold. >> the bottom line, sales up 16%. sounds fabulous, but they have had years where sales were up 30%. the point is, very important time for gift giving the chinese look like they're being more austere than before. >> right. this is the lowest level by the way, the lowest increase since the financial crisis. that's the context of this as well. maybe people aren't feeling as good and the feeling matches what we had in the financial i crisis. >> and jim was talking about general motors and what was going on, i think it's important what he brought up. this is a company roaring back that got big bailouts from the government. it should help the argument that these bailouts weren't worth it. i think it was in the case of general motors, but the point i'm making, we have had a fabulous rally of automotive stocks this year that had nothing to do with the headlines over the weekend. delphi, board warner, they're up better than 20% this year.

been a remarkable move. look at this. even ford. trailing behind 15%. a tremendous move in all the stocks and by the way, the s&p is up 7%. big, big outperformance in the auto sector. did not happen in the last three or four days. yes, jim? >> when you talk about china and you talk about gold and giving and lunar, you know that china is where gm has to make its numbers. are you concerned that gm will not be able to do the numbers given the fact that we're seeing some weakness lunar wise? >> i think that, yes, i think given the -- given their expansion in china which is a very major part of their operations, i think it is a concern. but aren't we happy, let's just pause for a moment. you have tried to do this earlier, jim. aren't we happy that the company is trying to make some bold predictions at this point? >> yes. >> talking about huge success. it's not talking about we have to get out of this crisis. it's talking about moving forward. >> but happy is all good, but

from the investment standpoint, you want realistic expectations that the company will deliver on. >> nice to tamper expectations. >> i think you're right. i think china is an issue. i'm just happy -- >> i'm happy you're happy, bob. >> we're all happy. holding hands and singing kumbaya on the floor. >> happiness is a p.e. multiplier. >> yeah. thank you very much, bob. all right, let's head off to chicago. get the buzz from the cme from lincoln ellis, the managing editor of strategic financial group. are we actually dealing with the fact that greece could be on the precipice of a default? >> i'm happy that everybody is happy too. particularly to hear the new cnbc indicator, which is pisani's mom's indicator. i want to ask her if she'd buy stocks up 7% off the back of the run and my suspicion is she'd say no, a little bit of caution is warranted at this stage of the game. i don't think that that greek default a disorderly default is yet priced into the market.

>> so is it simply the fact that the markets have run up so far so fast it's the compression of the time frame as opposed to if we had the same run over three months? >> yeah, i think it's a combination of both. you would see both an expansion in the multiplier which would be another positive sign which we haven't quite yet seen. then also, you know, you would see more of a cyclical rotation into the higher growth, and we haven't seen that yet. friday was the first day of that increase in participation in the equity markets. we look for more confirmation of that before we got back in or took more chips off the table. >> all right, lincoln, great to speak with you. lincoln ellis of strategic financial. by the way, the vix is at 16 right now. >> we had seen the lowest level since july. let's go back to karl. >> he said i may know something.

hga one of the largest ipo of last year. one of the greatest deals of all time for private equity of course. but having come out of the box you may remember last year, they had an earnings miss. the stock got crushed but they're also running a very leveraged company. what's interesting about hcs, look at the stock up over 6% it's a company that knows thousand run with a lot of leverage. a lot of debt. and that allows them to pay these special dividends including a $2 special dividend they announced this morning. because they're running at about 4.46 times debt to adjusted eto ebitda, so take the leverage up a bit and of course, many of the shareholders remain the sponsors who have made so much money off the company. long before they took it public they paid themselves special

dividends. this is a cash generating company. >> david, if someone is thinking about putting in for the cesars deal, don't you feel better after this? >> well, no. i don't think so. i guess you could make the argument that's one leverage company, this is another one. $28 billion at hca, but they do manage to generate more ebitda. they're in a business -- i mean, let's talk about cesars, you're talking about the domestic gaming business when you talk about cesars. but to your point, it is a deal they're trying to get done with a tiny sliver of stock getting issue. they failed last year to be able to take it public. >> i just hate buying the p.e. deals. i look long and hard and figure out why i want to be in. hca says, hey, you know what, you're too negative, look at some of these that are down and out. i think the p.e. deals are

important for the earnings and brokerage deals. >> they'll be an important part of the ipo calendar. they're typically deleveraging events. that's not something that captures the imagination of investors. although dunkin' donuts last year did well. i know you don't want to talk about the giants being the champions of the world, but i was curious, i'm coming down there tomorrow. the parade route, do you happen to know where that's going to start, what time? give me some pointers. >> i think it stars at 11:00, so -- well, actually by the time you sneak out of here, it will be -- >> well, my coffee guy told me he's not setting up. 31 years. he will not be here tomorrow. >> where are you going to get your coffee? >> i struggle to figure out. david talked about dunkin' donuts so maybe there or starbucks. starbucks. it could be involved. we all have our coffee. i have been down here for 31 years. if you don't have a coffee card who knows what you're doing.

you're like out of it. >> all right. that starts south and goes north then. >> correct. you should know enough about the yankees -- sorry, you're a mets fan. >> that parade tomorrow. >> yeah. >> one day. one day. >> one day. i have heard that. >> you can always dream. >> one day. >> obviously, we're all aflutter about the super bowl. i'm sure a lot of you out there are venting about the ads yesterday. hey, madison avenue, if you had to drop all the kids and the dogs from the super bowl ads, what would be your next trick? tweet us? as we head to break, look at the early movers. we have ak steel up 1.8%.

from one new york trading floor to another, i'm at the nymex. with a because on the floor. of course, it is all about the giants, but it's all about greece and what's next for greece. the possible default. that's of course weighing on the

euro,enni euro, strengthening the dollar. we are seeing commoditying strengthening across the board. look at the relative performance of oil versus appreciaprecious it's an outperformer and that's the top pick for 2012. also keep in mind that we're watching many hedge funds extending their net long positions in the gold market over the last week. we are seeing a correction some traders say right now, but it may be short lived. a lot of bullish sentiment on the floor for gold. back to you guys. >> thank you very much, sharon epperson. we're asking you today, hey, madison avenue, if you had to lose the kids and the dogs from all of those ads, what else would you have? what would be your next trick? one writes cats. overlooked demographic. janice tweets old people in wheelchairs in a nursing home. skyping their friends in other nursing homes, bragging about their amenities or boyfriends

and girlfriends. cartoons and avatars of anything. and john stamos doing anything. >> that was a low-rated ad. funny, because hane called out greek yogurt. >> did you have a favorite? >> yes, i liked the doritos. the dorito cat ad i thought was fantastic. >> melissa? >> i liked the elton john ad. >> you did? >> yeah. >> really? >> i thought it was so -- i was surprised that it came from pepsi. i was just -- i was surprised. >> i was surprised elton was in it. i would have thought that he would not want to take that gig. you know? >> yeah. i like budweiser had an ad that's kind of gone overlooked, partying in the '60s and prohibition. it was -- yeah, you remember the

brand name which is key after the ad is over. anyway, great night of television all around. >> bud light, they did have a lot of great ads. very pro dog. >> yeah. more "squawk on the street" still ahead. coming up -- watch as jim gives us a jolt of knowledge. six stocks in 60 seconds is minutes away. are you ready for the shock? >> clear! >> "squawk on the street" will be right back. a refrigerator has never been hacked. an online virus has never attacked a corkboard. ♪ give your customers the added feeling of security a printed statement or receipt provides... ...with mail. it's good for your business. ♪ and even better for your customers. ♪ for safe and secure ways to stay connected, visit usps.com/mail all in one account. keep watch on the markets.

or use our exclusive tools to help find ideas. it's powerful, easy-to-use technology for trading stocks, options, and futures. keep trading whether you're at home, in the office, or on the go. optionsxpress, the broker smart traders deserve. open an account today at optionsxpress.com.

we're here to kick off the monday morning. what's coming up at 10:00? >> next where smart money is going to now that the official euphoria of facebook coming to the market is dying down. and what the second leg of earnings season might bring to your portfolio. one hot pocket of stocks you might have missed in the rally. one of them boasts ticker symbol h.o.t. we will kick it off this morning with corning, upgraded at piper jaffray.

>> give it a good quarter before you go upgrading. come on. >> mgm downgraded. >> las vegas sands has all the momentum. >> i hope it comes down. a cyclical rally will continue. >> panera. >> always a dangerous call ahead of the quarter. >> whyier haasen downgraded. >> i had dan fulton on. i couldn't disagree more with this call. >> karl icahn cutting the stake. >> what are you doing? clorox, i marvel. i mean, it could be a t minus reverse. >> lost his touch? >> you're not going that far. >> i'm not going that way, because david faber taught me to be a diplomatic. he's taught me to be more like gandhi. it's very hard. >> what do you think -- i mean, you have been relatively trying to gauge your optimism with reference to europe. it's gone up and down. >> i think we have had such a

run. melissa talked about the s&p up for so much. i hate parabolic moves. i would like us to pause here. parabolic moves have led to tragedy in the market. really good moves and then stair steps have led to much higher levels. >> so where do you think -- what's fair at this point? >> i love to mark time. not give up too much. then i think you're set for a very nice year. >> yeah. in terms of what happens with regard to greece, how much does it matter? >> the longer it goes on, the more people are positioned correctly for whatever happens. i know. little bullish. >> some interesting moves today. bank of america holding on to the gain. be it a quarter of a percent, but in day when the financials are down across the board that's an accomplishment. along with morgan stanley. >> and i believe we have to get that deal on home owning,

although i know the republicans are going to fight it. >> in terms of the numbers you're looking for, coinstar, very popular with melissa. >> china is holding up. coke and disney at 40. my birthday comes on friday. i always wish you happy birthday, bob. >> i wish you a happy birthday. >> he's the first guy. >> really? >> yeah. it's really amazing. >> time warner, sysco, groupon and news corps on wednesday. >> that came with the pie throw. that was it. sysco i think is going to tell a good quarter. it's before on the upside. this is an important week. >> what's on tonight? >> curt schilling is coming on. >> wow. he of the bloody sock. >> yeah. this is about electronic arts. believe me, video is the mover for microsoft. this is for xbox. i'm talking about the mechanics and money behind the video games. >> just a few weeks ahead of

spring training. can you believe that? >> couple day before pitchers and catchers. >> i know. now that football is a thing of the past. always hard to say good-bye to the last play of the year. >> it is. i love football very much. i'm a season ticket holder for the eagles, and i hate to see the season end even if the eagleagl eagles aren't in the playoffs. >> see you tonight. >> tomorrow, you won't see me until after smash. >> which is tonight on nbc. >> that's right. >> katherine mcphee, my kind of celebrity. coming up, how the stocks ride the wave. we'll answer that question. more "squawk on the street" straight ahead. ♪

