♪ now we're going to move slow >> good morning, everybody. welcome to 0 "squawk box" here on cnbc. >> they're showing me. >> you're supposed to move your lips. >> your name but they told me to read it. this is like the start of the show. >> i'm having problems. this is my fault. i'm becky quick along with joe kernen. andrew ross sorkin is off today. i was trying to put the microphone on and didn't do it right. >> because you would be the last person -- >> steve liesman is here today. >> you're a sit-in, you're a sub. >> you wouldn't want me to be leading the show. it was like click. >> this is my fault. it was my fault. >> all right. good job. good job. who is it? is it paul? he's our good director. >> would you stop. >> the other ones aren't watching. >> good morning, becky. how are you? >> is paul here? i didn't hear. >> yeah, that's why i said it. >> but we love paul. >> he's the good one. >> we'll head to athens and check in with michelle to find out the latest on the ground.

first jobs. this is our big story today, the february employment report is set to hit at 8:30 eastern time. forecasters polled by the dow jones say the economy likely added 213,000 nonfarm payroll. the employment rate is steady. and if the forecasts are accurate this would mark the first time since early 2011 that payrolls have grown by more than 200,000 for three months in a row. that's pretty significant, right, steve? >> the way i'm looking at this, i think this is overstated. i think the actual trend growth is 175,000. >> that's not enough. >> i think it's been pumped up because of the weather, construction has added jobs. there are interesting things about seasonal adjustments that have to do with how the financial crisis is factored into the seasonals. ultimate ultimately 175,000 -- if it's at 220,000, 230,000, the trend is a little bit higher.

>> you never adequately explained to me the gallup stuff because it did come out yesterday, the day before. they do the same survey supposedly. now i don't believe they're going to be right. once this comes down, i figure we go down because of the trend. if we go up we'll have to say gallup -- >> i did promise i would look into it and i went to moscow. i looked at it a little bit last night. the surveys are a little different. the government has 60, gallup does it about 30. the government does it one week and gallup a month. we're talking 140 million people, trying to figure out if the number is 8.5 or 8.1. they're in the same range. i think gallup does a nice job

in getting there. the actual details are less -- i'm not sure anybody is picking it up. >> you had some remedial training in moscow. welch -- >> jack? nice. >> you said something pro-business or pro-capitalism and he said -- he didn't have enough exclamation points to ask me what happened to you. >> how am times have i said -- >> i think you told me this story one time. >> yesterday or the day before you were solidly with someone -- >> on the notion of -- >> it was yesterday. >> jobless claims and the effect of long-term unemployment. >> it was yesterday. >> the problem is it ruins your whole schick about the stereotype. >> it wouldn't be the rule without the exception. >> you told me a story, i think

it was you, steve, years ago about how in moscow it stunned you because when going to the grocery store here in the united states you look for the best produce, vegetables. in moscow they take a few bruised ones because they feel that's their part. >> that wasn't my story. the story i would tell is how i almost passed out in an american shopping center -- that was another story -- i would come back home and go into a publix down in florida and see all the tide choices, with the orange box and all the blue boxes and i almost passed out from all the choices. >> just from joy. >> just overwhelming. >> it is kind of a melancholy place, i think. >> i was very disappointed, joe. one of the things that characterized russia in the '90s when i lived there, there was always a hope they could make the change. then to see putin come in to do what he did, to steal this election, essentially keep the

competition off the air, and then be in the square, in red square, where they're on a microphone shouting putin, russia, i mean, it was a very eerie throwback to soviet times creating this cult of a leader. >> in russia, beautiful women, they populate all the modeling agencies in europe and here. escort services. >> i don't know anything about that. >> why aren't em happy wer? >> i think it's people. >> because they can't get thome toes. >> the difference between the czarist regime and the communist was only who was in charge. that leadership that has continually, and i use the word, screwed its people time after time after time and the amount

of money going into that country a trillion dollars a year and to see the level of public services is unbelievable. i was optimistic about russia for a couple hours after having dinner with stockbrokers and then i had lunch with misha and says, you know what, steve, just remember all those guys you are talking about who are optimistic about russia, they all have visas to leave the country. >> see, even the day after international women's day i'm still promoting women. >> international women? >> with my comments about all the russian models. because that's who i am. >> i have to read. great. this is important. now to greece. the government there securing a higher participation in its critical bond swap offer to reduce its debt and stave off an imminent default. this paves the way for release of funds from international rescue. michelle caruso cabrera, who else, is in athens and joins us live from there. michelle, is this enough? is this taken off the table?

>> reporter: it's a big question. greece still has a long way to go to get somewhere but they are probably going to get that loan. despite all the protestations, from all the bureaucrats in europe that no eurozone country was going to default, we have essentially had a country say officially we cannot meet our obligations. it's officially a restructuring but we know exactly what it is. here are the headlines of what you need to know. enough bondholders agree. that's going to force unwilling bondholders to come along on the deal. that is likely to trigger a cds event. isda meets in two ours everybody listen. walk back from the ledge.

in two hours they may still say this is not a credit event. somebody posted an anonymous question to the website. they're going to answer it. they may say no. the finance ministry has said they're going to impose the collective action clauses but until it happens it's not a credit event. weigh are told it will happen some type in the next several hours. once that happens we expect isda to say, okay, officially, this is a credit event. what are the lessons we have learned from this? the ecb is better than you. they are senior are creditors to everybody else. they didn't take the haircut. they're not going to take profits. they're going to make sure the profits go to the local central banks. they have been superseded by the european central bank.

sovereigns can do whatever they want. if you bought a bond under greek jurisdiction, the greeks changed the rules on you rheetroactivel. that's why now people pay a premium for sovereign debt. that's written under uk law because the greeks can't change uk law and neither can any other country in the european union. also, bureaucrats can't do magic. bureaucrats said no european member was going to default. they said this deal would be voluntary. we know both are not true although they deemed them to be so. they did not happen. so a very -- a watershed moment here, folks, as we look through what is still a progress, a movement through the european financial crisis. back to you guys. >> michelle, if isda decides, we expect if this is the triggered these clauses and isda, we expect, will eventually say yes, this is now a credit default

situation, what if they decide not to? how are we supposed to ignore that? >> reporter: okay. if once the collective action clauses are absolutely executed and done and isda still says this isn't a credit event, they will have chited harry kaer because they will have committed suicide for their entire market. let's see what they do. i don't expect them to do that. everyone involved in the process, the parliamentarians in the building knew that if those collective action clauses were imposed it would trigger a cds event so this shouldn't be a surprise to anybody. if they don't, it will be a big issue. >> michelle is the european

banking system long or short greek debt? it seems like the government has been acting like it's simultaneously both. we want to avoid a cds effect because it will affect the banking system and yet we want to write down greek debt because it will affect the banking system. i don't think it can be simultaneously both long and short. >> reporter: yeah, look, i think the french and germans went into this with the supposition their banks were long, right, and, remember, this was never really about helping the greeks. this was really about helping french banks and also german banks as well. does that answer your question? >> a little bit if it's all about the banks. the bigger question is, if the cds is triggered, who cares? >> reporter: yeah, look, at this point, yes, absolutely, who cares? remember how cds works, right? it's not like life insurance where you have to wait until the body is actually dead. it pays out over time.

so a lot of the insurance has already been paid. it's called extracting reversion. don't ask. >> i get it. >> reporter: a lot of hedge fund managers have already made a lot of money. >> nice work out there. a beautiful shot. in corporate news texas instruments says it expects revenue growth will resume in the second quarter signaling an end to the correction that has dogged the chip maker last year. ti now sees first quarter earnings at 15 to 19 cents a share below its previously announced target range. the company also cut its first quarter revenue guidance. starbucks is launching its own single cup coffee and espresso drink machine putting it in competition with green mountain coffee roasters which sells the k-cup, the home brewers that are out there. there are special starbucks cups you can get and that's why people sat up and took notice.

shares plunged on this news but the stock did regain some traction after starbucks said that it would continue to supply green mountain with those k-cups. shares of starbucks -- >> howard schultz is like steve jobs. >> up another 3.4%. >> it was in the teens. they were rude and trying to serve this stuff and serve quickly and he came back. >> i thought when he came back in he would streamline the whole thing. you can still get a lot of things you want. they figured out how to do it better. >> i can't believe how successful his retaking the reins has been. all-time high. >> when you go into starbucks coffee on your imac, that's the modern thing. >> and then you can go across the street and do the same thing at the other starbucks. >> what you don't do is go in

and read "the new york times." >> you might read it but it would be on the ipad. wouldn't be me reading. gail collins? >> she mentioned it. >> now she does it just to annoy people who mentioned she has said it 40 times. >> this is like the dog on the roof. >> it's almost kind of fun whyy. >> promised to do this in every column she writes. >> she is just a joke. i am embarrassed i grew up on the same street. >> did did you know her? >> i knew her family. >> really? >> especially in cincinnati. >> you need a reunion. >> oh, yeah. >> that would be great. >> i would drive around for eight hours. time for the global markets report. >> is that a threat? i'm kidding. >> a little uncomfortable with

that. >> i'm joking. >> ross westgate is on top of a land rover in lon done and ready to drive at 80 miles an hour. or kilometers. >> hi, steve, good to see you. all good times. great view on top of a land rover. we are flat here ahead of all these things that are going to break during "squawk box" hours. we have the euro group is going to decide -- they're meeting to decide on a collective action clause. it starts in 15 minutes' time. ahead of that stocks have hit their session low. we have had all the buying on this greek debt participation yesterday when stocks were up over 2.5% for the german and french markets. we are flat. xetra dax up five points. the cac is down and ftse mib down at the moment.

there are some standout stocks. lse shares up for the london stock exchange. a majority share in clearnet and a big loser in the conglomerate defense, some disappointed with operating targets. this employment report, what market makers said is collective action clauses get inserted and cds gets triggered. that will be good, of course, for the debt market of italy and spain. yields today are still pretty much contained. ten-year btps at 4.76% and in spain below the 5% mark. back to you guys. >> okay, ross. thanks. becky's sitdown interview with brian moynihan. did i say the director -- i said he was good, didn't i? >> he is. >> i meant less bad. >> he's great. he is great and you miss him. >> i will never live this down. >> one more time.

>> he's less bad. >> paul is wonderful. >> joe, thr people you need to be nice to. the director is one of them. if it if you haven't learned that by now. >> don't focus on my teeth. i just mentioned -- did they turn off my mike, too? >> if you didn't see this yesterday, a bit of college hoops. the fourth seed in the big east tournament which happens at madison square garden every year, cincinnati meeting the fifth seed but ranked georgetown 14th in the country in the garden. georgetown led 30-24 at the half and then check this out. the fast break with an alley-oop. to yancey gates. there was a steal. he look it down.

unbelievable. they looked nba ready. banked one in in double overtime. look at this. unbelievable. they play syracuse tonight in the semifinals at 7:00 p.m. this was double overtime. the lead story is no one is excited about college hoops. >> you beg to differ. >> you can watch it anywhere. people aren't going. that's the things. so many different media choices that they're not going into the stands. you were just there. didn't you see fordham play? >> fordham and harvard. >> harvard is in. >> i was told jeremy lin was in the stands at that game. americans are always ready to work hard for a better future.

