along with steve liesman. marcus agius resigning his post saying the buck stops with him. buck stops with him, and the pound stocks with him in the price fixing scandal. we are going to get more details in just a minute. millions are still without power after friday's violent storms left a path of destruction. 17 people were killed. mexico's old party could be back in power. steve? >> a big week for the economy ending with the jobs report on friday. there will be a half day of trading on tuesday. the u.s. markets are off on wednesday for the fourth of july holiday, and then the fireworks, and then on friday, the june employment report, the factory

activity hitting a seven-month low. the lowest level since 2011, a change from a month ago. and japanese manufacturing sentiment, improving from the prior assessment. joe? >> thanks, steve. you have got to do that again. just for me. >> enrique? >> keep going. >> enrique, and -- >> what a great way to start a monday. >> that's the new guy. when we go to break, will you work with me? i may have to say that. >> i can roll my tongue with the best of them. enrique. enriqinreubenriqu enrique. >> this barclay guy, does he say

the buck stops here. >> no, the pound stops here. >> i am surprised the brits don't say the pound stops here. several deals. bristol meyers, $31 a chair. and amylin, it traded in the $15 range before reports was servicing that bristol meyers was interested in a buyout, and they are collaborating on the products once it's completed. you know amylin is involved, and it's found in people that have dementia or alzheimer's, and am

lynn is not understood well. i was glad both of you, and based on merkel folding, it's what people said. the more i said, the bank examiner, when does he get appointed, and can the chancellor decide these things -- don't these things get voted on in germany? how much of this is going to evaporate like previous deals we

saw? that was the biggest move we have seen. >> it's a two-day rally, so far. >> did they really get it together? what was the most important thing of the three things? >> germany caved. >> but did they cave where you can lend directly to banks. >> i think you die verged into detail. >> i never do that. >> i think the three things together, and every piece of commentary i have read this morning says they fell short on what is really needed. >> for sure. >> and remember, she already said not over my dead body, but she had been so harsh the week before to see her move was a signal that i think you are going to see some movement from the germans. >> i think that's really

interesting, and correct that you are converging into details. i don't think the investor didn't care about the details, but what they cared about was they took the steps to stabilize the situation. put a bid in on the other side. over the last two months, or at least a month or maybe two months, there has been a one-way trade, which is to bet against europe. suddenly they put -- >> i heard this story so many times. >> they do it every time. merkel caves every time. >> i was surprised. we have the french guy, and sarkozy used to be there with merkel, and they were together and now he is undercutting everything, and she is all alone. >> when i got the e-mail that they had over -- they had upheld the obamacare -- >> yeah, yeah, yeah. >> all i could think about is coming in on monday and ribbing you that the market rallied

because the supreme court upheld the market. >> you also had europe -- >> it was the uncertainty of the obamacare -- >> you are not even biting on this one? >> no. you pass this law and it took you 18 months of acrimony, and you lost the house and pelosi lost her job, and you may have hurt jobs because small businesses can't hire, and now you did all that and your victory is that wow maybe it was not conconstitutional. >> right, that's the best you get. >> and in fact, it was unconstitutional, except the roberts somehow put in a new

statute. it never would have passed as a tax, and it never would have gotten it through, and then the justice of the supreme court goes back and says it was a tax. the only justice i see which is really interesting is you might be able to usury cuse reconciliation, and you may not need 60 to avoid the filibuster. >> which means what? if the republicans get four senate seats in the election they can overturn obamacare, is that correct? >> the key core of it. >> and there is 20 democrats that are in red or purple states -- >> you wore purple today. >> yeah, in honor of that. and they are there, and it may not be all republicans to vote

to get to 51, but -- >> you need romney as president. >> i think this fires up the republican base to get out and get these people out of office, and get democrats out of office. it does not fire up the democratic base and come out and vote to save that. it's a >> when i heard the guy say -- >> did he use that? >> oh, yeah. >> and he was a news man reporting that, and so -- >> it was so -- >> the fcc is not coming down on us. >> it was so miserable and disgusting, i would say that to out that guy. did you see the president with the big f'ing deal thing referencing the biden? >> it will be interesting to see if they are going to promote this thing at all. by the time re-election came around, the benefits would be seen by a number of people.

>> it would grow in popularity, exactly. >> harwood is going to be here. >> let's leave it there. >> we'll get his take on this. he would love this law all alone. let's check out the futures, which this morning are holding on, which is amazing to me after 270 points. >> it is obama? i am not getting the rise i was planning on getting from him. >> nothing like getting a whole new entitlement when we can't begin to afford what we already promised. it's really good in an 8.2% -- when we have not been below 8% in a year. >> this is all about control. >> hold on. >> robert rank, did you read him in the times this weekend? >> i like f robert frank.

oil was up big on friday as well. there you can see it today, it's down. it was amazing to me that the move by europe was going to cause the global economy to do better to cost $7 in oil, or maybe it was -- >> obamacare. >> all right. time for the global markets report. >> michelle, let's give you a quick check of what is going on this morning. after such a strong friday, the real question is whether we would be able to continue the games. there's still more advancers than decliners today. and we have paired a little optimism. the netherlands will block the

secondary purchases -- sorry. it's monday. it has been a long morning. and what is clear is the details that go beyond berlin. it's not surprising that they have said this, but nevertheless when we take a look at what is happening across the market this morning and we pulled back a little bit, that's here. they are all looking better, up between half and 1%. and this shows manufacturing across the nation unchanged to slightly weaker. the real story is probably happening what is across the bond space. it's amazing we were over 7% a week ago, and we are down to 6.29%. it's not sustainable, but it suggests if you were buying into the debt you would have made out pretty well, and the question is who is doing all the buying? and then the german field up to

5.77%. and then a lot of focus over here, guys o. what is going on with the banks. barcla barclays. the strongest performers, up, and so are a lot of the boanks, as people look across this. lloyd's up 2.2%. and rbc, this unchanged. rbs is one of the ones named to come live. it's hard to fix a rate all by yourself. coming up, the weather channel gives you a fourth of july forecast, and then woods and the crowds returning in full

force on sunday, and the violent kept spectators away from the at&t national on saturday. tiger's win puts him ahead of a legendary jack nicklaus. we have to take a break, but first here is john harwood with a look at the second half of politics. >> here is what to watch for in politics in the quarter ahead. republicans and democrats in congress will keep drawing battle lines for the november elections, including a house vote scheduled to repeal owe obamacare for mid-july. and mitt romney is into the vetting process already, and the republicans have to have their convention to nominate romney, and the democrats to re-nominate obama, and then they head out to the conventions. that's your politics, and i am john harwood.

♪ ♪ [ male announcer ] not everything powerful has to guzzle fuel. the 2012 e-class bluetec from mercedes-benz. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services. for exceptional offers this is new york state. we built the first railway, the first trade route to the west, the greatest empires. then, some said, we lost our edge. well today, there's a new new york state. one that's working to attract businesses and create jobs. a place where innovation meets determination... and businesses lead the world. the new new york works for business. find out how it can work for yours at thenewny.com.

welcome back. the futures at this hour are up and are still up a bit from friday. the nasdaq is a touch lower. really unchanged. walmart celebrating 50 years. sam walton opened his first walmart on july 2nd, 1962 in rogers, walmart.

the company went public in 1970 with 3,000 shares priced at $16.50 per share. >> isn't that extraordinary? target is 50 years old, and k mart is 50 years old, and walmart. how phenomenal is the growth of walmart compared to -- >> all the others. >> yeah. >> and you look at places like individual stores around the country that are what walmart was and how one makes it and one doesn't. >> yeah. >> the great man theory, rather than the great times -- it takes one guy -- >> or one woman. >> or one woman. you know what i meant. the mid-atlantic states cleaning up from the storms. let's get the forecast from the weather channel's ryan gosnic. >> it's the holiday week, and a

lot of people traveling out there, for today for the second day in july, it's going to be hot. that's typical there. and we will see 96 in atlanta. one change is we had the heat across the southeast and just to make things more miserable, we will throw in humidity as well. 96 degrees in atlanta. we will see 99 in raleigh and 89 in new york. temperatures not as hot as the last couple weeks across the northeast, but highs very close to 90 degrees, not only today but really all the way through the fourth of july holiday with an isolated chance of those afternoon storms. hope you have a great day. back to you. >> thanks. washington and the rest of the nation getting a full weekend to digest the decision on the health care act, obamacare. and joining me now, the washington correspondent. can this work, john? i thought it was fitting to live by the sword and die by the

sword. maybe reconciliation would give the republicans a possible root to repeal it without 60 votes. >> it could for sure. that's why the stakes are higher in the senate races than before. >> interesting, because of the taxing, john? >> no, because if the republicans get 50 in the senate, or -- excuse me, 51, because if obama is re-elected he would have a vice president, but if republicans get a majority in the senate they could use the reconciliation -- >> if it was upheld, and now that it is called what it actually is -- >> so it's a tax. how could they have a vote on it -- >> they have to agree that it's a tax now? don't they have to agree it's a tax now, john?