[ man #1 ] i was fascinated by balsa wood airplanes since i was a kid. [ man #2 ] i always wondered how did an airplane get in the air. at ge aviation, we build jet engines. we lift people up off the ground to 35 thousand feet. these engines are built by hand with very precise assembly techniques. [ man #3 ] it's gonna fly people around the world. safely and better than it's ever done before. it would be a real treat to hear this monster fire up. [ woman ] i think a lot of people, when they look at a jet engine, they see a big hunk of metal. but when i look at it, i see seth, mark, tom, and people like that who work on engines every day. [ man #4 ] i would love to see this thing fly. it's a dream, honestly. there it is. awesome.

that's so cool! yeah, that was awesome! [ cheering ] i wanna see that again. ♪ sadly, no. oh. but i did pick up your dry cleaning and had your shoes shined. well, i made you a reservation at the sushi place around the corner. well, in that case, i better get back to these invoices... which i'll do right after making your favorite pancakes. you know what? i'm going to tidy up your side of the office.

i can't hear you because i'm also making you a smoothie. [ male announcer ] marriott hotels & resorts knows it's better for xerox to automate their global invoice process so they can focus on serving their customers. with xerox, you're ready for real business. 10:00 on the east coast. here are some of the stories we are squawking about. we kick off with citigroup, saying it will issue credit cards in china as it looks at their consumption appetite. humana has a big rise, helped by higher membership in the medicare plans.

also lifting the full-year profit forecast. the stocks down today, but en45% over the last 12 months. and mark durkin has been named as the new ceo, following the death on friday of its former chairman and ceo, steve appleton. let's look at what the dow is doing so far. off about 40 points or so. and a lot of chatter about how far the markets have come. four months ago, going back to really the october lows the markets were at 52-week lows. a lot of people had forgotten that. of course now as we work our way into february, all three markets are officially in bull market territory. the dow up almost 21%. s&p up 22%. nasdaq up 24%. and then 156 on the dow with the highest volume since december 16th on the back of that jobs number. we'll see how much this lasts today. melissa is downstairs.

>> we're more than halfway through the fourth quarter earnings season, 57% of companies have beaten estimates. and christine shore is a director of floor operations, and great to have you both with us. christine, in terms of the fourth quarter what are the outlooks? we are starting off the year with the best start to a year in 25 years. everybody wants to know do the earnings estimates for 2012 match up what we're seeing in the stock performance? >> well, only 57% of companies are beating estimates. as we look forward to 2012 those numbers do come down a bit. the growth rate is 1.5% and that's with five of the ten sectors looking at losses for the first quarter. it doesn't improve too much in the second quarter, only 2% growth. overall, 2012 is expected to be

up 6%, but companies are expecting weakness in the first half of the year of the 62 companies that have provided guidance. only 42 have provided negative, versus 62 positive. that's giving us a high negative to positive ratio right now. >> now that we are here in terms of gains on the s&p 500, hearing what christine has to say about it being lower for the year, does that mean that the path of the market is going to be lower as well or does the 14 p.e. on the s&p 500 factor that in in your view? >> i think it's factored in to some degree. i think in line with this conversation, we have had very, very good profit margins and maybe the best in decades. now we're beginning to see some erosion there. so these companies have gotten lean and mean and very controlled and now they're beginning to lose that. you have to be wary here. >> in terms of the sectors where there are the most revisions downward, christine, what are

they? there has been a case made that financials for one. some of the biggest gainers, but the earnings revision will be very sharp and to the downside for 2012? >> we do expect financials to post losses. we're looking down 2%. they prop up a bit in the second quarter at 1%. so yes, analysts have been ratcheting financials down significant as well as telecoms. >> we are we then? you sound troubled. christine doesn't paint a bright and rosy picture. in terms of the stock market, are we at a pause? do we back and fill here? >> we're at an area where we have seen some real resistance in the s&p in particular. last february, this is where we kind of ran out of steam. but there are strange cross currents here. to the financials, we are starting to see them trade above book value.

that tells me the speculators are coming in. maybe look for the dogs of last year rather than worrying about the earnings. >> in terms of making the connections, what have you found is the best correlation over time? is it that earnings revisions come down and stock prices follow necessarily? >> well, over the past quarter we have had an excellent stock market. and unfortunately, they do so in an attempt to help companies beat earnings but we haven't seen that at this point. i think in some cases analysts are being a little cautious as are companies. this is a trend we have seen every quarter of 2011 where estimates come down low and they end up beating at the end. right now we're at 7.5% growth for the fourth quarter. and that's up from the lows of 5% seen a couple of weeks ago. right before peek earnings season, the analysts downgrade the estimates. it's a possibility that we will

surpass the 25% or hit 8% growth for the fourth quarter. >> art, in terms of the corporate profit picture, that's exactly what we have been dealing with right now. but there are greater issues out there, greece still no deal. i mean, when you -- here the s&p moves lower at this point. >> i think you can say, again, going back to the profit margins, okay, are going to be under some pressure. that's going to make it tough to live up to any earnings projections. but the geopolitical world is an absolute stew of troubles. egypt is beginning to unwind again. iran and israel. you have a lot of things out there to worry about besides whether you're going to make your earnings target. >> all right. art and christine, thanks so much for your time. we appreciate it. carl? a new problem popping up for boeing's dreamliner, but unclear if it will have an impact on the deliveries.

it's delam nation and the shares are being watched very closely. currently trading down more than 1%. gordon bethune is a cnbc contributor, former ceo of continental airlines and also worked for boeing, by the way. good morning. >> good morning, carl. >> walk me through what delamnation is and that it poses no short term safety concern. >> well, what they're talking about in the fuselage of the body of the aircraft or stringers, that give it strength, and this attachment has -- they shim it to make sure that it's tight, and when they bring it in, it's evidently not prepared correctly or built correctly and that -- in that aspect of the fuselage or the body. i don't think it's a big deal. i'm sure they have the fix for it. they said it will be a production error. so it will be limited to few airplanes before they noticed it.

>> is this what happens when you deal with composites? is it a function of a different material plane? >> well, i think it's the same thing like when you have large surfaces mated together, even furniture, you have shim to make sure they fit perfectly. this is a shim on a stringer that is insufficient, to make sure it's tightly joined to the section. and it's causing a problem. so it's not a big problem, but it's one of many. >> i suppose the immediate impact given the way that you frame the problem for shareholders is that it can impact the production schedule and they won't churn out as many craft as we had hoped and it's pushed further down the line. what are your thoughts on that? >> i don't think so, simon. i think this is a manufacturing error that they've recognized. they know the source of it, they have corrected that process. so subsequent aircraft shouldn't

be affected. what may be affected are those already in service that need a retrofit or a repair. boeing says they have a repair for it and it's not a major deal. >> they have delivered five. i think the 60th dreamliner currently on the assembly line in everett. are you convinced that the dreamliner process, the manufacturing process at boeing is intact? >> yes. carl, no question about it. these guys are not going to put anything out the door that doesn't work. airplanes have thousands of hours on them. this is something like the a-380 had things on it. these thing rbs not designed -- or not built as designed. this is a process error, not a design error. i think that they have fixed it. >> just the fact that it's the dreamliner draws a lot more attention to it because of the history of the project. >> yeah. absolutely. and it is a novel, new

composite, all come posposite aircraft. >> gordon, thank you for the time that today. >> carl, good to talk to you. >> gordon bethune on the phone this. you heard it, folks. we'll give you a breakdown of the hottest sectors and the rally and kick it off with the first sector "hot pocket" in a few. stick around.

42 minutes into the trade the monday mornings, sketches upgraded to neutral. and one getting hammered this morning, beating earnings estimates, but the first quarter forecast is falling short of what the market was after, down 14%. well, as you know by know, facebook is set to raise $5 billion, making it the largest internet ipo ever. but what others are set to ride the coattails and will the sector as a whole get a boost? daniel ernst is with hudson square research. he joins us this morning to talk facebook. good morning to you. >> good morning. >> i have seen all kinds of headlines today. i saw one a minute ago, don't bet the farm on zynga, to use a farmville pun. is that the right sentiment, do you think?

