>> we had a lot of sidebars, but thank you for having me here, and i hope you have my back. >> thanks to our host don drapkin. make sure you join us tomorrow. "squawk on the street" starts right now. good morning, we're live. carl kin nilla is on assignment today. wore looking at -- the dow looking to lose about 27 at the open. we are seeing declines. >> and here is our road map. dow component.

will the strong jobs report facebook controversy. it's talking to facebook. this should be more respect. the but roaring we have to start off with food and drink. kind of bizarre period, where we literally believe they would eat less chicken and drink less coke in china, because rates were tight. now we're pleasantly surprised? anyway, i'm sorry.

i just had to interrupt. we were so bearish in 2011, we actually dreamed up -- if you go there, it's quite a nice restaurant. people have gotten marriage. i'm sure that's the case here as well. this is america. >> can you get married at domino's? >> i'm sure you can get get married wherever you want all i say is i'm sorry that people are astonished it is a remarkable company in the sense that people were talking in "wall street journal," does it ever miss the number? it's been only miss onced.

>> in the past 20 quarters. >> it is not engineering. it is not financial engineering. this is a company with real revenues. >> looking through the press release was sparkling beverages, which would been a slow part of the business, actually gained. still beverages were up, so they had good volume growth for both still and sparkling. this was surprising, too, one of the biggest gainers in terms of volume, minute maid pulpy, up 20%. >> talk about a comeback. i grew up at tang. >> some of the orange juice products that were -- >> this is a juggernaut, and a really well-run company. you tend to hear from the ceo and the cfo. i think coca-cola is once again a company that puts together a productivity plan that actually works. these are solid revenue numbers. a period very brief where they weren't meeting numbers.

people often compare coke and protecter. there was open rebellion how it was, this is a quarter that you can be proud. >> you mentioned p & g numerous times. >> because there were teem saying where is the old p & g? the takes shares, that raises prices and they stick. i actually -- i think both those companies are ahead of protecter. i know they'll dispute it, i'm happy to have them on the show. >> and they'll probably say just give us more time. >> i have no more patience than the analysts that have covered them for a year. this is like the sportswriter covering the yankees and literally in the locker room saying when are you going to start getting better. you know you'll almost get cut off access, but almost everyone joined in on the bash. >> is yum the best way to play

china at this point? if you wanted to invest in china, but you don't want to buy the stock or the stock market, you want to buy. >> i'm going to give you caterpillar, cummins and joy. >> over yum. >> yum bizarrely, i think is a subtle and sub -- that no one didn't trust the food chain in china, and at kfc, it is u.s.-certified chicken. >> they control the food chain, they don't outsource the acquiring of food, the acquisition of food, but people do feel it's the safest food, that it's american certified in a place where a lot of people are doubtful about the quality of their own food. anchts in less than an hour, ben bernanke is heading back to capitol hill for the second time in less than a week.

he's going to be testifying about the economy. the difference this time around, the strong january jobs report wasn't out when berle nangie faced a house panel last week. we did wonder. if it had been one day later would hef changed the testimony, did he even know? here he is back again. >> he's not trading places. he's the government, right? this is not duke & duke. this is the fed. >> yes, it is. >> the reaction in the fed funds future is the fed would start hiking interest rates in 2013, which obviously is, you know, for him it's through 2014. >> right. right. he's said that. i think he's going to regret he said it. >> some feel as though the move towards transparency almost causes less. >> i want to go back to the days when tiffs a secret temple. >> no, you don't. why? when everything was in his briefcase and you had no idea what was going on?

>> too much transparency at times confuses people. i now feel the fed is in a box. he says the economy is not that strong, and then the economy gets strong. why give yourself no leeway he's a very bright man and i like him very much, about you i don't want to confuse this. transparency is a good thing wherever it is, but i do feel he's boxed, and i think the economy is stronger than he thinks it is. >> you think the fed chairman doesn't realize -- i mean, do you realize how odd that sounds? i don't believe the fed chairman knows how strong the economy is. he doesn't know what i know. >> okay. all right. i think he -- >> subprime is contain. >> that's very, very true. >> we assume they know more than they actually do. >> we had a fabulous unemployment number.

i think if he had had an extra day, i think the tone would have been different. if he had said nothing at all, he would have been fine. >> taken the fifth is it. >> even corzine doesn't take the fifth. >> i won't comment on the economy, because jim cramer could come back and make fun of me. >> i'm sorry, and i've done that numb lulls times on "mad money" i do believe the perception is weak is more in the eyes of the republicans, of president obama and ben bernanke, than it is is the ground-up ceos we have and talk to all the time. >> so you look at the companies -- >> i'm an empirist. >> we're are people looking at me like i have two heads. >> when you say people, do you mean david and -- >> there's nobody else.

>> they're not watching over here anyway. >> off the reservation early on, i'm sorry, but i get fired up. >> let's see what bernanke has to say. >> $145 billion pension fund is concerned about facebook. the california state teachers retirement system has issues with the social networking science corporate governance, measured specifically some of the provisions that protect mark zuckerberg's control over the company. the two classes of voting shares, the fact he can appointed a successor upon his death, the fact that that voting control will pass on to that appointed successor. it almost sets him up as a king mark, if you will. >> a we have other companies with two clamses, news corp., a company we work for, comcast. >> and the ownership of stock by those that control -- viacom is

another example. >> do you find over the long term people are more concerned about stock performance than ownership. >> absolutely. if the stock performs nobody complains. if the stock doesn't, you hear more about it. >> kind of like china. they're not free, but nobody is going to complain until -- >> doesn't it bother you he has the power to appoint his own successor, as if it's like a bloodline and this person will be accorded the same respect and power he has? >> one of the great things about stocks, if it bothers you, don't own it. >> it's been disclosed. >> yeah, that's true. >> absolutely a corporate governance issue, but i have to agree with jim, at the end of the day, if the stock performs wells, most of the time it doesn't come to the fore. it's only when they that -- >> eisenberg, union performing

miserably underperforming. i think it's great that the hundred million doesn't get paid to him, because he has not done the job. i think it should be predicated on how the stock performs. that's how i judge. >> on this note, it is something of a trend, carlisle has of course the private equity firm to come public. its ipo, it has different but similarly negative consequences. reading action for example, the shareholders have no ability to elect directors. it's controlled by the management carlisle will not hold an annual meeting. dar lyle has the right to sum matterly repurchase all the public shares. >> that's outrageous. >> i think car line makes facebook look like a paragon of virtue.

>> i think about the under stalin, he had very similar rules. also north korea has a similar governance. >> really? >> they are going to appoint some independent directors to the board, but if you buy carlisle, you have no rights whatsoever. yesterday the billionaire saying he has confidence in vikram pandit, and here's what he had to say. >> group under the leadership of vikram is doing really well. i believe he was able to have the company go out of the wilderness it was in. and sill believe that the best days are yet to come and i believe the full potential could come back to the previous

expectations. >> best days are yet to come. are the best days for the stock price behind it? >> no, i think the prince has a good point. it made a bet with internnal emerging markets. unfortunately those had a very big downturn. if they come back, i think the earnings can come back. as far as the dividend, i think the dividends are on which under the control of the government, and like bank of america, until you deliver, you don't get that dividend. >> he ace owned that thing a long time. >> great basis. people -- i think he came 5, 6, when greenspan suggested had el come in during the last banking crisis. he's a grate investor. i listen to him closely. >> but he's owned it for 20 years and he never sells. >> right. the stock is basically, if you back out the reverse split,

three and change. >> well, i don't -- it's different splits or -- >> i think pandit is a controversial figure, because people feel it should have been moving already. he does not talk about the -- the analysts say action look it was so horrible. if you think international bank is going to come back, he would be the play. >> the sprains also talked about oil yesterday with maria. here's what he had to say. >> there's an element here, because what may happen with iran and the possibility of closes the hormuz strait, but there's a sense that both the consumers and producers are satisfied with the price. and so they went public saying they will not led the -- which means we can use our leverage, excess capacity, to be sure to

pump more if needed while they're getting out of the economy, slowly but surely hopefully. >> should we not worry about oil get over $100 a barrel based on what the prince says. >> gasoline going back to $4. at $4 is whether we always thought you should sell darden and when retail would be terrible. it's not happening this time. there's a sense it's not mattering. i question that. i think that may be too xlasants. >> you do? >> yes, i do. of the things i'm worried about, i'm worried about gasoline going higher. >> are you worried about iran? >> i think you have to worry about iran. i just think that the minister of defense is a serious guy, wouldn't say they these idly. you can't take this off the

