at this rate. i thing we see is not going to be so clear in the second six months of the year, so it's not going to be so easy to say rates have to be one way and 2014 is the sign date. meredith, thank you for joining us. that does it for us today. make sure you join us tomorrow. now it's time for "squawk on the street." >> good morning. i'm melissa legality with jim crepers. carl is on assignment today. here's where we said up s we are looking at the mixed picture here. we are basically at prebailout

levels on all the major indices. for that we start with president obama's tax plan. he's expected to propose to cut the tax rate, but with the lower rate would come the we're going to break down which sectors will benefit. christie to buffett says shut up. if the billionaire wants to pay more to the government, he said be my guest, write a check. relief over a bailout disappears. as melissa just told you, and greek stocks the question is what about the credit default swaps? >> disappointing earnings last

night. saying don't chase the 24% rally. what does this mean to hewlett packards? >> if you're randing stevenson, it means you're going to get a pay chuck. we'll have the details. later the the plan would you believe revenue neutral. it's been out is there for some time. we say ceos say it's unfair given the corporate tax rates where they are happy to go, because they are far lower. >> i think the problem is as

soon as you hear something about taxes, you say forget it. i think it's interesting. that's something santorum was talking about. is this the president recognizing santorum may be more of a front-runner than we think? we're going to have to see what he has to say, but in terms of revenue neutral, is it vat if it's going to race -- it's coming from some place in taxland, it's coming from the coffers of corporate america. is this really a tax cut? >> the administration has made it no secret to tell media if there is revenue raising, in anything, the republicans will veto it. it's just one of those situations that republicans say unless taxes are cut, we can't vote for it.

>> but it may go back to this whoa idea of fairness. fairness in the tax code for individuals, and fairness for corporations, the idea programs of 28% across the board. as you said, when you talk to ceos they complain vigorously. >> don't bring it back here, the taxes are too great. i think when it comes to the individual tax rates, anyone who has looked at the taxes trying to clade it, it's a it's incredible to try to figure out where you are and the most important person is the cfo. >> what happens when it collides with higher gas prices, higher oil prices, a lot of the

subsidies that will be rolled back, this at a time when the gasoline -- and a reminder, $4 a gallon last year was the time when the president tapped the spr. >> you can't tap it when it's for emergency prurps. this time it's because all michelle caruso-cabrera had an unbelievable report about israel. saying basically listen, it could happen, and it could happen soon, and i'm talking about an air strike against the nuclear facilities in iran. why? they're building missiles that could perhaps hit is the eastern seaboor of the united states. to the israeli potential attack, the times had a pretty good piece i thought.

this is not a simple bombing mission to state, at the least. >> i had the ceo of -- has been a remarkable finder and replacer of oil. he's saying -- could it go to 150? i think people say yet. >> that's why you don't need motivation. ultimately there's a lot of oil still left in the ground. >> you have $100 oil. if it costs $40 all in. do you really need the tax breaks? you know what? i think the american people are a little sick of that. >> i would like to see what

happens. >> some woman came to my door on sunday night, here's a petition, i want you to sign it, it's because i hate big oil. i said, frankly i'm more subtle than that, and did not sign it. please sign this, because big oil is office? hey, i get that. >> did you educate her? >> no, i didn't slam the door, because i'm kind of a gandhi-like figure. in the old days i -- >> the new cramer? >> look, anger management goes very far in these situations. >> talk about anger -- >> the governor of new jersey, chris christie with harsh words for the oracle of omaha. he was sounding off for the call for the rich to pay more. he expressed his frustration to cnn's piers morgan. >> he should just write a check and shut up, really, and just

contribute. the fact of the matter is i'm tired of hearing about it. if he wants to give the government more money, he has the ability to written a check. >> i've heard the same refrain from so many people. who typically earning lots of money. many of my friends saying the same thing, from the hedge fund -- just write the check, i pay enough in taxes. it's a debate that will not end anytime soon. >> but christie is trying to get tax relief for jersey after being stringent austere. he has some street cred. personally i wish he wouldn't say a word that you try to teach your kids not to use. >> but -- >> i tire of people saying they would like to pay more.

that somehow you can translate ordinary income -- >> the point i think he's welcome, too. >> he's going to be joining the -- i mean, the point the buffett has been making, is i pay a lot less -- >> wouldn't doesn't he. >> i don't think that's the point. he wants fairness across the board, and we saw mitt romney's tax rate. >> i think tavares the peak of his numbers. >> because of the treatment of dividends, that's his point.

would you think about the stock market and where you put that dollar of investment differently? >> i think what they're banking on is most own their stocks in a tax-free and the wealthy stay away from tax-free. so they're saying it's perfectly okay to move it up to ordinary income. reinvested dividends is one way to make money. i think the buyback treatment is way too positive. sure, if you sell stock, you do well. i think it's a mistake of the president, but it doesn't matter. what he's trying to do, i think there's a continuing theme. rich people make too much money versus where they pay. >> where were we independent criminalitying? ordinary? >> i believe so. >> yeah, far higher, we know that. if you actually introduced this

along with everything else in terms of tax reform and a credibility plan. >> but michael semblance does a great piece call "eye on the market." he lays out a sock -- what he's done is parsed this whole plan. when you break it all down, not being so good, rates going up, you're really talking about a major overhaul to sock the rich. it's pretty incredible. fitch announced its dwround graded greece's debt. the credit rating agency says the proposal to rewill, if completed, constitute a rating default, not a surprise when you

have a 70% discount, but one key question is will it be a default too mitigate against this exact scenario, and we still don't know the answer. >> the ecb apparently not having to take a hit? >> but then putting the profit back into the pot for greece. so they're not making money on the deal. and then there's a provision that would ultimately force the conversion, regardless, but back -- -- it's not large at all. >> who's still in them other

than pure speculators? >> or guys who have actually hedged their position. >> doesn't that defeat the purpose we saw this once before. >> you would be furious if this were fire insurance. >> would we look back at a trigger of the cds as a time when a certain number of hung funds make that are -- so heavily -- >> i don't know the particular names. there will external by some who called it right. >> you leave levered up, you

made a fortune. i want to know who did that. that's my hero. that's who did it right. >> jon corzine tried. >> better never than late? >> no, no. how about never? >> all right. >> you don't believe in the constitution then? >> you don't think it's something for "law & order or svu? >> i don't know. >> who knows. >> he hasn't been charged with anything. >> i'm still going with that. >> so be careful. >> actually new york city is still not allowed to, and thankfully, by the way. >> i lived in my car. what are you going to do if not packing. >> i thought that was florida. >> no i had an apartment in florida. dell posting weaker than

expected earnings. a shortfall for the current quarter. for market expansion. we also have isi. which is $3 lower. >> obviously they blame it on disk drives in thailand, but look, when you do a conference call and you admit telebeginning that you're disappointed. i've seen conference calls where you have the most horrendous numbers. dell, give them this, they said, listen, we didn't do as well as be would like. othought the gross margins would go up in entirety. it was a pure disappointments. >> the backlog was actually fairly strong. it was a high capacity hard disk drive which go into the higher margin, consumer pcs, the most

troubling part is they said the shortage would go into the first quarter, which is different from what we've heard from other companies. >> and you have a 2.7 billion buyback. they have been buying back a lot of stock it's not nearly as reduced as i thought it would be. disappointing. >> i'm a big believes in michael dell. >> i want to know, david, you're close to hewlett. i'm not going to stick your neck in the guillotine, like carl did, and he asked me if we would be above 13,000. >> i would never take the bait anyway. we'll see what the numbers look like after the bell today. >> jefferson is alive and well. >> hopefully.

>> no, no, not last time. >> you have to go with the whole kitchen and bat when you -- >> so many employees. he didn't invest in that company. >> that's how they made the numbers. coming up, where nike is looking to score next. ceo mark parker in a live interview. as we head to break, a look at futures once again, as we approach the key opening bell here. [ 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 came 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. ♪

welcome back. a two-day starts of ten-year note rates pretty much gives you the picture. if you look at the dollar versus the yen, an interesting picture. these are the best levels on the greenback versus the yen since july. and if you look at all the economic news around the globe, we can simplify it to this. the pmis for your ozone, is below 50. that's not good. they still didn't improve. if you're thinking about europe and a possible recession, that seems to at least be borne out

by some of the recent data. back to you. >> thank you, rick. it appears google has a new vision. "new york times" reports that they're making glasses that will be able to stream information to the wearer's eyeballs. they're expected to cost up to $600 and go on sale to the public by the end of the year. if google is going to invest in high-end glasses, it better be able to see -- and you fill in the blank. we'll air your responses throughout the morning. it seems $600 wouldn't be anything i would want to buy. >> are you going to share a -- >> like you see on the inside of the glasses? very dangerous it seems. >> doesn't walking around like this kind of dangerous anyway? how many people -- i've watched people crossing the street glued to their infones. >> they trip. it's crazy. >> maybe not any worse.

>> i think steve jobs gave us a legacy, and google seems to come up with the opposite. groupon, during the break, i got 80% off laser removal. why do i need -- >> are you going to take off now during the show to take advantage? >> could be. the only laser removal i know is when goldfinger was going to remove some of bond. but they send me that, laser removal and $600. >> and you don't need it. >> thank you, mr. bond. coming up next, cramer's mad dash out of the opening bell. much more "squawk on the street" straight ahead. next week, "squawk on the street" gets a whole new set. >> we'll take it. >> we will too, lloyd. we'll be closer to the trading action, right on the floor of the nyse. you won't miss a thing. to think about your money...