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welcome back, everybody. let's get to our newsmaker of the day. we sat down with bank of america ceo brian moynihan after he spoke at a citi conference. we got the chance to talk from housing to the economy to when the bank actually plans to issue a dividend. we'll bring you pieces of the conversation throughout the morning but yesterday as you know if you watched "squawk" was international women's day and bank of america has new initiative to train in developing markets. listen in. >> we have been leaders in

diversity among financial institutions, and so you put all those things together and we have a nice partnership to help develop that leadership around the world. now how do we do that? we have global ambassadors. we bring in talented people like yourself and mentor these women to help them develop. i got to see in action last week and you had a marvelous thing -- >> in haiti. >> in haiti. and the women there in ten years. last week they had a group of women together and we brought in ambassadors from all over the world of incredible stature and they mentored the women and presented the president of haiti with all the things they need to a different infrastructure, et cetera, et cetera, it also had a plan to address violence against women. the women ranged from people, one of the candidates from prime

minister to a woman running for mayor. these are very powerful women but the mentors can bring them up and it was really quite something to see. >> what's the long-term plan with this? as you continue to see new leaders emerging, what do you hope? >> we as a company believe that opportunity has to be in every person. nobody should be held back by who they are, what race, sex, whatever they are. that's what we believe in. this is a chance to help enable them. >> in the next half hour more of moynihan's comments. we'll get his thoughts on bank of america's legacy assets and the costs associated with that especially countrywide. let's find out what the pros are expecting. david kelly at jpmorgan funds, joe of td ameritrade. let me start with david. what's your number and why is your number? >> we're looking for about 200,000 jobs overall, about

220,000 private payrolls. unemployment rate probably holding 8.3%. that's what the models are saying. i think the low level of unemployment claims does suggest the market is continuing to improve. as you know very well you can get a lot of surprises on the day. >> and what about the unemployment rate? has the decline in your opinion been for real or a statistical be aberration? >> it does seem suspiciously fast. the one thing really interesting is social security disability benefits which have been soaring in the last few years and of course if you're on disability, somebody calls up and says, are you looking for a job? no, no, no, my back is out. if people are moving to social security disability benefits that may be whittling away at that measured unemployment rate. >> what is a tolerable number for the market? if it's below 200,000, how big a blow is that for the market? >> i think we will have an adverse reaction to that.

the number that concerns me more is how they adjust. if they adjust last month back under 200,000 that's a much bigger concern than what comes out for the number today. i think that we have all seen the last few months the headline number has been as good or better. we will see the same thing again. what everyone is afraid of is there may be some political pressure, whatever you want to see. eamon had that excellent report yesterday that perhaps the numbers will be adjusted down and a significant adjustment down interest last month. >> joe, i'm a little speechless. that was not eamon's report, it was about the government was concerned -- it was being leaked. >> one of the things we saw

yesterday is the spx. a big buyer of the 1390 calls on the close yesterday so with the conspiracy theorists and what he was saying, that would lead me to believe we may not see the adjustment i just talked about but everyone down here, as i said, that is their overriding concern. if that number is adjusted down, we will -- that could have a much bigger effect on the down side. >> david, could you respond to that? is it possible the government is adjusting the jobs number for political reasons? >> no. this isn't a political statement by either party. i have talked and worked with people from the bureau of statistics and the commerce department and haven't heard after single instance of them actually bending an economic report for either party. i don't believe they are biased. >> and do you see the trading around the numbers such that

there is concern, david? >> well, it could be or somebody has a model that's the best thing out there. i would like to see evidence of somebody getting accused of something before i say that. >> david, joe, thank you very much. the report as far as i could tell yesterday -- did you see that, joe? >> he was on our show. >> the idea there was concern but no actual evidence of leakage. >> although it sounds like from what i've read on people following up on his reporting he mentioned himself if you were slowing down that information to other computers. >> the slowing down was over at the energy administration information. that was energy stuff where there was an accusation, i think, about somebody slowing down but i think there's all these reporters together and it all comes out and they punch the button. the thing that's interesting

there are programs that read the wire headlines. >> and trade off of those. >> without any human intervention. by the way, can you judge which way the market is going to go? is it always apparent to you? >> nothing has moved anything this week. >> right. >> because everything is coming in line with expectations, too. >> i'm not sure if you had the information ahead of time you would make the right trade. >> unless it was a big -- >> or about big upset relative to the consensus. all right. when we come back, bank of america ceo, brian moynihan, more why he is confident the firm's legacy costs should peak in the second hatch of the year. plus his father is a well known face to "squawk" viewers. he is a business leader in his own right joining us live with an interesting jobs indicator.

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take control of your portfolio today. trade commission-free for 60 days, and we'll throw in up to $600 when you open an account. it is jobs friday. our next guest knows about the state of employment firsthand. jonathan kraft of the can kraft group and president of the new england patriots. at least i don't have to ask you if you want peyton manning. europe the only guy i have to ask. you don't need peyton manning although he's like a manlier type guy. if you wanted to replace tom, someone who didn't have the hair and the wife intervening all the

time, you could do that. >> as long as peyton goes to the nfc we'll be ecstatic. he's a great guy. >> i'm kidding. brady is unbelievable. long hair, short hair, i don't care what he does. he's a beautiful man. the giselle stuff got a little crazy. >> yes. >> you are running kraft which, first, explain to everyone what your main business is and why it may be a leading indicator for job growth. >> our core business is in the paper and packaging field, corrugated boxes. we see it from big fortune 500s. literally some customers buying tens of millions, others tens of thousands of dollars of product across all spectrums, industrial, consumer, luxury goods, finished manufacturing component parts, everything. so i think we have a pretty good

view of the entire economy. >> i love that corrugated boxes. there's an i-75 indicator if you count the trucks around i-75. that works, too. this sounds really good. back in july there have been times in the past you were feeling something and could see it reflected in the labor reports. >> late last spring we saw middle of the spring, late last spring, we really saw things after a strong beginning of the year take off. and what took place last year was foreshadowed by the corrugated box demand. i think that's true. >> and then december and january things were better than you weren't surprised to see the jobs report, right? >> our industry is pretty level. there's not a lot of seasonality

to it. the only time things dip down is the second or week, the christmas backlogs have been fulfilled and the end of december was much stronger than usual and even the beginning of january. that was an anomaly seasonally and we saw it reflected. >> now, unfortunately, you say you're back to normal. no more spiking. they didn't necessarily subside but would you say it decelerated a little in the last month? >> i think it's decelerated from the pace we were on at the end of december, the beginning of january. it in no way has fallen off dramatically and the one thing that has happened is there's been sort of a bifurcation, food products, pasta, beverages, those types of things, produce, has actually stayed pretty strong.

has dropped off the last four or five weeks relative to where we were but in no way a disaster. the more moderate pace, the spike happened and now they're getting to levels of stability. but the food area has actually stayed pretty strong. >> so, john, don't fault me here but i'm a new york fan, trade and true, baseball, basketball, football. but i have tremendous admiration for boston. i wonder if you could just in a nutshell tell me -- i was just looking up, boston is not even in the top ten of big cities. every year in nearly every sport boston is giving new york a run for its money. what are the economics of that? how does boston, a 20th market or whatever compete with new york so consistently and so w l well? >> with a we don't have in our pockets we have to make up for with our brains. we have harvard and mit and umass and bc and bu. >> that's sweet. >> boston is the number ten msa.

new york is number one. >> that was sentimental. you don't remember bucky dent -- >> i do. are you kidding me? >> remember what happened with buckner? through his legs. remember the patriots when they had that old -- >> right in the sweet spot, joe. it's an amazing sweet spot. >> people suffered in boston for years. >> i know that. >> for years. >> you have the boston celtics. >> the red sox. jonathon, tell him. >> we had larry bird. but for a while there was a long drought. >> 26s a 20-year drought. steve has the intellectual capacity. joe, you're nor flash. >> oh, well thank you. the people's republic of cambridge is where he belongs. >> how hard from a football

perspective is it to compete with new york? i know there's salary cap stuff that evens things out but is it difficult given the economics? >> no, football is a total different model where all of us, whether you're green bay, new england, kansas city, new york, we are competing on spotting the talent that fits our system. that's the beauty of the revenue sharing model. it's about the competition on the field not the competition generating dollars and that's what separates us from everyone else. >> who do you least want to see peyton manning go to? miami, the jets? >> becky, anybody in our division would be bad because it means we have to see him twice a year. while i think our guy is far and away the best to have ever played the game, the number two quarterback in the league and one of the greatest all time is peyton. we've seen plenty of him and

would prefer to see less of him. i know him a little and he's a wonderful guy. we would rather see him in social settings. >> i'm glad you're calling me flashy. every time they show your box you're high-fiving steven styler on jon bon jovi. now who is flashy? >> joe, i'm just gjealous becaue my father talks about you like a son. >> you know what i was going to say? do not think you are going to replace bob. you were great today. we're not passing the mantle. we want him to come on a lot, too, and you. >> joe, he's all yours. i could never replace him. >> the first father/son guest hosts. have you done that before? >> i don't know. jonathan, we appreciate it. thank you. >> thanks, joe. take care. >> it's weird what he said sort of alliance with gallup because gallup said it would definitely 8.3 or low 8s in december or january and it definitely went back up to high 8s or 9s.

when we come back on "squawk," brian moynihan's first on cnbc interview. his thoughts on mortgages, foreclosures and much more. [ male announcer ] how could a luminous protein in jellyfish, impact life expectancy in the u.s., real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing.

coming up, we have more of our conversation with bank of america ceo brian moynihan, plus, the ceo of the best performing s&p 500 stock last year, windham worldwide next.

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welcome back, everybody. bank of america has reportedly struck a side deal that will allow it to reduce penalties and return for bigger cuts to borrowers' mortgage balances. b of a will make broader cuts and last night i got a chance to catch up with ceo brian moynihan. we talked about the expenses related to the legacy assets especially when you look at the countrywide unit. moynihan says those costs should peek in the second half of 2012 and here is why he's so confident about that. >> at the beginning of 2007 we had 1.6 million 60 plus

mortgages we were working on that were delynn quest. at the end of the year about 1.1 million. that's coming down. what is causing us to still weak over are all the new programs we're putting in. that all is going through the system, implementing the new settlement. that's why we're comfortable at it peaking. that is the operating expense. the operating expenses were comfortable because the 1.6 million is down to 1.1 million. so long term if i slow down the front end and am moving through the system i can get there. it will take all of this year and all of next year before we get more after normal setting. >> the fed is saying it doesn't expect to raise interest rates until 2014. do you think that's the case base d on what you've seen in te

economy? >> we're seeing the economy being more constructive maybe than people think. whether it's then or slightly less than, it doesn't change what you have to do now. end of '13 or beginning of '14, what are we doing about doing a? that's the question. so, we started a while back moving down expenses two years ago. so, if you think about, this is not new, the low interest rate environment. it's been going on. what do we do? last year we met and closed branches and customer behaviors change a lot. the transactions going to the phone. and our job is managing expenses in that regard and as rates come up, we'll make more money and the consumers really won't pay any more money. >> we have the stress tests coming up and i'm wondering if there's anything you think the fed shouldn't make public. are there other lines that could put the banking system as a whole in any sort of question? >> you've got to put it in context of what they are testing

which is a very draconian situation for the purpose of reporting how strong our industry is. when i talk to the conference today, showed what we looked at in 2008 as we went through the first stress and early 2009 we raised money versus now, twice as much equity. not a little bit more, twice as much equity. $300 billion, and we're not -- everybody's like that. and so i think this is a chance to show how strong the american banking industry is. so, the disclosure, you know, we always got to be careful because it gets into future projections and there's concern about that and people should be concerned. but the reality is it will disclose the stress scenario and we can absorb it with housing down 20% and unemployment down, if it's happening today, not out in the future. that's a very stressful scenario which frankly this industry has capitalized on it's a pretty powerful statement of what's gone on in the last couple of years and our country should be happy about it. >> especially europe.