table. when we come back. pharma pipelines and profits. we'll discuss it with glocks osmith klein's ceo. and as we head to break, take a look once more at the futures on this tuesday morning. ♪ oh! [ baby crying ] ♪ what started as a whisper ♪ every day, millions of people choose to do the right thing. ♪ slowly turned to a scream ♪ there's an insurance company that does that, too. liberty mutual insurance. responsibility. what's your policy? ♪ amen, omen

welcome bulk to "squawk on the street." rick santelli here. it's not a big day the week after the jobs report, but it will prove to be a federal funding type supply week. and we see that the corporate calendar has picked up a bit. a lot of people especially paying close attention to the high yield/junk market. why? looking for some yields. we continue toss the injuro inch its way as we play the ongoing waiting game. back to david faber. >> all right. mr. san tellist, thank you. with fed chairman bernanke set to testify, here is today's squawk on the tweet. complete the sentence. what he wants to say today but can't is -- we will air your

responses throughout the morning. >> you don't like my tweet? >> i think it's very clever. >> thank you. >> good morning. >> yeah. >> that's how i end most of my sentences. and talking about junk bonds, how about scrips? you want some paper, they're offering a lot of paper. >> $3.5 billion yesterday. >> what's interesting in part about this deal is they're paying real fees. we have a bit more on that. but they did hit the bond market big time. his matt dax is on -- and how tuesday is setting up on wall street. ♪

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welcome back. i'm sharon epperson. the prince says the saudis want to keep oil under $100 a barrel, but he must not be referring to brent crude, because it stopped $117 this morning. iran a big factor in the rally in brent crude, and saying that despite sanctions -- and they are vowing to ban crude exports before the eu embargo even takes

effect. as it approaches the goldman saks was short. they are closing that position and taking the new position. wti times spread sees further pressure. meanwhile, gold prices replain rather flat right now, even more than greece. a lot of gold traders focused on ben bernanke. back to you guys. about 5 1/2 minutes before the bell. time for cramer's "mad dash." yesterday it was earnings that actually beat plus. >> what's incredible to me about coinstar is 12 million short. notice, i understand that people felt coinstar could be blockbuster. it's been adopted by a lot of people. it's a generational thing. there's a lot of younger people

that know hoses to stream, and a lot of parents want to pop in the dvd with the kids in the car, boom, that's coinstar. should it be up ten? there's no stock around, there's no supply, just a lot of short. even the ncr deal would have been enough better quarter, would have been enough vising tie-in, you know? >> in terms of acquire -- more physical dvd assets, is that the way to go? when you look at that business model, are we say that netflix -- where you don't have a physical outlet? >> think about the iron here. you're put -- you put it in the mailbox put your flag up. coinbox is moving into the area that reed hastings hate, though they don't have the same mailing problem. would i be short coinstar here? i don't have a case to be

shorted. is this all really great news? i question it. i think the stock can go higher. they've got to bring it in. we have to take a break here. more "squawk on the street" straight ahead. coming up, as new york prepares to celebrates the giants' super bowl win, we're gearing up for the opening bell which of these 500 stocks are headed for a touchdown? find out when "squawk on the street" returns. [ male announcer ] let's level the playing field.

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all right. take a look as we prepare for the opening bell. there they go at the big board, celebrating a spin-off at the nasdaq, cepheid. >> that post-split i think is a very good deal. i think very smart company. i'm looking at both pieces. >> what does it do, if anything, to kellogg or another player in the cereal? does it compete for demand? >> i think it's an interesting question. now they'll be so focused on post, kellogg has been making a comeback. i never underrate general mills, baud ken powell is such a superior operator. he's really good. right now the cereal business is doing quite well. if we could get the price of gasoline down, because that's the most important aspect -- >> we were talking about autos

yesterday and it's interesting what toyota is saying. they're lifting the full-year forecast, but earns will be about half of what they were last year, a faster recovery ahome and abroad. all of this is predicated on the yen level of about 78, and we're not there yet. >> and i continue to think about the panasonic loss, the sony, how trouble japan is. before the show began we were discussing how broke is japan? should we be focusing more on japan and the troubles they're having? sometimes trying to get my arms around it very opaque situation. >> the demographics are terrible. >> just a nightmare. >> terrible, in that there are so many obligations to pay in terms of retires and pensions, because the demographics tend to be old. >> one of the reasons our country has been a higher birthrate, though ours has slowed down perigo a very good

quarter. >> emerson, again thai flooding. thai flooding. i happen to blem in emerson. february 14th very big analyst meeting. it reminds me of dupont. i would not be a seller of emerson here. >> right. in terms of -- we were talking about it with a huge deal, 90 billion at this point, but the biggest deal you've never heard anyone talk about. >> because it's not a merger of al can, not a merger of two producers, okay? >> sure. >> when producers merge, it's because they want to take it to china. this does not help them. >> but we should care as investors here in the united states. we could say it's a big deal, but it doesn't impact us, but it

does impact the trade. it will put pressure on some of the middle of 9 road, middle market miners to combine. we're seeing the activity in cliffs natural. >> and my problem is you've got to be careful at home. these are companies that are earnings challenged. boom you get hit with a preannouncement. >> right. in terms of -- let's talk pepsi. it's out on thursday. >> it's interesting. we had a couple aggressive analysts say -- deutsche bank raises i get tarts. i always said, who goes out ahead of pepsi, ahead of the earnings and saying things are good. made me feel more bullish about pepsi, though obviously egg on his face -- >> no credibility to the deutsche bank person, but is there credibility? >> yes, ma'am, there's

credibility there. coca-cola with a really good number. i am just emphasizing the fact when you buck your price targets, you better know something or we're just going to crush you. >> let that be a warning. >> david, bob, over to you. we're going to start off in greece, why not? >> the greek political leaders are meeting to discuss the terms of the bailout if they can get into the building. the entire country is on strike. all building services are shut down, even the museums. presumably you can't even get to the par ththenon today. >> here's the basic problem. the germans donnell trust the greeks. they think whoever gets in as the next president will renounce

the terms of the deal. so they're trying to propose ways they cannot let them out of the deal. now a new idea is being floated about an skro account potentially where they give them the money, but lars parts pay off the existing bondholders, provides they go through with the austerity planned. now, remember last week there was another deal proposed where essentially the eu would come in and sit and control the budget of greece. that went over like a lead balloon, so now there's a new idea floating around. give them the figure leaf, but set up the escrow account that in fact there's a series of things they have to do. >> meanwhile, all this back and forth, bob, does not seem to be having an impact on our market right now. >> not just a year ago, but three months ago, if this had

happened three months ago, where the leadership in greece are saying they're not in favor of this, i think the market would have been down 300 points. i give the ecb a lot of credit. >> the velocity is so slow. at this point you could have air bags, seat builts. is there anyone left? everyone's had a chance to be able to adjust to greece. >> yes, here's the problem. it's a dangerous thing to say that a greek default is priced into the market, would you say? i think that's a dangerous profits to make, certainly people get used to the idea, bonds are sold, write-downs are taken, that's a good thing. i think it's dangerous to say nothing is going to happen if there actually was some kind of disorderly default that's in the market. >> i keep getting her about how terrible the trading volumes

are. i think we saw two big banks, mccarrie, and ubs in switzerland. both said they're trading in fixed income and trading in equities were way down. the reason in their clients are trading less. and there is a major reason why we're seeing such low investment -- such low trading volumes. of course another main reason you don't have to gots too far. >> not to mention the lack of participation, a trend you talked about endlessly the last couple years. yes,ed point is you do not have to fined hidden reasons why trading did down. since you spent a lot of time with this, what is up with caesars? it was supposed to go -- >> go public yesterday, and very

small offering. >> though the other shareholders are ability to sell shares at a later date. >> the whole offering designed essentially to allow paulson & company to sell at least half its current position. the sbifr offering, by the way, valuing the company, $18 million offering valuing the company about 1.25 billion, it's a debt story, bob. >> the question is, where is it? it didn't happen. >> there's a glitch. >> one unknown underwriter mentioned a technical glitch. i asked around, what happened? i don't know if there was a problem with the seismt o or the prospectus. literally we don't know, but it was supposed to happen, and they're silent to where it will come today or not. there is a debt offering tomorrow as well from the company, a billion after a quarter, so it becomes complicated.