>> yeah, no, i don't think that it is. the facebook filing revealed a couple of things that were interesting. just how important zynga is to facebook, 12% of revenues. someone you want to take care of. i think people more feared the facebook effect and appreciated how important it was. the other thing they revealed was that their app sales inside facebook rose 20% quarter on quarter. some of that is from migrating the app platform or payment system to other providers. but we were really modeling zynga's first quarter's public company up 5% quarter on quarter. so i think that will be a potential bit of surprise. of course, the stock's already run. so that's taken the team at a surprise. the other thing that's interesting for investors on zynga's column next week will be to our extent is monetizing mobile. some of the most popular applications on iphone and android have been zynga

applications like words with friends that got alec baldwin kicked off the airplane over the holidays. so that's a game that's free to play, but you buy credits inside the game. but on iphones and android devices, none of that kicks back to facebook. so some of the revenues that zynga has been generating in fourth quarter didn't show up in the facebook filings. so i think mobile is an area that zynga really begins to accelerate on and monetize unlike facebook. so i think that will be a nice bit of surprise to people. >> so dan, in terms of zynga's revenues, obviously, yes, a big part is benefiting from facebook, but at the same time, do the metrics show that people are spending more and more time? they have 240 plus million active users, but of those active users have we seen that amount of time spent online and so therefore buying the virtual goods by which zynga makes a profit? have we seen that increase? >> well, in reality the data

that's available to us is how often people are playing those games and how many are playing those games, but actual elapsed time inside of facebook it not released. we know how much time people are spending on facebook, but not necessarily on zynga. so the metric that we're more watching is their revenue per user. how much are people spending on -- >> that is what for zynga, dan? >> well, only about 5% of people who play zynga games actually spend money. and of those people, their average spend per month in the third quarter was over $17 in gross spending. >> so actually the revenue per user is higher than facebook per user? >> per user that spends. >> oh, i see. >> that's the difference. so the overall number is more like 50 cents, but when you look at the people who actually spend money, those people love zynga

games. >> this stock is up 32% in a week. one of the reasons they're doing that according to the journal over the weekend, people have looked to what facebook revealed. and they're trying to reverse engineer the results coming on february 14 and they're lifting the numbers. the word on the street, that's unextremely unwise because you don't necessarily know what the other parameters are. would you agree with that? is this rally dangerous? >> what i said at the outset, they had 20% quarter on quarter growth. we were only looking for 5% quarter on quarter growth in revenues. the facebook numbers don't have mobile in them. but unfortunately because of the stock run-up, the potential upside to what i think could be some financial metrics surprise is already sort of priced in with the stock rallying on the facebook sympathy. so you're right. >> the thing that strikes me about the sympathy moves, for instance, something i read the day that facebook filed, why

would linked in by trading up on a day when facebook raised $5 billion to make their own linked in if they so chose? >> well, you know, facebook gave a lot of interesting information, but said nothing about their future plans. we don't cover linked in, but maybe people said well, they didn't enunciate going into job placements so that's a sign that linked in is safe for now. but yeah, it was a bit of a head scratcher i agree. >> presumably once they come to market, they have the currency to do deals and zuckerberg is an absolute monarch in terms of voting rights. i mean, once he has stock that he can buy the companies with, do we expect him to go on the acquisition trail? >> could they buy zynga? >> i don't think so. i think if you look at the way technology companies who are platforms run, right, so ultimately in technology you want to be the platform.

if you're the platform, you don't want to try to compete too much with the people who might leverage your platform. for instance, microsoft with the xbox 360, so they own that platform. but they don't make that many games. they had one big hit game which was halo and they didn't own the developer there which was bungee. they didn't want to compete with the electronic arts and activision. all those developers to come on the platform. so they buy zynga, maybe they scare off other app developers. so i don't think so, but we have very little information from -- as one filing about what their strategic long-term goals are. we know very little about how zuckerberg is going to try acquisitions. does he want to be like steve jobs and build everything inside or is he more inquisitive? we really have no information. >> yeah, that's going to be revealed slowly over time. daniel, thanks for your time. >> thank you. >> daniel ernst. we are down 42 points on the

dow today, but we saw the best january in 15 years. what are the technical indicators will signal from here on out? up 243,000. the unemployment rate, 8.3%. >> strong numbers like this, continual decline, how solid is the late 2014 promise? >> we were buying immediately the banks. these banks jumped in the premarket. they continued to move higher. >> nasdaq sitting at an 11-year high. >> that helped the dow close at its highest level in 3 1/2 years. so uh this is my friend frank and his, uh, retirement plan. one golden crown. come on frank how long have we known each other? go to e-trade. they got killer tools man. they'll help you nail a retirement plan that's fierce. two golden crowns. you realize the odds of winning are the same as being mauled by a polar bear and a regular bear in the same day?

frank! oh wow, you didn't win? i wanna show you something... it's my shocked face. [ gasps ] ♪ [ male announcer ] get a retirement plan that works at e-trade. hyundai genesis. in a new, faster-acting formula. zero-to-sixty in less time than a porsche panamera s. the 429 horsepower genesis r-spec. from hyundai. the two trains and a bus to the 5:00 arider.holar. the "i'll sleep when it's done" academic. for 80 years, we've been inspired by you. and we've been honored to walk with you to help you get where you want to be.

♪ because your moment is now. let nothing stand in your way. learn more at keller.edu. i took some steep risks in my teens. i'd never ride without one now. and since my doctor prescribed lipitor, i won't go without it for my high cholesterol. why kid myself? diet and exercise weren't lowering my cholesterol enough. now i'm eating healthier, exercising more, taking lipitor. numbers don't lie. my cholesterol has stayed down. and here's another number you might be interested in. lipitor may be available for as little as $4 a month with the lipitor co-pay card. terms and conditions apply. visit lipitor.com for details. [ female announcer ] lipitor is not for everyone, including people with liver problems and women who are nursing, pregnant, or may become pregnant. you need simple blood tests to check for liver problems. tell your doctor if you are taking other medications or if you have any muscle pain or weakness. this may be a sign of a rare but serious side effect. [ man ] still love that wind in my face!

talk to your doctor. if lipitor has been working for you, stay with it. don't wait. lipitor may be available for as little as $4 a month. get your lipitor co-pay card today at lipitor.com. cnbc realtime exchange market snapshot is sponsored by interactive brokers.

well, as the dow inches toward 13,000, guess what we're looking at? >> what are you going to pick equity hot pockets. >> yes, more savory and filling than a pop tart according to melissa. >> i didn't make a qualitative. it's like a -- >> you said they're like a pop tart, but better. >> i didn't say better. >> anyway, zeroing in on the hotel stocks. the s&p hotel index has outperformed the broader s&p 500. time to check on what's moving that sector higher. and we have a gaming expert, and good morning to you. these are big moves. marriott up 23% year to date. starwood up 18% year to date. and you still think they've got a way to go. >> yeah, you know, look the simple driver here two things.

first, the u.s. macroeconomic perspective has certainly improved. but more importantly room rates are continuing to grow in the u.s. hotel market. as long as room rates are go growing you want to focus on hotel stocks. i think room rates continue to glow this year. i think starwood is well positioned to benefit from that. >> the one caveat in all the notes, all the writing that you have done, all the analysis you brought to the market, "a," you keep with on the growth and various assumptions about europe which is a big market for these guys. >> first, the u.s. market, i can't tell you where gdp is going to go. that's obviously a very big input here. but we do know that capacity growth is limited. you have less than 1% supply growth in the u.s. hotel industry. so long gdp is growing, those room rates will continue to go up. now, europe is a big question. a lot of concern that the room rates go negative there. the exposure with the u.s.

stocks is small. starwood 15% of the profits come from europe. in the case of marriott only 10%. even if room rates go negative there, it shouldn't have a big impact on the 2012 earnings. >> what's the worst case scenario for europe, on whether we'll see that full impact? >> very specifically, we're assuming in a worst case you have room rates down 2% to 3% this year. every one point of room rate growth is worth a penny to share for both starwood and marriott. in the case of starwood it's $2.29. so you don't have much impact there. in the case of marriott it's $1.60. even if we go negative it doesn't derail the companies. we should still see 15% to 20% earnings growth. >> just thinking anecdotically today about pricing in this country, for instance, lilly. is freezing their base pay for their employees for a year. because they're facing various patent expirations. i wonder what kind of discipline

you think corporate america is going to have when it comes to corporate travel and whether or not that pricing power will remain strong. >> generally what we're hearing here, we're in the negotiating season. we're starting to hear that roommates -- room rates are upn the corporate side. that will follow corporate profits. as long as they're strong, corporate room rates will be good. >> we're out of time, jake, but we're bumping up to you think the price targets should be. marriott has little head room. starwood up 9% from here. would you be looking to raise the price targets or are they capped? >> i think we're seeing room rate growth, which could help beyond the valuation side. >> okay. we'll leave it there, jake. jake fuller joining us from

lazards. we'll have more hot pockets throughout the week on cnbc. >> i can't wait. coming up, the hour glass is quickly running out. can europe save itself? stick around, back in a minute.

laces? really? slip-on's the way to go. more people do that, security would be like -- there's no charge for the bag. thanks. i know a quiet little place where we can get some work done. there's a three-prong plug. i have club passes. [ male announcer ] now there's a mileage card that offers special perks on united, like a free checked bag, united club passes, and priority boarding. thanks. ♪ okay. what's your secret? ♪ [ male announcer ] the new united mileageplus explorer card. get it and you're in.

we are here the stories we are squawking about. apple shares surpassing $461 a share. speaking at a monetary policy forum, james buller expects the unemployment rate to fall below 8% this year. and the chairman and the former ceo eugene eisenberg has agreed to forego a severance package. his estate will receive $6.6 million. and look at the markets and internals today. obviously the dow with about a 47 point loss. s&p down almost five, and a reminder once again on the dow,

they're the highest we have seen before lehman busted, which is hard to get your arms around. >> yeah. >> internals over here at the big board, look at the advance decline line, and then over at the nasdaq, with sysco earnings coming up later in this week. since we came on the air, nicolas sarkozy and angela merkel have held a news conference in which they've given an unequivocal message to the greeks, they have to impose austerity or they won't get their money in march. in athens, the local political leaders there failed to do a deal on austerity that now the sitting prime minister, the technocrat prime minister is asking them to detail to the greek people what will happen if they go through a messy default. let's bring in michelle crusoe cabrera and our senior economics correspondent steve liesman. the -- and david faber. forgive me.