>> the democrats? no, they don't. >> the mandate is unconstitutional -- >> you want to settle this thing between you and and then come back and ask a question. >> it's a tax now? >> yes. >> that way they can do the 51. >> steve is still arguing it's not a tax. >> the obama administration calls it a penalty. >> they can't anymore. i don't think that's true. >> doesn't mean it's won politically. >> it's a small tax because -- >> that's not the point. >> because it would affect very few people. >> they can use reconciliation, john, that's what you are saying? >> yeah, and the add on medicare tax, and tax on the medical device makers. >> there's a huge tax on it, and most of it hitting on people

that hit $120,000 a year. >> which one are you talking about? on high-end people, on medicare. >> and then also, if there was -- if somebody didn't -- i need to eat -- apparently they can make me eat broccoli at this point if they make a high enough tax for me if i don't eat it, right? that's the way you can get around this, now? if i have to pay $30,000 a year if i don't eat block re, i am going to eat broccoli three meals a day. >> they say fewer than 1% of the people would pay that tax, but yes that's the significance of what you are talking about politically, and the republicans can say mr. obama you said you would not tax anybody under $250, and now you are. we have a total war going on in washington. a war between the utilities and

their customers and a war between democrats and republicans. you saw that on the talk shows over the weekend. >> no, i didn't. >> republicans, in about two weeks -- one week, the house is going to have a repeal vote on obamacare, and it's not going to go anywhere because the senate is not going to do anything, but we will continue to draw battle lines the rest of the year, very little having extended the low rate student loans, and there is almost nothing that will get done here for the period through election day. >> is it good or bad for the president that suddenly we're -- suddenly the obamacare has been thrust back into front and center -- >> right ahead of the election. >> we are not paying quite as much as attention to 8.2%, and it takes everybody's mind off the horrible job situation, i guess, but the first 18 months

the well was poisoned by this and here it is poisoned again. is that good or bad? >> it doesn't distract people who can't find a job or think their wages are not going up. the economy will dominate the election. i do think romney gets energy out of the decision because he can go to conservatives and republicans and independents and say you don't like obamacare and the polls show us especially white voters don't like it, and like in the wall street journal poll last week, 20% of whites said obamacare was a good idea and 50% a bad idea. much more popular among hispanics and african-americans -- >> if romney can connect the high unemployment rate to obamacare, then that gives him even more of a boost, don't you

think? >> that's a stretch, but yes -- >> why is it a stretch? we have had people repeatedly come up and say the small businesses are not hiring because the cost has gone up dramatically -- >> you go from 49 employees to 50 and 51, your cost explode as a small business due to obamacare. the other thing that gets me is i am still hearing -- >> i think the evidence that obamacare has contributed to high unemployment is quite weak. >> it may have certainly slowed job growth. >> something did. but -- what was -- what did i say? you threw me off with your throwing your opinion in there. what was the other thing? what did i ask you? >> you are asking him to help you? >> yeah. >> that's interesting. >> you are sitting there on the side of the boat asking him to hold you up?

>> if you have 49 employees, why would you go to 50? >> well, if you like your plan you can keep it, as if there is not going to be a lot of companies that say this is too prohibittive, i will just defer to the federal government. to still be saying that, to look into the camera and say if you like the plan you can keep it. >> this is about finland. finland saying it the going to block the secondary market bond buying. they have been the party popper on this every time. >> that came out more than an hour before. >> that's finland acting from the obamacare decision in new york. >> exactly. >> harwood, we will not need you until november and after, but we will see you a lot. you do that little thing first.

>> in 100--degree heat. >> yeah, that's good. >> lacey o'toole. >> lacey is the best. >> that solves everything. >> yeah, she does. coming up, we kick off the week with the squawk trading block. and then there is nothing that says summertime in the united states than a pint of ice cream. we talk about going creek in the next half hour. did you check out "ted" this weekend. it opened with a $54 million weekend. universal like cnbc is part of the comcast family. and we look at the winners and losers. ♪

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pharmaceutica pharmaceuticals. takeover rumors first began to surface in march. apple will pay to settle a trademark dispute over the ipad move. the lawsuit against apple delayed the launch of the latest ipad in china. don't even speak our language? do you understand that? >> the copy right the character. >> and marcus agius has resigned in the wake of a scandal. ben bernanke is apparently sweating this morning. he has -- >> you keep on that, don't you? >> huh? >> you keep on that, don't you? >> it's setting interest rates. artificially setting interest rates. >> one is mandated by congress, and the other is based on the

market. >> we are going to talk about influencing interest rates, and i am going to ask him about ben bernanke. >> when did you think about it? on the golf course. >> i didn't have to think about it. >> did blake think about this? >> i didn't have to think about it, it was so obvious. it was like last time, how much can the fed control in interest notes? >> all of it. >> do they have a 10% size limit? >> they impose one on themselves. >> aren't they at 60%? >> they are like 100% of all the new issue, and then -- >> no, in the contract? >> no. there is 13, or 14 -- >> i think it's a high number. >> they have $2 trillion.

>> oh, it's me. that's why. >> i think it's more. >> let's get a head start on the trading week. and shaughnessy's block. let's start with jim. the european -- it seems to be echoing over here. why did that have a profound effect on the markets? >> i think for the first time with the creation of the european stabilization mandate have an opportunity to open up the ecb's treasury, if you will, and directly fund floundering european banks. that's significant because previously we had to go through the sovereigns and now we have to go to the banks. it's a backstop that traders

believe in. >> that's well and good, but is there a sense it's big enough to do that with the european banks? >> i think if they are able to leverage their balance sheet, yes, and getting it off the backs of the sovereigns is very important. the spanish costs are plunging after this occurred. i think the markets are inferring that they might have really gotten somewhere finally. >> scott, is this full speed ahead on stocks now? is it a risk on trade? >> well, you know, i would like to think that we got the relief rally or the rally for the plan, but i think the big break will be on implementation or big execution. i don't think we will get through the things they would like to get through. i would like to be happy and think it's all going to work out and have europe be a trading block for the u.s. and asia. but i think we cannot have true

harmonization for europe until they give up some of their sa sovereignty. >> is that a yes or a no? >> does it all fall apart with the jobs number on friday? >> well, i think we have some people that are going to be really boyant and the market is going to go high '. the risk is going to be on the table and they are going to pullmany back because we are not going to see the harmonization that we like. we have corporate taxes in ireland at 12%, and we have france trying to lower their retirement age and everybody is asking germany to pay for it. there are things that are not going to work out. we will see the execution of the plan fail and the stocks go lower. >> where are you on the risk on and risk off, and if it was risk on where would you put the

money? >> the cheapness of the european shares. we own 47% in our high dividend portfolio in europe. we only own four banks. we own no stocks in spain or greece because of the way we look at the market. we are looking at cheap financially strong companies -- >> how about barclays, jim? >> we would not buy that. but we would buy baa systems, a yield of 7.21%, and 44% of the revenues come from the united states and israel, and astrazeneca, a 6.8%, and deutsch telecom. >> why tiptoe around? maybe scott wants to handle this. why don't you go and buy

european debt? >> we are an equities only firm -- >> good excuse. >> what we are trying to do is pick up a very cheap yet financially strong european companies on the high dividend yields. >> you are obviously in the opposite camp, though? >> i don't think you buy it. i think ultimately it falls apart. we are not going to see one massive trading block. i don't think it will work out as all. >> i think common sense has to take control there. why would it work in europe? >> scott, thank you very much. jim, thank you. bad risk on, bad risk off. e-mail us at squawkcnbc.com. coming up, why you should care about the election in mexico? and we are rolling out a special series, american-made, they are

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welcome back. usa futures are indicated to be down a couple points that's not much. actually a point on the dow after a huge move on friday. and in case you are wondering, what one point down in the dow translates to on a percentage

basis is .0000001. >> you are good at math. mexico voted for a president over the weekend. the winner campaigned on allowing more private investment in state-run oil company. in this day and age, there is private investment in oil and that may not sound like a big deal but in mexico it's revolutionary change. mexico seized all american and british oil assets in 1938, and with much fanfare. celebrations in the streets. when the corporations demanded payment, they responded by donating their most prized positions to help foot the bill. anything from chickens to cellos. >> mexico has oil, perhaps as much as saudi arabia. >> by the 1970s, there was great hope for the mexico oil

industry, and even leading to a weekend special on nbc news. >> mexico has more oil than texas and more than iraq. >> that was a long time ago. slowly but surely the mexico oil suffered from taxation and interference. production plummeted. but phebgs yo's presumed president elect champagned on changing mexican law to allow private investment. >> if mexico was able to significantly increase once again its oil and gas production, and since we sell 90% of what we export to the united states, this would contribute very significantly to what we would call north american energy independence. >> so their oil production has been climbing for the last five or six years. oil production is the opposite of weight. it's really easy to lose and very hard to gain back.

>> and the russians, they began to decline. >> the mexican government is scared to death, they tax and their gravy train is dying in front of them. >> you have glimmers of enlightenment, and it usually involves russia. you see it over there that identify made sense to private ties -- >> you just tried to pigeon hole me in this whole thing. what would you do without somebody to balance off something like that? you are nothing without me. admit it. >> all morning long it has been about obamacare and the market going up -- >> who started this? >> i started it. i thought of it three days ago. and it works so well.

it's like my little brother, just pushing buttons. >> and more to come, and we will talk about how they plan to pay for health care reform. but first, you scream, i scream, we all scream for ice cream. the first trade route to the west, the greatest empires. then, some said, we lost our edge. well today, there's a new new york state. one that's working to attract businesses and create jobs. a place where innovation meets determination... and businesses lead the world. the new new york works for business. find out how it can work for yours at thenewny.com. and this is what inspires us to create new technology.

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♪ >> it's all greek to the frozen yogurt world. here to talk about this and more, the ceo of ben & jerry's. good morning. >> good morning and thank you for having us. >> you don't know what is behind me here, two anchors dying to get in on the conversation here, but let's start with the business aspect of this. you are making a move into greek yogurt for breakfast. is that the idea? >> that's perfect. if you look at greek refrigerated yogurt, that was a $33 million market back in 2007, and if you go to the refrigerator aisle today, you

will discover a market. it's creamy and rich, and a li >> tangy. >> so, you know, you might take it for breakfast. >> what about overall business, jostein? is this something that attracts the economy? it's a premium ice cream. how's it doing? what's it telling usabout the economy? >> well, you know, we went through a little bumpy road like everybody else in the sort of two big-hit recessions. and what we see now, and i know we're all searching for possible indicators, and the ice cream consumer index is a positive indicator. the first thing we see is in our sweet shops. we have a group of fantastic franchisees who run the scoop shops and they've got about 12 months now same-store sales up. and of course, the holy grail, like anyone, is volume. when you have volume growth, that translates into more jobs and selling more ice cream and we have positive growth for the whole of 2012, so we're really seeing the market come back,

we're seeing consumers coming back and wanting to indulge. >> i'm looking at your website. it's michelle here. good to have you on. i love greek yogurt and i've tasted yours. it's terrific. i'm looking at your website and see you are a big supporter of occupy wall street. "to those who occupy, we stand with you. the inequality between classes in our country is simply immoral." tell us why you support occupy wall street so much. >> well, our whole business model is based around a concept of linked prosperity. that's why, obviously, we're governed by commodity prices, but we don't think about it as commodities, we think about it as quality ingredients and as an opportunity to impact the communities of which we buy our stuff from. so, our whole business model is a fully intergrated model where we look at the communities where we buy our ingredients, the communities where we make our stuff in, i'm in waterbury, the original ben & jerry's plant. then we look in the communities in which we're selling. so it's clear that if you want to engage, you know, with solving issues around like fair trade, you also need to engage