>> though as they pointed out, they only have dollar 45 million of payments on that debt over 12 months. >> i just wanted to point out there's an absurdity here this is absurd. where is the s.e.c.? >> maybe it caught somebody's attention. it call my attention last week because of the size. >> crazy. >> they tried to come up with a much larger offering a year ago, because the market is still not particularly crazy about delevering stories. >> it was magnitudes of order higher. >> why don't we just act as if it's a small cap and fool everybody? we want to move on to brian battle. at the cme, what are you watching this morning? >> it seems like there's a spring winding. we've been trading headlines for months. greeks vurp the europeans, euro versus the yen, so we're waiting

for something to break. so we're watching definitely ben bernanke's speech. he's going to have to say they have to hold rates low, and yet the stock market seems to trade at a high. so we're going to see if he says anything surprising there, and of course we'll watch and see if the greeks can get an agreement, but more importantly, can they follow through with it? they haven't done what they said they're going to do. we have to see if there's something to lock them in. >> so it's a market kind of waiting for something to break. what is the most likely thing to break, or are you saying that you don't think anything will? >> i think the biggest headline probably will be something out of the middle east. it's iran versus result world. we seem to be on tenterhooks. it seems like something it going to happen. no one wants to commit. there's a very low level of commitment, and we're sort of

drifting. >> brian battle, from the cme, melissa, over to you. >> let's shift to bonds. check in with rick santelli. hey, rick. >> it's fascinating, as we continue to monitor what isn't happening in europe, we see that our interest rates have ticked up a bit. the corporate calendar has some companies already looking to put forward some securities, but it's not huge, but yet we see the equities are down and the dollar is down. with ben bernanke going on the other side of the aisle today in terms of the -- going to be talking in front of the senate, it's going to be fascinating, say traders, to hear how he underscores some of the recent cyclical improvements, or will he bring up the shrinkage factor that even though things are getting better, the structural trends of less able-bodied men, women and children being included in the labor force or not included in the unemployment

source, we want to hear what ben bernanke has to say. back to you, melissa. thank you very much, rick santelli. you're watching wall grease today, citigroup with a note to sell walgreens. >> that's a gutsy call. despite between express scrips and walgreens has created this opportunity that cvs has been taking advantage of. i happy to like the new walgreens style, but i've got to tell you, this is cvs' game to win. >> it's been warm. is there a chance people get few are colds? >> seasonally that has matter. there's obvious been after the quarter, people say, wait a second, flu season didn't really develop, but there's a lot of people who just shifted all that

business to cvs, and then you walk to the back, and pick up a little shampoo, seasonal candies. >> candy. jim touching candy. >> >> maybe me didn't have -- all right, coming up. complete the following sentence. what he want to say today about can't, fill in the blank. all we head to break. a look at this morning as early movers. a tuesday the giants will own as they go up the canyon of heroes. [ male announcer ] what if we told you that cadillac

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brandt. hit earlier in the session. for apple, the magic number is 466.90, so just off that new all-time high set in this session. with ben bernanke set to toffee, here is today's squawk on the tweet. the thing bernanke really want to say but isn't -- blank. andrea tweets -- i wish i worked for apple. lawrence tweets. how come i'm the rodney dangerfield of the fed? i save the entire financial system, but i get no respect. george tweets -- i tried speaking slow will you. tried speaking english, it doesn't work. which of you dolts is in charge? if the fed seems to be doing -- it's because you guys aren't

doing your. >> did you catch the apple ad? a lot of giants taking pictures of the lombardi trophy with apple, no, that was actually guys using i phones, not paid for by apple. >> you watch the parade today, all the giants on the floats, they will be using their i phones to -- >> the samsung with stylus? >> and of the crowd. >> look there's crowds out there already. >> need i say this is my worst nightmare? now it's right in front of me. giants fans everywhere, surrounding me, a sea -- >> in jerseys -- >> yeah. >> second super bowl. >> that's why they created xanax and electric roe shock therapy. >> you do it together -- >> you do whatever is necessary. >> that sounds like together. much more "squawk on the street" is straight ahead. people with a machine.

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simon hobbs has a lock another what's coming up? >> in eight minutes' time we'll find out what ben bernanke will saying on capitol hill today. will his forecasts of low interest rates to theened of 2014 be abandoned because of friday's jobs report, coca-cola firing the first shot in the earnings war. which should win your look of love? back to you guys. time for six in 60. ibm initiated buy at stern agee. >> company's skying perfectly on its plan. i think that's a smart call. >> urban outfitter downgraded at green murray. >> new ceo, who the heck is going on? >> anadarko earnings beating estimates by 23 cents.

>> ceo remarkable, 159% of production replaced. mozambique, ghana, gulf of mexico, all fabulous. >> fedex no longer a short-term buy. >> good luck trueing to put that back on a buy list. that's a juggernaut. >> and you need better gangie to -- >> and cisco. not the foot week. >> what is it -- give me a break. that's about as preview as you get. >> for more go to sots.cnbc.com. >> if people want a laugh, they should go to preet's, grate "time" magazine cover. this is the credit sweet conspiracy. >> southern district of new york. >> this is about thousand to get a $7 million bonus by allegedly lying about the marks. this stuff is just amazing.

literally the stuff of the marx brothers. >> we've got two sets of bond marks. this is like two sets of books. this is the sopranos. this is the sopranos. this is how you make money on wall street. thank win heavens we have a u.s. attorney no the southern district who is more sophisticated than the bad guys. >> well, that case came out last week, a lot of that potential wrongdoing -- >> will you please put in alleged. did people not realize their own tape i urge people to get this, because it was about 7.2 -- 7.2 million, you know, they get a couple valuations from the bonds from real firms, and suddenly the real firms don't cooperate, so what do they do? they call some guy that's a buddy. >> if you're an average guy listening to you, jim, you think the whole system is rigged, these guys have two sets of books, like at the caesars ipo,

so when hedge fund can exit, how am i supposed to make money on wall street? >> we have been waiting for indictments. we said 6r7k got away with this mortgage crisis. >> i admit it, i've always been pro-pros cougs. i tried to little a job, didn't have the grades. i've got to tell you i think people should feel better and feel things are more honest after this, but not feel more honest after that outrageous see sars thing. >> that's a unique time. the mortgage securitization was the wild west. i followed it closely -- i'm not talking structure, but products all the way up the chain. we have very few prosecutions, we have seen civic cases, of course, but very few real cases. this, a market manipulation.

this is shakes peer, because this is one of the most brilliant i have ever read. >> on that know, but ubs shares interesting changes continue ubs still questions how they're paying their people. >> nothing cries for them, by the way, i'm pointing out the changes taking place and the question whether it's a real secular change. >> one of the reasons i recommended morgan stanley is because they now get paid what regular people get paid when you start add morgan stanley.

>> includes what? >> they get paid what lawyers make. i made more money my first month at goldman that is in seven years of work. >> who do you have on tonight? >> ab med, good spec. coming up, ben bernanke returning to capitol hill. will his message differ from what he told last week's house panel? stick around. we'll find out. [ horn honks ] hey, it's sandra -- from accounting. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important.

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welcome back to "squawk on the street." ben bernanke repeating his testimony from last week making no mention of the strong jobs report in the testimony he's prepared in the hearing that starts pretty soon. this is a bit of a trivial points, but he repeats the job average even though number has been revised up. the outlook remains uncertainly.

he repeats the job situation has improved modestly. remember this is a committee talking about the budget and the interest rates can soar quickly. simon i'm not exactly sure why he's repeating it this way, we'll have to way for the q&a to see how he does characterize those numbers, and it brought down the unemployment rate with huge implications for fed policy. one of the guests is out there, just not ready to recharacterize it, because the committee has not had a chance to recharacterize it. >> steve, thank you. the waiting game continues in greece, to oppose the austerity measures being discussed, as leaders attempts to do a deal that will again that flowing.