the exasperation seems real, it seems new and seems very powerful. do you think they can pull the plug on the dpregreeks? >> i think they could. i think in the end the greeks will come through. we're waiting for all the political parties in greece to say, okay, we agree to all this stuff. if you lead a political party you don't want to do that. especially if you think an election is coming up because you don't want to say you had to endorse all of the measures. i think in the end they get agreement for the following reason. the greek government does not survive a single day without borrowing. if they continue to say no, they lose their lenders of last resort. so what happens? if you are the greek government, all of those things that the troika wants you to put in place, ease in over the next two or three years, the wage cuts, the elimination of jobs, instead of easing them in over two or three years you do them tomorrow. because you have no choice. because you have no money. so in the end, i think rationality will play out, that it's going to be really ugly

either way and the fair uglier option is to turn your back on the lenders of last resort. >> i'm shocked. >> let me throw this idea at you. are they quite so willing to play the chicken game right now? before the imf or the e.u. have the firewall in place? wouldn't they be more willing to say, okay, go down your own route, when we have this big fund together which can bail out some of the victims of what would happen in other countries? >> are the europeans, merkel and sarkozy willing to play chicken? >> a little bit more. put your seat belt on before the car crashes. >> italian yields what have they done? they're not reacting. the market doesn't care. >> 0 -- 502 spain. >> portugal, very, very small. >> so the market is giving the green light to sarkozy. >> they'll let them go?

>> they'll push them to the end. the greeks face the far worse situation. they become argentina, people, you know, 200,000 job eliminati eliminations. not over the next two years, but tomorrow. >> simon, you know it's worth noting that i think ecb overnight deposits were at a 2 1/2 week high. one still has to wonder about the banks lending money, in terms of keeping it overnight at ecb. >> david, citigroup made some comments today. investors are ignoring greece at their own risk. it's nonnegligible and there can be foreign exchange volatility for a period of time. >> i think the effect comes in, simon, remember, this has all become circular. remember, we are talking about 50 cents worth of face value of new debt if you held old debt. >> right. i understand that. >> but if you don't get the

public sector involvement, you lose 15 cents of that deal. so it goes from the 15 cent deal to the 35 cent deal. i'm not sure the market has priced that in for the bank's balance sheets. >> david, i mean, how do you think the contagion would play through? i mean, back in the summer as we came in -- july to august, this market fell 20%. we plunged into a bear market partly of what was going on in europe. wasn't the only reason. why this time can we ignore it? >> i don't know that we can. but to michelle's point, i think we're accustomed to the likelihood that they will default, and therefore, that they -- >> 50 cents is a default. >> we have been talking about it for a long time and that there are safeguards in place that weren't there. were not there certainly for the financial system, simon, in europe. even in october or november. i'm talking about various things that were done, including the ltro, and they have cushioned

the financial system and stop it from losing a key member in terms of a bank or anything like that. that would be one answer. listen, portugal is small, michelle, but you have to watch it. okay, they move on to portugal. you deal with it regardless of whether the market is tiny. do we get back to spain and italy, being the keys and watch rates start to go up again. >> i think the one key difference is that we have had a lot more time. remember, nobody expected lehman to fail. and remember, when aig started to post all that collateral it was a two-week period where the world woke up and said, oh, wait, these mortgages are bad. it was a short term period of time where suddenly people had to throw all that money at cds. how long have we known about greece? two years. remember, that stuff gets posted over time. a lot of that money has been paid. a lot of that effect is already in the market. >> no doubt. a lot of losses have been taken. >> yeah. >> different situation when, you know, the italian yield is down.

you know, below 6%. than it was if it was up over 7%. a sense of relief is the wrong word, but panic is the other word prevailing in the key markets here, simon. i think that that kind of animates the trade right here which is that if there's not going to be this contagion, if they have a way of making it so that big countries don't fail along with greece, which to david's point they didn't have before. maybe there's a chance that it's become what everybody hopes it would be which is a greek event. >> i was telling that the combined debt to gdp of the 17 eurozone countries has come down. it's the three countries that are seeking bailouts where a debt to gdp is still raising. >> but never had anything to do with the actual metric, carl. i don't want to take away from the importance of those sort of measurement, but it's about the political will to stand behind their debt. they never had. this long-term repo operation by the ecb suggests there is

something of a willingness. >> but carl -- i think carl's point is important because if you look at the collective debt to gdp of europe, they have the money, they have to transfer the money. >> even when the debt gdp was rising they had the money. >> i somehow feel like we'll be talking about this one day soon, carl. >> probably at 11:00. thank you, guys. check the technical, as the rally gains steam here. the question on everyone's mind -- where what facebook end up? on the nasdaq? we'll look at what they're trying to do to win that business when we come back. [ male announcer ] if you believe the mayan calendar, on december 21st, polar shifts will reverse the earth's gravitational pull and hurtle us all into space,

which would render retirement planning unnecessary. but say the sun rises on december 22nd and you still need to retire, td ameritrade's investment consultants can help you build a plan that fits your life. we'll even throw in up to $600 when you open a new account or roll over an old 401(k). so who's in control now, mayans?

ttd#: 1-800-345-2550 let's talk about the cookie-cutter retirement advice ttd#: 1-800-345-2550 you get at some places. ttd#: 1-800-345-2550 they say you have to do this, have that, invest here ttd#: 1-800-345-2550 ttd#: 1-800-345-2550 you know what? ttd#: 1-800-345-2550 you can't create a retirement plan based on ttd#: 1-800-345-2550 a predetermined script. ttd#: 1-800-345-2550 at charles schwab, we actually take the time to listen - ttd#: 1-800-345-2550 to understand you and your goals... ttd#: 1-800-345-2550 ...so together we can find real-life answers for your ttd#: 1-800-345-2550 real-life retirement. ttd#: 1-800-345-2550 talk to chuck ttd#: 1-800-345-2550 and let's write a script based on your life story. ttd#: 1-800-345-2550 our machines help identify early stages of cancer, and it's something that we're extremely proud of. you see someone who is saved because of this technology, you know that the things that you do in your life matter. if i did have an opportunity to meet a cancer survivor, i'm sure i could take something positive away from that.

[ jocelyn ] my name is jocelyn. and i'm a cancer survivor. [ woman ] i had cancer. i have no evidence of disease now. [ woman #2 ] i would love to meet the people that made the machines. i had such an amazing group of doctors and nurses, it would just make such a complete picture of why i'm sitting here today. ♪ [ man ] from the moment we walk in the front door, just to see me -- not as a cancer patient, but as a person that had been helped by their work, i was just blown away. life's been good to me. i feel like one of the luckiest guys in the world. ♪ some stocks to watch over an hour into trading on this monday.

whirlpool upgraded to buy from neutral over at long bow research. and river bed technology upgraded to outperform from market perform. at pacific crest, price target there is $34. the dow climbing over seven, while the s&p finished friday with the fifth straight weekly advance. so as the sentiment charge surgesen surg surges, on are technicals confirming this? dan, we made such a to do about the golden cross of the s&p 500 about a week ago or so. i was talking to don bollinger and he said i don't like the golden cross as an indicator in this sort of market. this is not the kind of market in which you use a golden cross and this is bringing in people at the worst possible time to buy. >> right. you know, honestly, we were just discussing this a little bit on the break. i agree with you in that regard. because the time to really be buying was several months ago

when the market really got kr h crushed and started selling off on the bad news. but the bottom line is the retail investors out of the market, so if we're just talking about price action you have a lot of investors out there, a lot of money managers too who look at moving averages in relationships and things like that. when you see the lineup where the price is above the 50-day and the 50 is above the 200 and they're moving up, it might be illogical or irrational, why are stocks moving up? folks look at that kind of stuff and they get more confident about owning equities. >> so you brought along three indices. look at the charts and they're about to cross into a golden cross formation. so that to you for these sectors which are at semis, financials and japan that's a buy signal at this point? >> it's a confirmation of the buy signal because we have to be clear about that. agree with john, that it's not the greatest signals to use but

they do confirm what we are seeing. you think of it from the price action standpoint, we have transitioned from the sell strength to buy weakness market. in fact, you can even say that today with all this greece in the headlines. are we down, half a percent? not the panic selling. should there be? couldn't tell you. we just know we're not seeing that now. >> doesn't amount to a hill of bean, does it? what you're saying we confirm the buying if we achieve the golden cross. if we don't achieve if -- the golden cross we don't confirm the buying. i mean, it's meaningless. to look, the golden crosses are coming up. >> no, i disagree in that regard and here's why. what we're looking at is trends. the moving averages is crossovers and trends. >> brokered. >> no, not at all. it's a function of math, frankly, because, you know, we can get into all the detail you want. but 200 days over the past 200

days, those prices are high. you're going to drop off on the back end. that data, the new data coming in is going to drop that 200-day moving average even further at the same time, 50 days back. the prices on those -- on these indexes are low. so you drop those off, the higher prices come through. we are going to get the confirmation. it's just a question of math. >> you make the point that everybody was expecting third year of a presidential term to do well. >> right. >> historically it's almost always good. they got compressed into the next year. >> right. well, that's what i see. honestly, we have no data to back that up as far as well, we're going to move year three into year four. but when you think about everything that's happening, last year was flat from beginning to end, but in the middle that was an e ticket ride. no question about it. but we're pushing all these policy issues into year four. where we're starting to get a more user friendly washington and so i think we're go oing to -- going to get more investor confidence. >> bring it full circle back to

the s&p 500, we had a golden cross formation already. >> right. >> you see it holding up or are we at a point where we're backing and filling? what's the six to 12 month? >> i think we're backing and filling right now. you can see this. there's been a lot of chatter about the indexes coming up to press their higher highs. so we'll see that, my contention is you need to buy the dips. a lot of times especially the retail folks when the market is going down, they step back. they're out. they're habitual, buy high, sell low. you have to look at the trends and buying this weakness. >> you have a target, 1444 which is 8% above where we are now. >> right. right. yeah. however, not from this level. i do believe we're going to bet -- to get more of a pull back. you have to be honest. i don't know how much. the problem is, we have got folks coming into the market.