>> that's the question. we capitalized our industry. we had excess in our industry. we had to make changes, for the people that run the business. but we brought the risk down. we brought the capital up and brought the liquidity up. but the resilience of america, in 2009, 2010, that doesn't mean europe shaking doesn't make us all concerned but think of the tough times in capital markets in the latter part of last year, we made the revenue, you had stressful situations that we had. >> i know today you did say that you had not asked the fed if you could return capital to shareholders in the form of a dividend, but i wonder if you know what the hurdle is what you have to get to before you would be able to return a dividend. >> i don't. the responsible thing for us to do is keep getting the balance shape in better and better shape and build capital fast. so we went from 8.6% tier one common third quarter to 9.6% or 9.8% in the fourth quarter.

think about that in a quarter. other people move 23 basis points. our job is to keep moving up like that. >> we'll have more in the next hour when we talk about the consumer and broader economy. first, though, it's been three years since the march lows of 2009, the s&p has recovered nicely, but the real winner is wyndham worldwide, joining us is the company's chairman and ceo steven holt. and steven, why don't you talk to us a little bit about what's happened over this period with you coming out on top like this? >> well, good morning, becky, and thanks for having us on today. it's been a great run since the -- since the bottom of the pit a few years ago. i think it's really been a result of great execution. frankly, we have a terrific team. we've been executing on what we said that we would do, and we've seen great interest in the stock obviously. i think our story was relatively new back in 2006 we went -- we went public in the new york stock exchange and since then it's been a process of getting people to know us. i think that momentum is

still -- although we still have a long ways to do. >> stephen, what did we learn about the economy from your okay passy rates and the room rates and what did we learn about business travel versus leisure travel right now? >> 12, we are largely a leisure-based business, we're a hotel company but also we have a timeshare business. we have a large vacation rental business. so, i'll speak mostly to the leisure traveler. and the leisure travelers has been slow and steady growing. it's been exactly what we thought it would be three years ago. we saw improvement and we've been seeing continued improvement. so, it is pretty much what we expect to see going forward as well. >> let's talk about what you're doing. you're buying back an enormous amount of stock. you're kicking off tons of cash flow. tell us what the plans are for the future in terms of additional buyback i guess if you could buy back any more, right? >> certainly we could buy back more. we're producing about $600 to $700 million cash flow a year, and we're really to lever ourselves up to keep ourselves to the investment grade rating.

all total we have about a billion dollars of cash flow each year. one of our priorities is to invest in the businesses through m & a and also to buy back stock, and we bought back $900 million last year and we're not afraid to buy back stock. >> you are not worried about the free flow out there that maybe you bought too much of it back. >> no, i think there's a lot of ways to deal with that. the fact is as long as we look at the intrinsic value of the company, as long as we feel there's a decent upside for us and a good return, return, it becomes an attractive investment and our m & a activities. >> did i read that a quarter of your business is overseas or is that just in europe? can you tell us how what's happening in europe right now is affecting the bottom line? >> sure, we have about 15% of our businesses out of europe and largely that's the vacation rental bils. it's a very large business in europe. it's a business that consumes

about 30% of travel in europe is done in the rental product. it did well during the last downturn. we're cautious about it this year. we've said that from the beginning in our calls with investors that we're being cautious about 2012. we haven't seen anything yet that would change that view of caution. but it's a product that europ n europeans love. they love the usefulness of a cottage, a home, a villa, there's a lot of intergen rational travel in europe, so it's a very popular product there and becoming much more popular here in the u.s. as well. >> stephen, thanks very much for joining us this morning. >> thanks very much, steve. >>hrp>ñkc1a÷ interesting story. quick break, we'll welcome our guest host for the next two hours, ken rogoff when "squawk box" comes right back. ttd#: 1-800-345-2550 at charles schwab, we believe your money should be available ttd#: 1-800-345-2550 to you whenever and wherever you want. ttd#: 1-800-345-2550 which is why we rebate every atm fee worldwide. ttd#: 1-800-345-2550 and why our mobile app lets you transfer funds,

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the state of housing and the consumer from bank of america's chief. >> my job is to start the shrink the risk and move forward. consumers' health has been restoring and they're continuing to drive the economy. >> more of our special sit-down were ceo brian moynihan. the final countdown to the february jobs report. ♪ it's the final countdown >> the fallout and all the ramifications for your bottom line. ken rogoff shares his shthought on the economy and the labor market. it's time for a "squawk" trade-off we've got experts following oil and the dollar for you to stay ahead of the game. the second hour of "squawk box" begins right now. good morning, everyone.

welcome back to "squawk box" here on cnbc. i'm becky quick along with joe kernen and steve liesman. let's get to your morning headlines on this jobs report friday. the way is now clear for the release of a $172 billion greek bailout package. a bond swap deal that leaves private sector investors with sizable losses drew an 83.5% participation rate, but so-called collective action clause will be enforced to force others to take part as well. we'll have more details at the bottom of the hour. and starbucks is shaking up the single serving coffee market. it's introducing its own at-home system which will compete with the keurig machine. starbuck jumped after hours while green mountain shrunk. and today marks the third anniversary of the market bottom that followed the financial crisis. the dow and the s&p 500 have doubled since then. the nasdaq doing even better. american express, by the way, has the biggest gain of the dow

30 in that period, it's up nearly 400%. hewlett-packard is the only dow stock to register a drop. it's down about 3.5%. the futures this morning, well, things are at a dead stand still ahead of the jobs report. the dow is looks to open up 14%, and everyone is looking for the number that comes out at 8:30. joe? for the next two hours we're pleased to have harvard professor ken rogoff, as in rogoff and reinhardt, he's the author of the book with reinhardt that "this time is different." we'll talk about a lot of things, ken. i debated starting with greece and europe, let's start with jobs and what's happening here. i don't want to put words in your mouth, but i guess your basic thesis would be what's in the book, that the deleveraging continues. we've seen some good gains recently in job growth. but some of it you think might

be illusory or tough to sustain, is that fair? >> well, i think it's a long road ahead. i mean, what our book says is that it can take many years for it to hit bottom and it has. and it takes many years for it to come back up. so, i don't think -- i think we're sort of on a trajectory consistent with that, but we're not going to get a boom suddenly to getting 400,000, 500,000 jobs for several months which for a little while people were hoping. >> which would have been nice, whomever you blame or whatever you attribute it to, this recovery has been tepid and we're still down 7 million jobs from where we were and it's not going to come back in the next couple of years. >> well, i think that's pretty certain. >> that's bad. isn't it? it's going to be four or five years and we'll still be below the employment levels where we were before the crisis. >> some of that may never come back because some of the jobs may not have been real, but, yeah, certainly may be another two, three years before we've

hit normal, whatever that is. >> but you think that part of the gains we've seen in employment and part of the drop in the unemployment rate has been due to participation rates or due to, you know, some improvement some places but uneven and unlikely to continue? >> no. that's too strong. >> okay. >> i mean, it's likely to remain uneven, volatile. there will be some ups. there will be some downs. i mean, i think we or a trajectory towards a slow recovery. >> when do we get over 8% -- or under 8%? >> well, i think that depends as much on the participation as rate as how many jobs although that's definitely a big piece of it. i think it will be only after the end of the year would be my guess that it will slow down, and unemployment fall. >> we still have deleveraging to do in a lot of different places, but you do point out that there are some regions where the deleveraging has stabilized. like where? >> well, i mean, certainly the places that are really hard hit, the epicenter, you know, the

floridas, the nevadas, yes, they're still in trouble and the deleveraging hasn't happened. there are places like massachusetts where i live where it sort of looks like it's stabilized, but who knows? because you don't know what normal is. consumer credit has doubled, now it's gone down a bit. what is normal? we don't know. >> you said, steve, earlier, you know, 200,000 to 250,000 is optimistic. he says 150,000 is about average of what we're seeing and likely to continue. >> yeah, i mean, you know, we have a lot of short-term data that suggests it could be a little higher this time, but i think going at a pace around, you know, 150,000 is probably what to expect going forward for a while. >> do we break even at 150,000? >> i mean, if the participation rate's coming down, if it has, people going on disability and stuff. >> ken, there's been a lot of skeptics about this recovery and about the really strong numbers we've seen the last couple of months. is there a point where you say,

okay, maybe i have to reassess things? if the number today is stronger than expected, it's three months in a row. when we see four months in a row, five months in a row, when do you say there's something going on here? >> there are people trying to say there's a recession in the summer, people jump on that, we're in a recession. i haven't said that. i've said it's going to be a tepid recovery and it will continue to be volatile because of various uncertainties hanging around. i do think some of the unterritou uncertainties have been come about, but there's no doubt that europe has stabilized somewhat in the near term, and it helps with confidence. >> ken, what is -- >> printing money is what they're doing and that will work, right? >> yeah. we can agree it's a little more complicated than just printing money. but it has an element of that. there's no doubt about it. >> ken, what is holding it back, is it still the deleveraging and is there a way to speed it up or is it something that's got to

take its course or is it a policy think? >> i think the deleveraging is the big element. you can ask what should policy be doing to facilitate deleveraging, but i think deleveraging is at the heart of it and the fact that maybe things weren't quite as good before as we thought and you feel like the recovery has slowed and some of it's just gone. >> what -- i'll take your cue here. what should policy be doing to facilitate deleveraging? >> well, i mean, at the core of it i think it's still housing dead and foreclosures and having some sort of broader, more aggressi ivive write-down in mortgages with a quid pro quo, you give up the upside on your house and some percentage. >> you're saying the government should be involved in facilitating a clearing of the housing market, using government funds to somehow reduce principal? >> to grease the wheels of the deal. i'd rather see debt that way than debt the way that we're doing it. i mean, i think that would be reasonable. it is real complicated. there are millions of mortgages.

they're all a little different, it's hard -- >> but it's politically untenable, the thing that precipitated the santelli rant was the notion of helping out people on foreclosures and that really has -- >> it was people who you thought were living a little too freely using your house as a piggy bank when you did thinging t ins the way. >> it's tough to be a quid pro quo, there has to be something if you take a debt write-down you're giving up something on your house. i don't think there's anything pretty -- but you're asking what to do, what would facilitate things like that? there's no doubt. there's microeconomic evidence looking at different regions in the country that really underscore that the housing is a big future, the credit bubble and the housing, very differential around the country, yeah. >> but we're still living beyond our means. you even make the analogy to the excesses in the way we eat in this country. the debt is built up too much. we're living -- we're living too far into the future for what we're actually deserving, is that --

>> well, that's getting a little spiritual, joe, but i think there's no question there are a lot of dimensions of our growth pattern that forget about stocks, but, look, where our kids are in 20, 40 years that just aren't sustainable. and look at the environment. you can look at health, you know, the way our food habits and stuff. there are a lot of things where we sort of have this machine that goes forwards and needs to be tweaked now and then and the financial crisis is helping that. everybody's panicked. they don't want to do anything that hurts the short run, so there are adjustments that we don't make. >> when you answer these questions, ken, are you simultaneously thinking of chess moves? is it at the same time, that's what i want to know. >> i'm quite engaged, so i'm not thinking of ches. if i was bored out of my mind i would be doing it. >> have you thought about chess since you sat down here? >> if you get bored out of your mind, you will be thinking about chess. are you doing any more reports on -- >> on the economy?