at home -- >> wait a minute, wait a minute, giving a million dollars to occupy wall street, was that the company or was that the founders? >> no, that was -- as a company, we have just supplied some ice cream to the occupiers. we are not giving any financial donations, no, no. [ everyone talking at once ] >> why get involved? it doesn't help. i myself have a problem with that, and i would probably buy another brand of ice cream. my daughter just, coincidentally, over the weekend wrote -- she has a blog called peace, love, province. anyway, she's writing "for the first time ever, ice cream has left a bad taste in my mouth. it now appears after making their millions, both ben and jerry have turned their back on corporate america and wall street. call it a classic case of biting the hand that feeds you, complete with a cherry on top. i'm not sure how i'm going to work through this conflict, maybe a few late nights with some ice cream could help, but this time it's going to be haagen-da

haagen-dazs." why get involved? why drive people away by taking a stand like this? what other things does ben & jerry's stand for, besides occupy wall street? >> i think we predominantly stand for fantastic, good quality ice cream with good ingredients -- >> why get involved with this, where someone will say, you know what, i'm not going to buy ben & jerry's because i don't like what they're standing for here? why do it? >> because our fan base is extremely loyal -- >> well, if you had shareholders, still, it might make a difference if you had shareholders, but you're a unilever now, i guess, right? >> well, if you look at it from a value creation point of view, when we supported, we didn't -- when we came out with our statement on occupy wall street, our sales were up 5%, 6%. so, while some people feel maybe that we shouldn't take a stand, other people feel very happy that we do take a stand. we do think that it's important that business recognizes it's part of society and has a role to play in society. >> providing job --

>> political -- >> providing jobs is not a role in society and earning profits that accrue to shareholders -- >> exactly. >> and for pensioners? that's not contributing? >> correct. well, we deliver an over-and-above industry average, profitability and growth. and you know, we support our farmers all the way back through the farm. we have a care and dairy program, which is farming here in vermont, where we work directly with the farmers to improve yields and help them ride out the ups and downs of the commodity market. so, we deliver an over-and-above normal profitability. we are more profitable -- >> so, you're saying it's not impossible to make a lot of money and to be -- >> but that was the spirit of joe's question. the spirit of joe's question was, you made it sound like -- >> joe can't talk for himself? >> i'm just trying to do a little follow-up here, honey bunch. >> we had howard schultz on -- >> i'm just wondering. >> howard schultz has some of the same ideas -- >> right. many business people.

have an idea that you can be responsible -- >> at $50. you are responsible to the community. you're making it seem like if you don't do that, that you're somehow not -- >> i just -- what i think is that not every decision is down to the last penny, joe. there are some decisions that you make -- >> that is still not the spirit of the question. capitalism is a moral imperative. >> right. >> and profitability is -- >> what do you mean a moral impedtive? a moral impettive -- i don't buy that. capitalism -- >> you need to read up -- >> i need to read up on your ideology and beliefs. let's say good-bye to our guest, ceo of ben & jerry's. capitalism -- >> allowing -- >> what is the moral imperative? i mean -- >> it lifts so many people out of poverty, out of poverty. >> it's not just that -- >> but where's the moral imperative? >> people leaving poverty isn't a moral imperative? of course it is! >> people leaving poverty is the moral imperative. the means is not the moral imperative --

>> michelle, you've got to read -- >> oh, my gosh, of course it is! >> you have to read it because brooks argues -- [ everyone talking at once ] earned success and -- >> my point is -- >> controlling your own fate instead of learned helplessness, which we've seen in europe, is a moral answer as well as -- >> i agree with that. >> coming up, the morning's top stories. we'll welcome a special guest host, florida governor rick scott. from tourism to o.j. futures, his state tells us a lot about the u.s. economy. call it "squawk's" sunshine indicator when we return. [ male announcer ] introducing a powerful weapon

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raising the stakes. from the sunshine state, florida governor rick scott joining the set to discuss job creation, the presidential election and the state of the economy. and we're kicking off a special series this week honoring business opportunities in america. the second hour of "squawk box" starts right now. ♪ living in america ♪ good morning, and welcome to "squawk box" on cnbc. i'm joe kernen along with michelle caruso-cabrera and steve liesman. becky and andrew have the week off. futures this morning have been right around flatline, as you can see now, up about four points. let's get to steve with this morning's headlines. chairman marcus agius has quit, following in the probe resulting in the bank paying fines. dimon is also called on step down but no indication he is doing so. gary gensler will join us later

this morning with more on the probe and his reaction to the latest developments with barclays. we'll watch shares of amylin pharmaceuticals, being bought by bristol-myers squibb for $31 per share in cash. that's more than double the price back in march when reports of interests by bristol-myers began to service. dish network in the middle of two controversies. nbc, cbs and fox head to court today for a hearing involving dish's add-skipping feature known as autohop. networks say the feature violates copyright laws and amc networks disappeared from dish's offerings as of yesterday morning in a dispute over fees. michelle, we don't like autohop, right? >> no. all right, let's find out what's moving markets this morning following the best gains of 2012 for the s&p 500 on friday with that big, big rally. scott nations of nation shares was at the cme group. scott good to see you. we saw some continuation of this in europe, even with headlines out of finland that made some people nervous. still, it appears italian interest rates are lower this morning, spanish interest rates are still low this morning.

will this continue for the rest of the week? >> i think for most of the week, certainly, at least until we get to friday, the jobs number. and you didn't mention china pmi. to the degree that we can trust that number, it was impressive. and we're also going to look back to friday. friday was just such a great day, and the impressive thing, i think, about friday is that the last 30 minutes in and of themselves would have been just a great day. so, on a friday in kind of a goofy week or going into kind of a goofy week with the holiday, it closed on the dead high, the s&p. a little bit of follow-through right now is really encouraging. technically, we're at a really important level, 1,362, just barely above the 100-day moving average, but we're also at a level where we're about to break this series of lower lows and lower highs that we've had for the last couple of months. and if we can do that, things will be in a lot better shape. unfortunately, though, it seems that angela merkel may have painted herself into a corner, and the whole european thing could come unwound pretty quickly. >> oh, yeah. there are so many caveats to

everything that happened on friday, but i think people were just thrilled that the conversation have shifted to some degree. does it at least in the meantime take our eyes off europe a little bit and shift us back to the domestic picture here, especially as you mentioned with the jobs report on friday? >> i think it does. and that's probably a great thing, because we've been so focused on europe and that leaves everybody with a pretty itchy trigger finger here, at least as far as equity traders are concerned. we'll have to revisit the whole european thing in a couple of weeks. we are going to look for the jobs number. anything that i think is convincingly over 100,000 is going to be considered good news here. once we get past that, though, i think we're going to start to worry about corporate profits as we get into the earnings season. i think that's actually going to be a little disappointing. so, if we can maintain the level we're at now, say 1,360 on the s&p, as we head into earnings, that will give us a little bit of a floor if we have some disappointments. >> got it, scott. thank you. good to see you this morning. >> thanks. joining us now to talk about the race for the white house and

much more is our guest host, florida governor rick scott. governor, it's good to see you. >> good morning. >> i decided to ask you first off, every time you talk about the job growth in florida, i have heard that the romney campaign says, wait a second, will you please stop talking about the success down there, because we want to paint the whole picture, or the picture of the whole country being unable to add jobs because of obama's policies. and here you are able to do it in florida. has the romney campaign ever told you to -- >> no, they never said that, but you know -- >> you've seen those articles. >> i've seen the articles and i've talked to the reporter that wrote the first article, look, we are doing really well. we have buckled down -- >> you're not supposed to be doing well with obama care and regulation and uncertainty and everything else. >> but you reduce taxes, which we did, reduce regulation, which we did, stream-line processes, which we did, treat businesses like you'd like them to florida, so they add jobs. it does work. so, we've come down faster than every state but one. we're getting close to the

national average -- >> which is the one? >> michigan. >> oh, michigan, really? >> with the new republican governor. >> rick snyder's done a good job up there. >> i thought it was texas because we've got to find something for you and rick perry to argue about. >> we fight. he is the competition. he is absolutely the competition. they have done such a great job. they've just been doing it so long. he's won the "ceo" magazine survey eight years in a row now. we're number two. i told him next year -- comes out in may -- next year, we'll clearly be number one. texas is the competition. >> governor, you had a huge bump in your popularity up to over 40%, and now it's back down. do you understand what the heck's going on down there? do you pay attention? could you be re-elected today? >> oh, i don't even think about that. i'm doing what i ran on. i mean, i won because i said i'm going to hold government accountable, reduce the size and cost of government, reduce taxes, go after jobs. everything i do, i talk about how we're going to get our state to be the number one place for jobs. this election, like mine in 2010, is all about jobs.