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let's hit cramer's mad dash. we have to talk about j & j. the ceo used to be on the hall of shame. >> a tragic loss, they were the generic maker who's been able to capitalize off the mistakes. we just had a huge infant tylenol recall. recall, recall, recall, and yet the papers are very complimentary, everyone has william weldon, we wish him well.

i took him off the wall of shame for a particular reason. he got on, because he was a value destroyer. i think the stock pops, because maybe at last the recalls come to an idea. >> look at the recalls. this was all under his tenure. >> is the stock did not suffer that much, certainly through the s&p over the period of mr. weldon's tenure, yet i think the image of this company, one of the great american companies was tarnished. >> i prefer the brothers johnson, because this is a company that literally was the best single company in terms of a brand name ever, and i now go in and buy the generic, the walgreen product, the cvs, i feel like i've beenhood when i buy the brand name. >> the creedo at j & j is well known, something that was set in stone back in the days of the founders of the company, and won

wonders whether that will come back into play. when we come back, opening bet, much more "squawk on the street" straight ahead. on goggl,

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here we gho with the opening bells. >> we have a couple things happening. westport, the single best way to play surface vehicles using nat gas. they was at wprt. it's the current quarter forecast too conservative? >> they have been very good at

keeping sxhektations low. underpromise/overdeliver. at the same time i worry that europe is up 10%. tjx, my trust owns it. tjx and ross stores, the unsung heroes, besides macy's. >> but do you think this is ones again underpromise/overdeliver, so down 2% might be an opportunities? >> i think there will be swung who downgrades it. people are downgrade happy. maybe someone takes dollar tree off and tomorrow is a better day. >> dollar tree yesterday hit an all-time high. it's been on a tear, so not

really a surprise it's not bad at 2%, off an all-time high. >> i have a phenomenal dollar tree near my beach house, until you've been there -- you can't eat off the floor, not that that's always my goal, but a remarkable place for value. dollar tree pantses them on price, to use a verbal my daughter would have used. >> pants them? i like that. >> the merchandise is so great, and the managers are terrific. i always have a great time when i'm at dollar tree. >> toll brothers, why don't we talk about housing? not so good? >> there's some metric they choose to highlight that make them look good. they're talking about the numbers of homes sold per community being good, but again a miss is a miss, but i would like to have seen toll brothers brow the numbers out.

garmin, everyone tells, look, i got apple -- >> why do you need a garmin if you have a smartphone. >> this is incredible. i think people have been saying that and why they're short garmin. when you jog, when you use for gps, global positioning on ships, garping is a well-run company. it's confounded is the -- looking good today. >> it's interesting to see the area of strength is automotive and mobile. that was up 3.6% in sales. garmin has created a lot of uses. >> the margins were up, too, this quarter. the stock is about a 3 1/2 year-high.

you don't need nothing, but they're breaking out. >> you may not need anything, but a teenager -- >> anthropologyie in the middle. netflix getting crushed yesterday, based on this comcast streaming as much as. >> comcast a parent of this network. basically saying they're gooding to go one better. i thought that was a telling in your face listen, reed hastings, we've got the imperil mousetrap. i think netflix will have to respond. i don't know how they do it. we had an analyst on we hadbush, with a $45 price targets on netflix. >> not on a split? >> no, no, he's looking for it to go down by itself to $45 a

share. he says guys like comcast, they just don't want to lose subscribers to a competing service. they can afford to bankroll it. >> your worst enemy is someone who doesn't care about giving away a product. >> like johnson & johnson. >> we can come in with margins well below. amazon is an example. they are not necessarily about making a lot of money thj quarter. they're about destroying the competition whether it's best buy or walmart. that's on powerful enemy. comcast can be a powerful enemy. >> david? >> i have indeed, mr. pisani, fresh from the french caribbean. >> i took a few days off, let's talk to the french, see how the europe yen economy is going on. i've never been there. well dressed, guess what? there's no french in the french caribbean. nobody was there. now there are americans. >> a lot of russians. >> and newly minted, newly

wealthy brazilians. they are the russians of latin america. canadians floating around, but of the french, the ile italians, and germans, and the shop keepers were wondering as well. of course, the european crisis is the reason, but in gustavia, the charming capital, restaurant sales were done. a -- >> you're always working. that's what i like. how's business? >> they all said eh, in french. i think that's a very telling sign. europe is a big week. the greeks have to pass all this new legislation.

we simply don't know how much will be brought in terms of collateral by the banks. >> remember, the bulls are saying a trillion. the debate is what would the ecb want at this point? six weeks ago, two monthsal, i they they would have wanted as much as possible, but now the talk is let's try to ramp it down a bit. so if you have collateral, you get three-year money. as a low interest rate that you can do what you want with. obviously you have the class

real there. remember governments in europe have lent the greek government $110 billion. that was back in march of 2010. some people are raising the question, well, that's an official sector debt to a certain extent. will there be pressure to take a haircut on that kind of debt? that's not even on the table right now.

the problem is nobody believes it's enough. the only thing that people believe it's enough when mario draghi says i will be the lender of last resort to everyone. without those two elements, is it enough? the answer is no. the question is austerity the answer in terms of achieving the growth you need in gdp to put these ratios on a sustainable level? >> and of course we're watching the straw vote play out in greece. the problem is there's no invested interest in shall rimpging the state in greece. there's no invested interest in shall rimpging anybody's income. no interest group will support that. one final quote before we go on.

toll brothers, he's the good news. i'm the son of a homebuilder. my whole family competed against toll brothers, a great company. 19% order growth. very good number. so far encouraging. >> mr. spy sani, let's get over to kevin ferry, who joins us. kevin, cnbc contributor, chief market strategist, what are you looking at this morning? i would say traders are focusing on the yen, which has been absolutely sandblasted, and oil.

those are the two markets traders are watching the tone in the s&p is looking for more defensive action into the isms next week. i think an orderly decline would be a good test, maybe something into the low 1340s. forget italy, man, japan has an awfully big one, doesn't it? >> you bet. the idea that they stepped on the gas, moving their currency down, getting back into the game with all the other central banks, i think that added a lot to the movement of movement around the world towards what people have termed risk on, but i just think that the market has had a great move since october/november, an orderly decline that began to develop and give us a chance to get some as-expected news at the end of the month on production. >> all right, kevin, thank you. back over to you, melissa. let's check back in with

rick santelli who's standing by in chicago. >> hi, melissa. all the futures markets for fx are down today. not a big occurrence, rare, whether you look at the yen, the pe peso, the canadian glare, the aussie dollar, the british pound, the euro currency or franc. so we want to continue to monitor. it seems the foreign exchange is heating up a bit as some of the traders seem disappointed, not much more volatility posting the greek second bailout details, if you look at the equities that are the biggest economies in europe like germany and like france, if you look at the dax and cac they basically made their highs on friday and have started to give up some ground. we have continued to monitor how the digestion process of what happened to greece has moved into the marketplace. our own supply today, 35 billion five years. back to you. thank you very much rick.

let's chat about at&t. randall stephenson with a paycut. >> in fact his 2011 short-term award reduce d due in part to te acquisition that didn't happen. in terms of everybody says these pro-consumer, this is going to be good for people out there, but ultimately it failed when the doj and fcc had vigorous opposition. >> how much did sprint's very contingent arguments have to do with the -- >> well, they were aggressive from the very beginning. it was dan hesse's -- he had a war room at sprint devoted solely to that. >> i was a moderator for a panel at ctia, the wireless conference

that sunday at&t announces the bid. dan couldn't get out of it, and he said this deal will not pass muster, and everybody was like, give me a break, you sour grapes. he did great on this. i still want to own sprint bonds, not sprint common. >> i don't blame you. as we toll you earlier, google is about to go high tech. so we're asking you in our tweet of the day to complete the following sentence. if sgoogle will invest in high-end glasses, they better be able to see blank. you tell us. we've got your responses straight ahead. as we head to break, a look at the early movers this wednesday on ways.

cnbc celebrates black history month. in 1992, she was electsed the first african-american woman to the u.s. senate. >> it's part and parcel of what i was supposed to do to be again not just a woman but an activist for women's rights. >> she served under 1999 when he was named special consulting to the department of education, and later ambassador to knew s.e.a.l.ant. she ran briefly for president in 2004 and for mayor of chicago last year, eventually losing to rahm emanuel. ♪

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welcome back. taking a look at the impact on occurrence sis, we are seeing the weakness in the euro having some effect on the complex, and

the fact there is this lack of optimism about the greek situation. that is something that is weighing not only on what we're seeing overall on the index, but on the metals. nothing really that much has changed, just down a dollar or so. what's been more significant and what traders are most focused on is oil. most of in the has been on the heels of the contemplating tensions between iran and the west, and the concern of many traders there will not be enough strategic reserves when you combine the government reserves as well as the reserves to cover what will happen if there's any altercation with the strait of hormuz. >> thank you, sharon. time for squawk on the tweet. google is reportedly making glasses that will be able to stream information to the wearer's eyeballs. we're asking you to complete the following sentence. if google will invest in high-end glasses, it better be able to see, blank.

gary tweets -- it better be able to see where the market is heading next. do you 15,000? tyler tweets -- the next move apple will make in the future. and mary ann tweets for $600, you better be able to see the traffic in front of you. all right. fair enough. if can you buy an ipad for 499, i don't see why you would buy a pair of glasses that can stream whatever search results to your eyeballs. >> it always feels like google is grasping. when i hear what they've got, it's like here, here, we're still really relevant, we're not just search, we're not just click, and they are just surf and:00. >> they are search on youtube also. >> they monetize -- >> they're starting to. >> instead of do recall $600, i would realty see them make a ton of money on youtube somehow. the stock is on the up, but last

quarter was -- >> android is not a failure, by any means, but we haven't been able to monetize ads on mobile. much more "squawk on the street" straight ahead. coming up -- mardi gras is over, so cramer is trading in his beads for six stocks in 60 seconds. we'll return after this. sfoo