>> keep it -- keep it close. let me ask you this, you don't think anything is going to happen, though? that needs to happen in 2012, right? >> i'm pretty skeptical that there will be anything beyond gridlock. if the economy slows down, we'll see some kind of stimulus deal. i don't know what kind. we'll see something. but it's hard to see the real reform that we need. i don't know if we'll have it in 2013. i mean, that worries me a lot. in 2012, it doesn't worry me, i just don't see it. >> it's interesting because you say the debt is -- you know, what we're doing is completely unsustainable for the debt. yet, you do want -- we need to invest in infrastructure, we need to invest. we need to make investments in education, infrastructure? >> i mean, obviously we do. this isn't just about the financial crisis. we're competing with china, with asia, again -- >> who do you tap, the government or the private sector? >> both. you know, our infrastructure is hurting. i'd like to see government investment that is at a

reasonable price. i live in boston, the home of the big dig. $20 billion to do something we could fly everyone around in a helicopter for what we paid -- >> is that a plug for government? >> well, it was not a good example, i have to admit. so, when we talk about infrastructure, because we like the big dig where i used to watch with my son and one guy working and five guys watching and policemen there, you know, on the weekends, and it cost a fortune or will it be something for efficient? >> like what? >> yeah, we don't have anything. >> are we seeing an obviously example of results of austerity in europe, yesterday the ecb do minus 0.5 to plus 3 where in the u.s. we did spend a lot of money and did a stimulus plan, the outcomes are much better, 3%, 2.5%, is that a lesson for us that in the middle of the crisis austerity is the wrong move? >> countries like greece and

spain and italy and portugal, there's no choice. they're getting money from the ecb directly or under the table or one way or the other. they were living large. now they can't borrow as much, they have to have austerity. there are countries like britain, united states, germany, there's a choice, how much risk are we going to take. how much are we going to let the debt go up. i'm certainly of the thought and i can implicate carmen reinhardt as well that we don't want to do anything panicked to bring down the debt and deficit, it happens slowly. but don't think that it's a free lunch that you just keep printing money, there's no risk. there's a slower growth ramification to have. >> but to this point do you approve of the u.s. model or the uk model? you know, obviously what we do here is different, but what would you have done to this point? >> well, the uk had a deeper financial crisis than the u.s. did. they had a different structure. they had a lot of government jobs built up before the crisis. we had more private sector jobs built up. their financial sector is a

bigger. i think the uk policy's been pretty good, really, i mean, you know, you can disagree with little things, but i agree with it. and the u.s. maybe the fiscal stimulus might have come off quicker. >> all right. living large i think you should use that to describe what i was trying to describe earlier. that people are fat. they're large. they got big cars. they got big houses. they don't -- you know, they're carrying forward a lot of work and earnings and, you know, the stuff that we don't deserve until 2020, right? >> well, if you really want to take this analogy -- >> living large. >> -- my spouse has a kids' cooking show on tv, and a theme of it is certainly, you know, that i learned from it that there's certainly a lot of analogies to the financial sector where the corporations, you know, encourage certain kinds of eating that isn't that healthy. the regulation doesn't stop it very well. it doesn't represent the consumer. you could look at a lot of

things going in the way our country is run where you could have issues with regulations. >> supersize me, cheesecake factory and you look at the portions and people were buying houses at 8,000 square feet. >> that's people's choice and it's fine. but it's the terms of what the regulation does and our education as well. >> living a little less large. >> he's dreaming of pecan pie. >> you are accusing me of chess and you are dreaming of pecan pie? >> any kind of car. >> we got a lot more coming from ken rogoff, very happy he's here, comments and questions, follow the show on twitter, atsquawk@cnbc. and the latest on the successful greek bond swap, and the ceo of career builder matt ferguson previews today's jobs numbers.

the other office devices? they don't get me. they're all like, "hey, brother, doesn't it bother you that no one notices you?" and i'm like, "doesn't it bother you you're not reliable?" and they say, "shut up!" and i'm like, "you shut up." in business, it's all about reliability. 'cause these guys aren't just hitting "print." they're hitting "dream." so that's what i do. i print dreams, baby. [whispering] big dreams.

its recent troubles aside bank of america is obviously a hugely dominant influence in the banking industry. it touches on one of every two american families through its businesses. last night we caught up with ceo brian moynihan and asked him about the state of the consumer, the housing market and the economy. take a listen.

>> what's consistent with multiple months in a row now going on for a couple years i've been talking about it, it's been the thing, you think about it, consumers are spending about 6% more on the credit and debit cards february 2012 versus february 2011, and that's been pretty consistent. a lot of people are talking about gas prices and you are seeing an increase in percentage of what they spend. overall there's been reasonable spending by consumers. spending on discretionary items and so we're grinding forward from a consumer's perspective. then on the fees and credit cards and all the things we worried about two or three years ago, you continue to see delinquencies coming down and there's a healing process going on and the consumers who made it through are in good shape. there's high unemployment and as a country we got to work on that issue. when you think about it the consumer health has been restoring and they are continuing to drive the economy. >> is it a fairly steady move, there are people that are

worried in the last couple of months we are seeing a pullback. >> we didn't see it honestly. the november, december, january statistics year over year, they will ebb and flow, we saw no difference. and everybody is worried about the fallback, the consumers' behavior, not about europe, but the consumers, we didn't see the change. >> what about housing? we've had a number of people come on our air recently including warren buffett, donald trump, bill ackman, who said individual homes is a great place to be right now, if we haven't turned the corner we're about to very soon. what do you think? >> i think -- i think that the housing market continues to heal. you see delinquencies come down in portfolios. when a property is available for sale, it sells relatively quickly. now, prices, you know, there's lots of debates about whether 1% or another percent, you think about the context in how far they've come down, the 30% or the next 1%. so, it's stable. >> when you look at country wide, is there ever a point

where you wish you didn't have to deal with it. >> well, that would be unfair because, remember, hundreds of mortgages, the american household, and working through this process, i think it's actually leave aside the financial ramificatioramificatik it's good for us to work with the borrowers. i think people have different opinions about how fast and how slow, we're trying to do the right thing. we've hired 45,000 people to do it. but it's been a very difficult thing and there's no good outcome out of it in the sense, you know, that it's a very difficult, stressful time, think about that in the broad consumer franchise and brands, but think about it, it's moving forward. as we have reached various accommodations and settlements and stuff, you are starting to see us move forward. i think it's still in mind among the policymakers that we've got to move this forward because the only way to get to the other side is to actually get there. you don't want to rush it, but you want to move forward. >> i understand that from the people perspective and the

people you are dealing with every day, but this was an acquisition made before your watch and you're left to deal with the mess. is there ever a point when you think you'd be better off without countrywide from the shareholders' perspective? >> there is no way if you know that now that you would have take that much risk, the question is what did people know. so, the work not only is it the financial end, we spend, you know, from our shareholders' perspective we spend $2 billion a quarter operationally, and so that's upside from here. but it's a reality where we're at. so, you'll never get anybody to say it was a lot of -- you know, many multiples, it's a difficult acquisition, but my job once we got ahold of it was to start to shrink the risk and move forward and frankly restore the brand and the profits of what we do for people in housing which been has been a good fix. >> if you take a look at the chart of bank of america it was the worst performing dow component last year but it's been the strongest one this year, one of the worst last year and through february it was the

strongest dow component, $8.10 is where the stock is trading. coming up we have more from our guest host ken rogoff. and the dollar and the equities ahead of the jobs data. we'll be right back. i had a print out of how many hours i have actually put in over my career. and it's 168,000 hours. so just think, if you had an 8-hour job, i'm like a man of 100 and something years old. i've worked very hard to support my family. and i finally reached that point where i'm going to retire. ♪ ♪

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let's check on the markets this morning. looking at the futures ahead of the big jobs report. we're usually treading water. it's pretty much where we are. dow up 14 points. looking at the fair value board. there's the s&p, pretty much unchanged. oil has been on a pretty wild ride up 106, i am noticing $4 gasoline when i was driving to work. we are at $106. brent crude heating oil, down a little bit. u.s. treasuries down 2%, down below the 195, 198 range and looking at currencies, the dollar, pardon me, is stronger against the yen. it is weaker -- stronger against the euro and gold is at 1,700 mark which it's been quite a while. can't seem to make up its mind, joe. >> yeah. >> either way. it can't go -- what does that do for people that are sitting on gold? there's no return for them. >> or people that sat on it for

20 years at $300 but suddenly -- and we'll see, because people still -- we're supposed to be at $2,500 by now according to everybody and, you know -- it was a heck of a run, wasn't it? and people weren't satisfied because of $300 to $1,900. >> i want to talk to ken about this, but it's clear that nobody's theory on inflation has been borne out not on the hawks and not on the dollar. >> it's 8% if you look at -- >> yeah, if you change the numbers, right. >> well, you have to change the numbers. all right. i hope he's watching, because he'll -- he'll -- >> i'll take him on. i'll take him on. >> good, we look forward to it. qñl3íó trade, oil, and the dollar, and ahead of that report career builder matt ferguson what he's seeing in the labor market and the economy. at the top of the hour our jobs panel is ready to rock as we await the february unemployment numbers at 8:30, some of the usual suspects, mark

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welcome back to "squawk box." among the stories we're following this morning video game sales fell for a third straight month in february. npd reporting game software sales were down 23% from the same month a year ago. that was worse than expected but it was an improvement from january's 38%. hardware sales down 18%. analysts say the biggest problem a lack of any new compelling games, and i can tell you that from my kid, it's true. united continental purchased boeing dream liners, the carrier will use an $892 million purchase to fund through capital markets. greece is now on track to receive its bailout package following its successful bond swap. cnbc's international correspondent michelle caruso-cabrera is in athens with more. using the word successful really bothers me in this context.