people need jobs. we still had 800,000 people out of work, but we've dropped the number of people on unemployment from 568,000 to 340,000. this is about jobs. >> how would you explain this, steve, that capitalism is moral not just for generating prosperity, but just for being able to actualize your potential to the pursuit of happiness and individual earned success, versus learned? would you disagree that capitalism is not moral? >> capital -- i mean, is capitalism perfect? no, but is it moral? absolutely. >> is it the most moral -- is it the most moral system? >> can i engage on this, joe? i want to hear from the governor and i have my thoughts -- >> 70% of inherited wealth is lost within five years, all right? >> right. >> so, and it's way better -- i mean, when you raise your kids, you raise them to be independent. you want people to have an opportunity. now, it's got to be a fair and level playing field. everybody has the opportunity, has to have the opportunity. i mean, i lived in public

housing. i started school living in public housing. my dad had a sixth grade education. so, in america, you have this opportunity. it's harder now, way more regulation, the taxes way different than years ago, but that's what america's been built on, capitalism, the opportunity to get somewhere. >> but when you raise it to a religious level, which is what my colleagues are doing -- >> that's not true at all. >> when you say moral imperative, that speaks to me of religion. i believe what larry kudlow says, that it's the best path to prosperity, but is it -- [ everyone talking at once ] >> you're missing it. >> i'm not missing it. the moral imperative -- >> we're talking about prosperity. >> i hear christianity, judaism, the moral imperative. >> i'm not talking about a path to prosperity. i'm talking about a path to freedom and individual earned success. it has nothing to do with what you finally have, it those do with the way you live and you're able to live. and you look at what's happening even in germany. 75% of the people in germany -- tell me again? >> so, pew does this annual

survey every year, and one of the questions they asked, they asked americans and they asked europeans, are you in charge of your success? >> of your life. >> of your life. >> or is it not up to you? >> even in the country that's working -- [ everyone talking at once ] greece or italy and see if your life is fulfilling as it is here, where you can earn your success and where it's not -- >> both my brothers disagreed with me and i was at the bottom of the pile. but what i'm saying is that -- >> three people disagree with you. >> well, four. i only had two brothers, though, so. when you say moral imperative -- >> i'm not saying moral imperative. >> i did. i say moral imperative. >> okay, i'm saying it's the most moral economic system. >> i agree with that. i agree. >> now he agrees. >> so you were slicing and dicing over semantics? come on! >> when you say moral imperative, that's not slicing and dicing. >> absolutely is. >> those are serious words. and what bothers me about it is it creates an intransigence that troubles me when it comes to policy and important things. there are times when the public, the governor, the government must act in the collective good.

when you say capitalism being a moral imperative, that troubles me that you can't get there to the collective good in those times when the government needs to do things that are better than the market -- that are quicker or the things the market cannot do. >> there are so many bad assumptions in that, but go ahead. >> my personal belief is that capitalism, businesses, they create the jobs. i mean, you can't buy, have the safety nets you need -- >> agreed. >> you can't care about education and the environment if you don't have jobs. >> but you've built roads in florida, you have incentives in florida. you are fighting as the governor, as the government in florida against texas to create the framework for business. >> they don't build highspeed rail. >> sometimes that makes sense, but i guess not, in florida. i lived in florida for five years. i love the state of florida. >> where'd you live? >> sarasota, venice and tampa. >> that's right, you were in sarasota for a while. >> i was. >> look, people want -- look, my experience in life is people would rather have freedom, even make less money. if you could go -- if you look

at small business owners, they're happy. you know, it's hard, they have to make payrolls, but they're happier than a lot of people that work for big companies, where it's easier. you don't have to take the same risk. so, people want to have their opportunity to live their version of the american dream. all of our versions are different. but they want the opportunity to live their version of the american dream. >> tell us about the single best thing you think you've done in florida for the economy. >> or the best thing. since there's only one. >> talking semantic -- come on, joe! >> give me your single best unique idea. >> single best. >> is it the exact same as someone else's? >> i think exact opposite. >> i think certainly. i think the fact that people now know, they know that florida government is there to help businesses succeed. it's not there, we don't attack businesses. you've got to do the right things, comply with the laws, but we're there to try to help you succeed. somebody wrote an article the other day that we don't fine people as much under my administrati administration. that's great because we're trying to get people to comply with the law rather than fine them. we've cut the number of days to

get a permit. if you want to get a permit to do business in florida, it's 2.05 days. environmental permit is 64 days. so, we've made it -- there's a lot of certainty now, so that's why businesses are coming there. i love what illinois's doing. i hope they keep doing what they're doing, because there's more illinois businesses coming to florida, as they've raised their taxes. >> there's a headline, governor, "florida will not comply." governor scott says florida will not comply with the health care law. you announced on friday you would not expand the medicaid program to lower the number of uninsured residents. >> here's the deal, we have -- what that showed us is we have two opportunities. one, we don't have to do the expansion. i mean, the expansion's not going to be good -- >> that was one of the nuggets in there that some people have seized on. >> it's going to cost $1.9 billion a year growing. it will make florida way more dependent. we'll have to raise our taxes. the medicaid program is -- right now, you have a choice in florida government. it's medicaid, it's education or it's prison. medicaid has been growing at 3 1/2 times our general revenue.

so, that has made it very difficult to fund our education. so, this will make it -- i don't know how you fund k-12 education or universities if this grows like this. no one wants to pay more taxes. so, we're not going to do that, because one, it's not a program that works. we're not going to make more people dependent on this. second, these health care exchanges, they don't reduce price, they increase the price. they say you could only sell this type of policy. >> right, there's no competition in the type of insurance, right? >> governor, stay with us. you'll be with us for the next two hours? glad to have him. coming up next on "squawk box," our "american made" series continues with florida-based harris corporation, maker of wireless and electronics systems. it's also the largest private-sector employer in brevard county. we'll talk jobs and more with the ceo, next. comments, questions, send them to @squawkcnbc on twitter. follow the show and look for updates from andrew, becky, joe and the "squawk" staff.

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>> checking checking futures, back up above the flat line, about 11 points on the dow, and we have technology distributor ingram micro buying brightpoint for $350 million in cash, a

distributor of wireless devices as ingram looks to expand from the mobile pc into a new market. harris corporation is one of the top employers in florida and also one of the top 100 federal contractors. it's an american-made company looking to put people to work and provide profits for shareholders. here now, bill brown, ceo of harris corporation. aerospace seems to be doing well, but not the federal side of the business. >> right. >> talk about how those two things are working to the bottom line. >> we have about 60% of our revenues with the u.s. government. about half of that is with the usdod, and that is under some pressure this year. fortunately, foreign militaries are growing pretty well, so our business growing outside of the u.s. is going reasonably well at this point. >> how about the private party? >> private sector is going okay, but that's a small part of our business. we're a big player in managed satellite communications globally, so we sell those products for remote and harsh environments, mainly for the energy sector, for the maritime

sector. and the energy maritime sector is growing very well. >> talk about some of the cool things you guys make, radios and satellite communications, that kind of stuff. >> yeah. we are known for tactical radios in the industry. >> what's a tactical radio? >> a tactical radio is a radio that's handheld by our military forces, both within the u.s. and outside the u.s., that allows them to communicate with other soldiers and up the chain of command. and what we have here is a 152a. it's a wide-band -- >> take a look. >> -- encrypted radio that allows a soldier to receive voice, data and video transmissions from the brigade, from other commanders -- >> so, i can plug that into a monitor here on the side? >> i don't know if you can plug it into the monitor. it's a highly encrypted radio. >> no, not here, but -- >> you can connect it to a ruggedized tablet and the tablet will be able to receive information from a drone -- >> a ruggedized tablet will be a tablet we know about, but that can withstand a lot more stuff. >> exactly. you can take it to the

battlefield. take it to the battlefield. >> a ruggedized tablet. >> i've seen those. you can drop it and they -- >> you can drop it, you can -- >> they can withstand a direct hit by a mortar shell, right? >> exactly, exactly. >> so, you say defense spending is under pressure. >> yes. >> does the election matter to you at all? because there's even an arm of the republican party that very much wants to cut defense spending as well because they think it's grown too big a part of the budget. >> i think whatever party wins in the fall, defense spending is going to continue to be under pressure. the biggest issue we have and other defense players have in the industry is this concept of sequestration, whereby there's going to be mandatory across-the-board cuts that could be $500 billion over the next decade on dod spending, that would be about a 10% spending cut going into 2013. the aerospace association estimates that would cost the economy 1 million jobs, raise the unemployment rate and take 25% over the gdp growth rate in 2013, and that's the environment we're competing in today and that's the uncertainty that we're facing between now and the

election year, because nobody's really sure exactly how sequestration will take place. is it across the board? does it target certain programs? and what programs are going to be exempt? >> how are you planning right now, beginning planning next year? how do you do that? >> very, very difficult to plan in an environment where our customers at the pentagon aren't planning themselves. we're not really getting a lot of guidance -- >> wow. >> -- as to what programs are going to get cut and how they will get cut. >> because they can't give you guidance. >> because they can't. so, we're also asking omb for guidance and we'll expect to hear something over the course of the week. >> i have to ask you something. >> sure. >> this is a big, bulky thing. >> yes. >> and i've got this thing right here. so, why don't i have one of these for military use? >> because this device here is an encrypted device and it's got a battery that will last for a long time in the battlefield. >> how long? >> it will last for a day and a half, two days -- >> okay. >> depending upon the usage of the radio itself, but it has all the capabilities of that phone you have here. >> right. >> this is acellular device. this is an rf device. you don't need a cell tower in a

battlefield. >> okay. >> this can communicate to other devices. >> what's that other one? >> this is a unity radio for public safety, for first responders, and it's the first radio that allows a first responder, a firefighter or a police officer to be able to communicate with other first responders, no matter what frequency they're using. this also has noise cancellation technologies that comes out -- >> so, is there a lot of post 9/11 funds that went in to buying this? >> not a lot of funds, but there's a lot of development we've done to develop this particular radio. there is now funding going into state and local authorities in order for them to upgrade their radios. >> want to get to governor scott. there's been a big development in the aerospace industry that doesn't affect harris, which is that airbus is moving to florida. >> it's great. it's going to be right across the border, pensacola. that whole panhandle area, we have a lot of military bases there, so we'll get a lot of the suppliers to airbus. so it's going to be great for florida. but you know, one thing harris is doing is they're adding a new technologies center. what do you have, 7,000?

>> we have 17,000 people globally, 7,000 of which are engineers. and through governor scott's support, we've just announced that we're going to open a $100 million r&d center in palm bay, which will house about 1,500 engineers. we think it's important because it will allow us to attract and retain strong engineering talent in florida. >> can you get enough engineers in the united states? >> we are finding good talent in lots of different places. we recruit a lot of our engineers from the state of florida. >> you're not really answering my question. are you getting them from america? >> we are getting them from america. >> but you have to bring in engineers from overseas, too, right? >> very, very few, very few. >> what do you pay -- >> another university just for engineering, science, technology, engineering and math. >> what are you paying the average engineer? >> $70,000, $75,000 a year. >> that's a pretty good salary. >> fully loaded with very, very good benefits as well. [ everyone talking at once ] >> they're a little less than they used to be. they're going up in price now. >> i want to thank bill brown for coming in this morning. >> thank you very much for having me.