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let's go to simon hobbs for a look alternate what's up next. >> it is a big hour. pimco's ceo mohammed el-erian will have frank advice on where to invest now, and how dell is getting hammered, and is hewlett-packard a better play? and we'll talk about the business of golf, melissa with pga tour commissioner tim

finch finchem. finches sounds like fun. we start can nokia. >> nokia, yahoo! r.i.m. >> medtronic, downgraded to neutral from buy. >> surprising defib and spine products not selling well. >> mosaic getting an upgrade. the firm raising the price target to 73. >> goldman did it yesterday. johnny come lately. >> herbal life posting dividends. >> michael johnson is on tonight. compare it to avon, please. >> this is all about mall ware, you can't get enough of this stuff. >> and range resources also a nice pop. a lot of takeover talk. >> that's what it's all about. >> mistake. for more on these stocks go

to sots.cnbc.com for more information. >> can i say my twitter has lit up because people accuse me of saying you don't understand google. look, it's unbelievable technology, great databases, it's phenomenal. i base everything on earnings per share. i'm not a guy who's analyzing technology, i'm analyzing earnings. it doesn't have the momentum i thought it would. >> think of the great google products, talk about android, google docs. if they charged -- i don't know what kind of -- what do you call it when people leave, the opposite of retention. churn. what kind of churn they would have -- >> i've made a fortune trying to analyze earnings per share, and i've lost a forting -- when google pops the earnings, i'm all over it. >> second acts terr very hard to come by. they kin to invest enormously,

and the first act is still doing pretty darn well. >> i'm just pointing out to the action creamer people, c'mon, man, it's about earnings. >> who do you have on tonight? >> herbal life. >> hot stock today. >> michael is so great. i like him so much. >> tonight at 6:00 and 11:00 p.m. meantime, don't go anywhere. breaking news on existing home sales and market reaction after greece. much more "squawk on the street" is straight ahead. [ 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 ] ♪

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welcome back. breaking news. existing home sales rose 4.3% month to month in january to a seasonally adjusted annual rate of 4.57 million units. there was a major downward revision in december's numbers down full five percentage points. what he thought was an increase in 5% was absolutely a drop of 0.5%. year over year essentially sales flat. information torrie fell to 2.31 million homes for sale. you the lowest since march of 2005 represents a 6.1-month

supply. the median price, $154,700, down 2% year over year. the realtors say supply may be coming into balance. looking locally in the northeast, sales rose, in the mid we had up 1%, in the south up 3.5% and in the west up 8.8%. distressed sales made up 35% of all home sales, an increase from december. it may account for the big jump out west as banks start to ramp up the repossessions. cancellations running at 33%. still very high. we know canceled contracts affected the toll brothers today. all-cash buyers 31%, first-time buyers just a the 33%. single family home sales. condos took a big jump up of 8.3%. condos are a much smaller share of the overall sales numbers.

>> diana, that 35% numbers is the is that highest you have ever seen? >> not the highest, but it's rising, as we no. as banks start to ramp up the process, realtors are saying they're seeing so much demand that they don't think that we need this big government bulk reo sales program. >> that makes sense. diana, thank you. let's run through the markets. the dow, s&p, all in negative territory, as you see, you know, fractionally percentagewise, let's call it a quarter person. the dow down a bit less than that quarter percent. also let's hit commodities, gold, crude, copper.

down day, as you see copper also lower to the tune of 0.6%. it is a move to minimize pension risks amid a shaky market. bill weldon announcing he will step down after a long list of recalls that has cost the companies hundreds of millions. he is the ninth leader, seventh ceo. the first two were actually presidents. he will remain chairman. royal dutch shell making a bid of $992 million pounds for mo a.m. beak focus coffee. if accepted it would open a new frontier in east africa. fitch rating is downgrading greece's rating, indicating a default is highly likely in the near term. wall street is still experiencing a strong year to

date rally. joining us is mohammed el-erian. it's always great to see you. >> thank you, melissa, what is most notable, things have returned basically to prebailout levels to friday close levels, et cetera. so in your view, have things changed substantially, your investment view from friday? >> the problem in grease is there's too much debt, too little growth. while the agreement helps a little, it doesn't get to critical matt. in the short term, and david spoke about this an hour ago, there's implementation risk. each of the three parties will have difficulty selling it. over the longer term, there has to be another agreement, because somehow greece has to deal with its debt level, which is still way too high and the growth just way too lowe.

so the market i think is being very rational say it's a step, but not big enough yet. >> in the past what a company would have done is devalued the currency, the way ultimately -- i use that word a lot -- they would have reduced debt significantly and at least had a path for growth. this is not happening here. what do you think? >> fundamentally, david, greece will have to find a way to restore growth and competitiveness. if it doesn't do that, private capital isn't going to come in. if it doesn't come in, you don't get the oxygen an economy needs. greek society has to decide. you put it absolutely correctly. in terms of an internal devaluation, which is very painful, or an external valuation, now, these are major

decisions annual only greek society can make it. so far it's been let's kick the can down the road, because no one wants to make a major decision. >> mohammed, it is what it is, and that's what they've decided to do. what i find interesting is the clarity with which you see generally the situation in which we find ourselves. you believe the central banks have pumped enough money in, but you're quite clear this is a lehman moment in terms of the economy actually not being as prepared as it was in 2008 for a jolt. therefore the situation actually being very dangerous in your view now. >> yes, the good news is that the central banks understand they cannot risk the payments and settlement system. they understand that, and pumping liquidity after liquidity, with another rto coming up. the bad news is just look at the economic indicators.

fiscal deficit around 9% to 10%. so we have less economic and policy flexibility. that's the bad news, buff the good news is central banks are doing all they can to limit. >> why would you suggest that people underweight equities. >> so it's a valuation story, simon. what is an investor tries to do? have exposure to the up side of a healing u.s. economy, which is very important, and the -- not as high as before, but still there.

two country that is explode when they are internally dizzy stabilized. so take a bit off the table, make sure you have some gold, some oil, and concentrate your bond exposure in the five to seven-year bucket. >> so you still like gold and oil, even if the dollar strengthens amid st. all this uncertainty? >> yes, because the word is uncertainty. we have a major uncertainty remember oil, you cannot pump it overtight to disrupt a supply overall devaluations of the currency complex, that's why you're seeing more investors look at gold starting from a very underweight position. greece finally got the deal done and you don't seem to be seeing anything particularly constructive or change in the

overall view that too much debt, too little growth gets you somewhere very bad in the future. >> david, if you're long-term investor, you have to ask not only about the adjourn, but also the destination, in terms of adjourny, people are trying to build bridges. no doubt about it, they are building bridges, but for a bridge to stand, it has to be a bridge to somewhere. you have to does your will have about the journey. when you don't have clarity about the journey and destination, you have to ask about the destination, okay, you remain cautious. it doesn't mean you don't reflect what has happened. of course you do. >> but you articulate the fear very well. at what point does the fear have to turn to greed? at what point do you see a market rallies and say enough, you have to get in? >> first, people have to be convinced that this greek agreement will pass.

as david said earlier, there's a question mark to whether the private creditoring will agree, and of course greek society has to agree. secondly donnell forts portugal is simply a few months behind greece, you need to get these things out of the way to make sure you have clear sailing for a while. >> mohammed, thank you for your time. well, retail is having a great run so far in 2012, with the xrt, the s&p retail etf rallies over 10%. we'll break down the numbers notably t.j. max and go behind the bargains when we return. good morning. [ male announcer ] technology accelerates at a relentless pace. anything not moving forward... is moving backward. [ tires screech ] [ engine turns over, tires squeal ] introducing the 2013 gs,

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stocks to watch 43 minutes into trade. beading the street thanks to growth in the turbotax and quickbooks business. new field exploration downgraded at citi and a big move on that stock. and apple's price target raised to $600 from $550 at credit

sweet. citing the company's growing cash pile. the owner of marshall's and tj . max. x. kimberly joins us. the stock is down. why? >> we heard very, very solid numbers out of tjx today, but no up side to the guidance. it could be giving back some recent gains, because it has had such a nice run. >> simply that. nothing we heard on the call or anything else. obviously a good quarter from your perspective? >> really solid quarter. february has started off equalitily strong, so just tells you that consumers are flocking to value. they're gravitating to those retailers they think offer the

best value. as we hear more and more about all sister measures there. >> that kufrl has yet to get under way in the next 45 minutes or so. we haven't heard directly yet. but last year tjx did struggle in europe. they had some execution issues. the growth rate was simply too fast to manage effectively. so they have pulled back on the growth 4 to 5 the management ranks in the european operation, and for the benefit of easy comparisons, they're starting to see execution improve meaningfully. >> switching gears, kim berg, everybody is saying they're too cautious on the quarter, he there overdeliver. is that your feeling as well? >> my partner covers dollar tree, so i don't have the right information for you today.

i'm sorry. >> yesterday there was margin compression with wall matter, what's the sense overall in terms of retail, given what seems to be a price conference consumer. >> we just came out of the holiday season here with a very, very competitive mind-set and consumers really waited for the best deals. the message is if you don't have a great deal we're not coming to your store. we see 2012 as a year that will continue that theme. we think that consumers continue to trade down to the value-oriented retailers. and because we do have inflation in cost of goods sold persisting here, you're likely to see margins under pressure. the only area where we're see less price competition is in the intimate apparel category, that's why limited brands is one of our top picks in 2012. intimate apparel is not seeing

the same kinds of price pressures, so we're arguing for a defensive stance, sticking with some of the lower-end retailers. >> what does that mean? 17% comps over 35% last year? what's going on at intimate apparel? >> victoria's secret has done a great job of shortening the supply chain so it can reorder in season the items that consumers are demanding most. also, remember the second place market share leader are the department so the competitors do not have an incentive to promote or discount this category. victoria's secret as the market leader sets the market here. we think think that they're likely to provide conservative guidance tomorrow. we would use any pullback as an

opportunity. >> and thank you for mentions victoria's secret, because we get to run that video. >> i thought you were going to ask another question. and it's never bottles of mango body butter. >> no. >> would that be your preference then? >> no. i'm just saying. coming up, we're talking tech. no, it is not apple this time around. old-school tech stealing the spotlight this morning on the back of dell's weak outout, is the pc market finished for good. >> speaking of the music, speaking of old school. ♪ they're going to rip it off pushing back toward 13,000 very rapidly. >> the think the more people see the end of the world isn't here, they can say, you know, maybe i can dip mea feet in the water. [ male announcer ] we know you don't wait