we should be down more over fears of what's happening in europe but we are really not. people are buying. >> good to see you. netflix is shifting strategies launching the first original program yesterday. will the strategy shift bring on new subs? we'll talk about netflix when we come back. (

. some new competition for netflix, the dvd rental service redbox is teaming up with verizon. this as they make their first foret into programming. julia boiften joins us with the latest on all of those things. good morning, julia. >> good morning, carl. verizon and red box are taking a direct shot at netflix, teaming up to offer subscription service to stream and download content which they'll pair with dvd rentals through red box's kiosks. no word yet on pricing. the partners say they aim to draw on red box's hollywood

relationships. the service is set to launch in the second half of the year and it will be 35% owned by red box, parent of coin star, 65% owned by verizon. this new competition comes the same day as netflix launches its first original show, part of a strategy to use exclusive content to lure in new subscribers to its streaming business, help is compete with hbo and shift focus away from dvd rentals. >> i'm the boss now. make sure your people keep in line. >> don't worry about my people. >> he's sent by witness protection to lillehammer, norway. this is one of five original series netflix has in the works. david fincher's "house of cards" starring kevin spacey is due in the fourth quarter. it reportedly costs $100 million and "arrested development's" fourth season is due out early

next year. netflix says it's spending less than 5% of its content budget on this experiment. original content does demand more up-front payments than licensing. the company is looking to build a war chest of premium content as it loses its starz deals, sony and disney movies, at the end of the month. coming up on power lunch, the ceo of red box's parent cone star, paul davis and verizon's president of consumer markets will be on to discuss their join the venture. i'm sure they'll be asked questions about what this means for netflix. as you mentioned after the bell, coinstar reports quarterly earnings. carl and simon, back over to you. >> thank you very much. from the west coast, tweet time next. we are asking hey, madison avenue, if you have to drop the kids and the dogs from your

super bowl ads what would be your next trick to use? tweet us your ideas. ♪ i'm making my money do more. i'm consolidating my assets. i'm not paying hidden fees or high commissions. i'm making the most of my money. and seven-dollar trades are just the start. i'm with scottrade. i'm with scottrade. i'm with scottrade. and i'm loving every minute of it. [ rodger riney ] at scottrade, we give you commission-free etfs,

no-fee iras and more. come see why more investors are saying... i'm with scottrade. today is gonna be an important day for us. you ready? we wanna be our brother's keeper. what's number two we wanna do? bring it up to 90 decatherms. how bout ya, joe? let's go ahead and bring it online. attention on site, attention on site. now starting unit nine. some of the world's cleanest gas turbines are now powering some of america's biggest cities. siemens. answers. want to protect the house. right. but... home security systems can be really expensive. so to save money, we actually just adopted a rescue panther. i think i'm goin-... shhh!

we find that we don't need to sleep that much. there's an easier way to save. geico. fifteen minutes could save you fifteen percent or more. [ technician ] are you busy? management just sent over these new technical manuals. they need you to translate them into portuguese. by tomorrow. [ male announcer ] ducati knows it's better for xerox to manage their global publications. so they can focus on building amazing bikes. with xerox, you're ready for real business.

the ratings for the super bowl are in. 47.8, the third highest in history. that's 7 full percentage points higher than the last time the giants took on the pats. so definitely, carl, a win for comcast. >> that is a huge number. >> yes. >> and just reinforces once again the notion that live programming in this country, especially football, a league that barely had a season when the lockout was happening. is just the place to be seen if you want to get your message out. we've been talking about the ads all morning long. >> yes. lord knows what the viewership will be for "the voice," of course. >> which followed the super bowl. >> which was excellent and kept us all awake far too late, particularly the second contestant. >> you actually watched it? >> i did. i had to take myself in hand and go to bed because it was getting too late. don't forget, tonight, of course -- >> "smash." >> yes.

huge as well. >> very important series. >> meantime, get the "squawk on the tweet." we have a memo to madison avenue arriving. if the dogs and kids are a thing of the past, what else would you do as your next trick in the ad community? ryan writes put a kardashian in the commercial. they don't do anything in their tv shows and those are hits. and amy tweets obviously last night it was hot chicks, juvenile humor and knockoff "snl" skits. pathetic. i will always love baby animals. >> they work. >> who doesn't love a baby or a dog. >> and old people always work in ads. >> betty white works. >> what's coming up. >> we have seth klein, what he's seeing going into the summer, how you can trade it. that should be a good one. >> okay. meanwhile we're holding on,

these levels here, down some 44 points. you know, one thing i've noticed, melissa, maybe you can back me up on this, in recent days we've set a level early in the day and clung to it, basically. almost exclusively over the past four or five sessions. maybe adding or subtracting a bit through the session. but it seems that the market's making up its mind earlier and earlier. >> today may be a different day. who is not bore of talking about greece? there is some sort of end game afoot here. you know, carl, you know the prime minister's actually going to put out for the population a -- what the civil service believes would happen if they defaulted in march to try and persuade the population to try and push the politicians towards action. >> today, simon will be different from other days where we thought a greek deal could be imminent? i feel like we say this every single day. why is today any different. >> i know. you try covering the story. the exasperation from the rest of europe is palpable.

it's really cull. it's really real. >> it's hard to feel the exasperation here as we continue to hang on to the multiyear highs. i don't know. we get to the third hour of "squawk on the street," it starts right now. welcome to hour three of "squawk on the street." here's what's happening so far. >> this is a country that needs to borrow every single day in order to function. half a billion a week just to keep running. >> any time you come across a manufacturing problem like this, the potential to slow down future production plans, that's always the concern. >> you ask yourself, is small business feeling better? probably better than it was at the trough but is it feeling better in a sustainable way? that's something that remains to be seen. >> the president has really not been able to reign in the gses who continue to put road block after road block in household's way. >> this is a year where some companies are doing better, others aren't and yet people

want to -- it's not working. i still think this is a positive market where a lot of people don't believe. a lot of people don't believe. >> you like that? >> yes. >> you do? >> i like that very much. >> you're watching the opening bell there and the s&p 500 at the cnbc realtime exchange. >> this is a manufacturing error that they recognized, they know the source of it, have corrected that process. so subsequent aircraft shouldn't be affected. >> some of the revenues that they have been generating in the fourth quarter didn't show up in the facebook filings. i think zyng really is able to monetize unlike facebook. >> good morning, 90 minutes into the trading day. want to run you through some of the number ozzen this monday morning, the dow, the nasdaq, the s&p and the russell are all

lower, coming off the second biggest gain on friday by the dow. on the commodity beat we continue to watch things like gold, off almost $20 today. although morgan stanley is out, into the average for the year. still, they expect to be 1845 and 2175 in 2013. also watching the currency trade, the euro has lost ground on the back of pessimism in europe and fears that the talks between the greek prime minister and the so-called troika continue to not go well. still awaiting that deal in greece that we were told last week was just hours away. on to the road map, speaking of greece, still no deal and the rest of europe is getting antsy. gm is looking at $10 billion in profits. one of the architects is steven rattner. he's with us this morning. what's next for mitt romney after taking nevada as he moves 0en to other states. detail on the big battle between the nasdaq and the nyse for facebook. what will friday's big jobs

number mean for a new round of potential quantitative easing? first, three years after receiving a government bailout quarterback gm is on track to report net income 6 about $8 billion for 2011. earnings are set nor next week. beyond that gm is talking about profits of $10 billion a year. steve rattner oversaw the bailout and the restructuring of the auto industry in 2009 as the white house's car czar, he joins us today from new york. >> good morning, carl, happy to be here. >> why would the company telegraph this kind of year and margin specifically they're talking about? >> look, i think it's wonderful that gm, after years of underachieving, is setting it self-for stretch goals, trying to raise the bar, get everybody focused on getting to the highest ground possible. i think it's a symbol of the kind of energy and ambition that exists within this company now. >> the cfo, the 10 billion figure has been out there.

a 10% margin number has not been out there as much. what is your reaction to that figure? >> i think you have to separate the two. 10% margin figure would put gm at the absolute top of the league among automakers. i think it would be wonderful if they got there. i'm delighted they have it as an ambition, neither they nor i would say it's a slam dunk or it's into the bag or will happen any time soon. 10 billion on the net fwhk line is a different matter. this company, all auto companies, have enormous operating leverage. as sales rise, a huge amount of those incremental sales drop to the bottom line. we had a very strong january in the u.s., as you know. i'm reasonably optimistic for the rest of the year. $10 billion in net income is not a crazy ambition. >> even though very few companies make that kind of money on the bottom line. harry wilson who was on the task force says in the journal, it's important for the company to guard against focusing on share

profitability. losing that focus would be one of the biggest threats to the company and their projections. you go along with that? >> i absolutely do. i think it's wonderful there's a new discipline, not just to gm but across the northern american auto industry in maintaining the discipline. now, it is going to get harder as the japanese companies come back into this market and are more effective competitors than they've been for the last year or so because of their own problems. i think everybody in the industry recognizes the folly of that kind of downward spiral. look, gm's other challenges are probably bigger, to get to those kinds of profit goals, things like fixing europe are absolutely at the top of the priority list. and i think while they made great strides in terms of internal processes, i think they would be the first to say they still have a way to go on really being best practices, best in class in terms of just the management efficiency of the place. >> does too much of this projection pivot around china holding up as a growth market? do you worry about that?