>> thanks for coming. >> thank you. got a business success story you want to share, comments about companies you think should make our "american made" special? tweet us @squawkcnbc. be sure to use #americanmade. we'll have more throughout the week. michelle. coming up, corn concerns as dry heat hits the midwest. why a spike in prices could be headed our way. then, cftc chairman gary gentzler joins us to talk about the libor probe and barclays fall out with chairman marcus agius quitting. "squawk box" comes right back. we're celebrating america's birthday all this week, companies built from the ground up in the u.s. tomorrow's guests include pretzel-maker auntie anne's and harold hamm. send us your business success stories. include #americanmade. god bless america and god bless "squawk box." ttd#: 1-800-345-2550

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the forecast offers little relief, little rain, little hope for now. here's a look at corn futures. look at what they've done over the last year, and you can see just in the last couple of weeks they've really moved sharply higher. do you have any comments or questions about anything you see here on "squawk"? e-mail us, squawk@cnbc.com or @squawkcnbc. share your small business success story with us, use #americanmade. speaking of "american made" chicos specializes in women's clothing and job creation in the united states. the company is opening 120 stores a year and looking to expand, despite tough economic teams. the ceo joins us at 7:40 eastern time. first, bertha coombs has a look at what's in store for health care for the second half of the year. here's what to watch in the health care sector in the third quarter. the high court upholding the obama health plan lifts some uncertainty, but analysts say there are more big shoes to drop in washington for health care.

the election and the fiscal cliff deadline at the end of the year. big health care spending cuts could mitigate some of the gains some would see under the health care expansion, say analysts at jefferies. they also see strong near-term fundamentals, however, for insurers, with lower medical utilization trends and higher medicare advantage enrollments. as far as the politics, citi analyst carl mcdonald says them rallying up to 20% in the second half if republicans win in november. that's your third-quarter channel check for health care. i'm bertha coombs.

down here, folks measure commitment by what's getting done. the twenty billion dollars bp committed has helped fund economic and environmental recovery. long-term, bp's made a five hundred million dollar commitment to support scientists studying the environment. and the gulf is open for business - the beaches are beautiful, the seafood is delicious. last year, many areas even reported record tourism seasons. the progress continues... but that doesn't mean our job is done. we're still committed to seeing this through

welcome back to "squawk box." in the headlines this morning, bristol-myers squibb is buying amylin pharmaceuticals for $31 a share or more than $5 billion. bristol-myers also getting $3.4 billion from astrazeneca for the right to co-develop amylin products after the deal is completed. micron technologies is buying bankrupt japanese chip-maker apida memory for $750 million in cash and pay creditors $1.7

billion over the next seven years. and dell may announce as soon as today it's buying qwest software, according to "wall street journal." qwest has been subject of a bidding war between dell and insight venture partners. steve? a big day for walmart as the company celebrates 50 years in business, half a century. the nation's largest retailer by revenue generates huge property and sales taxes for communities, jobs and record growth for shareholders, but it's what's helpful for walmart, is it hurtful for the rest of retail? cnbc's courtney reagan joins us now with more. >> i feel like i'm taking a slice of some of your beat here, steve. >> go ahead. >> the economics of walmart. walmart has come a really long way from the first store in rogers, arkansas, 50 years ago today, but today the world's largest retailer and the world's largest employer returns substantial profit for investors, offering lower prices on millions of items to consumers. but at what economic cost? the company says its overall impact on the retail industry and beyond has changed the way business is conducted globally and increased consumer benefits,

regardless of where they shop. now, most agree walmart has changed retail, but not everyone believes the effects were net economic positives. walmart's 1.4 million u.s. employees account for 9.5% of the nation's retail workers, as defined by the bureau of labor statistics. the retailer's u.s. employee count has increased 8% since 2005, but total retail unemployment has grown to 8.7% from 6.8% in that same time period. a university of missouri study found that for every 100 jobs created by a new walmart, 50 retail and 30 wholesale jobs are lost at competing establishments over the next five years. so, the study does find the net job effect positive, but others argue those jobs pay a lower wage, depressing the community's competitive retail pay. walmart says its employees earn an average annual wage of between $10 and $12 per hour. a study out of the university of california estimates an entry of ten walmart stores causes the average hourly wage of retail workers in the state to fall by

2%. while it's hard to deny walmart's disruptive power in the marketplace, it's responsible for 11% of total u.s. retail sales. the harm that's done to the greater retail landscape is hotly debated. university of missouri's vaas car says it compresses the community. after introducing the generic drug program in 2006, target, kmart and others responded by lowering their prices. so, ox the next 12 months, drug inflation fell to the lowest level in decades, but americans were also becoming more accepting of new generic drugs that were becoming available right around that same time that the program began. so, others say walmart is really what the american economy is all about, supplying merchandise demanded by consumers at competitive prices. walmart's technological advances have increased retail productivity. its size allows for economies of scale in nearly all categories, keeping costs low, translating to low prices and high sales volume, a positive for both

shareholders and consumers. >> so, this is exactly my beat, courtney, right? which is you look at the depression, what happens to wages, but then you look at the idea that all people, the vast majority of people get lower prices. not only do they force down prices for walmart's customers, but for walmart's competitors. so i guess what you'd call the surplus is on the side of society. >> you know, there's a positive and negative to all of this. i'm sure we'll talk about it all day long, but there are two sides. >> do you have a number for cpi over the last ten years? >> it's been right around 3%. >> don't you have a number for walmart's influence on cpi? >> we don't actually have that number, but you can imagine -- >> it's a point or more. >> -- it's quite substantial. what courtney talked about, with two things. i mean, technology is an interesting concept in the sense that it's computers, but it's also business process and how they source stuff. >> right. >> they also, i mean, one thing you always hear a lot about, courtney talked about this, is you don't -- you want to be a supplier to walmart, but you don't really want to be a supplier to walmart, because

they really squeeze the profit out of that part of the business. >> it's true. even shoppers feel that way sometimes, too. i want to shop at walmart, but i don't want to. it's sort of a double-edged sword for a lot of different -- >> you've heard the walmart suppliers talk about what it's like to do business with them. >> i would go further and say that allowing china to be such a huge exporter, as we've imported deflationary forces -- >> right. >> -- which have allowed us to keep interest rates where they are, which has allowed us -- >> that money goes elsewhere. >> we've been allowed to run huge deficits because of walmart. [ laughter ] >> oh, my gosh. >> china is able to buy our debt because of walmart. >> you could think of all sorts of businesses that are in existence because of the money that consumers have saved from groceries and things like that. >> right. >> now they put it into sports and hobbies and recreation, maybe going to florida on vacation is part of the walmart surplus. >> the ma-and-pop analogy people bring up with the home depot or the hardware stores with home depot or with walmart, it's sort

of the same argument about the poor record companies, that remember the retail record companies that you used to go to when you were a kid at the mall? >> right, right. >> that hang out there because they sold bongs and stuff? >> i still shop at wise hardware in pelham, because -- >> okay. >> there's four guys that are going to help me find something. so the surplus to me is in the time i save, and i know i pay a little bit more there, but that's a choice i can make. >> it is, but it's kind of the price of progress -- >> you don't see it as much in the united states. do you see it in latin america, particularly mexico where walmart, as we know, has expanded dramatically? and to do the old-style shopping like in the victoria era, can i have one of those? can you make a copy of this? that's still how people snob vast places -- >> in the soviet union, all the products were behind the counter. >> right, that's what i'm talking about. in mexico, it's the same way, except for walmart, which has changed -- >> courtney, how many more times are you going to do this today? >> a number of times, but we'll take different slices, because there are other retailers that are 50 this year.

target, kohl's -- >> when is your next, so i can tune in? >> 11:00 a.m. >> 11:00 a.m., excellent. >> talk about how much money you could have made if you had invested in the ipo in walmart. it's a lot. >> look at the 50 richest people and like 6 or 8 of them. they're all there. >> walton's. i wish i was a walton today. >> not the waltons from walton mountain. >> no, not those. >> john boy. >> john boy, jim boy. >> right? can you have that removed without bleeding to death, do you know? that always got me. >> that's gross. >> and the father, big drinker. he was. anyw anyway. >> you're welcome. >> thank you. >> thank you. barclays chairman marcus agius has resigned just a few days after the british bank agreed to pay more than $450 million in fines for its role in fixing interest rate prices.

joining us now from washington, gary gensler, chairman of the cftc. my biggest question, gary, was did he really say the buck stops here? and why didn't he say the pound stops here? >> well, i think most likely because we're talking about u.s. dollar libor -- >> that's what liesman said. >> -- in the american public. >> that's exactly what liesman said. i still think as a brit that the whole expression should be changed to the pound stops here. tell us, can you summarize for our viewers exactly what was going on, gary, and how serious this is? >> this is very serious. the american public and our markets depend on reliable and honest -- and i'll repeat, honest benchmark rates. this rate, london inner bank rate is something you can consider the wholesale rate between the most sophisticated banks in the world and the rest of us pay retail. and i notice governor scott

there, but i would imagine florida probably pays somewhere a rate that's above libor sometimes, the retail rate. and the bank, barclays, was attempting to manipulate this rate and falsely report this rate. in essence, to rig the market in their behalf. >> and that would have aided them how? >> well, the way that it aids them is, one, in the middle of the crisis of 2007 and 2008, they were worried about their reputation. they wanted to have their submissions lower, because when they put in -- there are 16 banks that submit these numbers. that's public information. they wanted the markets to think that barclays was doing better than they otherwise was. secondly, they wanted to make profits when their trading desks in tokyo, in new york, in london, by attempting to manipulate this rate, given what their proprietary trading positions were in those other markets. they were also aiding and abetting other banks,

influencing what the other banks would do or aiding them. >> gary, can you just bottom line it? and maybe you've answered this, but i haven't heard a clear answer on this. were interest rates higher because of this manipulation for consumers? >> well, this was over a four-year period of time, and they have admitted to the department of justice that on some days it did influence their rates, but on some days, it would have been lower, some days higher. but certainly, during the crisis, this wholesale rate was influenced to enhance their reputation. >> lower, right? >> their influence would be lower, right? >> well, on some days throughout this four-year period it may have been the other way, so i don't want to -- >> who's the victim, i guess, who's the victim in your opinion? >> oh, i think that we're all the victim, because one, markets rely on an honest rate throughout this period of time. and without that, we can't really rely on the key, where