>> reporter: yeah, i agree with you absolutely. the deal will get done, but think about what it means, water shed low moment for the european union, the first member of the euro zone to cry uncle and say we cannot pay our bills. the question is will it be the last? let's give you the details on the so-called deal. the debt exchange was successful, they tendered bonds to avoid a chaotic default but not enough to avoid imposition, collective action clauses, if you don't know what it means, it means the deal will be imposed on nearly all bondholders. we expect that will trigger a cdf event. in other words, the insurance if you bought it on greek debt will pay out. we don't expect to get an announcement about that from the committee that decides until after the deal is actually executed, which we expect in the next couple of hours. we were told sometime in the afternoon in greece and it's already 2:30 here. let's tell you some of the

winners and losers are when it comes to this. emerging market hedge funds. i know this isn't an emerging market in theory, but i can tell you that anybody who played latin america debt during the crisis in the '80s made a ton of money here because they have seen this movie before. all of my very best sources are people who were involved in the emerging markets in the '80s and the '90s, two years ago they were buying very cheap greek debt insurance because they felt what happened today was absolutely inevitable even when the european union was saying it was never going to happen. let me tell you who some of the losers are and it's a really, really sad story. greek pension funds. back in the '70s they passed a law here in greece if you are somehow connected to the state in some way, all of your excess cash must be invested or deposited with the greek central bank and they will buy greek bonds on your behalf. so, not like a pension fund in

the united states which will diversify its assets, try to achieve the best return, et cetera. during the heyday of the markets, they were receiving returns of 1% to 3%. well, they've now been told that they're going to lose roughly 50% of all that money and they are furious. they felt like they had no choice. many of them refused to actually tender their bonds. so, a lot of people like to complain about the banks, why should the banks get paid back. keep in mind a lot of the greek people have also j hurt very severely by this haircut. back to you guys. >> all right, michelle, you mentioned before about the collective action clause, how this will called in even though it was 86.5% that agreed, i thought it was 96% that got pulled in by the collective action clause in total it would bring it back up to that. i couldn't figure out what happened to the other 4%, who gets to skate around this? >> reporter: okay, there are two kinds of greek bonds you need to care about, greek bonds that fall under greek law and greek

bonds that fall under foreign jurisdiction law, most likely the uk. they created a new law just a few weeks ago and said we're going to impose collective action clauses on everybody who bought greek jurisdiction bonds. they did it because they could. because they can change their own laws. that wraps have been up into the deal. but that's not all the bonds. so, that little -- that last few percentage points that don't get brought in, those are the people who bought uk jurisdiction bonds and that's what gets you to the 96%, 97.5% of all the bonds out there. >> i knew you would have the answer to anything we could throw out there. thank you, again. michelle caruso-cabrera, who has been doing a bang-up job. we'll get back to her later. and let's get market outlook from the trading block, joining us is boris wasburg, and addison armstrong, and from the cme jim eurio of tjm institutional

services, and boris, let's talk about what happened with greece. this morning we've seen the euro showing weakness against the dollar and the speculation is that people are worried about exactly what michelle pointed out at the top of the report that greece was the first one to go into this, but are we going to see it from other european countries? is that playing out? the >> a little bit. it's also much more buy the rumor, sell the news. most of the rally in the euro happened yesterday because everybody saw this number coming out, so i think you are seeing profit taking. the biggest issue going forward as far as the risk trade goes what happens with the nfps, plus up until now most of the propulsion for the risk trade has been from the central banks. we had the rumor from "the wall street journal" that the fed may do qe, te beginning of the week we had the european central bank may lower its rate, and india lowered its rate and all the support has come from the monetary authorities and not economic data. economic data will be the next thing to make it or break it as

far as the risk trade going forward. the nfps concern me for three reasons. the index component of the fed survey was lower both of the ism's employment survey was lower and the small business survey said employment stalled. there's good reason to think that we may miss a little bit, i don't know if it's much, but it may be a little bit. it will put further pressure on the euro and strengthen the dollar. >> i have to think what you said to follow it around. the fed coming in with qe-2 could be more important than the miss so if we miss it could be a good thing eventually for the dollar? >> it could be a good thing -- if we miss strong and that really puts up the idea that the fed is going to come in and do q qe-3 in a sterilized fashion, it may be good for the dollar in the fact that the aussie dollar may rally. overall i think time has come to the point that the market wants

to see economic growth. u.s. is the primary driver of growth. market is looking now at the u.s. to be the primary driver of global growth. china is slowing and europe is a basket case and we need to see the next three or four months for the rally to be sustainable. >> jim, let's follow up. what does the stock market do if the miss is significant? if it comes inline, we'll see what we've seen all week long which is no real move in the trading action. if there's significant miss, does the market focus on that and think holy cow, we'll not get the growth we need or does it jump to the next point out and say the fed will help us with qe-3? >> i think number south of 225-ish, i think the market will be disappointed with, because we've come a long way in the stock market and we're probably in a spot where we could use correction anyway and it's looking for an excuse. the interesting point to underline his point is we know europe is slowing and we suspect asia is and this is pretty much what we've got, and it's a big

deal. all week long in the bond pits here and the middle of the interest rate curve pits here we've seen people putting on trades that will do well if rates go up, so all those people are looking for a good number to force rates up, i think they'll be disappointed if it's below 225, i think 240-ish is where people don't know what to do. >> jim, how much belief is there really in this number out there, the numbers we've had? i mean, as soon as the higher numbers came out, everybody starts talking about the participation rate being the real reason why the unemployment rate's gone down. you've heard a lot of people just saying, do you know what, it's not for real, it's seasonal adjustment. i'm not sure that the market has priced in 200,000 yet. i still think the market has priced in 125,000 to 150,000. >> no, see, i disagree, i think it's priced in more. as far as unemployment rate and participation rate, the market is not looking at that much just as job creation. you don't necessarily care how to interpret exactly where we have are in the cycle we just want to know what direction we're pointed and where we're going and if there's good job

creation the market can at least convince itself that things are going the right way and it needs that particularly in light of europe and asia. >> market's focused on payroll where as the politicians are foe focused on the unemployment data. >> with the expectations being set so high, is there any number that really makes the markets say it's better news than we expected and we're taking off to the races again? >> i think above 260,000 number to have it risk-on with no question marks that's kind of the way i feel about it. i think even a 240,000 or the 250,000 the stock market gets an initial pop but then it's maybe a sort of sell the news sort of thing. >> everybody should remember that the consensus is 210,000. >> 210,000. >> addison, let's talk about oil prices above $106, is this the new normal until we wait to see what's happening on the geopolitical front? >> i'm laughing and smiling, because we've been talking about oil, everything that jim and boris are talking about you can

put in the oil market because we certainly aren't trading on the fundamentals, you had opec, that's a bit of a misnomer, but as a freudian slip, but, you know, they came out and they cut their growth forecast for oil by 9% today. and the whole cartel's producing at a million barrels over their quota, the highest level since 2008. so, for me oil looks stuck here, and we've seen that this week as we've seen some of the long interest come out of the market. we've seen day in, day out, just playing with the previous day's ranges to try and get some sort of direction going here. but until we see some sort of real pick-up in demand, i don't think we're going to get it. >> okay, let me ask you this, if we see a disappointing number, a number that comes in weak and people say, okay, the u.s. is where we were counting on growth coming from and if we're not seeing it here, would that actually pull some of the premium out of the oil prices and how much would it pull? >> here's the difficulty, theoretically, yes, but the problem is that we've still got

this constant drumbeat of the iran crisis in the background. we've got the world awash in cheap credit from the central banks and in that environment it's very, very difficult for oil prices to go down. but i say again, we have seen some pullback from the long interest in the wti curve at least this week. >> okay. addison, jim, boris, gentlemen, thank you very much. >> thank you. all right, up next, he runs one of the nation's leading jobs search sites, career builder, ceo matt ferguson talks jobs in america. ♪ i'm making my money do more.

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welcome back. what industries are putting out the help wanted sign these days?

joining us to talk more about jobs in america, matt ferguson, ceo of careerbuilder. matt, first of all, give us the overall of what's going on in the jobs market there as seen through your company. >> hi, good morning, steve, good morning, everyone. yeah, what we're seeing in february if you just look at the top line number, the jobs on the site were up 19% versus last february and that's a significant jump considering especially last february was a good month for us and so we've seen numbers that are getting much closer to the 2007 numbers we had on the site which would have been the high point in february. >> and tell us where you're seeing the jobs particularly we see a lot of executives and a lot of other data insisting there's a tremendous jobs mismatch, that there are jobs available but not the employees with the skills for them. >> well, i think that's a real problem. i mean, the skills gap is something that is getting worse each month, not better. the jobs that we're seeing on the site are in areas that, you know, you would think in line with that skills gap. information technology jobs are

up significantly. jobs in health care are up significantly especially when you get into nursing and specialized medicine. i would say higher-end sales jobs are up significantly that require experience and specific skills to perform them. and so, you know, if you look across those areas. and then finance, i'm not talking about wall street jobs, i'm talking about generalized accounting and finance in companies around the u.s., we've seen those jobs go up. and one interesting thing, we're not deep in manufacturing, but we did see year over year manufacturing jobs were up 35% on the site. so i know on the bls survey last month they were up 50,000. >> yeah. >> versus december. and so i think that's a good sign for manufacturing as we look at the next couple months. >> hey, matt, one of the theories we've been trying to figure out whether there was some seasonality that really helped the jobs picture over some of the winter months when we saw weather that was a little better than had been expected. are you able to figure out seasonality at all based on the numbers that you look at?

>> the best way for us to do it is just, you know, compare versus last year when obviously it was a tougher winter. and i think that in just talking to employers and looking over, you know, quarter by quarter that the labor market has been strong. i think even last spring when people were more pessimistic about getting to ability for the u.s. to create over 200,000 jobs, we were seeing the job creation on the site. you know, we don't have as close a hand on maybe who is coming back in the labor mark and what the unemployment number will be, but we are pretty close to the job creation number. and obviously what you see on the site today will turn into the bls number in probably three or four months. so what i will tell you is i think it's been continuing to get better, that it's better now than it was in the fourth quarter of last year, that it's significantly better than the first quarter of last year and we expect in talking to employers it will continue to improve. >> what is 19% worth, 19% year over year, what kind of payroll numbers does that correspond do,

matt? >> it's hard to judge, i think it's better than the 210,000 jobs number, if it's not, it will be an outlier, what i think we'll get close to creating 300,000 jobs getting into the back half of the year, assuming you were talking a lot about greece and what's going on there and you hope at least it kicks the problem down the road. the u.s. continues to improve. and i think if that's the case, you'll see a labor market that's going to be each quarter better than it was a quarter before. >> hey, matt, this is ken rogoff, i have a question. how much of that 19% is simply that your business is getting better and so it doesn't actually mean the economy's getting better? >> well, i think especially when you look back versus 2007 there's been a secular trend where more jobs are coming on the internet that would -- >> right. >> -- impact that. i think when you look versus last year, there's probably some of that secular trend. but a lot of it is that there are just more jobs. i think if you go back to steve's point earlier, some of the problem is these jobs are coming open and staying omer longer because it's harder to

find that. you just see it in the overall numbers when you see the college educated workers have an unemployment rate of, you know, around 4% and someone without a high school education is above 13%. and then you dive into some of these specialties where you see these jobs being created. and the demand is there, but it's longer and harder to fill them today in those spots. and then where we have people who are unemployed, some of them don't have the skills to match to where the job creation is. >> all right. the answer was a lot of it is due to our business and management at careerbuilder. >> thank you, joe. thank you, joe. i appreciate it. i apprec yaiate that. let me call my board directors so you can tell them. >> three-quarters is probably the ceo. >> the ceo is it. ken was suggesting it's a trend. >> joe, you have to root for the bearcats in the tournament if you keep talking about that. >> tonight i want your support at least. >> you've got them against syracuse, you definitely have it. i'm from bloomington, indiana, so i'm from around there.

i'll root for them. >> it's hoosier country for sure. >> oh, yeah, we'll be back in the tournament this year, we're excited. >> i know it. i know it. good team. indiana beat someone, it was unbelievable. i can't believe it. they beat someone earlier this year. >> kentucky. >> yeah, they knocked off kentucky. >> it was a great game. last-second shot. >> awesome. all right. >> i just don't have a dog in this fight. i mean, division iii state school and they didn't have any professional -- i was going to say professional, high-level college sports. thanks very much, matt, we always appreciate you coming by and the numbers you provide. >> thanks for having me. great weekend, everyone. >> you see he's going public. >> who? >> you didn't see it? >> no! below that. >> offshore -- fender, fender! >> fender is going public. >> that's awesome. >> $200 million, stratocastor. >> i have a great stratocastor

that i bought in 1979. >> it was owned by cbs. >> i think mine might be before cbs bought it. this is an american-made guitar and it's fairly highly valued. >> buddy holly made it famous on tv before hendrix. >> they have great amplifiers. and up next, more from ken rogoff, the number of the month the february job reports, the all-star analysts are ready to go to tell you what the number means. ttd#: 1-800-345-2550 let's talk about the cookie-cutter retirement advice ttd#: 1-800-345-2550 you get at some places. ttd#: 1-800-345-2550 they say you have to do this, have that, invest here ttd#: 1-800-345-2550 ttd#: 1-800-345-2550 you know what? ttd#: 1-800-345-2550 you can't create a retirement plan based on ttd#: 1-800-345-2550 a predetermined script. ttd#: 1-800-345-2550 at charles schwab, we actually take the time to listen - ttd#: 1-800-345-2550 to understand you and your goals... ttd#: 1-800-345-2550 ...so together we can find real-life answers for your ttd#: 1-800-345-2550 real-life retirement. ttd#: 1-800-345-2550 talk to chuck ttd#: 1-800-345-2550 and let's write a script based on your life story.