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and the drama keeps on coming. yesterday the game regulator requesting more information on the decision made by wynn results to buy on the its largest shareholder. jane? >> even as some analysts were raising the -- others caution let's see how this plays out. the cofounder is intending to prevent the redemption of his shares through the u.s. affiliate. okada seen with his former best friend is accused of wynn resorts of actions that are unsuitable, and this allowing him to not only take his shares, but not pay him for ten years, this because of allegations, some the company says he

admitted to to freebies of philippine regular torries, including this suite at the wynn macau. now, okada claims he has yet to see this report put together by former director louie freeh. he says this is an incomplete and flawed process tainted by the desire to serve steve wynn's predetermined goal of removing the largest stockholder of the company, he's also computing the 30% discount which the company says is what they're worth under an existing shareholder agreement. meantime, the gaming authorities want more information. is nothing from the s.e.c. yesterday and the wynn macau board. i will be in court tomorrow as both sides return for round 3 of

this vegas title fight. guys, what we haven't been able to determine yet is whether the 1 24.5 million shares have been returned from the float. it doesn't look like it. we don't know quite where those shares are. >> okada is also fighting back, isn't he? this is a big deal for wynn. i don't want people to be mistaken. this is a serious fight they have on their hands here. >> well, he was the biggest. yes, steve wynn and he used to be equal weight, but after steve's divorce from his wife -- this really goes back, most people believe, to the philippines deal. okada wanted to do a deal in the philippines, wynn said know, they claim he was throwing wynn's name around, pwent ahead

on his own, and that puts them at odds. >> jane wells, thank you very much. 132.30 is where we're trading at the moment. it's been a good week. let's bring in andy bush. this was not the way you thought it would work, i believe? >> no. i think there's a few other people that are thinking the same way. the amount of euro shorts shows that the euro's kind of contained here. it looks like we're trading in a any range there's just so many out there, it's tough for the euro to go down even on bad news. we've had a big rally that generates more euro buys. >> so what's your trade here?

>> this is a trade i create d now, it's broken out of its range that it had been in for a number of months, but i'm looking to sell what i think will be a new range. it will take profit at 8410. this is based on a better than expected uk gdp number on friday. it's supposed to come out mineius 0.2. >> has your trading slightly undone by events over the last 24 hours, in that we've now found out that members of the policy committee at the bank of england are talking about even more qe, and you have that big move on cable today on the sterling dollar? >> yeah, actually i hope they continue to buy euro sterling. the whole concept is the bank of england wants more qe, but if that number comes in better than expected, it takes that away. i want to try to fade it because of that.

andy, we'll leave it there, thank you very much. andy busch, and for more currency trades be sure to catch "money in motion" on friday at 5:30 eastern. if you want more education, go to currency class at money emotion. >> thank you, simon. well said. we're taking it to the greens. pga commissioner tim finchem will join us to talk the business of golf. and how will the iran effect affect israel? we'll head to the israeli border in just a minute. i'm michelle caruso-cabrera on the northern israeli border. over here, syria, an ally of iran. to my right southern lebanon, controlled by hezbollah, an arm of iran. coming up on cnbc, the iran threat and what it means for doing business and investments in israel. ♪

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here are the stories we're squawking about. existing home sales up. to an annual rate of 4.57 million units. that's the highest level according to the national association of realtors. however it was below expectation, actually a revision down, and there were sxekdations he would get 4.6 million. but percentagewise, it works. shares of microsoft hitting a

new 52-week high, almost up 22% just this year, but dell is today's biggest decliner, down 6% on an earns miss. we'll have more coming up. no question around the world the rally has paused. and you have all the excite of hitting that 13,000 on the dow we've had come back down. relatively broad-based move. the breadth of it so far, to my point certainly down here at the nyse. a look at the nasdaq, yeah, kind of again almost 1:1. now let's head over to tehran, and bring in ali eruzzi. what's the moon right now? >> the mood is very jittery.

the ordinary people in iran feel the fate murmor, the authorities in iran keep telling the people the enemy is at the gates, so people are very concerned here, but authorities have dug in very hard. the resolve seems to have stiffened. the supreme leader said after talks, basically talks collapsed, the supreme leader said iran will not change its nuclear path at all. iran is being very, very defiant in its mood here. they've talked about going into further talk withes the p-5 plus one in the next month or two and iran wants to negotiate from a position of strenkt. that's why they're going so tough right now, but this may backfire. the talks may come apart because

the visits with the inspectors fell through. back to you. >> ali, thank you very much. simon? let's bring in michelle caruso-cabrera who's monitoring the events in israel. she joints us live from jerusalem. how would you contrast what you've heard there from tehran with your experience in israel, michelle? >> i would say there's a lot less tension. at least the israelis put on a very good face and say look, we've lived with the threat for 60 years and we will continue business as usual. at the same time they think the situation is elevated compared to what they have faced in the past. for example, one of the highest ranks members of the israeli government told me this morning that he believes iran will have the capability to strike the eastern part of the united states -- never mind israel -- the united states within two to three years. he's the minister of finance, but has an extensive amount of

military experience and also a very close ally of the prime minister of this country, benjamin netanyahu. >> millions of dollars, in order to develop intercontinental ballistic missiles. we estimates in two to three years, they will have the first intercontinental missiles that will reach the east coast of america, though their aim is clearly not only to be able to threaten israel and the middle east, but to put a direct nuclear ballistic threat to europe and to the united states of america. >> reporter: i also schedules what kind of impact the threat is having on the economy.

he said the bigger concern for the israeli economy is, what else, the european financial crisis. >> our main concerns, like the rest of the developed world is currently the jesus in europe we feel the impact. >> reporter: but bottom line, when we talk to people in this country, i don't know if they're trying to put on a good face, they say they're conducting business as usual. >> that said there's a parallel, isn't there, between what the man is telling you about the potential for iran to strike at the united states with the sort of thing we have in advance of the iraq war, which was where tony blair ace intelligence suggest to do him that saddam hussein might be able to attack

into the uk and beyond. in that situation it was a threat enough to actually draw the allied forces into the war. that's clearly what israel i assume is hoping will happen here, a stronger ally in the white house than they perceive to have at present? >> absolutely. repeatedly he said europeans and americans would like to say this is not about us, but it is. it is about europe and the united states. he said that over and over again. he equated it to being like winston churchill trying to warn the world about hitler during world war ii. he's trying to make this a much bigger issue to try to get more support and participation by the united states. >> netanyahu has been doing it for years. that i can you, michelle caruso-cabrera, joining us live from jerusalem. let's see how this is impacting the broader market after crossing that skee scloj level. we're bringing in art cashin.

it's ash wednesday. so that's why. >> it is. so obviously we have the iran threat, the threat of a technical default out of greece at this point, where cds will be triggered. the market is taking it in stride. >> it is. i think it's more curious, trying to figure out what it should watch. there was discussion overnight about whether all of the political parties in greece would work, so there's still a lot of questions on the table. i think that's why people are hesitant, that run through a round number is always pleasant, but it's only got about a 52 to 55% rate of follow-through. so the markets often take a rest. >> wait, that's what you found so on the floor time, does it foul in terms of 13,000 is crossed? >> they usually have a period of rest or uncertainty before it

beginning to try to kick in again. they're entitled to a day's rest. >> do you think we will have that period, or have we seen at least in the near term a top in the market until we get the next catalyst. it could come as early as next week with the ltro, number two. >> you have two great pressures. people are not heavily invested so there's pressure on pension funds and other funds to put money in. so that's the one explosive side that could take you to the up side. the other part is that this is kind of a strange rally. it's coming on a declining number of new highs. stocks have fallen from 80% to 50%, so it's not a pervasive rally, and that's got doubters in there, but that's good. that's what you need. >> great to speak with you. art cashing, from ubs.

we're watching dell this morning. it's down, we're going to break apart of large-cap tech names, and talk about the pc market and much more in just a few minutes. stay tuned. 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 ] the 2012 m-class continually monitors blind spots, scans the road to reveal potential threats, even helps awaken its driver if he begins to doze. so in the blink of an eye it will have performed more active safety measures than most cars will in a lifetime.

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ew. seriously? dude that is so totally gross. so gross...i know. there's an easier way to save. geico. fifteen minutes could save you fifteen percent or more. as you know, dell missing the street's expectations, the stock sliding more than 6%. let's bring in jon fortt with more details on this story. hey, jon. >> yeah, the earnings with a mixed bag, missing on revenue and beating on earnings per share. this morning alone, shares have given up all the february gains. the main culprit is the thailand floods. dell said they had plenty of drives, but not the right ones. high-end drives went to large enterprise customers. that left dell with few options but to sell low-end, low-profit

pcs, add have that to a weak public sector market, that seems -- dell is guiding higher into the second half, but many analysts boulevard it's too early to count those chickens. let's get more inside. chaise wu, analyst at sterne agee. it looks good today, shaw, but what did you hear and do you believe the second half can see the company emerge from what was, it appears a difficult first quarter? >> those are two questions. first, we think there's problems beyond what the company is saying. we think the competent thif market has gotten -- so we're seeing lenovo and acor getting

aggressive at the low end. apple is taking a bite out of their core business, i think more son than they're saying, and then on the second half, i would agree that basically they're implying a back end loaded second half. i think there's some skepticism in that. that's why the stock is down today. >> in terms of the shortage of the high-end, higher-capacity disk drive, the cfo was clear this problem, the shortage would persist into the third quarter, if they're projecting a powerfully loaded back end, it doesn't sound line they're setting themselves up well if they're going to continue to see the shortage in the higher-end products. >> when we do our channel checks, ironically, apple is one of the biggest purchasers of the high-end drives, so frankly we don't buy into that explanation as much as some others out there. again we think it's more of a

competitive issue that's impacting dell. >> so they're simply losing market share to the likes of apple and some of the higher-end computer makers? >> that's right. we sue them losing share in the core business, and also at the low end with acor and le nova getting pretty aggressive. >> shaw, wiz haven't really let you do the victory lap that you probably deserve for taking down the stock during the course of last beak. if you're talking about the problems they had in thailand or public sector expenditure being down, isn't that something the market should have been able to foresee yesterday you have this 24% rise in the stock so far this year. what is good on? >> yeah, i mean, this is the exact reason why we downgraded last week. >> sure. >> because of disconnect between the stock and the fundamentals. so we still think there's a disconnect here, so we would be selling on strength. just more on the public sector, a big part of that is the k through 12 higher education

market, and that market frankly is also going to apple. you know, that's been -- dell has been able to take share from apple in the 9 ons, in the 2000s, we're seeing a lot of schools and universities are moving to the apple platform, so we think they're losing share in that regard. >> as you look out from the area in which you specialize, do you look at other moves so far this year? this is not an unusual move, and believing we're perhaps disconnecting from reality? >> that's an interesting question. we look at the different stocks that we follow, you know, including apple, ibm, cisco, dell, et cetera. the one disconnect we saw was clearly dell. that's why we cut to basically a sell rating form 9 others we think are pretty fair. apple is finally getting the respect it deserves.