are these 16 banks borrowing dr. >> seems to me when i look at this situation, it looks like the shareholder would be the victim, and somehow, in fact, the consumer might actually benefit, right? because their interest rates stay lower? >> oh, but i wouldn't come to that necessary conclusion. >> no? >> because there's a lot of days over four years. >> gary, i want to get to one thing. when i read the news accounts of what happened, it seems to me that barclays was informing regulators, certainly central bankers, about what it was doing. is it our understanding, your understanding, that central bankers knew about what barclays was doing? >> well, we're a market regulator, and we started taking a look at this about four years ago. >> okay. >> and what we did find is they contended that, hey, we told the british banking association -- >> right. >> -- we told some central bankers about it. >> right. >> but in fact, when you look more detail, we include this in this order that we put out last week, and i suggest any of your viewers to look at it if they're interested, that they didn't really fess up to the particular

central bankers that say, oh, by the way, we're attempting to manipulate this rate. >> can you draw any parallel between this and -- just when i hear you, setting ragts at artificial levels and that's going to come home to roost and it's going to be a negative because it's not market-based. do we ever think about bernanke and coe? the fed haters would immediately hate that and say look what we do. it's a central bank, not a commercial bank. but look at the way -- >> what's the difference? >> what's the difference? and the difference is, we like low rates, so we want to set them as low as we can and manipulate them. we like low oil prices. let's make sure we make sure the contract sizes are limited for the speculators, but we wouldn't limit the fed on buying interest rates. >> well, two distinctions. one is, these are private institutions that are setting a rate in the wholesale market, and we need in the marketplace to know what that is honestly. >> right. >> central bankers are different in that they're attempting to manipulate the rate and falsely

report the rate, then we have less reliance on that market. and i'd say that even in florida, governor scott would probably be interested to know whether it hurt or helped his -- >> i'd like it to be lower. >> well, but then -- >> i want everything -- >> that's just the wholesale rate. that's just the wholesale rate, then you're probably paying a spread to that rate. >> well, yeah. >> so, you need to rely on that rate. >> what we're trying to do, nothing that's variable. everything's fixed, and we're paying down our debt. i don't like borrowing money. >> but i would think that you'd want to make sure that they are honest when they're submitting this rate. >> yeah. >> why are you so reticent to suggest we're pushing it lower? once you understand the situation, intuitively understand, barclays would want that number lower, right? because the higher the number goes, the more it reflects negatively on their reputation because investors are nervous or other banks are nervous about lending to them, right? i mean, let's just say what's going on here, they were trying to keep the rate lower. why does it bother you to say that? >> well, because it was two different things going on. the management was directing

through late 2007 through the beginning of 2009 to do exactly what you just said, but also during that whole four-year period, to profit in their trading desks in london, new york and tokyo, they were also at times attempting to manipulate sometimes up, sometimes down. so there was both going on. >> and libor, by the way, you people should know, i formed by throwing out the high and the lows. so the extent to which one single bank is manipulating it, it only shows up as perhaps a few basis points. >> and what you should also think about is during this period of time, people have credit card loans, people have student loans, mortgages, and tens of thousands of small businesses rely on this rate because they're contractually obligated to pay some retail spread over this wholesale market, and this was a pervasive evidence here that suggests that they were attempting to manipulate these rates. and we have to vigorously fight.

we have to vigorously fight to get this right. >> great, all right. chairman gensler, we appreciate it. thank you. and you knew those questions were coming. he likes that. anyway, we appreciate it, gary. thanks. >> thank you. >> sounds like walmart, lower prices. >> right. right. up next, another "american made" story. the ceo of chico's on chico's fas on making money and creating jobs with style. he's our guest after the break. here's a look at the futures. "squawk box" coming right back. [ male announcer ] introducing a powerful weapon in your fight against bugs. ortho home defense max. with a new continuous spray wand. and a fast acting formula. so you can kill bugs inside, and keep bugs out. guaranteed. ortho home defense max.

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it's been a it's been a banner year for retailer chico's and its shareholders with the stock up 33% so far in 2012. joining us now is david dyer, ceo of chico's. good to have you here. >> good morning. >> this is part of our whole american companies series, and it's great to have you here. why is revenue up so much considering how weak the economy's been? >> well, i think there's two things. first is we have most amazing personal service, so we have a relationship with the customers versus a mere transaction like a lot of retailers do. and secondly, the product is right. when you have the right merchandise assortment in your

stores, the customers will respond. >> you do different sizing than most stores when it comes to chico's in particular, right? there's a 0, a 1, a 2 and a 3, and that's it. is that right? i haven't been there in a while. >> and a 00 and a 0.5 and -- >> but it's not the traditional sizing. why do you do that? >> it's the way the company was founded back in 1983 it was one size fits all in the beginning, and if you needed it smaller, just put a belt on it, around the waist, and it would fit perfectly. so, i guess we went from there, and it is a little bit of vanity sizes. everybody would love to be a zero and a one. >> i would, too. >> and so. the other brands are the normal sizing. >> right. black and white. >> soma and boston proper. >> you're expanding the number of stores in the united states? >> yeah. we're opening about 120 stores a year for the foreseeable future. we're one of the few retailers that has that opportunity to

grow square footage in the u.s. and so, we're taking advantage of it. we think we can almost double our stores. >> any manufacturing in the united states or is it all overseas? >> there's very little anymore. >> why? >> over the last few years. i think nafta and everything else has forced manufacturing out of the united states, so the majority of ours is made overseas. so, there's still some jewelry that's made in the u.s., which is a nice part of our business. >> but the trade-off is, the product line you can offer to consumers is much more affordable, no? as a result of manufacturing overseas? >> yes. it would be much more expensive to manufacture in the united states. >> health care reform, is that going to add to your costs? >> it is going to add to our cost. we're not exactly sure how much yet, but we're certainly looking at it and have been preparing for it for the last year or so. >> do you think it will inhibit hiring in any way? >> i think it may. >> why? >> obviously, when we have to

deliver the bottom line that our shareholders want, we have to consider that as one of the costs. so, it will inhibit some hiring. we're not totally sure how much yet. >> it will inhibit hiring because the cost of an employee has gotten more expensive? >> the cost of an employee will get more expensive. there may be some stores that will become marginal because of additional expenses, and we'll have to consider whether we want to keep them open or not. >> on top of that, it's going to mean for corporate employees, there might be an incentive to have them in another country where you don't have to pay for those, so -- >> i see. could even move some headquarters folks overseas? >> no, governor -- >> hopefully not. >> we hope to stay in florida. >> but that's the incentive. the incentive will be if you don't have to pay for that employee overseas for our health care, you'll move them. >> right. wow. >> but they're also expanding boston proper, they're opening up stores. >> we're opening up stores in 2013, and boston proper has been a catalog business to date. we acquired that last october

and we think that that can grow into 300 or 500 stores over time. we're testing next 2013 spring, and we'll see where goes. >> bottom line, are you optimistic about the economic future of the u.s. right now? >> i'm optimistic about chico's and the chico's brand. i think that there is some caution with the economy. you know, our customer, the chico's brand in particular, is a 30, 40, 50, 60-year-old customer, and they're either thinking about retirement or some of them actually retired. and when they see the volatility in their portfolio, they take a pause. and so, i think anything that increases volatility that we may see will certainly not be good for business. >> that happened to you, right? >> it did happen to us. it happened to us last year. we fell off a cliff faster than i've ever seen in my career during the debt ceiling debate last year. we went from double-digit

increases to negative comps in the period of about a week. >> wow. >> and we had bought inventory very aggressively, so we had a little cleaning up to do through the fall season last year with the excess inventory. this year our inventories are very lean, and we think that, you know, if there is some volatility, that we certainly could manage our business much better than we did last third quarter. >> great microcosm look at how uncertainty at the national level in politics can really affect individuals. >> right. >> thank you very much for coming in. it was great. >> thank you. coming up next, more from guest host, florida governor rick scott. then in the next hour, an american legend, gibson guitars was founded in the early 1900s. the iconic brand is on the forefront of innovation for musicians and those who love to listen. the ceo of gibson guitars will join us as "squawk box" continues. there are a lot of warning lights

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>> dueling governors on dueling governors on jobs, health care and the race for the white house. >> we know texas is the competition. >> texas governor rick perry will face off with our guest host, florida governor rick scott. the private equity powerhouse behind names like boston market, smokey bones and more. and our "american made" series continues with the world's largest guitar maker. ♪ the ceo of gibson guitars will tell us his plan to boost the company's market share. the third hour of "squawk box" starts right now. welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with michelle caruso-cabrera and steve liesman. andrew and becky are off this

week. our guest host this morning, florida governor rick scott. checking equity futures in this country, indicated up about 11 points now, 12 points on the dow, almost 3 points on the s&p after a gain -- >> 0.09%. >> if you need to see that, you can see it there. among the stories we're following this morning, michelle caruso-cabrera says that -- >> among the stories we're following this morning, barclays -- >> i already read that! >> barclays chairman marcus agius resigning from his post saying the buck stops with him in the libor price-fixing scandal. the announcement comes less than a week after the british bank paid $354 million to settle claims against the bank. and mexico's old guard could be back in power. enrique pena nieto of the institutional revolutionary party, or the pre, as it's known, claiming victory after he was points above his rivals. >> central casting. i read that over the weekend,

that was the idea. he's very -- and he works it, the photogenic aspects of the thing. what's this mean down there, anything? what's it mean for you guy, slim? slim pickin? >> so, that's an open question. i don't think this was his favorite candidate. this was the favorite candidate of the two people that have been going up against carlos slim for the last few years, the tv executives. so it's probably a negative for slim. >> you weren't down there for this election? you were over in greece or something? >> over in greece instead, yeah, on vacation. >> things happen in both -- >> the biggest thing about this election is it's hopefully going to lead in the medium term to a lot more oil production in mexico. >> it certainly may privatize -- >> they may allow more private investment in pemex. >> but not private sector oil development. >> no. i mean, they've got it embedded in their constitution that mexicans own the oil in the ground. >> are there other things that can be privatized that are owned by the mexican government? >> you could privatize a lot of stuff in mexico. this would be the big ygest thi, 60% of the government's revenue. it takes 60% of mexico's revenue

to run the government, so it's the most important thing for them to try to get -- >> steve's mouth is watering with the ideas of what we could do here if we had that system. >> which one? >> think about that. if we took 60% of exxon's -- think of the good we could do. >> all the good we could do. you know what the producer just said in my ear? >> of course, no longer -- >> he said let's move on. didn't even want me to respond. he didn't like your comments. bristol mire squibb is buying amylin pharmaceuticals for $31 a share. amylin closed friday at $28.20, after trading in the $15 range in march after a report surfaced that bristol-myers was interested in a buyout. bristol-myers also getting $3.4 billion in cash from astrazeneca in a deal to collaborate on creating amylin products. wants to take it over completely. joe, do you want to say two words on what it is? >> i don't know the deal itself, but amylin, the name itself implies the amylwood plaques that show up in alzheimer's.