>> look, china is a wonderful success for gm. it has contributed substantially to its bottom line. but the engine of success in this company is and will be for the foreseeable future north america. north america still contributes the vast bulk of the profits. north america is more profitable on a unit basis than china. it does make good money. it has great share. it's only a join the venture. it does not contribute the same amount to the bottom line. yes, we all want an expect china to hold up. china is not what is going to determine gm's success or failure at reaching these kinds of profit goals. >> chrysler getting the lion's share of the action on the tv front. separate from that, i wondering with all the criticism of the way the bailout was structured and various folks along the chain of getting paid back, being mixed up. do you expect any level of profitability of margins to silence those critics?

>> no, because, look, i think you're probably referring as much as anything to mitt romney who's become a little bit of a poster boy as a critic. he's taking his position. he's flip-flopped a couple times on it. his position, he wrote in "the new york times" was clear that bailouts were going to lead to a bad outcome. i don't see how he just flip-flops 0en that. that's his position. i think that every year that goes by, every month that goes by, the rest of the world sees how successful these rescue operations were. i think it's going to put governor romney in a more difficult position to try to defend his position as this campaign goes on. >> steven, good to talk to you, as always. >> pleasure. >> speaking of mitt romney, he did take nevada over the weekend. how close or far is he from winning the nomination? our chief washington correspondent john harwood can hop on to that end of the conversation which rattner brings up. john? >> he's stronger than he was a week ago. it was a very good weekend. he followed up his big florida

victory with a big victory in nevada as you mentioned. he got to 50% against a field of three other opponents. that's never easy to do in a divided field. his problem is that ron paul is continuing to the convention, rick santelr rick santorum is continuing and newt gingrich told david gregor on "meet the press" yesterday that he has no intention of letting up or getting out. >> we want to get to georgia, to alabama, to tennessee, we want to get to states like texas. we believe by the time texas is over, we'll be competitive in delegate couldn't the. i think the key from my standpoint is to make this a big choice campaign. you had a quote that's a perfect example from governor romney. he doesn't worry much about the very poor because they have a safety net. it's become a spider web, it traps them at the bottom. >> what mitt romney is worried about right now is barack obama who is benefiting from a rising

tide of economic optimism at 50%. in a head-to-head november matchup among all adults, barack obama leads mitt romney 52% to 43%. that's a substantial lead, slightly narrower among american registered voters, carl, but this is an indication that barack obama is in a stronger position than we thought and mitt romney has a lot of delegates to wrap up before he can engage in that general election. >> john, appreciate that. john harwood joining us live from washington today. boeing down more than 1% after new problems crop up for the dreamliner. fi phil lebeau is live with that. good morning. >> these are the growing planes you get with a new plane. the problem is right back here in the "f" fuselage. it's built in boeing's new plant in charleston, south carolina. when you look at the 787 and the production problems they've had, boeing says it has corrected these production issues at its charleston plant.

the problem is incorrect shimming found in three dreamliners. what is shimming? the shims are used to strengthen the frame of the plane lengthwise. the problem could, if it's not fixed, lead to loosening of the composite frame. the problem is not considered a safety threat at this point. boeing says we do not expect that there will be an impact on planned dreamliner production rate increases. by the way, boeing currently building 787s at a rate of 2 1/2 per month, even though they didn't make that schedule last month. the goal, 10 per month by the end of 2013. as you take a look at shares of boeing, the focus for investors right now, does this latest problem with the dreamliner, even though it's not an immediate safety threat, does it pose a threat to future production rate increases? the carl, the company is adamant in saying we have found this problem. we can fix this problem. it's not a major problem and it will not impact the production rate for the future. and that really is the focus for investors today. >> yes. the debate will continue about whether it is just another process error that is sort of

run of the mill or says something larger about -- >> right. >> the project which we've known so much about for so long. phil, thanks. >> you bet. gary kaminski will tell us why stock picking is back. good morning. >> a little tired like everybody here at hq. i was perusing the papers very early as i do every morning. something stood out in "the financial times." they talked about how the 50 most active etfs sank. last week we talked about tom lee with the jp morgan data in terms of active managers outperforming the benchmarks basically in every asset class for the first time in three years. we talked about what was happening with this relative performance. the fact that etf volume is sinking is quite interesting. it's what you may call a confirming detail in terms of the fact that stock picking at least for the last five weeks has really added a lot of value.

i think back to those on the air with us, whether it be marvin schwartz, lee cooperman, bob olstein. very interesting. because when you think back to 1998/'99, why do i bring up that period, carl? indexing. everybody was indexing. when it ended and you had a huge boom in terms of stock picking the tech bubble, it was very ugly for those who did not move into active management. whether that's going to happen again, obviously a great question. a confirming detail today, etf volume down, stock picking is back. >> i like that. and hey, after the volume we got on friday -- >> yep. >> much higher than the year-to-date average, highest since mid-december. are you willing to go up there and say that a mom and pop dynamic is in fact happening or not? >> well, you know, there is definitely more chatter in terms of trying to identify individual

stock situations. a lot of the discussion over the weekend was about this idea of are we entering a possible new tech bubble? let me just answer it this way, somewhat of a tease. we'll be joined later in the program with the head of sales and trading at cowan, somebody who i know who sat through the tech bubble. we'll address that exact question, are you starting to see individual investors once again nibble at tech stocks which if we're in the early stages of that, it will run for some time. >> the old cab driver doorman effect. >> yes. when we come back, another take on facebook. with the nasdaq up 14% in six months, is the fact that facebook's about to go public, the sign the rest of tech is about to hit bubble-popping territory? before the break, a check on five big nasdaq players. [ tom ] we invented the turbine business right here in schenectady.

without the stuff that we make here, you wouldn't be able to walk in your house and flip on your lights. [ brad ] at ge we build turbines that power the world. they go into power plants which take some form of energy, harness it, and turn it into more efficient electricity. [ ron ] when i was a kid i wanted to work with my hands, that was my thing. i really enjoy building turbines. it's nice to know that what you're building is gonna do something for the world. when people think of ge, they typically don't think about beer. a lot of people may not realize that the power needed to keep their budweiser cold and even to make their beer comes from turbines made right here. wait, so you guys make the beer? no, we make the power that makes the beer. so without you there'd be no bud? that's right. well, we like you. [ laughter ] ♪



time for the call of the day. shares of fedex up almost a dollar, 95.38 after analysts at bank of america, merrill lynch upgrade the the stock from neutral to buy. almost put a $112 price target on the stock. the high point over the last 12 months is 98.66. the reason behind the upgrade, the company's increase in market share. it's possible as many people watch the super bowl these days for the ads as they do for the

game. the exclusive cnbc collective intellect ad tracker was working overtime all weekend long. on the board, you can see the top five ads according to a sophisticated ranking formula that includes monitoring social media. number five, the avengers, skechers, chevy, doritos and number one, the m & m ad i'm sure you've seen. check it out, samsung, audi, coca-cola, m & ms and chevy, the ones with the biggest affect on buying power. we'll see what the exchanges do to woo some of the leg listers. and the close is on in europe. back in two minutes. librarian emily skinner, each day was fueled by thorough preparation for events to come. well somewhere along the way, emily went right on living. but you see, with the help of her raymond james financial advisor,

she had planned for every eventuality. ...which meant she continued to have the means to live on... ...even at the ripe old age of 187. life well planned. see what a raymond james advisor can do for you.

the two trains and a bus to the 5:00 arider.holar. the "i'll sleep when it's done" academic. for 80 years, we've been inspired by you. and we've been honored to walk with you to help you get where you want to be. ♪ because your moment is now. let nothing stand in your way. learn more at keller.edu.

we're going to have a situation soon where nasdaq is going to want facebook. the nyse is going to want facebook. what do they do to woo that listing? we have more on that.

>> they all want it. where the social network will start trading in may? will it be the dow or the nasdaq? gruppen and zynga went nasdaq, yelp took the more traditional exchange. to trade the stocks, though, issuers could pay up to 500 million at the nyse or 100,000 at the nasdaq. for the exchanges themselves, the revenue from facebook would be a blip on their screen, even as a heavy volume stock, only aa fraction of a penny would be made on each facebook trade. they could generate 30 million to 40 million in trading revenue for whatever exchange it chooses. the big sell from them will be how they plan to pitch to market facebook, both at its ipo and

going forward. nasdaq get zynga ring the opening bell remotely. they allowed budweiser bring a clydesdale on the trading floor and wacky things like that. the nyse will tout the trading floor and boardroom with a gift from the russian czar. the marketing request for the company can be outlandish. ceo steve jobs wanted nasdaq to stage a fake ipo for "monsters inc. ". finally, there's the issue of an index. nasdaq could offer facebook to be part of its nasdaq 100 or the etf as soon as the end of the year. while this would take longer but carl, the biggest hurdle, deciding whether to stick with the legacy of entrepreneurs and growth companies or the big blue chips down at the nyse.