>> michelle caruso-cabrera has the latest. >> hi, simon. just about an hour ago we got word there appears to be some kind of draft agreement that perhaps all these leaders will sign up for. the european union, and also the international monetary fund, the imf. there have been limited reports coming out of greece. if interest that does happen, we -- once you get release of the bailout money, we can tell you some of what's going on. we know that pit releases the bailout money. once released, 30 billion

injuros goes to the private sector deals so they can pay over the prime certificators, and that presumably eliminates the big threat in late march of this 14 billion injuro payment. the prime minister has been under intense pressure to get this done, fighting p leaders. >> michelle, i called around europe this morning, and i get skepticism in every corner. that the deal will be strong enough to convince anybody. secondly the greeks would ever sign up for anything so they don't have sovereignty over it, and thirdly the impact of the french presidential election and the desire to try to squeeze something past that. >> no, absolutely. there is a lot up in the air. the point about the escrow account, so that way you can be sure that creditors actually get

paid. the implication you can't trust the greeks, that's highly possible. that may have been positithe mi you start attacking dignity, they start doing think that may go against their interest, but the proverbial insult, oh, yeah? go ahead, that's how you feel about us? it's a lot of human nature, but right notice we believe there's been some kind of agreement. there's a million moving part s parties. >> michelle, let's leave it there. coming up an exclusive interview with the ceo of

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stocks to watch about 45 minutes into the trading day

mcdonald's action estimates raised at piper jaffray, also one of the top performers in the dow today. fossil downgraded by green murray. that stock is getting hid. and advanced micro upgraded. also finding new names here. thet of doubt about the fed's commit mint. they just made a commitment to

keep rates low for three years. we had to assume some of the data was going to be fairly strong and, you know, we've got one month of strong data. i wouldn't expect them to back away at all. >> i think he'll tip to keep that as an obvious. they've never strongly indicated it would by imminently on the was. and any market softs in, he will be able to respond. >> so what you're saying is because the fed has laid out that interest rates will replain low for three years, it actually can't necessarily move with a piece of data even if it is a gender changing, in other words this super-transparent fed may

argue be less responsive to what is happening in the economy? >> that is one of the dangers. it's a human instinct to defend that froost. it does change your behavior a bit when you visibly come out and say something. that was ha statement that we're going to be willing to live with stronger data, be willing to live some -- this really is a focus on the unemployment part of their dual mandate. >> but michael, can you forecast where we're going to be in three years' time. i appreciate that the fed can actually set interest rates and that's not something you're able to do, but can you really forecast definitively three years in advance the u.s. economy? >> no, i was somewhat shocked the fed was that aggressive.

but the fact is they did feel comfortable making that statement. so i wouldn't expect one month's unemployment report to change the tone at all. it move toward more transparency, is it you will ultimately a good thing? or is it making things a bit more different? >> i think this is a difficult time. i think that historic will many did like to present the fed was a semi-op any yen thing to protect them when things go bad. we do lose a bit of that -- >> wizard of oz kind of thing. >> exactly.

>> given the fact that you think it's a human tendency to defend a forecast does it make it easier for investors in terms of where deciding in the yield curve you may want to position yourself? >> it has -- what it has done is pulled down five-years rates significantly and forcing -- those are now so low it's forcing investors to take an additional risk. it's reduced voluatilitvolatili given that we've seen people trying to erase risk, trading less than five-years securities right now, you sort of have a good idea what the fed will do for the majority of that. it really has reduced the active

trading, pushing people to more active trade in very long maturities. i think we'll see some volatility out as a result of this shift out the y50e8d curve. >> michael, thanks for your time, ahead of u.s. interest rate strategy at rbc. tanned by everybody here's what's coming up. ♪ what are you gonna pick ♪ hot pockets we have hot pockets, but not exactly those. some casual dining stocks and all-time highs when "squawk on the street" returns. 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. ♪

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a quick check on sears holdings. again, this is a stock that has high short interests, actually not abated even despite the surge in the shares. >> and it moves sharply both ways. >> exactly. >> but today another big up day. >> all right. emerging markets have continued to outperform. what's behind the is move higher. tim seymour is the founder of emother-in-laws money.com. ambassador, good to see you. >> good morning, mel. >> e.m. came out as number one here. >> currencies, if you get them right, you have half your return profile, at least if you look back over the last ten years.

so 2011 were destroyed by deleverages, certainly an unwind, but at the end of the day this is what we call a generational opportunity, emerging market opportunities are going higher, because these are fiscally sound governments, better debt to equity gdps, excuse me ratios, that have much more sound fiscal policy, so you're getting monetary easing, because inflation is nonexistent. food inflation, the biggest part of the inflation basket, you're going to see possibly 4% inflation in russia this year, which is record levels. brazil will go 1.25 probably on inflation, which allows the central bank to continue to cut rates. ultimately this is a retail trade. ultimately this is an opportunity for people to get into emerging markets and ride this trade. what i would say is currencies have rallied 8% to 10% already

this year, you may want to watch for a pullback, technically i think things look a little rich. >> so in terms of a specific retailer, can you point us in any directionisms the biggest retailer is ticker cdb, largest food and electronics player. in mexico, mexico has seen a major resurgence in the home building market. we've seen better numbers out of the states, but the mexican peso has been rallying off the charts. home ex, hmx, is another way to play that, and gives you the opportunity -- as much as i like em banks, the consumers will do better in this falling inflation, at the banks will suffer. banks are good, retailers are better. >> tim, good to see you. >> going to see you at the parade? >> yeah. are you there? we'll meet at the corner. >> see you on wall street. >> see you there.

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yum stocks hitting new all-time highs. a different storing for boeing. that stock is off more than 1% after of course yesterday's news. bp shares falling despite better than expected earnings and reinstated dividends. 27 members of the dow 30 are in negative territory. njse, first of all, the breadth of the move here at the nyse. thank you very much.

almost 2:1 declines to advances. over at the nasdaq, who will get the facebook ipo? almost 3:1. ben bernanke is back on capitol hill giving his second set of testimony to the congress, clearly about where we're going with interest rates. since we last had him up there, we got that strong employment report. the important thing to say, steve is the statement this time around is the same as last. what about the q&a, and what he's actually saying, off-piece, so to speak. >> we did get a preview of that. senator ben nelson put up a chart, and it showed private sector job growth in the green after a long extended period of it being in the red. so we know that's going to happen. we know the fed chairman will be asked about jobs. the question is how he characterizes it. my guess is he's going to need to see several more months of two things, one a strong payroll growth and decline in unemployment from the household

survey before the fed is going to change policy. even then, simon, i think the keep will be done as a committee, because the committee has a policy statement, and that policy statement is very much predicated on a forecast, a sort of consensus forecast that the best guest is rates will remain low through 2014. the thinking in the markets about that statement, simon, is that just creates a very high bar for the data to really have to change that, tore be significantly different from the outlook to change that. >> i believe that we were told that they were discussing qe-3, and they were preparing to enter the market and buy mortgage-backed securities. is that now off the table, steve? >> yeah, i think it's got to take a step back until we figure out was january a fluke? you have the numbers in december and january in terms of payroll growth both above 200,000. you have this 0.2 step-down five

months in a row of unemployment declines. 0.2 has been the number for the past several months, so i think it's a tricky time to do qe-3, though i do know that several -- there's a substantial wing of the fomc that thinks, you know what? really no matter what is going on out there in the economy, we see so much slack and a long road back, we can make a case right now for doing it. >> would it be completely inappropriate to suggest that ben bernanke's got it wrong and that the economy is and was much stronger than he thought it was? >> i don't think that would be completely inappropriate. i do think one thing is interested in that context, though, simon, which is that he had it wrong, or he was -- almost had it wrong last year. remember we had that pickup in growth, jobs were picking up, employment was picking up, then there was this sense that maybe the fed ought to be thinking about tightening? there's a line of thought out there that bernanke is not going

to be fooled again by a nascent recovery. he's going to wait until it's undeniable. ed this before everybody simon, this 2014 forecast, bernanke wants to get this wrong. >> right. did he really misstate what the average job growth was in 2011 in his testimony? >> yeah. what he did is simply repeated what he said last week. thursday the average was in fact 160,000, but it's since been revised, now 1784. so he was very -- i don't know what you want to recall it, he carried over the wrong number. >> so nobody updated his testimony at all? >> well, we just did, david. >> can i come back on that. ? when you say he wants to get the forecast wrong that rates will stay low until the end of 2014, what is the point of making the forecast in the first case? >> to help him get it wrong, sim simon.