>> it's a marker of alzheimer's, but not sure if it causes or results from it. and if you reduce the plaque, is the thinking, you might end up perhaps -- >> think of what a treatment or even a cure for alzheimer's would be worth in the marketplace, considering where baby boomers are right now and where we're all headed. and all of the other stuff, we're getting better and better at fixing. we may have transplanted organs eventually, but what good is it if you're -- >> right. >> art cashin has sent a note saying the buck stops here is a reference to the buckhorn knife that was passed around in a poker game indicating who's the dealer of the hand. it has nothing to do with the pound versus the buck. >> so, i say it and you ignore it, but art cashin says it -- >> exactly. >> i know my place. poker, yeah. >> oh, but it's a knife, he said. >> a buckhorn knife. >> i didn't know that, i knew it was a poker term. >> well, if you had said something about the knife, we would have given you more credit. >> mark said the buck stops here. why would a brit say the buck stops here? >> i always thought it was a dollar. it's the buckhorn knife.

>> but it was truman who sort of made it popular, right? but everyone thought he meant the dollar. our next guest is the head of the private equity powerhouse behind some of the nation's biggest brands like boston market, the limited and american standard. here now with his investment outlook and the state of the u.s. and global economy is roger krause, co-ceo of the private investment firm sun capital partners, which has $45 billion in combined sales. it's great to see you, and we've got to get, initially, whenever we have a gentleman as yourself that has all these disparate businesses, how are things right now? give us a snapshot of this point in time. >> i would say things are treading water at this point. as we look at the first half of the year, sales are flat. really, our expectations for the next year, second half of the year are pretty flat as well. some positive points i think have been in the restaurant area. restaurants have been declining same-store sales for a number of

years, but we've seen some stabilization there. then also our auto parts companies that sell to the oems have been doing surprisingly well, but overall, it's been pretty flat. >> everybody talks treading water and that's not going to cut it at 8.2%, is it? what's wrong? what's happening? is this a hangover from the financial crisis? no demand. is it europe? >> i think it's a conglomeration of things, and we're just at a point where we're not moving. and i think a lot of people feel that should we get unemployment down, that's going to really help a great deal in terms of consumer demand. we just haven't seen the excess demand. >> and i wonder, do we need to fix housing or let housing fix itself to get to the point where consumers start picking up, which causes a demand, which will allow for the hiring? it's also circuitous. we don't know where to start. we just know we're at 8.2%,

maybe headed up from here. >> yes, i don't know what else you do with housing. housing's a long cycle and i think it will find its way. i don't know that's necessarily the place to go, actually. >> but you just make it a better place to do business. if we reduce taxes, reduce regulation, you'll be more comfortable adding more businesses. you're another great florida headquartered company, but if you -- what we're doing in florida they ought to be doing nationally, reduce taxes. we can't have the highest corporate tax rates in the developed world, more regulation, longer permitting processes. it impacts your ability to inve invest, doesn't it? >> absolutely true. i think what we are doing in florida's a great thing, and you're seeing it nationally, the results in florida and the improvement in the economy here. and there are two things that are really worth noting. clearly, we all talk about taxes and just the effect that taxes have. the higher they are, the less le have to reinvest, and that's certainly clear and the more it hurts the economy. and as the governor said, our

corporate tax rates are about the highest in the world, and it puts us at a real disadvantage. we compete with companies globally at this point, and our competitors have a natural advantage over us, which is a tough thing to overcome. >> right. >> but one of the main points he makes -- i do want to mention this -- is regulation. and regulation doesn't have a stated cost to it, but it has a huge drag on the economy. and i saw a small business administration study which talked about a cost of business of $1.75 trillion. and it's an enormous cost across the economy, and i love what the governor's doing in florida to reduce red tape, particularly for small businesses, where it's really a burden. >> over the weekend, "the new york times" informed me that both sides of the political aisle agree that the obama administration's attacks on private equity, which have ramped up hugely in the last month, that they're seeing a benefit from that. people on the right say they're

not sure it's lasting. people on the left say that it's definitely something they're going to keep doing. do you think that candidate romney has addressed the attacks on bain sufficiently? and are you yourself -- i mean, do you feel nauseous when you hear them, like cory booker, or does it make you -- what do you think of the attack? nauseating? nauseous. i think it's nauseated. >> yeah, i have different visceral reactions as well, and nauseating may come into it, but you have to really look at things in a broader context. and people could pick at one or two bad things that happened that they don't like in a different construct, but when you think about our industry, one, we provide a lot of capital. and there are a lot of companies that we have saved over the last five years by virtue of having that capital in a cash-strapped world. and two, when you actually look at who we invest for, it's largely for retirees, it's

through pensions, through public pensions, through private pensions so -- >> do you think romney's done a decent job of answering the criticism, rodger? >> you know, i haven't really seen them address it and it's hard to see what actually gets through the press. >> what should he say? >> well, i think he should say the benefits -- the other thing, though, what the industry really does well, i believe, is it helps run companies really well. and so, there's a great connection. we do really well with governess and holding management accountable and companies do better and companies have a better chance of succeeding and then a better chance of growing. if i could just digress to talk about us personally. we have 83 companies, 170,000 jobs worldwide, 130,000 of them in the u.s. a third of the companies we buy are losing money when we buy them. half the companies we buy aren't losing money, but they're not making near what they should. all of those companies are in jeopardy of going under. and so, it's the capital we

provide and it's the management expertise that we provide that helps preserve all those jobs. and if we do our job really well, then we can grow it, and that's what's best for us and our investors as well. >> unfortunately, people are able to use numbers -- what you just said -- so, a lot of those companies, if they were to close down in total you'd see one job number cut. if you take them over and have to lay off some employees to keep the company in business, you're still going to see possibly a net loss of jobs, therefore, the 0other side's going to use that as an example that you're really not in the business of job-creation, you're in the business of destroying jobs. it's tough. >> i think you have to see it in the total context, though. i mean, if we're buying a company that is losing money and then -- >> right. but you see how you can work with those numbers, and they're going to say -- >> oh, no, no, i understand. i can see how they can -- >> that's why they need to be defended. we need people to actually say, look, this is what happened. >> absolutely.

>> you made it clear to me right there. >> right. >> if half of them are not making money or a third of them are losing money and you come in, and some people unfortunately lose their jobs -- >> absolutely. >> -- but the company survives and other people keep it, then it's that simple. but you could go to the average man on the street and he wouldn't be able to explain private equity to you that way, because of the way it's being portrayed. >> well, i guess we've got to explain it better, because it is a force for good. >> but job creation is not specifically in the charter of a private equity company. that's one of the problems, too. it's maximizing return to partners, right? >> our objective is to maximize return to our partners, as i said, most of whom are the pension funds. but along the way, you know, adam smith's -- >> oh, i know. >> you need to serve your customer best. >> all right, we have got to go. >> you need to serve your employees properly and that's

the only way it can work. we only make money if the companies do well. >> great. >> we're well aligned that way. >> rodger, we appreciate it. thank you. thanks for your time today. you don't want the government involved in every plant closure and every layoff, right? >> no. he really came up at the very end with the one thing that's been a criticism of private equity, which is the idea that sometimes they do well even when the company does poorly. i wanted to ask him about that. that's been one of the criticisms out there, although my knowledge sometimes of some of these small companies they take over, the governance provided by private equity's absolutely essential -- >> you don't want every plant closure to be signed off by the -- >> what i do want is to tell you what's coming up. europe in focus. the debt crisis and scandal at barclays. our contributor will weigh in. our guest host rick scott will go head to head with texas governor rick perry to talk jobs, health care and the presidential election.

to welcome back welcome back to "squawk box." the s&p 500 and the dow jones industrial average will be living under the same corporate roof. it's the result of a newly announced agreement between mcgraw-hill and a ceo dow jones

adventu adventure. the cme dow jones venture contributes to the business, the result a new business called s&p dow jones indices. did you know about this story? >> no! and i'm hoping that finally means i can get the s&p up on this little thing, because they never put the s&p here because it's a compete, used to be a competing -- so dow, nasdaq, no s&p. >> i need to read more about this. are they merging these iconic indices under the same roof? i know there's probably an infrastructure issue. use the same guys to calculate, right? it's a huge data business they do besides. maybe they're saving some money. >> diverging into two. can i get it on the front page, please? barclays again making headlines as chairman marcus agius resigned after the libor scandal. joining us is jessica pressler, "new york magazine" contributing editor. good to have you here. you write about all these folks. dimon, falcone. is bob dimon next?