>> so much speculation about the fact that fb is open as a symbol or like or frnd. not that so much of that matters any more. >> the two letter ticker used to mean they would list at the nyse. with fb it doesn't look like that has a bearing whatsoever. we'll wait and see. they have a couple months. we're expecting them to have a final deadline to disclose where they'll list a little bit before they go on the road. >> all right. thank you for that. broader question is, is facebook's listing a sign of another tech bubble? gary kaminski has more on that with a special guest. >> the nasdaq at an 11-year high, everybody talking about tech bubble 2.0. let's bring in david sieberg, somebody who lived through the previous tech bubble. let's talk about what is happening in terms of technology right now, the type of buyers, give us a sense of what you're

seeing. you're trading with the biggest institutions in the world, technology. >> yes, absolutely. if you want to talk specifically about technology right now, i mean, it's no secret, gary, we've seen all the subsectors in tech really outperform. we've watched pretty much all of them in double digit-type returns or midteen returns since the beginning of the year with softwares lagging, up roughly 6%. the hedge funds, the vanilla institutions seem to be buying these things hand over fist. absolutely, i mean, when you look at a company like almal, they basically preannounce and the stock is down 7% after hours. we come in on friday and friday the stock closed up 3.5%. we're absolutely seeing demand for the space still. i think it's going to continue. >> dave, you mentioned vanilla

institutions. for those that might not understand, explain, a vanilla institution is one that may have a technology waiting or a market waiting in technology. these are the incremental buyers who drive these things. what is your sense of how they're doing now compared to six months ago? >> the risk-on trade is here. you can see it where the sophomores are lagging. the vanilla guys are buying that space up. >> momentum traders go back to '9 8 and '99. you have the wagners and baxters. is there anybody out there right now on the heels of what may be the excitement related to facebook that will push the technology stocks to have that huge relative outper maformancet there? >> it's been a broad-based sort of institutional vanilla and hedge fund flow. we've seen in the space.

and you know, look, is the space at levels that there's a near-term pull back? we may be seeing that. the risk on trade is here and people are absolutely very, very, you no he, intrigued in being involved in that space. >> dave, very helpful. thanks. see you again soon. carl, there you go, you wanted to know if it's vanilla institutions. that is what the incremental buyers that continues this. >> nice stuff. thank you very much, gary. where does the next round of qes stand now? [ male announcer ] the draw of the past is a powerful thing.

but we couldn't simply repeat history. we had to create it. introducing the 2013 lexus gs, with leading-edge safety technology, like available blind spot monitor... [ tires screech ] ...night view... and heads-up display. [ engine revving ] the all-new 2013 lexus gs. there's no going back.

all three of the main european -- had fresh 2012 closing highs on friday, simon. as they close today, probably giving some of that back. >> the big news politically during the course of the european session is that merkel and sarkozy warned greece it wouldn't get the money. still, we were able to cut those losses. you'll notice in particular france came back up to the front line. the big french banks were down over 4%. they've come back slightly. we have an interesting snapshot as to what might happen if greece does warn on default. let's have a look at where we were and the italian yields today. the bond markets started to fall off when we thought the prime minister imposed a deadline.

the yields spiked up, then there was a wave of buying. >> that comes on top of manufacturing data out of germany. here's the bell. >> the european markets are closing now. >> in many senses i wish we had a weather map imposed 0en that. that's what a lot of people are talking about at the very, very poor weather across europe. for the moment, you see the markets are in negative territory. let me show you one more, the portuguese yield, today, lisbon, the government had to deny they were talking to banks about restructuring their net. it got perhaps more play than it otherwise might have done. thompson reuters put it up on some of the front pages. it would appear that the portuguese are not doing that, though indeed it should be said that moody's today again warned what is good for greece may well be used in other peripheral nations in terms of the

restructuring and the collective action clauses or the likes could be used by lisbon, the same they've been used in athens. that is one of the concerns. back to you. >> simon, thank you very much. here with bob pisani on the floor. we're here at midday talking about what's going to happen in greece. >> i know there's a groundhog day to all of this. simon had a good point. there is a sense that we are moving towards some kind of danumont. a lot of traders feel that merkel, angela merkel, the chancellor of germany, is getting more comfortable with the possibility of a greek default. look how tough she's been. digging in her heels. no money unless we get a clear deal on the austerity plan. all the leadership has to sign off on it. last week she floated a trial balloon about having the eu take over the greek budget. that went over look a lead balloon over in athens. the point of traders bringing

this up is, she wouldn't be holding the stance if she hadn't had the calculated decision that there is a higher probability that the greeks might simply reject this. maybe it's as high as 40%, which is a shockingly high percentage. she's also calculating this right now. a lot of traders feel she's come to the conclusion that the markets have held up very well, whether you attribute it to the ecb and liquidity procedures they've had, the ltro or whatever. the markets are not falling apart here. look, even today, if this would have been three months ago within we were talking about higher probability of defaults, the dow would be down 300 points today. we're down 33 on a low volume day with 3-2 declining to advancing stocks. that's not a panicking market and it is not over in europe as you can see. there's a significant amount of traders feeling that merkel has made a calculated bet here. the odds are still that a deal will be made. still, higher probability that they won't and the markets may not fall apart.

today i'm just pointing out here we would have seen stocks, particularly the big global sectors, put up some of the sectors here like materials and industrials would have been down 2% and 3%. we get fractional declines here with the materials, again, on very, very low trading. that's an indication of the kind of calculated brinksmanship that's going on in europe right now. >> yes. was the volume on friday, you think a one-hit wonder or not? >> i think the volume on friday was unusually heavy. but, again, you had some unusual things going on around the end of the week and a very important week. so far today, we're back to 3.5, 3.8 billion shares which is what we've been doing most of the month of january. >> just to come back on what you were saying about the chances of a deal being done, i'm not so sure that now the chances are that a deal isn't done. because the politicians in greece with that april election, it would appear as we look at it from a long way away, to a man

and woman saying no to wage cuts, to the extent that the technocrat prime minister, we believe he may have offered to resign or threatened to resign over the weekend is now saying by the end of today, i want you to publish for the greek people my civil service, exactly what the ramifications are of these parties lining up saying no. what will that mean for the greek people? i think that appeal directly to the population is an indication that actually we've now reached a point that they will say no, because they will not carry the can into that april election and lose power. it's about their own power. don't forget, over the weekend, other members of "the new yorker" -- the european union, it was later denied in advance of the election. there's a lot going on concerning local politics. we may have hit the buffers. >> going straight to the greek

people may be the only way this gets done and run the politicians. >> meanwhile, we continue to get just enough economic data from germany, manufacturing data, to keep the notion alive that maybe they avert a recession, which is interesting, too. >> it's interesting that german unemployment remains terrific. it's the only country in europe where there's essentially a positive role on the unemployment situation. >> thanks, bob. >> pleasure. >> head over to our capital markets editor, gary kaminski. fascinating stuff you had earlier talking about institutional buying. >> absolutely. if you are in the s&p, you're essentially flat. here's another confirmation indicator of what's happening in terms of 2012 and stock picking, carl. i just looked at the new high, new low list. there are 69 new highs on the new york stock exchange where you are this morning. you know how many new lows there are? zero. you haven't seen that in quite some time. 69 new highs and it's a broad-based rally in erm its of many different names if you take a look here, no new lows.

again, further confirmation that this continues. it is a stock picker's market and boy a lot of people are happy about that. >> where is your own head regarding europe and how much this -- any kind of disruptive event would affect markets in the levels we're at? >> i think it goes back to something you and i spoke about three weeks ago, which is the idea that europe was driving the u.s. equity markets, whether there was a good reason or not a good reason was becoming sort of nonexistent. again, i -- as i do many weekends and talk to those that are professional investors that make a living managing money, it's just not that relevant right now. and i can't tell you the reasons why but it's not. >> yes. i don't you have been consistently, i would argue, two to three months ahead of where the market is. i have to hand it to you. you've had a good track record the last four or five months. >> thank you, carl. dave sieberg, when he tells you that the technology buying is plain vanilla institutions, incredibly important to understand the difference

between funds that are dedicated to technology investing. they have to be benchmarked. they essentially have to own the index. when he talks about vanilla institutions, those are managers that could go anywhere. you're seeing it in technology. that's real confirmation that there's buying happening right now. >> see you in a bit. >> see you in a bit. when we come back, how the bookmakers in nevada fared during last night's super bowl. here's where the casino stocks stand this morning. a lot of interesting bets did not go the way vegas thought they would. here's las vegas sands, wynn and mgm. before the break, some of the winners and losers out of europe, too.

should we be letting him p-l-a-y with our t-a-b-l-e-t? [ mom ] i think it's fine. it's the new element from at&t so it's w-a-t-e-r proof. cool. what else does it d-o? it's fast. it's 4g lte. what's l-t-e spell? nothing. w-h-y? hey, can we stop spell talking now? ok. a-y. [ male announcer ] buy a waterproof pantech element for $249.99 and get a 4g burst smartphone free. only from at&t. eeeeeee!

whee! whee! wheeeeeeeee! ah heads up. wheeeeeeeeeeee!

everything you love about geico, now mobile. download the new geico app today. welcome back. coming up in 19 minute or so on the halftime report, some call it the best pick in all of tech this year. after the super bowl, why the street is not so wild about buffalo wild wings. now back to carl on "squawk on the street." >> those wings were pretty good. >> they always are. >> the spread in vegas, the

giants get three points, of course they didn't need them. they won outright, 21-17. how did the sports books do, though? >> i put that out about two minutes before on twitter, it was 60-1. we know there is one guy who bet at $50-1 -- 50-1 $1,000. there's a lot of stories out there, the most popular being that vegas got pounded because the giants were long odds to win it all, as highest as 100-1 after they lost to the packers. it's a popular story. we founded this morning it's not exactly accurate. lucky's in vegas says they'll come out on top and the wynn told me they'll also be a small winner. no big book has acknowledged that they lost a huge amount of money on the game. that's their job to balance even the future bets, though it would have been better, they say, if

the over was hit on the game. now we have to fill you in on ratings. the early results, the overnight which is came in earlier this hour, a lot of people thought it would break the all-time record of 111 million viewers. we'll probably get that in the 2:00 hour. the overnight show, the third highest rated super bowl behind last year's game and super bowl xxi between the giants and the broncos. we're going to have to wait on those numbers. maybe the digital play had something to do with it. it was of course the first super bowl you could watch online at nbcsports.com. maybe we'll have to start adding up those numbers. i'm not exactly sure. >> the game had them until the end. >> game was great. thank god because the commercials were not so great. >> i'm with you on that front. darren, welcome home. >> thank you. >> what a weekend you must have had. when we come back, hiring is on the rise, factory orders are better, the data shows life in the u.s. what does it mean for a new potential round of qe? back in a minute.