>> but then people won't believe it, because people will say it tunnelly accident mean anything. >> we debated over the clinton era the mean of is. when you read that language dodds a program? a forecast? it's all of the above, and the fed says specifically this is based on the economic data. what they want the market to do is bid down interest rates and help the economy now. it sets a high bar for anything to xhang. if it does change substantially, i believe the fed will change and i think bernanke wants that to happen. >> i hope i didn't confuse it. >> as we watch the chair, never.

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glue let's rj are listen in, the q&a has begun. let's listen in. >> we are concerned over the past few years there has been some modest increase. one of the factors contributing to that is the fact as i mentioned in my remarks, about 40% of the unemployment have been unemployed for six months or more. those folks lose skills, lose attachment to the labor force, it's more difficult for them to

find steady employment in the longer term. i would like to emphasize in estimating that sustainable long run rate of unemployment, we are nowhere saying this is a desirable series dr state of circumstances p we're only saying that monetary policy can't do much to bring unemployment in a sustainable ways at lower levels based on current information. other policies could affect and bring down that sustainable rate of unemployment. i hope congress will consider ways to address that problem. >> we've started to see a revival of the manufacturing sectors 50,000 jobs added last month. is there anything you would suggest we do to hasten the

return of the manufacturing jobs? >> the recovery of the many sector has been encouraging. one of the reasons it's doing so is because american manufacturers have become increasingly competitive on the global stage. as emerging markets and other countries grow quickly, they represent a sort of demand for our manufactured goods as well as some of our services. so clearly maintaining open trade with other countries and maintaining those markets is an important step. i think another area that's important is trying to ensure that the u.s. remains a leader in advanced education, research and development, technology and the like, because many of our manufacturing firms, for example, high-tech firms are often clustered after

universities are producing the most sophisticated, most technologically advanced products. that is where we have an advantage in the united states in maintaining our technological leadership would certainly be a boost to our ability to export. >> you know the decisions we will have to make, and you know that there were all these attempts to get agreement between the white house and the congress last year that did not make it. there was one plan that some 40 of us held a conference in the senate, wanting the super committee to go big with a $4 trillion cut in the deficit over the next ten years.

>> would you recommend going forward steep cuts that -- or do you believe we should place -- in a more broad way while being fills dale conscious of the recovery efforts in the near term? >> mr. chairman, i was supportive of being aggressive last somewhere. a number like $4 trillion was the cbo's estimate of what would be needed to stabilize debt, which is an important objective, obviously. i would like to urge the committee not to be solely attentive to the ten-year cbo

window, most of the problems in our path arise after the next ten years, going out 15, 20, 30 years, as our population ages, as health care costs rise and so on. so what i would advocate is, you know, looking broadly, having a broad-based discussion, but in particular looking at sustainability over the long run. i think that's going to take a lot of work on the part of congress. i -- it's really not my place to make detailed recommendations about specific components of the budget. but i do urge the congress, and i heard many people on this committee express the same sentiment, we need a long-term plan to put our debt to gdp ratio on a sustainable path. >> thank you.

>> thank you mr. chairman, and chairman bernanke thank you, your remarks have been very insightful. we all have differing opinions, but i think you're pretty close to what we need to be doing that. i would yield to senator grassley at this time. >> first of all, i want to compliment you on your movements towards transparency. >> i think the more you can do that and not just for the sake of letting people know about the economic impact of your policies, so that there's not but to do it for the purpose of educating the public more, you're too important for people to think that's summer

conspiratorial aspect to everything that the federal reserve does. this comes up not often, but comes up too often in my town hall meetings, and the more you can tell people about your role is very important. my question is based upon, if congress fails to act, our nation will see the largest tax increase in the history of the country, and people don't understand this, because that will happen without even a vote of congress. the congressional budget office has estimated the economic impacts of this three and 5/10 tax increase along with a few other policies, cbo estimates the unemployment rate at the end of 2013 could be as much as two percentage points higher and the gdp growth could be as much as three percentage points lower. do you agree with cbo, the failure to prevent this tax

increase will have a serious negative impact on our economy in terms of gdp growth and unemployment. secondly, if so, at what point in 2012 will the uncertainly begin to hind ser economic growth? >> senator, first, thanks for your opts on transparency. i have agreed to give a series of lectures at george washington university next month as part of a class, and i will be talking about those issues. if no action is taken on january 1st, 2013, between expiration of tax cuts, sequestration and a number of other measures, which by itself would -- with no compensating action would indeed slow the recovery. cbo predicts a 1.1% growth and increase in unemployment in that year, based entirely on their

current law of assumptions, so they're assuming that contraction will take place. i want to be clear i'm in no way stepping back from the sustainability in the longer term. it's critically important that these changes be combined with a credibility plan for longer return to sustainability. i think there is a concern there that it might slow the recovery. i don't know when the uncertainty would become a factor, but certainly closer to to the deadline, that had affect planning, household decisions as they look ahead to the next year.

s this question comes from the point of view that you said if there's a trade-off between decision-making and unemployment and a inflation, at least as i read it, unemployment would have a higher priors. is the february sending a signal that keeping inflation in check is a second dare priority to achieves full employment. to what extent is the fed willing to act should inflation continue to rise? >> well, senator it's true a 12-month backward looks shows inflaws.

as we look forward and the energy price increases have not recurred, our is projections are that this will be subdued going into 2012 and 2013. monetary policy works with a lag, so we have to think of where inflation is going to be, not where it's been in the past inflads haz averaged over 2% a a year during mea tun injure. so we think that's entirely consistent with the policy of accommodative policy. imto disabuse any notion there's a priors for maximum employment. we say very explicit we we take a balanced approach. congress gave us a dual mandate. we worked to bring both side back toward the target. the main goal of that statement

was not ma maintain until -- it was to give greater clarity, but we certainly will work to bring both parts of our mandate toward desired levels. >> i think it's good you're going to the university -- or george washington university, but if you would want to comes to the grassroots of america in iowa, i would help arrange it for you. >> thank you, it will be streamed online, so it's open. >> okay. thank you very much. >> thank you, senator grassley. >> senator wyden. >> thank you chairman nelson and chairman bernanke. i want to ask you more about the shocks to the economy that you have been discussing. you talk about the pace of the recovery being slow, particularly for millions of people who are hurting. and that all of this comes together as part of a sluggish expansion that's left is the

xhiz vulnerable, so i can see plenty of shocks. another one mentioned the question of sequestration, and to me that alone puts a very negative spec cal out. doesn't it serve to have all this delay and week after week of bickering, and able -- isn't

that in and of itself a shock to the system. >> well, policy uncertainly is one of the things that businesses complain about. we face the same issue as regulators. and obviously to the extent that greater clarity can be provided, actual be helpful to the economy. >> is it fair to sdrip that as yet another shock to the system. to me, everybody -- everybody i've trying to do is try to figure out how to force action early. because when you don't, what you're most likely at a time when you have the sluggest expansion to see the shocks and reduction in confident. so is it fair to say that delay in this kind of climate, when it

kem to getting the payroll tax issue and others, that in and you have itself is a shock to the system? >> i would cite the example of the debt ceiling debate, which was clearly a shock and affected consumer confidence and financial markets. more generally, loss of confidence that agreement will be reached, is a negative for confidence. >> to me, the annex dot to economic shocks are the cushions, the is it kinds of cushions that start us on the road to predictable, more certain kinds of opportunities to promote economic growth. we have senator portman that has doing good work on this. a lot of that work has been done

now. there are tough political calls to be made, but the principles are pretty clear. much of what was down in 1986, clean out a lot of the junk, the special interest rates and keep progress i havity. wouldn't long-term predictable tax reform be the kind of cushion that would hope address the shocks that you're concerned about for the economy some. >> predictability is good, also a good tax code in itself promotes growth. i think most economists agree a simpler, fairer, broader-basised tax code could be cruxive for growth, yes. you've been listening to testimony from fed chairman ben bernanke. we'll continue to monitor that testimony. for now we'll take a bit of the break and get to the new york giants who are getting the customary party going down the

canyon of heroes in a parade that starts less than 30 minutes from now what does it mean for new york and new jersey residents? our darren rovell has the story. darren? >> reporter: thanks, david. there's actually a study that says a super bowl championship could mean $40 to $50 per person in economic benefit. who is that? where are they from? >> obviously the science play in east rutherford, new jersey, so it new york or new jersey? when you consider that often we're talking about stadiums and taxpayers, luckily people don't have to worry about paying for a stadium. metlife was paid for by the giants and jets, privately financed, also personal seat licenses sold to the fans. then again how about the loss to businesses of people now taking off today?