you know, cisco as well, under-appreciated turnaround story. we like hp here. hp really hasn't recovered, so we think there's a disconnect there. we'll find out how much when we hear from hp after the bell. shaw wu, thank you. we'll hear from michael dell on monday right here on "squawk on the street," and following the earnings call i'll have meg whitman. i think they should make my picture mall and hers large. >> it always look like you're just slapped on there. >> i think it looks like you're proud of what you're bringing to the table in the photographs. >> like the dog that caught something in the yard? yes. let's have a look at the broader markets. after yesterday's move, all the technicals saying there's trouble brewing behind the 235 sawed here of the bull. dan fitzpatrick is here, good morning to you, sir, thanks for

joining us on the program. it's not necessarily about the dow, but about where we are with the trumps. >> right. i think the 13,000 level's largely a news item, about you when it gets down to it, we're looking for the dow theory confirmation, where if the industrials make a new high, you want to see the transports do that too, i'ming if they don't, investors tend to think there's something wrong. and the problem is they have to rally about 7% just to confirm the dow's -- the dow industrials' level now. so i think we'll see a bit of difficulty with investor confidence to see the market continue to move higher. >> simplgts do where he still live in a world where we need

transports to confirm the move where america may so heavily be banking on technology. >> right now the dow theory still matters. whether it really does with respect to the actual business cycle, i know, i couldn't tell you. i do know this. you still see a lot of things transported on rails, planes, trains and automobiles, that type of thing, so you definitely want to look at that. you ignore that dislocation to your peril. what we're talking about, when you think about it, is how broad is a market advance? or is it a market advance to be believed? when when you've got, let's say issues with energy costs, that's going to impact the broader market. you're external going to see that in some of the transports, because their costs will drive their profit margins down. >> thank you, dan fitzpatrick. ahead on "squawk on the street," this morning the list of netflix competitors growing

steadily. comcast's announcement of stream picks, are any of them a true santelli on what he has for the next hour of the show. good morning. >> good morning, simon. we're going to have a fun time this morning. we're going to talk about who should be that twinkle in the government's eye. who should be the apple for the government's desk. i have some thoughts on that and a couple other thoughts. the debate about gas prices. yes, there's actually debate. are higher prices good or bad? and treasury supply. we're going to tie all that up, top of the hour. but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important. well, both are important. let's be clear. they are but this is important too.

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let's talk a little golf, shall we? the players advisory council giving its blessing last week to the idea of the nationwide tour being the primary path to the big leagues. the new idea heads to the board next month. dan raffle joins us now with fedex vice president mike len. darren, take it away. >> thanks so much, david. fedex has sponsored the pga tour playoff since 2007, and today it's announcing a five-year deal to extend that. mike len joining us. mike, i got to ask you this, you

sponsor the atp tour, the nba. you've been a pga tour sponsor since 1986. how does this yield the return on investment for you by sponsoring, you know, a part of the fall season in the pga tour that didn't get a lot of attention, and now does? >> well, darren, sports is a great way for us to break through the clutter, and our association with the pga tour over the last 25 years has really been a very effective medium for us. so as we expand the fedexcup to include other events, and build to a crescendo of naming player of the year it only supports our brand and allows us to connect with customers and provides a great marketing platform for us both on on advertising and a pro-foegsal basis. so it's a great tool for us. >> i assume that this is your highest sports sponsorship in terms of spending or close to it. you give away $10 million, $35 million worth of prizes guaranteed. how do you actually figure out

your return on investment? >> well, it's a complicated case formula that we use to measure every one of our sports properties. we look at both brand awareness and how we support the fedex brand on a global basis and the pga tour certainly does that. it allows us to connect with customers and we're actually able to measure the incremental traffic or volume impact that we get from customers that we host at events. so we've been at this awhile. and we've refined a model that gives us a very good estimate of return on investment. >> you know, this has not been free of controversy. it's almost like the bcs talked about last year, bill haass, the guy who won, actually wasn't really sure where he was on the 18th hole, the last hole, didn't even potentially that he was going to win $150 million. it's a complicated formula, that you and the pga tour are not changing that formula. how do you feel about that, that some have compared it to ice skating, and the fact that casual fans might not be able to figure it out. >> well, i wouldn't say a comparison to ice skating would be appropriate. but i will say that the first

couple of years, obviously it didn't work quite as well as we could have liked. but i would say the changes that we've made in the last couple of years have really been very much in line with what fedex wants to see. and that is building to a crescendo with the very final event, the tour championship, and specifically on that sunday. i don't think bill haas wanted to know where he was. but it was great for the fans to see how it changed on a shot by shot basis. i mean, you know, again i didn't talk to bill about this. but my guess when he was making that shot on 17 out of the water he really didn't want to be thinking about what it meant to him financially. he was competing. but it was great for the fans. and that's what we're looking for is that fan appeal and how it builds throughout the day on that final sunday. and i think we've accomplished that. >> mike len senior vice president of marketing development from fedex. by the way, simon, bill haas won $10 million, $11.4 million, when you added that last tournament.

he won $10.5 million in his entire seven-year career and then winning the fedex last year he won $11.4 million. pretty incredible story. >> nice, yes. darren thank you very much for that darren rovell with the the latest on the pga tour. >> it is tweet time. it looks like google's got a new vision. "the new york times" reporting the tech titan is making glasses that will be able to stream information to the wearer's eyes in realtime. we're asking you simply the following seine ten, if google is going to invest in high-end glasses it sure better be able to -- and you feel in the blank. tweet us your responses. we've got a few ahead. oh there's tons. french presses, espresso tampers, filters.

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all right, time now for squawk on the tweet. google is reportedly making glasses that will be able to stream information to the wearer's eyeballs in realtime. this morning we're asking you to complete the following sentence, if google's going to invest in high end glasses it better be able to see blank. diana tweets it better be able to see the new fine print in everyone's privacy settings. >> oh, yes. >> blaine tweets, what normal glasses can see, but for $600, it better come with one share --

let's call it one share of google. and ron tweets it better be able to see the elusive god particle. >> i don't know what that is, i hate to -- full disclosure. i have no idea what that means. >> as a religious correspondent what are you talking about? >> i think that's a bit they haven't quite yet discovered yet. hopefully you'll be able to see, this is god. >> speaking of which, "fast money" tonight. >> well we have the ceo of mgm, jim murren on the company's earnings. the stock is trading lower. we'll also talk about expanded gaming and macau and social gaming tonight at 5:00. >> all right see you then. >> meantime, third hour of "squawk on the street" starts right now. >> welcome to hour three on "squawk on the street." here's what's happening so far. >> if there were less lobbying i think business actually focused

on having what regulation was necessary and what wasn't we might have better, more enforceable regulations. >> what's going to be most disturbing over the next several years is this issue where fewer americans are getting access to the traditional financial system and that is going to slow down the spend power for so many americans. so we call it debanking. >> the next big thing in our mind is really the growth of companies that can really bring value to the huge amounts of data that are being stored, the leverage the khodization of storage and harbor itself. >> i think that what comes on the individual tax rates everyone's who's looked at their taxes trying to calculate it, it's a throw your hands up corporation. it's the same for corporations. there's so many loop holes. it's incredible to try to figure out where you are and the most important person for a lot of these companies is the cfo. >> dell, give them this, they said listen we didn't do as well as we'd like. i do think the enterprise was

good but they made a lot of acquisitions. i thought gross margins wouldn't go up in entirety. it was eight beurre disappointment. >> the opening bell, the s&p 500, realtime exchange. >> existing home sales rose 4.3% month to month in january. >> somehow, greece had to deal with its debt level which is still way too high and it's growth which is way too low. so the market i think is being very rational saying it's a step but it's not a big enough step as yet. >> markets slightly lower today but all indices still on track for their best january and february percentage gains since 1991. the dow looking at about a four-point loss right now. s&p, three-day winning streak looks to be in jeopardy with it down one point to 1361. nasdaq in the red, as well. financials the worst performing sector in the s&p. slipping today on some concerns about a recession in europe. got some relatively discouraging pmi numbers out of the eurozone. a lot of the big banks were

exposed over there. of course the big players are in the red today. energy the best performing s&p sector led higherly neighbors and range resources after both companies reported quarterly results. so time for our road map. the dow retreating a bit from 13,000 yesterday. we'll talk to barry map of barclays about why he thinks it's time to revisit some of the high dividend names. greece got hit with another downgrade. worries about a recession in europe weighing down markets overseas. all the details and the european claes in less than half an hour. then it's net flex versus the world. company after company coming up with their own netflix-like streaming plan. which one has a real chance of taking down the original? and then finally, nike targets olympic gold. the company unveiling a whole line of products that will be worn in the summer olympics. we'll talk live with the ceo about the new line, and what else is going on at the athletic giant. first squawk on the beat. the president releasing his new