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♪ that's our very own steve liesman serenading paula abdul from years ago. >> they keep coming back to this. >> we like it, though. >> the animal orchestra saves us. it was sheryl crow yesterday. and, yeah, i prefer -- >> you prefer the animal orchestra? >> what did paula say? >> she was very kind. very kind. she was very nice to me. >> i wish you had been playing for simon and i would have liked to hear what he said. >> that's what he said, that's what british people are on this earth to do, judge americans. let's get back to our guest host, ken rogoff, the department

of economics -- of the department of economics at harvard university, also author of the book "this time is different" is here with us. and, ken, we spoke with brian moynihan yesterday and he pointed out that in february you look at the consumer spending on the credit and debit cards, up about 6%. he said he hasn't seen any drop-off, that's been the case for the last four or five months and that's stronger than some people might expect, to continue to city that buildup. what do you make of numbers like that? >> well, it's certainly interesting, given the high debt and that there are a lot of problems in the country and people aren't very mobile in the jobs. it is striking to have it start reflating. i don't know at what point is sustainable. could it be weather related, too, i mean with retail sales? i don't know, but it's certainly an interesting learn. >> becky, when they revised personal income savings rates higher than we thought. and what's the right savings rate? we thought they were saving 3% and in the high theres a3s and

the mid-4s. >> we truly don't know. the models that the feds used it should have stabilized years ago. and people were scared. they want lower debt for where they were. what are they aiming for, we don't know. >> when you look at the banks or the credit cards, they do not have the same makeup of people that are using the cards four or five years ago. there are a lot of people that are unbanked and maybe it's a reflection of it. >> that's a very good point. >> it's still a very broad reflection of the economy but maybe it doesn't include everybody. >> uh-huh. >> all right. we'll think a little bit more by that. by the way, if you have thoughts pz on that as well. ken will be with us for the next of the morning. the best is yet to come. we leave no stone unturned when it comes to the jobs data. diane swonk, mark zandi, and austan goolsbee, professor of economics at the university of chicago booth school of business

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2012 presidential race, the february jobs report is 30 minutes away. we're convening a panel of experts to join our guest host harvard economics professor ken rogoff, diane swonk and austin gool sbe goolsbee, the third hour of "squawk box" begins right now. welcome back to "squawk box" here on cnbc. first in business worldwide. i'm joe kernen along with becky quick and steve liesman, andrew ross sorkin is off today. our guest host is harvard economics professor ken rogoff, it should be on the book. carmen's name is first, it should be reinhardt, rogoff.

>> it is reinhardt rogoff. >> all academic papers are alphabetical. >> this is a book. >> we saw it. >> you shouldn't range it, it's reinhart, rogoff. >> i think we actually have done that, though, that's what we've called it here the whole time. >> all right. well, anyway, it's nice of you to take a back seat and defer. it's the kind of guy you are. >> and you want to make fun of andrew, he traveled yesterday, off today. >> he's off next week. >> he gets on a flight and he takes time off. i didn't know if you wanted to make fun of him in dacase you we going to do that. >> am i introducing goolsbee? we are messing with people. because they looked like they were cloned. >> right. >> and now we're going to have them both on.

>> becky and i are right. >> people at home will be going, wait a second, what's happening? >> austan has a little less hair because he worked in government for a little bit more than mark did. >> right, right, right. all right, we're going to -- >> look at diane who has never worked in government. >> u.s. equity futures. >> my hair is getting longer. >> it's a 13-point gain, so what good is the percentage gain? i don't know. but there it is. up 0.1 percent. we should point out that the john claude juncker is saying the collective action clauses of greece will be triggered. we knew it was going to be the case. they got voluntary participation of 83.5% with those clauses being triggered, that brings them up to close to 96% and that means they can go ahead with this. so, that's been the announcement we've been waiting for this morning. we'll bring you more as it

comes. some of the other headlines on this jobs friday, airbus won 97 aircraft orders in the first two months of the year driven by airline demand for its narrow body passenger jet. by contrast boeing has sold 387 aircraft this year, a net figure of 385 after cancellations. in the meantime the sp reports that emirates airline will seek compensation for airbus superjumbo cracks. the airline is complaining of widespread disruption of an expected loss of revenue that came on top of this as well. and in washington news, senate democrats defeating a republican proposal to give a permit to the keystone crude oil pipeline. the pipeline would ship oil from canada to northern u.s. states to texas. republicans argue that it would create jobs and improve energy security at a time of surging gasoline prices. president obama put trans-canada's $7 billion project on hold earlier this year pending further environmental review. senate republicans tried to advance their plan as an amendment to a highway funding bill. but it failed on a vote of

56-42. >> 56, you had quite a few dems there. it had to get 60 to get it through. it didn't quite make that. >> right. the next round of u.s. bank stress tests those results are expected to be released in the next week or so. many of the 19 largest u.s. banks have been pressuring the fed to try to limit the information released to the same detailges that were published after the 2009 tests. this would not include projected annual revenue and net income. yesterday we spoke with the bank of america ceo brian moynihan about the latest round of stress tests and planned disclosures and here's what he had to say. >> i think it's a chance to show how strong the american banking industry is. the disclosure, we got to be careful bawms it gets into future projections and there's concern about that and people should be concerned, but it will disclose a stress scenario saying if the industry can absorb the stress scenario with housing 12% and unemployment 12%, today, that's not out in

the future at 8%, that's a stressful industry, and that's a powerful statement of what's gone on in the last two years and our country should be happy and proud about it, relative to other countries struggling with the core problems. >> we'll have more of the interview later this hour. the february jobs report less than 30 minutes away. we're in countdown mode witho austan goolsbee. i need to put diane between those two, and mark zandi chief economist at moody's -- there we go. austan -- >> can you move ken to his right? one move there? >> austan -- zandi, he's a good-looking dude. he gets a lot of mail from, you know, all different types of people, so this is not a putdown. you know that, right? you're okay? >> are you talking about me,

joe? >> i'm talking about you, austan. it's not bad to be compared to zandi. >> all i want to stipulate that austan had theegsj brett erbett. it commands attention. >> it does. >> joe, the thing is, first of all, we're disproving that we're clark xekent and superman whichs what you said before. the reason i have less hair is you give me a lot harder time when i come on here. i've been doing this a long time now. >> which all hearkens back to, you know, the government service that you provided. it was -- and we appreciate it, actually. but it's tough, austan, and you got to expect that especially when you come from university of chicago and, you know, and you were -- i thought you were, like, from university of moscow when you were at the white house. i'm kidding. >> i got a few broken ribs before i even got there from you! >> i helped get that studio at university of chicago. >> exactly. >> that's good. >> joe, how do you explain my hairline? i've never been in government. >> no. >> you're an adviser to mccain

campaign and then -- >> that will do it. >> we know that will get you there. we'll start with the better-looking of the two, austan, what is your number for what we're likely to see today? >> you know, i'm a little more pessimistic than the consensus. i'd probably say maybe 198,000 or something around there. i just think the gdp is not going to keep growing 2.8% so eventually the numbers aren't going to be as big as what they've been the last several months. >> and what about the rate, too? because that's the headline number that we've been using and, you know, everybody -- that 8% number by november is on everyone's list right now. >> you know, i sort of think the rate stays about where it is. i mean, we have had the household survey's been coming in a little stronger than the payroll survey, so maybe it ticks down a little. but i would -- i think i would guess it stays the same. >> zandi, i've been trying to

figure out why gallup is so sure that things fell off a little from january? do you follow? i asked steve to look into it and he keeps blowing me off more or less. why is gallup back at 9% and was there some slowdown versus january and february that you've seen in your work? >> well, you know, the gallup number's pretty -- at least with regard to unemployment is a pretty tertiary number, i don't think it's seasonally adjusted. >> no. if you adjust it -- >> it's a smaller sample. >> and they only started that, what, in early 2010? we really don't have much history, so i place very little weight on it. i mean, i think we're getting job -- i think austan's right that the numbers are going to eventually come on the softer side of 200,000. in part because we're getting juiced up by the weather. the warm weather is adding 25k,