>> am i skipping work? absolutely. >> i'm not going to work for two weeks. i need to recover. >> i told themfuls going to the doctor's today. >> reporter: maybe the number will come out, but the mayor's office has not told us how much this will cost. the new york police department refuses to tell us how many police officers are out here. we know in 2008 when the giants last had this along the canyon of heroes. it cost $331,000. we know that in 1986 mayor ed koch said that he did not want to have a parade for, quotes/unquote, foreigners, because they were playing in new jersey at that time. the cost was estimated at $many 00,000. american express actually offered to pay for it, and he said no. we do know there are a group of people who are making money. i have this officially licensed rally towel, officially licensed -- fiducially unlicensed official -- i don't

know what it is. i guarantee you the nfl did not license this thing. it's $10. "new york post" is selling these posters for $1. the parade will start in about ten minutes from now. there will be about 50 tons of conphettist, which is recycled paper, not ticker tape, of course. back for you. that's the best you can find, darren, a towel and "new york post"? >> supplied by rupert murdoch. >> reporter: one more thing, there are unfortunately there are vuvuzelas out here, so they are not dead, the horns from the world cup, they are selling those and selling cotton candy here in mid february. >> it's a good way of injecting cash into the economy, isn't it? that 300,000 has got to be good for the city. >> it's all good for the still. >> it's all good. come on. >> a psychological uplift. >> for each of us, how did you

get to that, darren? >> no, no, that's the problem, simon, you're right. the problem is the study says of the immediate area where the stadium is. now, that's why we have a conflict here. this stadium is in east rutherford, new jersey. i guaranty you it's not $40 to $50 per each person. >> darren, have fun. >> can't put a price on winning the super bowl. >> reporter: it's like st. patrick's day out here. darren rovell covering the parade starting in about eight minutes' time. tweet time right now, ben bernanke is back on capitol hill today to face more grilling, so we're asking you to complete the following sentence. what he wants to say today but isn't is -- blank. tweet us. [ 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.

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we're asking you to complete the following sentence. the thing bernanke really want to say, but srcht. bill tweets -- nor, that is the dumbest sequel i have ever heard.

dave tweets -- he wants to quote cartman and say screw you guys, i'm going home. please wake me up when your stump speeches are over. all good tweets. i thought what was interesting is whether senator widen was trying to equate economic shocks to the system. >> i thought he -- no mention of 2014, though we have the commitment to keep interest rates near zero. or maybe that's the point at which they abandoneded forecast. we're continuing to more tore the q&a session and will bring you interesting developments. david, still early on in the session, what i have noticed is a turnaround. gold is trading higher by $11.

crude has also turned around, now up by 47. we're still waiting for any words on the see sars ipo. >> bob pisani mentioned that earlier. so that the large shareholders, in this case paulson and company can sell at least half their holdings. paulson came into the holdings as a result of buys debt some time back. this is a company with enormous amounts of debt. after a leveraged buyout of harrah's you may remember. it's interesting on gold. we've seen such a rally, sat at this very desk at the end of last year wondering why the metal was being sold. i'm curious about your thoughts. >> given what is going on in europe, you would think, for

instance, the day the market was down on european concerns that gold would have found a bit, but it did not. it seems to be trading on technical levels right now. so i'm not sure if there was fundamental shifts going on, if there is a risk on/risk off trade, but technically it seems to be holding certainly levels. >> around europe today they are totally transfixed with this massive injection of liquid that they got promised in december, and the prospect that that or more could be delivered at the end of this month again. for many people that's a total game changer. when we look at why the market hasn't necessarily reacted. humanage far bigger potentially, and that is why the elephant

standing in the room. >> of course today's session it could be as simple as the injuro strengthening. guys, great to have us all here in one place finally. simon, we'll see you later for the european close. dave, we'll see you tomorrow. the third hour starts right now. most americans really can't afford to retire and funding trends today by buying longer assets priced near zero. so heavily invested in the u.s. >> in particular china and the

opec nations, i felt the stance was by far the strongest. >> we wanted a cyclical bounce to translate into a secular bounce. that's what the markets need to sustain this wonderful return so dpar this year. >> people often prepare coke and protecter. this is opening rebellion, and this is a quarter you can count on for coca-cola. >> if they come back, i think citi's earnings can come back. as far as the dividend, i think it's clear that they're often under the control of the government, and i think like bank of america, until you deliver, you don't get that dividend. >> prepare for the opening bell. there they go at the big board. >> i just made a commitment to keep rates low for three years. you know, we've had one month of strong data.

i wouldn't expect him to back away at all. good morning we could be witnessing a market turnaround. so let's get a check right here. the dow is higher. 1345 is a level up by just under one point. federated investors leading the delivered, charles schwab and legg mason also lower. as we had mentioned appear the 466.90 was the magic number hit earlier. tractor supply, yum brands off the back of its very strong earnings report, particularly strength in china. also a fresh 52-week high in

torchmark a fresh high in today's session. let's get to the road map this morning. martha stewart taking over your home office. launching a new line of products at staples. after a failed line at k-mart and drama in the corner office, is it too much too soon? glaxosmithkline says it returns a profit, but revenue did fall short of expectations. the ceo gives us his take on the quarter. and we're half an hour away from the european close. we'll talk about how the overseas action will affects market. soon shareholders could have the power to oust board members, what does it mean for the company as a whole? the boss of all segments is back, all that and much more in the next hour. we want to head over to gary kaminsky, who's delves into stabilizing money funds. this is very controversial

effort. >> the important thing to understand is that -- there's two things happen. the low interest rate environment. the article points out that was about 1,000 money market funds four years ago, roughly today 600 and change, the assets were 4 trillion down to $2.7 trillion. when you think of a cash equivalent, as a result of what happened in 2008, many investors don't feel that a money market fund is the same as having a bank deposit account. there's good reasons for that. money market funds were never supposed to be the exact same thing as, for example, a certificate of deposit. money funds always strive to report net asset value at the end of the day.

the idea that always pell plexed me, melissa, if you want to invest they never think xw the actual money market fund that the if you have money in a money market fund and that fund is generating maybe two, three basis points, that is a red flag, a warning. the lesson is simple. above average yield are taken on

due risk. not what you want. what is the group here? the gripe is that essentially they're going to make it so that money market funds need to hold it for a certainly number of days? >> the first issue has to do with the idea that if they break above, the regulators want the parent company in some cases to actually make up the different. if in fact you have a money there is some idea that the holding entity has to make up the different. many people think they'll -- the idea here is to hold the side pocket, and believe me, when you want money, as you know, when

you want money, you want 100%. you don't want that holding day period. the most important thing is every asset company that's been managing a money market fund has been losing money. you've got to pay the administrative costs, the portfolio managers, you have to pay to run those funds. >> thanks for boiling down what would be a complicated issue. we'll see you later on. now to the cme group. rick santelli is here with the santelli exchange. rick? >> we all love gary's rendition of no free lunches and risk/reward. they're always tied. seniors, if your cds are getting much higher rates than a neighboring bank, what gary says is true risk/reward.

let, transparency or just a confidence buster. of course i'm doing a post mortem there'sing so many e-mails that i've gotten, but the most common one lately is something charles schwab said. in short, the fed's action the willingness of banks to loan to anyone but those whose credit is so strong, they don't need the loans. i can't answer if what the fed is doing, in consider they didn't get it quite right, even though structural problems remain. it's hard to forecast long term and hard to tell somebody we're going to keep rates lo you ltro, on february 29th we'll get the second, but the first one's post

mortem is also important. there have been many articles that first said many of these banks were buying the weaker paper, but when we look at how much of the first ltro is sitting in terms of reserve at the ecb, it questions that. this is a big deal. in the end, if there isn't sponsorship of this paper, just these loans at 1% isn't going to do what it's designed to do, just think the u.s., just what i readily charles schwab, the notion of easy money, it hasn't worked exactly as planned. we'll have at 1:00 eastern, the first of at least auctions. today will be $32 billion in three years and in about 14 minutes harry dent will do a post mortem. must see. time for squawk on the beat right now.