corporate tax plan today. what does that all mean for big business? eamon javers is live at the white house. good morning. >> good morning. we're about half an hour away from the official unveiling of the president's new tax plan. we don't know everything that's going to be in there. but let's take a look at shop of the details we do have. starting with the headlines, and a big one of lowering the corporate tax rate to 28%. an effective rate, the obama administration says of just about 25% for manufacturing firms. the plan would eliminate dozens and dozens of tax loop holes in order to do that, it would establish a new minimum tax on foreign earnings and it would make tax filing simpler for small businesses who struggle with the complexity of the tax code. this plan would reportedly raise about $250 billion in new revenue over ten years. but exactly whose ox is getting gored here isn't exactly clear until we see the details of which loop holes they're going to close. we're expecting that news or some piece of it from trishry

secretary tim geithner who is going to be briefing reporters in about half an hour. >> and eamon, the treasury secretary has also said that they believe there's nor common ground in this area than there is in other areas of tax form, right? >> that's exactly right. republicans and democrats have both said kind of the same thing. we need to lower overall rate, broaden the base. that would bring in some additional revenue. exactly how much is in dispute. but don't expect that they're going to be able to do any of this this year. this is a presidential election year. a lot of this is giving obama talking points to say look, i want to lower corporate tax rates and i want to broaden that base and close some of those loopholes. but how they do it is going to be tricky. we've seen some early analysis that says banking and manufacturing would benefit but the devil's going to be in the details. >> eamon javers in washington. for more on the new corporate tax plan, want to be joined by douglas holt aiken president of the american action forum, a public policy institute, previously served as chief

economist for the white house council of economic advisers and directors of the cbo. welcome back. >> thank you. >> let's talk politics. i've heard some estimates that say the chances of this getting through and being made law are almost zero. maybe in a lame duck. would you go along with that? >> i think those are optimists. i think they are zero. i don't think there's any realistic chance that we've seen corporate tax reform this year. i think the politics are real simple. governor romney was going to make a major announcement about his tax plan on friday, moved up to wednesday and the white house decided to step on it. pretty simple. >> let's pretend for a moment then that this was a potential reality. you still say 28, as in percent, is not internationally competitive. why not? and what is? >> well if you look at our major developed competitors, they average somewhere around 25%. so we're still above the internationally competitive line. what's interesting to me is that they left some money on the table. this raises revenue that could have cut that rate further and chose not to.

i'm mystified by that, to be honest. but, the details will come out at 11:30 and i would expect that on the whole it will represent modest reform at best. >> there's this bit about the special tax for manufacturers. is mcdonald's really considered a manufacturer? >> well, see, we already have a special tax regime for manufacturers. there's a manufacturer's deduction. mcdonald's qualifies for this deduction. i think that tells you everything that's wrong with this kind of tax policy, and for the white house to replace one mistaken tax policy with another doesn't really constitute reform. might be good politics, talk about manufacturing in an election year, but it isn't going to help our tax code. >> you think it's more about getting on the scoreboard. your broader point is it's hard to do reform piecemeal. if you're going to do corporate you want to do individual as well. that's one area the white house is not willing to give much ground. >> i think it's a very important point. look at what happens. if you lower the rate to 28% you've got somebody running a sole proprietorship or

partnership being taxed at 35%, if they become a c-corporation they get taxed at 28%. it's really bad tax policy. the lesson is you have to do them at the same time. the white house doesn't want to talk about individual taxes. their proposals are all about raising them. >> what do you think the mood is in corporate america, as they're reading these headlines today? i mean we've had u.p.s., macy's, all these companies for so long have been crying for something like this. would they say no to it? would you really say no to something that might not be -- are you letting the perfect be the enemy of the good? >> well certainly this is an opportunity to talk about what you want to be perfect. and i think that's the biggest missed opportunity by the white house. they were given a starting point by their bowles-simpson fiscal reform commission. they've consistently ignored its guidance. its guidance said get rates down, broaden the base, move to a system that doesn't tax foreign earnings at all, much less having a minimum tax. then go in a different direction. i think what makes corporate america nervous is the starting point is so far out of line with our competitors that you worry

about a deal coming to the that actually helps on all fronts. >> one thing we don't know a lot about is the minimum tax on foreign earnings of global companies, right? any clarity on that? >> i don't know what that is. i do know that for three straight years, including two years when the democrats controlled the house, the senate and the white house, they have tried to institute something like this. getting rid of deferral, raising taxes on foreign earnings, and have failed because it's really bad policy. so, this may be good politics but it's not going anywhere. >> yeah. well if they think -- if democrats think that there's common ground here, and you're telling me zero percent is an optimistic view that shows us where we are heading into the fall. >> i think it's zero this year, carl. but i think everyone recognizes that 2013 is a very important year in the history of this nation. we need tax reform. we need entitlement reform. and we ned to change course on our national debt. this is a big part of that debate. i'm hoping while it's zero this year, it's 100% next year. we really need to do this. >> that's something a lot of people can agree on.

douglas thanks for the time. let's head to chicago this important for the santelli exchange. before we get to rick, want to play a bit of the president giving the windy city some love last night. rick. take a listen. ♪ ♪ come on baby you don't want to go ♪ ♪ ain't no place like sweet home chicago ♪ >> sharing the mike with b.b. king. rick, how does that feel? >> listen, i think chicago is one of the greatest cities on the planet. you know, despite the asterisk that in the last four decades four of our governors aren't calling home chicago, they're alling it a state penitentiary, but that's for another day. you know, there was a wonderful, notable and quotable section of the "journal" many guys on the floor like to read and clip it out, pass it around, by a professor meade. and basically what he said is

that small businesses, self-owned, entrepreneurs, those businesses need to be the apple of the government's eye. and he talked in this quote at length about whether it's how you pay both sides of the payroll taxes, social security, medicare, employer, employee, how health insurance issues, if you work for someone in this country it's easier to deal with the system. we need to come up with a very easy way for small businesses to get started. maybe one page of rules. give a chance. my grandmother came from ellis island, she opened a grocery store. she could hardly read. i don't think she could do that today. gas prices topped $4. last night i was watching a couple programs with the experts and they kept saying regarding our current find of $4 test, oh, well we can't do anything now, it will be at least five years. '08 was four years ago. when are we going to wake up and say, now is the time to start! well, what's under the question mark? somebody that really doesn't

agree with me. there's a debate by tomorrow. high gas prices are good. who said we have to figure out how to boost price of gas to the levels of europe, and they're multiples of ours. happens to be energy secretary steven shue circa 2008. there's a litany of economists who have written many papers whether it's the whole carbon issue, whether we're going to trade that, that this would be a good thing. sure if there's a replacement. every facet of our life is energy. we need to wake up and be a lot more honest about that. >> the white house is going to have a tough time explaining that one come election season. thanks a lot, rick. we'll talk to you soon. when we come back one of the top minds at barclays, barry knapp is with us talking dow 13,000. 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. ♪

markets still slightly lower this morning. how should investors position them 168s for the market ahead. barry knapp is head of u.s. portfolio strategy from barclays capital. >> good morning, carl. >> so despite all year long

rally's been fantastic, you're sort of downplaying the benefits of a rising market, even things as simple as the wealth effect. we should not be counting on any sort of near-term bounce to that. your argument is even that the consumer balance sheet might end up negative impacted in the near term. can you explain that? >> sure, absolutely. you know, the wealth effect, which i heard the ceo of saks on your network yesterday talking about a little bit, you know was driven by two things, right? housing prices and stock prices. we've clearly had a rally in stock prices. that helps to an extent. but it helps at the high end. while at the low end, the impact of rising gasoline prices is probably, you know, a bigger effect given the magnitude of the move that we've seen. yes you'll probably just continue at the current trend which is high-end retailers do quite well. if you listen to walmart's report yesterday, they clearly are already starting to feel the effects.

>> yeah. >> and even, we see central banks making moves. that's going to inflate commodity costs before it can inflate a balance sheet at home, yes? >> fascinating point, carl. because if you remember during qe-2 the fed underwent a lot of criticism on using the dollar as one of their transmission mechanisms. that is you increase the monetary base, by definition the dollar should go down. that would spur exports but also spurs higher commodity prices. so you heard central banks from the emerging world criticizing that, the tea party, gop candidates, all piled onto the fed. but operation twist was supposed to do was not use the dollar so much as a monetary policy transmission mechanism. if, now, growth slows because energy prices have risen does that handcuff the fed from starting large-scale asset purchases or qe-3 again? i think it's a tricky point for them. they've generally been dismissive of that but nonetheless, rising energy

prices could start that whole global race to zero with the dollar and kur besies again. >> where does that leave you relative to the levels we're close to now, ie 13,000. and what do you mean when you say there should be a hunt for yield looking at some high dividend names now? >> i think there's two aspects to that. one is a year ago at this time, when energy prices kept creeping higher and we had the arab spring, libya, that drove them up even further. what you saw was the cyclical sectors' relative performance started to stall out. so those rising energy prices could very well trigger that in the short-term. in the longer-term, if you go back to the last period of financial repression, the '40s and early '50s when the fed had effectively pegged interest rates, at that point they'd capped the long-term treasury rate at 2.5%, those defensive yields, really yield sensitive or high yielding sectors and stocks, they performed well all the way until the fed started

normalizing policy. that is stopped pegging rates. so, you know, given that we're in a very similar environment now, we think that that high yielding performance will linger all the way until the point when the fed is ready to normalize policy. >> so can you point individual names or do we have to figure that out on our own? or should it be obvious? >> i think it's pretty obvious. i'll point you to some particular industry groups that look attractive. the pharmaceutical sector, for example. very high yield, very attractive valuation. there's obviously all sorts of policy concerns. some of those may be resolved by the supreme court. the secretary quarter. some of them are going to take the election. but that's an example. the regulated utilities are another one. >> yeah. well the market today is backing up your thesis, that's for sure. barry, always good to talk to you. thanks for the time today. >> all right, carl, thanks. >> we're going to count you down to the close in europe in a few minutes. bring you the market action live when it happens. first rick santelli is watching those numbers and other ones,

too, tracking trades at the kme. there's ira harris. we'll talk to them both when we come back. [ 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. 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. 4-g-l-t-e? mhhmm. i think it's time to stop spelling? ok. a-y.