30k to these monthly numbers. even if we continue to get gdp growth of 2.5%, 3%, i think we'll see softer numbers. given that, say underlying job growth distracting from the weather is 175,000, that's enough to bring down unemployment. we only need 125k in the current context to get unemployment moving south. it will go down month to month, but at this rate, unemployment is moving south. >> there's no people coming back? some of the big numbers, big graphs we saw, people leaving, no one ever does come back? there's no day of reckoning? >> i think they eventually will come back, but there's all kinds of crosscurrents going on right now. is with the expiration, the slow expiration of the emergency unemployment insurance program, that's also going to put downward pressure on the unemployment rate, because you'll see younger people who have taken longer% periods of time to find a job take a job. and older workers will leave the

labor force and retire. i think over the next year that will also put downward pressure on the unemployment rate. >> diane, all of that, i saw a lot of nodding. you think 200,000 or so? >> 220,000, somewhere north. weather's a big component. the first half of february was colder than the second half. i found myself in an elevator saying, oh, god, it's cold outside. and i thought unemployment numbers wouldn't be as strong. but i think weather is a component and i agree with mark and austan as we get further into the year and growth i'm looking at 2% in the first quarter 2.5% or so in the second quarter. this is not a boom year. this is still coming out what ken has talked about and we'll see unemployment slow. the unemployment rate maybe tick down a bit and the labor force participation rate, some of it is an aging labor force, not all of it, and all the younger workers are now accepting jobs. one of the things i've been working on with labor economists

is the cumulative effect, is they are accepting jobs at lower earnings, and not particularly in their field. >> you are talking about productivity one of the biggest forces out there. it slowed down a lot. we had unbelievable productivity during the first part of the recession. we were, like, living like the jetsons if we'd stayed on that same trajectory. >> it's good for job growth. >> that's my point. we can talk about all this stuff, the weather, construction, this and that, if productivity slows and output remains at the right level, you have to hire more workers. >> and we have. >> to mark zandi, how many jobs 2[f#ñhy%)e5uat be if we were, y know, undoing the productivity and people wanted to keep output at the same level? >> well, you're right, steve, i mean, the productivity growth has now slowed to half a point, 1% year over year. and if your gdp is 2.5%, 3%, it means you are getting more jobs. and i think that's one reason to

be optimistic even if we say 2%, 2.5%, we'll get jobs strong enough to bring down unemployment. because i think what happened is during the recession, businesses did everything they could to raise productivity. they -- they took everything they had on the shelf, took it off, deployed it. they cut a lot of workers and now it's a lot harder for them to gentlemen rate productivity gains. and moreover, they haven't been investing quite as strongly and the capital stock hasn't been growing. >> ken, you want to comment on this? >> while i think it's true, just remember we have an 180-year observation that productivity grows around 2%, so it may be over six months or three months or even the year that productiveproductiv productivi productivity's going to be slower, but i think if we're counting on that to get the unemployment rate down, i think that would be a mistake. >> what austan is saying is right there are the trend productivity gains in the month to month and quarter to quarter, you don't know what's going to happen. throughout the downturn

initially jobs fell a lot more than that it would look like they would from output and now they're rising faster than it would look like they would from output. and i think you square the circle that the output number's not as good as the job numbers. i think the recession was deeper than the official numbers because they don't account for medium and small-size businesses as well. and i would say if the job numbers are good, it's, yeah, it's coming -- that's the -- >> is the recovery, then, better than the numbers indicate? >> well, this moblnth if the jo number is good, it's better than the numbers indicate, but broadly speaking i think we're still deep in a hole. >> i think the gdp numbers will get revised up, i heard you talking about the saving rate and income. >> that's my feeling, mark. >> i think that's where we're headed. >> that's 2011. not the recession. >> 2011 the official statistic is gdp grew 1.7%, 1.8%. >> that's what i'm saying, i agree. >> it's hard when we agree, joe.

>> when we what? >> it's hard when we agree. >> we talked earlier honestly about getting a conservative person, you said maybe it would make sense, on the panel, right? >> i would like to keep all of these guys. >> and, austan, he said we should go to the university of chicago and get someone. and i said, we already got austan! >> all right, i'll do it. >> but you're, like, a rogue chicago guy. your ribs are fine. i've never given you a -- that hurts me. i just asked you, you know, questions, to allow you to show me up most of the time which is what happened every time i tried. anyway, we'll be back in a second. >> everybody is staying with us. we're going to be counting down to 8:30 a.m. and that february employment report. we'll get the final predictions from our panel of experts in just a moment. but, first, the latest from greece, our international correspondent michelle caruso-cabrera will talk to us after the break. and then we've got jobs and

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welcome back to "squawk box." let's get a quick update from greece the government there securing a high enough participation in its critical

bond swap offer to drastically reduce its debt and stave off imminent default and we heard from chairman joncker he's heard the so-called collective action clauses will be activated. michelle caruso-cabrera joins us from athens with more. michelle? >> reporter: i'm glad he read the press release like the rest of us several hours ago that he had to be informed that they were going to be imposed. i'll leave my snobby comments aside. what we're waiting for in the next couple hours is for the deal to be executed, i would say the physical exchange of the bonds but not quite right, the electronic exchange of the bonds, one that happens, the deal is exercised, and we expect to get an announcement from the body that carries out the credit default swaps, it's expected to, because as part of this deal the greek government imposed changes on all bondholders, that's usually one of the mechanisms that would cause a cds event and

we're waiting to see announcements from the euro group, remember, part of this deal includes 30 billion euros coming from greece's european partners to give 15 cents of sweetener, nearly cash, to every bondholder for every bond that they hold, so there's a lot of moving parts here. we want you to know coming up 11:30 eastern time, charles delara, the institute of international finance, is going to talk to cnbc. he's significant because he was one of the two lead negotiators for the iif in representing the private sector in this private sector involvement, hence why it's called psi, and with that, joe, we are watching the first advanced economy in nearly 60 years to tell the world it cannot pay its debts. back to you. >> yeah. thanks, michelle. i'm making a -- you don't have the ft probably. but the cover of the "ft" has

this really cool graffiti, that someone drew of the euro, and it looks like this mechanical monster with all these tentacles and that's how greece must obviously feel about -- or athens, about the euro, and all the forms of austerity. i'll get it for sylvia. she's always in front of that what is already a monstrosity in frankfurt, the ugly thing. i'll use this one instead. great job, today, and michelle, good to see you. we'll see you in a while. >> reporter: thank you, guys. we're coming up to 8:30 eastern and that's when we get the february jobs report. we'll get final predictions from our panel of experts next. [ male announcer ] what if you had thermal night-vision goggles, like in a special ops mission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do.

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all right. welcome back to "squawk box." the february jobs report is just a few minutes away. let's add to our panel for some final predictions. cnbc's kelly evans joins us on set and rick santelli joins us from the cme group in chicago. kelly, why don't you get in with your prediction. >> i think i threw out a number like 185,000, i don't love predicting or trying to predict the number. it's a fool's game. i thought that the unemployment rate frankly because the payroll number can be so erratic, we'll

see what can happen with the trend and temporary jobs and we'll have to get a fuller view and i'll actually look at the unemployment rate and see if it upticks or makes a bigger move. i think that might be more solid. >> rick, let's get your idea of what you expect to see and what you expect the market to do based on the numbers. >> i'm going with 144,000. i won't play the game of the unemployment rate. i have no idea, you know, if you tell me the labor force participation rate up or down from 31-year low at 63.7 on the seasonally adjusted, i would venture a guess. i think that the market is going to price extremes in this regard. you know, anything 250,000 or higher, anything under 100,000, maybe even under 50,000 now would be an extreme, i think the market gets juiced either way with volatility, but anything in the middle, it continues to be a wait and see. job creation is important. expanding the labor force and true apples to apples terms is the most important, and there's

still a lot of questionable issues i think globally, not the least of which is energy prices. and i know some out there saying it's the economy's getting better. i'm sure a part of it may be that. >> mark, i don't think we pinned down on the air for your guess as to the jobless number. is it 200,000? >> darn, i was hoping i would get away with that. >> no, no, no. >> a big range. >> well, you know, i think the best estimate is around a couple hundred thousand payroll jobs and the unemployment rate, you know, if you unround it, it's 8.263%, it's a pretty low bar to 7 think that's a reasonable possibility. >> steve, ten seconds, what's yours? >> right around 175,000. >> okay. our panel will stick around. we've got much more to come. >> we're months away from the february unemployment report. as we head to break, take a look at the dow futures ahead of the data. ♪

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we are just seconds away from the february employment report. ahead of that the markets have been relatively flat all morning long. you'll see the dow futures are

up by about 27 points. we've been watching that through the morning. also up 13 is what you see, but when you compare that with the fair value, it will give you a number of about 27. s&p's been hanging right in that very same level. again, the consensus is for 210,000, when you look at reuters, 213,000 and dow jones. hampton pearson has pit. >> nonfarm payroll, 227,000 jobs and average hourly earnings, and private sector job growth increased by 233,000 the revisions for december and january an additional 20,000 jobs added to december payrolls and an additional 41,000 jobs added to january payrolls. february job growth, widespread across the board, professional and business services, up 82,000. health care, plus 61,000. leisure and hospitality, up

44,000. manufacturing, an increase of 13,000. the job-losing sectors, construction down 13,000. retail losing about 7,400 jobs. we also had inside the numbers, the labor force participation rate increased to 63.9%. that's up two cents -- 0.2 of a percent, the reason it's important it's the biggest monthly increase in two years. long-term unemployed six months or longer, 5.4 million people. 42.6% of the total unemployment. and the youth unemployment rate down 14.9%. that's almost two percentage points lower than this time a year ago. back to all of you. >> hampton, thank you very much. if you've been watching the futures you see the market moved 20 points higher based on these numbers. again, though, this was very close in line. you were talking about a number of 227,000, the unemployment right at 8.3% and, steve, you are looking at the numbers.

what jumps out? >> the january revision in the private sector is nice, the private sector for february is a good number. i think this is in line with where the market is. 220, 175 to 250, it would have been right in line. i think the way to put it is 200s the new 100. we come in, we get 200, we yawn a little bit. we did have the increase of participation rate. that tended to keep the unemployment rate from going down which would have otherwise happened. one interesting thing, you still have this very strong household report that has not resolved itself. let me just give you that number. i think hampton might have given it to you. 428,000 increase in the number of employed in the household survey. we've seen this happen before where the household would run stronger or they just diverge, but it's not happening. maybe diane wants to talk about it. >> it's definitely an issue of new business formation and it doesn't get fully captured in the payroll survey, but you are calling people up and they are

working as a aconsultant and thy are too small to get caught up, it shows up in the household survey, and sometimes calling people up you get a sense of that. so, i think we're starting to see the tipping point on new business formation which is critical to the sustainability of the recovery. it's still not enough jobs. as ken points out this is still subpar but, you know, frankly, we're not popping champagne corks but we'll take what we can get. >> kelly, it's also important the youth coming down, while the unemployment rate remained the same. in general there's not a whole lot of different information in the u-6, but they tend to move together. >> i was looking at the share of unemployed, 27 weeks or longer, the long-term unemployed, whether the people are getting less behind even as the labor market improves, it was an increase to 42.6%, even if things are getting better, they are not getting better fast enough. >> the number came down from 5.5

to 5.4, 100,000 fewer in the bucket, right? >> the share is the total unemployed is staying separately. >> are they getting jobs or are they dropping off? we're losing some people off the long-term unemployment insurance and some may be dropping out. the previous peak on that number in the '80s was 26%. this is still something really -- k staggering. >> -- stunning. >> let's get your read on this because you called it right with the market reaction, can you talk about the others? we watched the dow futures, what else did you see happening? >> well, i think it's pretty interesting because the market halv has the same bias that many have. it was a little nervous about a better number, and i only use the word nervous, because you can see the treasuries selling off to extremes on the long end before the numbers release. i saw us go from 318 to 322 yield on the 30-year and the minute they actually saw the data, that started to come back down. that tells me that the burden of proof for the market and on traders is be careful. you know, we're going to be

creating jobs. it's a question of how much strength does it get. i think the trade deficit's something we ought to mention as well. january trade deficit was over the 50,000 mark to 52.6, with a subtle upward revision to december from 48 and change to slightly over 50 billion as well. >> chinese lunar new year. >> that will bring down the estimate for both fourth and first quarter if the trade deficit is wider. >> which wasn't that high to begin with. >> you did see 3% in fourth quarter. all things being equal that would bring down from the 3% number if it's a real number. >> mark zandi? >> yeah. >> a lot of that's coming -- is going to be coming from what happens with oil. and they got these weird seasonality things. >> and the lunar new year, too, austan. china's trade surplus really changed a lot in the month of january, we already got that data, and the lunar new year had a big impact, and china is

slowing. global growth -- emerging markets are not doing great. >> hey, mark zandi, why don't you toll us what jumps out to you, there's a lot we expected. is there anything weird? >> no, it's a terrific report coming on the heels of january and december. quickly, what was hours worked and temp jobs? >> just looking that up. average weekly hours 34.5, unchanged. manufacturing hours up a tenth 5v8 41. overtime hours unchanged at 34. and then you got the earnings per hour. >> there was temp jobs were up. >> there was average weekly hours. one is all private and the other -- 33.8 to 33.7. go ahead, mark. >> i want to point out one thing. all the numbers, the good numbers that we're getting are largely because of a reduction in the number of layoffs. we really have not yet seen a significant pick-up in hiring. the level of hiring is still very, very low. and to me that's a reason for

some upside here. as soon as businesses start to engage in hiring in a more normal way, you know, i really think we can start getting monthly job numbers of 300k, 350k, and even some really, really very good numbers. you know, i don't think we're quite there yet and i think we've got some issues this spring given the run-up in gasoline prices and some seasonal issues, but i think we're pretty close to that. so, you know, i think our standards are starting to rise. as you said we went from 100k to 200k as a benchmark and i wouldn't be surprised if we get close to 300k. >> i would expect gdp to slow down a little bit and the jobs will soften a little bit. that will be fantastic if the jobs start going to 300k. this was not a bad report. i think it was a good report, but i'm not sure that this is a game changer and will we get to something like march, that would be a big -- >> i want to talk about one thing that has changed which is government firings. >> that's the biggest issue. that's a big issue. >> 20 off the top before you even got started before.