martha stewart trying to conquer another sector of the retail world. courtney reagan has more. >> martha stewart is the face behind the three-pronged empire, but is that empire in trouble? today martha debuts yet another deal in new york city, this time with office supply story staples. it's leading some to ask if the pow powerhouse is being -- >> we're in about 8,000 retail units, and i think that's a very good number. when we add in the j.c. penney next year, it will be even bigger. the by grows. >> martha stewart living omnimedia has posted losses in four of the last five years.

in the wake of her television show cancellation, longtime retail partner macy's is issuing a lawsuit alleging contract violations as she signs on to develop exclusive merchandise for competent torrie j.c. penney, and as j.c. penney acquires a stake in mso. martha stewart is nothing if not resilient, bouncing back from her 2004 stint in a federal prison to help build her company into what it is today. melissa, you can see more of the interview with martha stewart today on "power lunch." >> you have to admire the turnaround part of the story. is there a. >> absolutely. that's a worry with many of the retailers. you admire what the company is trying to do, but each of the

retailers worry that her exclusive line with them becomes watered down as she spreads herself out among the different retail chains. >> and in terms of that lawsuit, will that hold up at all her merchandise line with j.c. penney? >> as of right now both sides say no, though macy's would like to put a stop to that, or at least change some of the terms of at the contract. there's been a lot of due diligence done on all sides. all of knolls it's going to court and the deals stand. >> thank you so much. courtney. up next, the ceo of glaxosmithkline. the stock's been a real winner in the last year, up more than 18%. more "squawk on the street" in two minutes. sometimes investing opportunities are hard to spot. you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker

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the dow is up, and the nasdaq is up by almost four points. worth noting as well that the haven't ix has eased off its highs of the day. take a look at the turnaround in crude oil we have seen, wti specifically as brent has hit a six-month high. up by 1.8%. so a true turnaround. this dollar is seeing some weakness. glaxosmithkline returns to profits as reporting a loss earlier. still the drub mash reported -- revenue was down 3%.

andrew, a pleasure to have you. >> thank you very much. >> as we move into 2012, we expect our underlying growth to translate into reporting growth. all that combined with the pipeline is what's giving us confidence for the future. >> how many drugs are in the process?

we announced today we've all right found one those for approval. as i sit here right now, we should finance another six before christmas. i think there could be another five or six -- i'm sorry, in 2012. there could be another five or six in 2013, and we expect another 30 drugs into full development in the next three years. stalls after many years of restructuring, i feel that the pipeline we're beginning to get visibility on will sustain the group for the next several years. >> what concerned you and could derail your forecast in the global economy? . our primary markets are the --

there's tremendous volume, but it tends to be dr we continue toss -- what could derail us? continued insecurity >> consumer confidence has been damaged by the continued uncertainly. those are two of the big pieces. make roe economic pressures. >> in terms of partnerships and joint ventures, it seems like the strategy of the day for pharmaceutical companies is to either acquire smaller biotech companies with drugs already in the pipeline or drum up partnerships with companies that are in development of drugs. are you doing either ought this

point? >> we're very happy with the organic r&d put out, plus existing partnerships. we're already very partnered between those groups and our own group, we believe we can sustain our r&d pipeline. we do look at both in acquisitions, but our priorities are very clear. only if the bonds on acquisitions bead the returns of giving the money back to shareholders will we do it. you've announced an increase in buybacks in terms of the dividend could investors see another in terms of 2012? >> we're committed to delivers a

rising dividend. so i can't give you a specific number, but we certainly look to continue to nick our dividend. you'll have seen a substantial increase in our cash conversion over about half a million points all of that has allowed us to continue to pay our shareholders as well. 2011 we paid out 5.6 million pounds. we expect to once again strive to increase our dividend. i i announced today we would start the year as planning to buy back between 1 and 2 billion pounds of shares. >> it's a pleasure to have you with us, andrew witty. >> thank you so much. it's been a pleasure. right after the break, rick santelli's take on the trading day, the seemingly neverending greek crisis. in europe just about ten

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that must mean we're going to chicago. talking details of -- rick? >> i'd like to welcome my guest, famous author, in my opinion the expert. harry dent. >> nice to be here, rick. >> we live in strange times where if you speak out again what looked like in my opinion sicklically positive labor report, you have those strong for the president, they don't like it. if you talk about the labor force, the shrinkage, people get lost, what say you about the shrinkage of those employed, the shrinkage in friday's report.

tie it all up for me, mr. dent. >> unemployment varies the truth is, we peaked at 147.5 million workforce. we lost 10.7 million workers. we gain about 3%, now we have a shrinkage. that's the truth. that's just a simple truth. >> why are jobs jobs jobs so important in the same reason up somebody in wrigley field, you want somebody who paid and contributes, buying concessions. we need jobs.

we need act sieve participation. what you're telling me is the good news we see isn't good news if we're not bringing more taxpayers to the country. >> and people enter on average age 20, they retired on average age 63. the greatest workforce growth was in the we're about 1% and a deck indicate from now it will be zero. so this is not going to turn around easy. it's -- workforce growth alone will slow even if we don't have a difficult economy or great resection. >> thank you, mr. dent. back to my gang in englewood cliffs, this just makes trying

to find the right medicine that much more difficult. >> you said it, rick santelli. a lot more is still ahead. plus the european close right after this break. sometimes investing opportunities are hard to spot. you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea. 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.

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1:20 until the close across continental europe as well as the uk.

simon, dare i say it, it feels like groundhog day on the european close, saying we're still waiting for a deal. >> we have movement. as we come to the close in europe, you see the indices are cutting their earlier losses. we do have events coming across the wires. that's how we're heading into the close. mere are the -- any moment we believe that the prime minister of greece will meet with the private sector bondholders. and then later tonight, which would probably be around "closing bell," we will get a full announcement and tomorrow

there are a series of other events, mainly to do with the promise of -- >> the european markets are closing now. >> we have the european close. a note just crossed into my inbox, saying if it seems terribly pessimistic that it could unravel, prompting a disorderly default. >> nobody thinks there are enough on the table to cut greece's debt. possibly kicking the can past the french presidential election. yeah, that gets them, if you

like, to -- let's not forget that ben bernanke within the last few minutes have said that it remains to be seen where the entire euro zone is about to enter the recession. >> do we connect that with what's going on in greece? >> yes, and a little more than that. it's fairly complicated, but let me start with the injuro. watch that. there's a good leading indicator. we had the injuro rallies convincingly even early this morning on that they were finally getting together to at least come to some consensus.

he didn't back off. he refused to rule out qe-3. i think that was somewhat important. put up the new s&p i think some of this was clearly on greece, but you see it coming off the lows gold and oil, for example, gold also rallied a bit. he didn't say anything was going to happen. to make this even more complicated, melissa, there were vague reports floating around that the iranians may be getting more involved. nothing confirmed. both of those commodities were moving up in tandem, which led me to think mash -- contributing to commodities as well. >> and very interesting from a market watch point of view.

this the important think is the big mo continues, the big momentum. the dow and nasdaq are essentially at in highs. and the bottom line is this may be the most important thing, melissa and simon. traders are behind the curve. the rally in january caught a lot of people behind, and a lot of stock is just not out there for sale that may be the single-most important thing. >> may i add more, from what i was hearing in europe, if we can put up where we are on the european indices, that would be very helpful. that was that a lot of people didn't recognize the degree of liquid. i'm sorry to keep saying it, this half trillion that the european central bank.

the fact they could give the same amount again, maybe more, maybe less, so if you're sitting in europe at the moment, your choice is actually -- your choice is actually very simple. you believe those boats aren't going to float, partly claust liquidity and also because of the prospect that you'll get a sudden sell-off has been taken off the table. >> do we expect to see another leg to this rally that we have seen? >> most of the guys think -- >> the survey is 400 billion, but you hear people comfortably talking of a trillion. >> --

i have to bring in gary kaminsky. >> plenty of thoughts on it. >> i assume you're referring to our tradeers. we're in a very unusual period where active managers. large cap, small cap, are actually outperforming the benchmarks, so the professional portfolio managers are blowing off the benchmark. when you say that traders are lagging, i assume you're talking monday about short-term traders who are getting involved in the market. the volumes, though. do not suggest massive buying.

right, but those investments, the investment professals 95% invested most of the time, they actually have been outperforming. >> i know rick is out there as well. when you think about europe, you this i about four, five months ago, you've got to tell you, mf global, the stories are starting to fall for the back of the business sections in all newspapers. you're getting very little coverage, and i've got to tell you, we talked earlier in the program about the government looking at the money market funds. it's really unbelievable that no one has been held accountable yet. the missing funds, no indictments, no arrests, and rick, i don't know if you're out there, but i'm sure you hear the same thing i hear. how can we have a better system when no one at this point has been held accountable?