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rick santelli is over at the cme group talking i think to ira and i think about europe. rick? >> yes, we are talking about europe. we're going to start, since the president got to sing part of that or play part of that wonderful song, sweet home chicago, you know, it is a catholic holiday. it's ash wednesday, and illinois, our governor, governor quinn is going to put forthillinois' budget. i see a greek one-year is about 750%, a two year is like 215%. you know, i think it's interesting we release the budget on a religious holiday. that gungate is going to need god's guidance. why don't we buy one and two-year greek paper? >> it will take care of the pension problems in illinois. 213%. >> all kidding aside. considering the ecb's hedging and wedging bailout number two, maybe there could be number three. seriously why would that not be a good investment? >> the markets are saying they really don't believe it. >> everybody's happy with the

short-term liquidity fix. >> all kidding aside, portugal's yield curve is inverted. short-term yields pretty much are all higher to the ten-year. you look at a two-year about 30 basis points higher than a ten-year. why should anybody in these problematic countries care about anything but short-term rates. >> well, no, that's right. the fact that that is inverted it's like when greece started to really get in trouble, that 210 curve inversion in greece with all this austerity, which is causing havoc, and the bonds don't mean what they mean in a regular market. this market is so badly broken. the more that inverts, the more danger it is for countries in trouble. right now we're seeing good things though. italy is very positive. ireland has gone very positive. spain is positive. those are where the keys are. we know that the markets are like water. they're going to attack the weakest points that they can. so now that supposedly we've had some resolution on the greece

issue, you can bet that soon they'll be showing up in portugal, because that's what they're telling me that portugal is the next danger point. >> i certainly hope not. we do have a five-year option today. i think our auction will go pretty well. back to you, carl. >> all right, rick, thanks a lot. when we come back, europe's trading day coming to a close. just a few moments to go. less than four in fact. we'll have the close and some details on economic data that we got there this morning and what it might mean for the markets there and at home. ♪ 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. [ mimi ] i had cancer. i have no evidence of disease now. [ erica ] i would love to meet the people that made the machines.

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bringing in simon hobbs as we count you down to the close in the uk and across europe where they got kind of discouraging data, simon, and also this cut by fish on greece. >> there's no question as far the markets were concerned in general it was better to travel than to arrive. it's been a pretty down couple of days on the equity market. have a look at where we're closing out. you mention the data today. a lot of people, and this is the service sector, the pmi coming through for the eurozone at 49.4. but the bull cases for the bulls still very much intact. it's below 50, maybe it points to a contraction down the line. but in broad terms, a lot of people, or this is what i've heard, carl, have said, we're still -- the world investors are still under weight, europe we still believe that they will close those shorts out. the bulls are still very much intact. a look at where we are on the dax, they would say okay we've

retrenched but look at how far we've come so far this year. it isn't necessarily a turn in direction or at least that's what i was told here in earlier calls. >> we keep looking for answers if they're going to have a recession. still don't know. >> the european markets are closing now. >> so i mean it -- you put it like that, it does look a little bit like a sea of red. however we are off the lows. spain is down 1.2%. again you're coming off quite a strong rally. there are definite concerns. we're watching events as we have them in greece. protests started there in 2 1/2 hours ago or scheduled to start. athens has now got to get within nine days the huge number of unpopular measures through there, through the liberalization of the industries through laying people off. measures to cut people's incomes. that clearly is unpopular. there's a huge political risk there. in that environment it's quite interesting that we are ticking slightly higher, on, for

example, the spanish and the italian yields at the moment. it's not a huge move, but clearly the market is just pausing on the rally that we've had so the prices move down and the yields move slightly higher. notwithstanding what ira and rick were talking about with the inversion of some of the notably portuguese bond market earlier on. let me just mention one corporate story for you. people have been selling in to peugeot today. it's a french carmaker, the second largest in europe. it's still controlled by the family. there's widespread reports that general motors might be about to link up with peugeot in some form. comments out suggesting that will be more about structural issues, clear overcapacity there general motors and other carmakers in europe. if it does go through, that's what it will be about. apparently waiting for one of the automotive shows for that to be announced. >> interesting corporate story. don't go away. i think fresh head leans out of

greece. >> the euro spiked up. the euro intraday, the greek parliamentary committee has voted to approve the debt bill so it's going forward. you can argue ultimately none of this is going to matter. but they are going to move ahead with the whole program, with the private debt swap. they're going to move ahead with trying to get a bill through to implement the austerity reforms, the technical aspects of that. that's going to be the hard part. you see the euro spiking up 15 or 20 minutes ago on that news. the biggest problem as i came in this morning from everybody, headlines, comments, there is still no vested interest in this interest in greece. no vested interest in shrinking the state, no vested interest in shrinking pensions, in liberalizing hiring and firing rules. where is the constituency that is going to dramatically push for that? >> how about the permanent presence of the troika? they have an interest. >> here's an interesting question, is there academic studies that support the idea that if you let brussels turn

your government over to brussels things will get better? the problem is there really isn't. that's a big debate that's going on now. just because brussels comes in does that mean things are going to be better? a lot of people feel that's not going to be the case. presumably there's a constituent that says well, actually, if we don't do this and we don't get our bonds paid on march the 20th, and therefore through disorderly default and we lose our pension funds, suddenly we devalue and can't afford to buy medicines or oil and get hyperinflation. there is a constituent that would say, this might be the thing to do, surely. >> worse than the alternative. >> it's certainly a very small constituency that's out there. >> intellectually you can argue that, the parliamentarians can say that, again there's a reason they haven't been able to actually implement any of these reforms. that's because there's not a large enough, let's just say, not a large enough constituency invested in this. we have too little -- one problem and one piece of good news, home builders, the spring home buying season is shaping up to be good but not good enough.

the home builders are rolling over here, very interesting comments this morning. we don't know how good the spring home buying season is going to be but their orders for the quarter were up 19%. that's very good, carl. but it's not good enough. people were talking about orders to spring have got to be up 25%, 30%, 35% because these stocks have moved up dramatically in price. they topped out a few days ago. spring home buying good, but not good enough. the reason we're selling off. on the other side, energy stocks, are to continue to have a great time as oil spikes up. natural gas looks like it's starting to bought up. there'ses exploration production companies all up fractionally. i want to know today, shell, royal dutch shell made a deal to buy a big natural gas company over in england. lots of acquisitions with small energy companies. they don't have any choice. shell is a big acquirer, they've got to get very aggressive. >> let's bring in rick santelli and let you go, bob.

rick, bob's point is a good one. politically the tough sell, some of these measures they're requesting out of greece. >> yeah, i'll tell you what. there's so many moving parts to this. i enjoy bob's comments on cnbc. you know there's the stabilization side. and then i think the market's being very smart. it's looking at the future the way el-erian, the way bob pisani, the which i look at it, all the uncertainty, not to mention the political uncertainty, what powers are going to stay in, what aren't. issues with the greeks moving towards the streets to show their displeasure. even when we acknowledge honestly that a lot of these austerity measures that don't seem pretty haven't been even implemented yet. this is going to be dicey times. that's why you still have a ten-year in the uk trading 2.12 yield. it's historic yield just a bit below 2%. we're only two basis points above 2%. the boom is only two basis points above 190.

these markets haven't flinched nearly as much. i'm not advocating buying the good sovereigns. maybe it's not a great trade. selling it is like watching paint dry in terms of collecting your "p" in p&l. >> next week they're going to have the second ltro, the three-year program, give it 1% and the talk is it could be a trillion dollars. the ecb and i don't know how you feel about this rick may or may not be happy to have banks come in and buy a trillion dollars worth of this 1% paper. maybe -- or excuse me borrow 1%. maybe it's better if we just have a $400 billion euro take up and that will indicate banks are getting healthier. what do you think? lower takeup or a better? what's the correct way to read this thing that's going to happen? >> there really isn't. art cashin has been wonderful on this topic. if it's too small or large all the bloggers seem to think there's dangers there. i personally think it's more important where this money is going. if it ends up stockpiled maybe it stabilizes the situation.

but it doesn't give me a lot of hope for the future. >> definitely stabilizing. you notice you don't have people talking about the imminent death of the euro. we did in december. that talk has gone away. you know, kick the can, whatever you can say, it's like draghi, he has stabilized things for the moment. >> bob, imagine how all these positions and all this ltro money and where it's gone or may go, if the euro moves down, that would be a disaster for those positions. it's not going to happen. >> absolutely. >> rick, bob, thanks guys. want to bring in bob bower, as well, chief global economist at principal global investors says this is not a solution, it does kick the can. although the counterargument has been give the markets and the economies enough time to grow. and that's all you can expect at this point. is that enough? >> well, i think it is for a little while. i think where we are now in europe, we should be looking ahead to phase three. of the eurozone. phase one of the eurozone was ten years of the new currency. it ended with a debt crisis.

phase two is when the ecb and german figured out a way to make a godfather-type offer that the countries couldn't refuse. you know, we'll help you with your debt if you restructure your economies. now those countries did kind of take up that offer. and they're starting to make some moves in that direction. now i think we need to look ahead. they're going to need some help with deflationary times, and germany needs to offer some things, as they look ahead, help these countries a little more permanently. >> when you say phase three are you necessarily referring to a default, the way fitch is predicting one in the near-term? >> no not at all. i think what's going on now is we have kicked the can down the road a little while. and we bought some time for these countries to restructure. you know, the ultimate problem there in the periphery is that these countries are not competitive. the governments are too large. their budgets are too big. their labor markets are not flexible.

there's too much regulation. they immediate to go through some dramatic restructuring, and they're starting on that. monty in italy is taking on the professional gilds, doing a similar kind of thing in spain. we have to see that the greek plans are going to be implemented. but if that really happens, that's what's necessary in the long-term. but in the short-term, then, while that's taking effect, these countries are going to need to continue to buy some more time with their immediate debt problems. and that's where germany and the ecb have helped and can continue to. >> yeah. might not be the last time we're talking about a bridge loan to get us through a matter of weeks, not months. >> yes, that's right. >> bob, thanks a lot. >> my pleasure. >> talking some europe this morning. straight ahead the list of companies attempting to take on netflix just keeps on getting longer. comcast, amazon, verizon and coinstar. will any of these competitors be successful? we found out what impact it will have. we'll talk about it on netflix's bottom line.