it's, like, you are playing poker and somebody comes in and taking, you know, 20% of the kitty out, it's a really hard way to play or make any money. now we've got the last two months minus one on -- where is january? minus six is the new -- is february, and minus one is january, so maybe, just maybe, diane, we stop the government firings. >> temporarily. >> more contraction. >> more to come. we're not done. we're not done. >> shifting from the state and local sector, which aside from a few states which i won't name, have already really put their fiscal houses in order and made a lot of the cuts already. that's going to be abating. mark made this point i think a year ago, so give kudos to mark. on the other side of it, though, we've got the federal cuts coming, even as the postal workers retire out, they will not show up in payroll. so, we've got all of that still ahead of us, so we're in a bit of a sweet spot here with the government, and that's why my gap was so small between private and public. >> austan, would you give us a sense of the politics of this? what -- how is the job market

going relative to the election? >> i mean, if you get more months like this, certainly you'd think the administration's going to be pretty happy. this is a fairly solid report. and expectations were pretty good and it beat the expectations. i'd say, though, if the -- if the gdp slows down a little, not talking about recession, but that's likely to show up in the jobs numbers. and the other thing to remember is in a normal recovery, about a quarter or a third of it is coming from construction and housing. we still got 5 million vacant homes, so that's probably still going to remain relatively weak. >> all right. >> i'd like to disagree. >> go ahead, mark. >> i want to disagree with austan there. >> with your twin? >> yeah. sorry. we're usually on the same page here. but construction jobs, there's a lot of upside there, too, i mean, the level of construction is as low as it's been since prior to world war ii and we're working off the excess inventory very rapidly, and in many parts

of the country we've blown through it and now we're coming to a situation where we don't have enough housing inventory, you can see it in the multihousing sector. >> minus 13 on construction. >> what did you say, austan? >> i said i think it will be a ways until we get to the point where there's really some pent-up demand for housing. i just think we still got a lot to go. >> and to add to that, i understand mark's bullish on the housing market, but i think we'll overshoot, but the bang for the dollar is square foot and building apartments. >> it's fair to say that we went from big negative construction numbers to basically zero now, you know, depending on the -- >> getting rid of the negatives. >> and we are going to have a positive number in the next few -- in the next few months. >> i was hoping, kelly, you would get in an argument with santelli. you want to fight with rick about it? or, rick, you want to fight with kelly? >> i don't know about rick and i fighting. but i wanted to mention --

>> this isn't a game. it's not about fighting. >> one second. we want to just remind people, too, even though we're getting the strong headline numbers we saw it a little bit last year, there's a lot about 2012 that echoes 2011 that echoes years past where you start to see the increase of momentum build in the spring and it peters off, it was what ken was talking about here sort of saying is this the point where you start to feel like the economy is achieving velocity or should we be mindful of what happened last year? remember, we saw reports that were over 200,000 and by the time we hit the summer it -- >> the jobs is still there in the consumer sector and the government sector, that's the headline. . >> what was it? >> 0.2 to 63.9. >> one of the big headlines of the morning. look, laker force participation increasing even though broadly speaking the trend is heading downwards but it's one of the best signs the unemployment rate held steady despite a big increase even though -- >> it stopped because of the

increase. it would otherwise come down if you had -- >> if you had a lot of people surging back to the labor force, everybody would come back in and push the unemployment up, but it hem helped steady it. we were 66 before the recession hit, so if we were still at those levels -- >> 1% of that is demographics. >> okay. we want to thank our panel today, austan, mark, diane, rick, kelly, thank you all of you for joining us. and by the way, we've got more from our guest host ken rogoff still ahead. i want to add one conspiracy theory here, you know how we heard from eamon javers yesterday who reported that it's, you know, the questions about whether they can slow down the government computers to get this information off the website, i tried to tweet this and it wouldn't go out for seven or eight seconds. >> still trying to load a chart here for the historical payroll figure. >> it could be conspiracy theory or it could be -- >> because i just don't think they have upgraded their computers. >> i started tweeting the number at 8:27, i don't know what you're talking about.

>> was that a joke? >> that was a joke! it's an economics joke, joe! where were you? you weren't even around! >> that was a pretty good one. come on! >> i'm in the same place whenever you make an economics joke, i like the viewers, are always in the same place. anyway, coming up, more from our guest host ken rogoff.

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we had excess, we had to make changes. the people that run the business, but we brought the risk down. we brought the capital up and brought the liquidity up, but the resilience of america is we got through it in 2009 and 2010, so we're on the other side of it, that doesn't europe isn't shaky and make us all concerned but think about the tough times in the capital markets in the latter part of last year. we made our revenues and our competitors did and there was no

blowups. and that was brian moynihan talking to us yesterday about the difference between the banking industry in europe and right here in the united states. our guest host is ken rogoff, harvard economics professor, while you are here, i want to ask you quickly about china. i don't know whether i would call you an outlier on that, but you're just not willing to buy in to good times forever there, there will be some bumpy roads. >> it's ridiculous, of course, as the economy normalizes, it's going to have business cycles like everybody else, and there's this mantra out there that says, oh, you know, things slow down, they got a lot of money, they'll just do a big fiscal package, and, you know, every fast-growing, emerging market, developing economy has speed bumps and invest menments more 50% of gdp, how long can that last? and exports have got to slow down. they have to make adjustments. they can't keep doing what they're doing. it's very hard to call the timing, but, yeah, i think they'll have normal recessions, not necessarily

recepti receptir recessi recessions, i expect they have the same probability 10% plus like anybody else. >> but are expectations at this point is that consensus that they never slow, even fit was just a slight slowing that would be a big surprise? >> i think it is consensus. i mean, when i go out and give talks around the world and mention that china just might have a bad year once in a while, people go crazy, you know, and i worked at the world bank on the china, you know, department and you don't know anything. and britain grew forever and the u.s. grew forever, which they didn't. we had recessions and business cycles so -- >> and that could eventually involve printing some money. or turning up the printing presses in china, too, did you say? >> yeah, i don't know if i said that -- no. >> something will go wrong, that they'll spend money and print money themselves, no? >> yeah, i don't know. they did invent the printing press and had the first

hyperinflation 1,000 years ago but i think that was something else. >> yeah. so, that's not likely to happen. but will that cause you to change your viewpoint for the rest of the world? >> if they had a recession or -- >> yeah. >> i mean, that would be disaster. people are saying we're depending on the united states for growth. no, that's because we take china as a given. i think that if the china story somehow were derailed for a while, that would be, you know, about the worst realistic thing we can imagine happening. >> interesting. all right. thank you. all right. when we come back, we're going to head down to wall street to talk jobs and stocks on the move with the "squawk on the street" crew. carfirmation.

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welcome back to "squawk box." the futures right now they took a jump up. obviously in the last couple minutes. but, yeah, fair value, up 35

points. we were down about flat before the jobs number. s&p would be up 0.23 percent, all pretty much along the same place. let's get down to the new york stock exchange, melissa, jim, and brian have put the job numbers into their algorithms and tell us what to think. brian? >> we have algorithms, i didn't know we had algorithms. >> it's a very high frequency show. >> we have abacuses. >> i like the jobs number. >> this number some could argue, hey, listen, it's good but maybe if you look at the trajectory, not as good. >> the issue, though, is the historical trading pattern has been it meets or exceeds expectations and in terms of the market reaction, a big open and then it fades. >> in fact, you and i were talking, i don't want to discount jobs, because it's what we do for a living, but the reality the market in the last year and a half has hardly moved on the jobs data. >> it's so important, how can you say that? >> it's only important for the

first hour of trading. >> the all-important jobs data. i just don't know if they're true, we just kind of throw them in. >> you are saying that we lie? >> no! i'm just saying it becomes a -- >> this is post-nine, focus. >> is this how it will be for two hours? >> yes. >> all right, i look forward to it. >> added zero value there. >> i think i got that. joe will explain it to me at the break, right? coming up, the stock of the day, or possibly stocks of the day it says here. wow, that's exciting. "squawk box" coming right back. monday on "squawk box," two hours with dr. love. ♪ they call me dr. love ♪ they call me dr. love >> master of m & a, mario gabelli is our guest host. don't miss "squawk box" starting at 6:00 a.m. eastern. because the network finds it and tailors it across all the right points,

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stock of the day is starbucks, the company launching its only single cup coffee and espresso drink machine later this year which puts it in direct competition with a partner green mountain coffee roasters c erers which sells thr keurig homebrewers. let's get thoughts from ken

rogoff, he's author of the book "this time is different" and, ken, we just saw the monthly jobs numbers, it's a huge issue for the markets. you do see a lot of volatility, but today with the market moved it gave right back afterwards because it wasn't too out of line, but you are looking at data over a much longer period why do you look at it a little differently than we do when we're looking at the market? >> because, clearly the numbers move the market a lot but you don't really know how much they move the economy. they get revised or lots of things going on. you need longer-term data, although i will say the employment numbers are really one of the better statistics that we have. things like output, i mean, they think the standard error on that is several percent at least. who knows. >> we can feel good about the numbers and see a trend that eventually builds up but don't feel good about the number. >> we've seen a good trend. >> three months is that a trend? >> it's definitely telling us

something, i'm not saying that, but certainly academic econom t economists not that we don't trade but don't change in their minds that fast. i see the debt overhang still there. it didn't go away. it won't go away overnight. and i see slower growth as trend for a long time. >> ken, asking a political question, so for the next eight months or whatever we'll hear the republicans say all the obama policies have hurt job creation and made this a less robust economy. and the obama people will say they saved us from a second great depression, was all this baked into the cake, it's all going to happen anyway based on the nature of the selloff like the reinhart/rogoff thesis? >> it is our thesis. that something like this would have happened -- no, if they really screwed up, we could have had a second great depression, that's for sure. i think when you start looking forward, obviously policy matters. what is tax policy going to be, what will the health