>> you know, it's amazing. i know mr. gensler, for example, was on a big talk show recently. i remember when i watched it thinking to myself, you know, this is just absurd, having the head of one regulatory body talking about the s.e.c. and how so many changes from dodd/frank are coming through the cftc, and how they're going to have new boundaries, regulation, when we know for a fact the s.e.c. knew of things like the european position, but didn't say anything when it wasn't in disclosure for the 300 million last bond issuance that mf had in august, or the fact of the matter whether it was drexel or many or dark blemishes potential in the past, where long best court days we see things like rico being thrown around, where is that? where is the outrage? how can we realistically look at

viewers or have listeners listening talking about dodd/frank when something like mf, which is so much has to do with the regulatory issues, what a failure it's been. a failure. >> rick, you and i total he agree. with el speak to professional investors, and they simply can't believe how this has become such a back story in the sense the money is gone, there has to be a trail to this money and no one has been held accountable. you mentioned at the top of the show apple. i want to give a shoutout. there was a semi-viral video, was it on "fast money" about you had somebody talk about apple with a trillion price target? >> within the year. a trillion dollar market cap within the year,. >> this video went semi-viral this morning. i made a point last week, if you

look at the valuations, that type of price target, is not really off the market. >> it's not and we have to give props to james. five years ago he said facebook could trade at with that prediction, which is why we brought him back on yesterday. that's an interesting prediction. >> thanks, gary. thanks, rick, of course. let's bring in the global head of blackrock. ross, great to have us with us. >> thanks for having me. >> there's developing when it comes to actually coming out with a greek debt swap dial for the markets here in the united states. is that a reason to buy? is that a reason to be bullish? slinchts put it this way. the absence of xh would be an excuse to accept. right now people are expecting is the negotiation will go

through, there will not be a short-term crisis. if spoke some reasons the discussions fall apart. that would clearly be a negative for stocks. >> so right now -- you mentioned the success of the ltro the first time, part 1. part 2 is coming up at the end of the month. will that give us a sweet spot where there's more liquidity that would be pushed into the system, therefore that's good for equities? >> it certainly helps in a number of ways. it's always good for stocks and risky assets. ltro has done a very effective job of removing liquidity crisis or the potential crisis that european banks are facing in the fall, and finally it has indirectly helped from lowers the costs, and to the extent these cunning have more time, this will also help mitigate or remove some of the risk coming

out of the europe. >> i want to talk about the sectors you are overweight, energy, technology and tell com. i'm curious to to why you have that up there with technology. is it the allure of the dividend yields that a lot of these companies have? >> it's exactly that. right now i think investors are taking more risk. right now we're advocating that you take a bit off the table. one of thes to do that is an allocation to some of the lower beta sectors like telecom. we like telecom, because compared to some of the other parts of the more defensive sectors in the market, the valuations do not look ago stretched. >> we had a couple great data points out. it coca-cola and yum out last night. do you rethink how you view the consumer in this environment.

>> the consumer has proving very resilient, but it's important to understand why that's happening. in other words, people's consumption is growing much faster than than income. at the end of the day wage growth in the u.s. is very slow. for hourly workers wages are only grows 1.5%, the lowest since records began, and in my view it's hard to sustain that spending level until the labor market improves. so i would still be cautious on the stocks leveraged to consumer spending. >> ross, thank you for your time. we do appreciate it. >> thank you. coming up. two gyre rues give us their take. who comes and goes. before the break, take a look at the winners and losers from europe's trading day.

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your position on disney earnings ahead of the numbers? will it be the mouse tharoored? that's next, now back to melissa. a little more than two hours into the trading day. an 800 jobs. the move comes as part of the grocers' plans, and hackers allegedly saw 50,000 from antivirus, in return for stolen blueprint until what the company says was a sting operation run by an undisclosed law enforcement agency. posing as a semantic employee. up next we call it the boss of all segments. two people with intimate nothing, weighs in on the latest boardroom drama at

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in layoff, hewlett-packard has had its share. he's also a board member of, and we have jeff sonnen feld, at the yale school of is management. great to have you with us.

investors who own at least 3% of hewlett packards shares would be allowed to nominate up to 20% of the company's director. this is a great step, bill, but at the same time that seems to be very high, because according to holdings. only four would qualify to do this under the proposed terms. >> well, i'm not sure that it is a good move for the long term. he's replaced many of the board members. and it's back on the heels. that is been too short-term focus. my concern is it will make a on the board who are quite well qualified.

not just the most short-term. >> at the same time, though. short term shareholders, the requirement is according to this proposal. they would have to own it for at least thee years. is this a measure that could backfire and tilt the advantage toward the short term.

of course mare where shapiro reversed it this summer, but bill you kind of surprised me a bit, because you're basically mimicking the chamber of commerce position, and three years of ownership is not a hit-and-run operation. in fact, i can pressure the idea that you don't want people that are very highly specialized as if it's a municipal city council meeting, and basically it's the suspicion, but there's no evidence that that's a problem. in fact, owners with this amount should have a voice, and this is a much better board. you talk about ibm until john akearse before mr. gerch northwesterly went in there.

you know, you ask see great companies come back. this hp board already more man half of them are new, and the ones were confide heroic figures, and they represent heavy industry and not just financial organizations. i think it's a very good board now, took them a while. >> bill, do you want to quickly respond to the notion of the -- three years does seem like a fair amount of time. >> that's a fair amount of time. could be three, two tomorrow, one year the next. i'm concerning that i think you need chemistry in the boardroom. the boards i have been on have had great chemistry. that's why the companies are successful in the long term. this is a board that's never had chemistry. i want to make sure as an investor in hewlett-packard that they represent the long-term shareholders interests who are often quite silent and have an opportunity.

>> that was 25 years ago. they also had a congenial board taking them off the cliffs. >> let's agree to disagree. i have literally 20 seconds, so jeff, i want to issue a challenge, your quick 20-second take on the effort to improve or get facebook to improve. specifically they have an issue with mark zuckerberg controlling rights and the ability of him to actually pass that control on to a successor. >> this one you might be surprised. the different from the govern it'sas, that you're betting on facebook and more zuckerberg. we saw a similar thing with zynga and groupon. maybe it's the right thing to do, but even ford motor company today and through its history has been 40% controlled by the ford family, only 15% or 13%

ownership. nobody would say the more equitable governed gm was better governed than ford. >> just to add on to that. >> ten seconds. >> i think they have been very good at protecting the company so they can go for the long term like apple and amazon. that's very much to their credit. >> let's enon that congenial agreement. >> the topic is ben bernanke ben bernanke and what he's really like. tell us what you really think he wants to say. we'll share your thoughts in a few minutes. stay tuned. impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses

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with no blackout dates. let's get to it. ben bernanke testifying biff a senate panel this morning, we are asking you to complete the following sentence. the thing bernanke really wants to say but isn't is mary tweets -- good morning, mr. chairman. i'm really sorry, i put it all on the patriots. jason tweets -- you're the reason we lost aaa rating. and jason tweets -- can we do this on hbo so i it tell you what i really thing of you? which implies something

unsavely. gary takeaway time. >> it's been a week from the s-1 filing for facebook the best story was about the graffiti artist who took stock in lieu of cash in 2005. he's now got $200 million of foible toby stock, and he said if in fact you have been an 11, always double down. that's just a great story, sitting on 200 million of facebook stock. take the stock in lieu of the cash. double down every time you get an 11. >> think about the other graffiti artists, designers who have seen the same. it is staggering. rick, what are you watching? >> germany had their december industrial report today.