this is an rc robotic claw. my high school science teacher made me what i am today. our science teacher helped us build it. ♪ now i'm a geologist at chevron, and i get to help science teachers. it has four servo motors and a wireless microcontroller. over the last three years we've put nearly 100 million dollars into american education. that's thousands of kids learning to love science. ♪ isn't that cool? and that's pretty cool. ♪ so -- tell me again what happened. i was downstairs making coffee, and we heard it. it just came crashing through the roof, out of nowhere. what is it? it's our ira. any idea what coulda caused this? maybe. i just sorta threw a little money here, a little money there. and i loaded up on something my dentist told me was hot. yeah. ♪

♪ [ male announcer ] for our families... our neighbors... and our communities... america's beverage companies have created a wide range of new choices. developing smaller portion sizes and more low- & no-calorie beverages... adding clear calorie labels so you know exactly what you're choosing... and in schools, replacing full-calorie soft drinks with lower-calorie options. with more choices and fewer calories, america's beverage companies are delivering.

while you were watching the super bowl, senior economics reporter steve liesman was tweeting. he got the tweet of the night from politico last night. he was also watching the fed after friday's big jobs numbers.

he joins us back at headquarters. >> i didn't hear about this. >> tweet of the night, has an nfl team ever hit 21 with 76332? talk about hitting a number the hard way. >> i have an interest in numbers, carl. let's talk about the jobs number. what a great segue. raising the stakes for fed chairman ben bernanke's testimony tomorrow at 10:00 a.m. he would be expected to repeat those remarks from last thursday's appearance. that was before house budget. question is whether the jobs data from friday changes economic outlook and whether that changes the markets outlook for fed policy. morgan stanley writing after the jobs report, quote, we still believe that the very dovish fomc statement and subsequent comments from fed officials indicate that the bar to additional qe is still low.

deutsch saying, if unemployment continues to trend lower, the fed will not have the luxury of waiting until at least through late 2014 before hiking the fed funds rate. he will have to be careful not to get too far ahead of the committee's economic outlook which ultimately is the basis for the fed's ultradovish policy stance. i don't think an nfl team has ever gotten to 21 that way. >> 7, 6, 3, 3, 2. a rainman watching the game there. stick around. good morning. >> nice to see you, sir. >> always hard to read into fed policy around one number but of course the jobs number on friday took a lot of people by surprise. do you think that number or maybe even the three-month average and the way it's been trending changes the probability of qe? >> i think it does.

as you've suggested, you can't ever put too much story in one monthly figure. but if there was ever a month where you could put a lot of store into it, i would say it's this one. the number was strong across the board. they revised earlier numbers up. so i think it changes the game. i think it changes the outlook. and i don't think it takes qe 3 entirely off the table. i think it definitely lowers the probability compared with where we were before the number was announced. >> steve? >> it's going to be interesting, carl. there's a couple views on the committee, i'm sure al is aware of these. there are those who say -- there's three. no qe under any circumstances, that's one. the middle ground is qe under certain circumstances. but there is a substantial wing of the committee that says you know what, almost no matter what, i think we need additional qe, because we don't see ourselves hitting any of our employment metrics, especially.

and inflation is not a problem. i think there are five or six guys on the committee that think that and want to do qe, even at 8.3 unemployment. >> your reaction, mr. brodis? >> my thought, steve, would be i think that's right. i think this number will have some impact. a lot will depend, obviously on the way the data evolves from here. but -- that's really what i'm basing my answer on. i think this number changes the odds regarding the outlook. it makes it more likely that the kind of outlook the fed has been putting out there in its longer term projections may change. again, while i don't think you can take qe3 entirely off the table, if inflation remains low, if the next monthly job number is not terribly strong, if some of the risk in the economy, in europe continues to be out

there, then it could bring us back to qe3. certainly the odds are lower now than they were. >> then the question becomes, carl, what happens to the 2014 pledge? and what's interesting is to think of that, remember, all of these things that are policies in the zero bound environment when the fed is at zero to a quarter are essentially seens arate hikes or rate cuts. this 2014, if they were to dial that back, i think, carl, would be seen a bit as a rate hike. >> yes. we watched the chairman's defense on the hill last week after the questioning of paul ryan. accused of maybe targeting inflation in ways that wasn't completely forthright. then we have charles schwab in the "journal" today quoting federal reserve chairman ben bernanke has told lawmakers last week that fiscal policy should first do no harm. the same could be said of monetary policy. the fed's prolonged emergency near zero interest rate policy is harming our economy.

how do you think the fed has fared in that defense? and how do they argue that we can survive without being near the zero bound? >> well, there's always controversy about monetary policy. this is one of the most difficult periods the fed has gone through in a long time. my own view is that the position the fed has taken prior to this number, in particular, has been a reasonable one. you know, the one thing you don't want to do is to have any kind of drift back towards deflation. that's been very damaging in japan and, of course, the chairman remembers the '30s very well. i think that's been at the forefront. hopefully, this number is a signal that things are changing. if that's the case, then i think the fed will have to adjust to that and frankly, i think the fed will adjust to that. we still need some more information. you always need some additional information in this game but that number last week was an

encouraging number. my hope is that it will allow the fed to avoid going to qe3. >> al, i think it's interesting to talk about the process here, which is that the fed has to get a consensus around a policy, especially where it is right now. it has a tendency to be late. i think there are critical turning points during even this recession where it's been late. it's been late in terms of saying we'll be heading towards tightening when the economy was weakening and it's been late in terms of easing when the economy has been strengthening. i think there's a critical issue that the market has to really watch out for. i think the fed has to watch out for the market where it can sort of start to tighten before the fed is ready and may well lead the way up here. i think it will be nervous. >> go ahead, i'll let you have the last word, al. >> well, i just, again, to repeat, i think this is an important number. a lot of people are nervous, as

you know about the fed being this easy this long. i think up until now, it basically, the case for it has been pretty strong. this number suggests that maybe the case is going to move in the other direction. frankly, if that happens, i think it will make a lot of people at the federal reserve more comfortable than they've been. >> al brodis, thank you very much, joining us from richmond. if ads have to get rid of animals and kids, what would they turn to next? some of your responses after the commercial break. [ leanne ] appliance park has been here since the early 50s.

my dad and grandfather spent their whole careers here. [ charlie ] we're the heartbeat of this place, the people on the line. we take pride in what we do. when that refrigerator ships out the door, it's us that work out here. [ michael ] we're on the forefront of revitalizing manufacturing. we're proving that it can be done here, and it can be done well. [ ilona ] i come to ge after the plant i was working at closed after 33 years. ge's giving me the chance to start back over. [ cindy ] there's construction workers everywhere. so what does that mean? it means work. it means work for more people. [ brian ] there's a bright future here, and there's a chance to get on the ground floor of something big, something that will bring us back.

not only this company, but this country. ♪ it's a lot busier than it looks, let me tell you. today we're asking, hey, madison avenue, if you had to drop all the kids and dogs from your super bowl ads, what would be your next trick? david tweets they would have to get morgan freeman to narrate

the commercials. who could beat that? hire letterman to do stupid human tricks. joe tweets betty white. enough said. i think we did see betty white in some ads last night. get a takeaway from gary kaminski. >> it was hard to decide who you wanted to win, as a die-hard jet fan. i was pulling for.giants. i was happy. liesman came over here, said that was great stuff in terms of how he came up with that idea if you were playing blackjack to get to 21. fantastic stuff. that's why he's an economics reporter. great stuff. what i did have to take away in terms of the super bowl, it's a good thing i'm not an advertiser. i tell you why. i would have thought the jerry seinfeld acura commercial would have been something people mentioned that they remember. everything you've been reporting all morning in terms of the top five commercials, i was surprised. let's take a look at that.

>> you're number 1. how would you like to be number 20? >> no. >> i'll throw in the soup nazi. how about a new boat? final offer. access to my private zip line. >> wow. >> you get the first msx. >> how about a jet pack flying squirrel suit. >> sorry. >> the acura msx, it's coming. >> now, again, maybe not the funniest commercial but i thought the idea wasn't something that somebody was going to remember today and tomorrow. so i guess it's a good thing as i said i'm not in advertising. i was surprised that was not one of top five. >> yes. i think some of the -- my problem with that ad, i thought it was funny, i remember leno, seinfeld. i wasn't sure i would remember the brand of the car. was it a nissan, a honda, an acura? it's always fun to watch. volumevie volumewise, on average on super bowl monday, the day after the

game, the dow moves an average of minus 0.6%. s&p averages 0.4 decline. hardly moves at all. which makes you wonder if everyone just stays up too late or drinks on a sunday night or what? >> you know, it's very hard to have an event on a sunday night. i know you felt the same way. when there is a workday the next day. god, remember when the super bowl used to be at 2:00 in the afternoon and you could have that kind of a party and it didn't affect the day? i will say one thing, too. a lot of people that work in the industry that went to indianapolis, there were stories about this over the weekend. i spoke to people that tried to get out thereof at 11:00 and 12:00. they were not equipped to get people out on the private planes. people that were leaving last night didn't get back to new york until 4:00, 5:00 in the morning. a lot of those professional traders as we say couldn't get back to get to work today. >> i did have a friend who was on a 6:00 a.m. back. we know rovell is back. it can be done.