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coming up next on the "halftime report" another bullish call on apple as credit suisse joins the 600 club. the restaurant rally. three eateries hitting new highs. and which major home builder

caught the eye of one of our traders. now back to carl on "squawk on the street." >> thanks a lot, scott. yesterday nbc's parent comcast as nowed xfinity stream pix, the latest service that will compete with netflix. netflix owns about 70% of the video streaming market. market crockett is an internet analyst and amy is a writer with "the new york times." good morning to you both. martin, awkwardness aside because we are majority owned by comcast. it does make you wonder if over time their first strike advantage comes to an end. does it? >> it does. netflix has had a wonderful run as really the only game in town for streaming at a commercial quality onto your tv. i think it's inevitable that over time all of the cable companies, all of the satellite tv companies will have a at log feature streaming online into your set top and they'll have an advantage over netflix because it can be bundled into your standard video subscription. i think over time that will be difficult for netflix to compete

with. i think it's a headwind for the stock. >> where does it leave the stock over time and is there any way to remedy it? >> the issue with netflix is they're spent. they're spending so much money that you have to have most americans with broad band subscribing for netflix for the stock to work. unless they're able to pare back their spend, i think they face a difficult future because i think their ability to, you know, have most americans subscribe is limited by the fact that there will be other options that we haven't seen before. the market will vulcanize, netflix will be a leader but won't have everyone. >> amy the story has so much drama because i think a lot of customers fell in love with, maybe still are in love with netflix. there's an emotional tie to it but when you're painted in a corner the questions that start arising are not only can you compete, but will someone buy you. >> right. i mean i think that part of that emotional connection has to do with what's available. in terms of what barton was saying about spending. they're going to have to spend more on the licensing agreements and get the content you want to

watch. they just struck an exclusive deal of the weinstein company. they'll get "the artist." and i think that's the kind of thing that's going to keep subscribers coming to netflix or any of these other services. this is a dream come true for the media companies that own the content. it will only drive up companies for these licensing deals and put the impetus on the companies to get exclusive deals. >> we've always said content is king. but it's only illustrated for you over time in deals like that. amy of the deals you've seen so far, of the services, is there one you think is a poster child, a proxy for the threat that netflix faces? >> i think the verizon/red box partnership cannot be underestimated. redbox already has brand recognition. verizon has huge heft in terms of negotiating deals with studios. i got a call from a warner brothers executive who was ecstatic when the verizon/redbox deal happened because he said this is a chance for us to get a good chance for our content. comcast has said that this will only be available to xfinity

subscribers. but i think the deals do have the power to go more bradley. and you can't underestimate your parent company. >> neither can we. not ashamed to say it. are you hearing a lot of acquisition chatter as you cover the beat or not on netflix? >> in terms of netflix i have not heard too much chatter. of course, it's on the minds of a lot of these companies. but they're also probably thinking can we go a cheaper route, and partner with redbox, and you know, come up with something that's equally formidable. >> without that, martin, i think those who say the stock may retreat into the $70s or lower you don't think they're completely out of line? >> i don't think they're completely out of line. it is a business that is going to have better growth for the next couple of quarters than it has for the last couple. but looking out over the next couple of years it's hard to see how that growth can continue with more options. i think buyers face a bill versus buy discussion. and you can write a check for a lot of content for what it would cost to buy net flex pip i think

that's one of the big issues they have when you look at a takeover prospect. >> last question, they did graduate from dvds to streaming. >> right. >> can they make a similar leap to something else? a technology that who knows what it could be? >> yeah, i don't know what that would be. i think streaming from dvds is pretty futuristic for the consumer today. i think the challenge they have on the dvd business is that's where they make all their money. so they've got to start to make money on streaming. you've got to walk before you transport to the 22nd century. >> thanks for the great insight. >> thanks for having us. >> nike's new olympic line. the company's ceo mark parker will be with us live to talk some new products, the state of the company, and the olympics and a lot more. ♪ [ male announcer ] the 2012 m-class continually monitors blind spots, scans the road to reveal potential threats, even helps awaken its driver if he begins to doze. so in the blink of an eye it will have performed

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nike unveiling a new line of products pegged to this summer's olympic games in london. the stocks seen some steady gains over the last few months up about 15%. will this push it even higher? darren rovell is live in new york with the president and ceo of nike. darren? >> carl, you know, i'm always excited when i come here and nike unveils their new innovations like the hyperdunk plus here, which basically you can put this in your ipod. you do any movement it tells you anything about agility. that's one of the new products. lebron will be wearing this during the olympics. and this fly knit shoe. this is the first time they've ever put one piece, a one piece upper, makes it much easier to

manufacture. but also, people who -- this is a marathon shoe, people who are using this, there's less friction over 26.2 miles. joining me is nike president and ceo mark parker. thanks for joining us. we've moved into the digital space with a lot of force here. >> yes. >> you have the fuel band coming out today. everyone who had their preorders, you put that on, and it measures everything. now you have this nike plus hyperdunk. how important is digital to the future of nike? >> incredibly important. for us digital is a part of today's reality. i think it's going to be embedded more and more to every product that we create at some point. this is a really exciting time for us. you were there at the fuel band launch a couple weeks ago. here we are with round two. round two is just the beginning. there's a lot more coming. but the idea that a consumer, an athlete can actually track their movements, and share that information with other athletes,

and compare and compete, there's a whole social aspect to it that's really exciting. >> they can obviously send it along twitter, along facebook. >> all of that. >> got to ask you this, i have never seen more excite for something that's already been out, and that is the nfl jerseys. >> oh, yes. >> april 1st is when you take over the deal from reebok. >> that's right. >> what can you tell me about the what is the -- how are the stores, the retailers reacting in the preorder stage? and how is it going to manifest itself on april 1st, are you going to open the boxes and show the public? >> well, first of all, inyesterdaybly excited about our relationship with the nfl. this is obviously a big focal point for nike is american football. one of the most popular sports in the world, but certainly here in the u.s. we've been very involved with collegiate football, innovated at very high level. the uniforms are lighter, better fitting. the athletes are really excited

about what we're going to bring to the professional game. so incredibly exciting. people are wondering, what are you going to do? are you going to get crazy with the uniforms? i think we're actually going to have some fun but respect the tradition of these teams at the same time. >> i want to talk about europe in general, because we know when we see those future orders coming out and we look at the world we see that europe is reflective of the world right now, in terms of, you know, having a tough time. does bringing the olympics to london, do you feel you can help jump-start that economy? >> yeah, i think the summer of sport, you've got the olympics and you've got the european champions on top of that. so between those two major events, which by the way are global events, the energy that we're going to create, i think, is going to be huge. and that's going to be a big factor in getting consumer confidence going again. it will ultimately, the best thing that we can do is create really great products and then celebrate the great moments in sport. and there's nothing like that to get people excited. >> speaking of the great moment in sport, we have jeremy lin. you guys signed him to a

three-year deal last year. if there's one knock on nike it might be that it lacks the agility of like a quick turnaround. you can't make a quick shoe and air freight it and have the whole thing. so, tim tebow you had as well. not really the quick strike. what can you say about what you might do with a jeremy lin situation going forward and if he turns out to be the real deal, how big is this for your business potentially in asia? >> first of all jeremy is a fantastic story. this is one of the things that we love about sports. amazing. every kid fantasizes about coming off the bench and doing what he's doing. absolutely amazing. jeremy has been with nike for several years. since he actually came out of college. so yeah, lots of opportunity. i think he surprised himself. he certainly surprised the world. and we're going to be ready. >> mark parker, ceo of nike, thanks so much for joining us. carl i'm going to test my 0.0 vertical in these nike hyperdunk

pluses. back to you. >> if you can keep your concentration -- you can keep your concentration during that interview in that room with people jump-roping behind you, darren, i'd like to see you in those shoes. >> could you hear -- i hope you could hear the interview. >> yeah, we heard you. darren rovell in new york. thanks. keep those tweets coming. google is reportedly developing these glasses that will stream information to your eyes in realtime. $600 price tag. so we're asking you to complete this sentence, if google's going to invest in high-end glass, it better be able to see blank. our twitter handle @cnbcsquawkst and we'll get your responses after a short commercial break. ♪ ♪

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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 squawk on the tweet. we've been talking about these glasses that google is supposedly making that will stream information to your eyes in realtime. so we're asking you to complete this sentence. if they're going to invest in high-end glasses it better be able to see blank. ian writes more than the google search home page. ed tweets streaming facebook updates. oh, that would be terrible.

and if google is going to invest in high-end glasses it better be able to see when politicians lie. now there's something, rick santelli, that people might be able to make some use of. >> the problem is it's going to be the only thing they see 24/7, i think. i personally like to see, in those glasses, a game one of a world series that started out in wrigley field. but, you know, that would be my call. i was going to say, between that comment and your one about the new is it the budget's going to need the hand of god? you're on fire today with the oneliners. >> i'll tell you what i wish i wasn't because truly, illinois has such a serious underfunded liability issue. many states like california do, but illinois seems to be leading the charge. and there's so little frankness regarding how to take care of it. you know, some people said they may have to double property taxes that means they'll