>> i think so. >> why? >> he was always kind of disliked. he's the swaggering american who came in, you know, reportedly quit his job because he was dissatisfied with his $8 million bonus at -- first boston? >> i thought the brits loved americans, no? >> they do until they sdrcrew u. then they can be like, you, get out of here. it's all your fault. >> they were nothing before dimon came here. he put barclays on the map. they're looking a gift horse in the map. >> he's also been very vocal. >> you're looking at -- >> but how does he run both jpmorgan and barclays? >> right. >> but they are sort of the same thing. both really loud. they're both really -- >> i think that's -- i don't know. i think that's shameful. i mean, did he not put barclays on the map here? he did an incredible job building that business here. that's why he got to be ceo. >> and they scooped up that mess. but i think that this is --

>> an $8 million for a banker is not a huge bonus, either. to the brits -- >> well, this was in 1995, so it was bigger then. >> but he hasn't been overpaid, i don't think, in british terms, maybe he has, but not compared to his, you know, rivals here -- >> well, it depends on what your scale is for overpaid. it's kind of a lot. you know, i think he made like $13 million in 2007, which is less than goldman sachs. that's true. >> pick up lehman on the cheap, right? they didn't have to buy it. essentially they got it out of bankruptcy, so that was a good move. >> i think it would be tough to be an american trying to run a bank in britain. >> i think they sort of see him as this kind of casino operator. >> so, you're saying he's going to go, is that your prediction? >> i feel like he's going to go. he doesn't have a lot of support from investors, from politicians. >> but he's going to go after having done well, right? i mean, the u.s. operation is a profitable operation. they've moved into a bigger, more prestigious position than they were in before. >> i bet he could come back here and find another job.

i think he is done in london. i think that they are super outraged about this over there in a way that we're not, rightly or wrongly. >> you have also written about falcone. what an incredible fall, cinderella story, bar none, and now this mess. >> yeah. well, that's another like sort of similar thing, where he, you know, was really kind of flamboyant and out there, and i think that in this time, the tall nail gets the hammer. metaphors again. but you know, he was really out there. >> you could take money out of your firm when you're finding nobody else can. >> he thought he could do whatever he wanted, and then you know, really kind of got a little bit nuts, it seems like, taking loans from your own hedge fund and giving preferential treatment. he just ran rough shot over all of the laws. it's pretty amazing. i mean, he told me, you know, he thinks he's going to get through this, it's a piece of cake was his exact words on that. so. >> all right. what is it, a walk in the cake?

>> a walk in the cake. >> uh huh. thanks for coming in. great having you. >> it was fun. coming up, more from our guest host, florida governor rick scott. still ahead, texas added more than 500,000 jobs in a period in which most states lost jobs, but rick scott tells me it's really hot there and dusty and not a place you really want to be. but we're going to see, he's going to have to say that right to rick perry's face in a second at 8:30. as we head to break, first day of the second half. here's jane wells with the outlook for defense. >> here's what to watch for in the defense sector in the quarter ahead. one word -- uncertainty. the military is planning a half billion in cuts, but that could double if congress doesn't fix the budgets by the end of the year. half of northrop grumman's sales are with the pentagon. we have a hold on both, concerned about the outlook for the f-35 program and for northrop "there is more downside risk than upside potential," but

steeple has a buy on raytheon, believing the classified business bringing in double-digit growth to that country may be more protected from cuts. but more than anything else, investors want to know what plans defense companies are making to prepare for the worst. that's your "q-23 channel check" for defense. we're hitting new highs. tdd# 1-800-345-2550 and i'm on top of it all with charles schwab. tdd# 1-800-345-2550 tdd# 1-800-345-2550 i use streetsmart edge and its tools like... tdd# 1-800-345-2550 screener plus - i can custom build my own screens tdd# 1-800-345-2550 or use predefined ones. tdd# 1-800-345-2550 and i can trade wherever i want, tdd# 1-800-345-2550 whenever i want. tdd# 1-800-345-2550 the kicker? tdd# 1-800-345-2550 i pay $8.95 a trade. tdd# 1-800-345-2550 that's a deal in any language. tdd# 1-800-345-2550 open an account tdd# 1-800-345-2550 and trade up to 6 months tdd# 1-800-345-2550 commission-free. tdd# 1-800-345-2550 call 1-866-393-6174. ♪ ♪

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why is the why is the camera on me? i have no idea. >> because you're supposed to read! >> it had my name in it just a minute ago. welcome back to "squawk box"." i'm sorry to bother you with the internal goings on at "squawk box," but here are the stories we're watching. dish network in the middle of two controversies. nbc, cbs and fox head to court today involving dish's add-skipping feature known as autohop. they say it violates copyright laws and amc network -- the second issue -- has disappeared from dish's offerings as of yesterday morning in a dispute over fees. joe tells me i'm supposed to not like autohop because of the business i'm in. >> well -- >> rather than the predominance of my time spent as a couch potato, i don't like autohop. >> next to devil worship and molestation, yeah. >> right, exactly. >> does it seem like a reasonable thing? >> seems pretty reasonable from an absolute economic point of view, to dislike autohop. >> you have to dislike it. >> that's what i'm talking about. >> it's akin to devil

worshipping. >> i dislike it. >> i agree, you should never skip the commercials! we only exist to keep them from bumping into each other. >> here we have a disagreement, i think, with our viewership. >> you couldn't get elected. think about it. no commercials. >> no commercials! >> positive information in commercials all the time, the things you didn't know. things you didn't knows about -- >> things you didn't know you wanted to buy. the sugar cereal that your kid didn't know they wanted. >> it's funny, i never skip the movie commercials. >> the incredible content that you manufacture every day. >> every day. >> that needs to be monetized. >> monetized. >> it does. >> through the advertising. and autohop is the devil. >> it's ergan, and i don't know anything else about him, but i assume he's a pretty -- ♪ >> ooh hao! >> thank you for that. >> speaking of the devil. >> that's a signal to go to commercial. that's what that is. coming up, we'll ask texas governor rick perry about mitt romney's campaign strategy.

and the music is about our a american made" series continuing with the world's largest guitar manufacturing. the ceo of gibson guitar will tell us about his plan to increase market share. ♪ it's very important to understand how math and science kind of makes the world work. in high school, i had a physics teacher by the name of mr. davies. he made physics more than theoretical, he made it real for me. we built a guitar, we did things with electronics and mother boards. that's where the interest in engineering came from. so now, as an engineer, i have a career that speaks to that passion. thank you, mr. davies. according to ford, the works fuel saver package could literally pay for itself. jim twitchel is this true? yes it's true. how is this possible? proper tire inflation, by using proper grades of oil, your car runs more efficiently, saves gas. you could be doing this right now? yes i could, mike. i'm slowing you down? yes you are. my bad. the works fuel saver package. just $29.95 or less after rebate.

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let's take a look at some of the stocks on the move in today's early going trading. amylin pharmaceuticals getting a pop on news that it's being bought by bristol-myers for $31 a share. amylin doubled since march when reports of bristol-myers' interest first surfaced. lincare holdings is being acquired by lind for $51 a share. it's a home-based provider of respiratory therapy. and brightpoint is being bought by ingram micro for $650 million in cash or $9 a share. that's a 66% premium. at friday's close, up $5.41 per share. qwest software has been halted for news pending. that follows reports that dell is about to announce it's acquired qwest. that's a lot of m&a news for a monday! but still. >> yeah, it is. all right. and it's a monday. that's when it happens. they work on the deals over the

weekend. the lonestar state versus the sunshine state. which would you prefer? it all comes down to what these two governors have to say. joining us now, texas governor rick perry, former presidential candidate, and rick scott is here as well. a battle of the ricks here. i'll tell you, it wasn't very -- listening to this guy all morning long talk about florida and how much better it is than texas started to rub me the wrong way, governor. is it really that hot and desolate and dusty? i mean, why wouldn't people just all go to florida after what rick scott told me? >> beaches and weather. >> palm trees. >> hey, we've got our beaches. we've got about 600 miles of beaches in the state of texas. so you know, the great thing about this is these are two wonderful states, great competition that goes between them. >> that's not what the note said, governor. that's not what you just said before you came on tv. >> i will tell you, rick likes to talk about how good the fishing is in florida, and they do have good fishing. i admit that. but by the organization that ranks the states by best bass

fishing lakes in america, florida would be behind texas. thank you very much. >> wow. how about marlin and -- >> take that! in your face! >> saltwater fishing. now, are you going to come -- i proposed a fishing tournament with you. are you coming? >> i am. and listen, you guys have some great saltwater fishing, but again, we've got our fair share of it, too, down in the state of texas. one of the things i'm going to try to get you to do is i'm going to come over and i think we'll bring some veterans with us to take them fishing at your recommendation. i think it's a great idea. and then you can reciprocate coming back down to the state of texas. i'm going to give you a tour of padre island that will water your eyes, governor scott. >> oh, it's going to be great. well, you know, our two states are clearly competing for jobs. what we're doing -- i mean, governor perry's done a great job. eight years running, "ceo" magazine says you're number one. probably your last year, i know, but we're number two. >> dream on. >> you've done great job and we're doing the same thing, lowering taxes, less regulation,

less litigation, easier permitting process. i mean, texas is the place to be. >> well, and i will just add to that. it is good to have governors that are out there working with their legislators, putting in tax regulatory legal system processes into place that make their states more competitive. it's one of the reasons we passed loser pay in our legal system this last legislative session in 2011. and by the way, rick, we only meet every other year for 140 days. we happen to believe that the less the legislature meets, the better it is for the small businessmen and women in our state. >> because you get less legge legislating in that way. >> roger that. >> if i said that, it wouldn't help me with the legislature. >> when we look at the recent supreme court decisions, are you thrilled -- you can look at the overall decision, i know there are a lot of complaints from the conservative end, but when it comes to states rights, it's pretty good, right?

>> they gave us a right to not opt out of the medicaid program, which is a $1.9 billion a year increase. and we know we don't have to do the exchange. i mean, look, what they didn't do was obama care is deal with the cost side of health care. the problem is the cost. the cost is out of whack. >> but this important question about the states being able to compete and do what they need to do. i mean, this thing that you're talking about, there are people in this country that think everything should be done at the federal level so that we states don't compete, but we need states to compete. >> laboratories. >> they have been. they have been chipping away at the tenth amendment and that sovereign right of the states to be making decisions. i mean, there's a clear enumerated number of things that the federal government should be involved with that our founding fathers put into place, and they left everything else up to the states. that has been chipped away at for 60-plus years. and we need to push back on it. and i think it's one of the things that governor scott, governor jindal, martinez, i

mean, all understand. >> and depending how you feel about the supreme court decisions over the last -- what about immigration, for example? >> any time you allow unelected judges to make decisions about your freedom, it makes me very nervous. and our constitution is what we ought to be allowing. and i think misrepresentation and misinterpretation of the constitution is a great concern. so you know, here's the issue on health care -- they should never have been making that decision to begin with. this president and his cronies in congress are the reason they pushed that through, this misrepresented what it was, they told us it wasn't going to be a tax, they told us it wasn't going to infringe upon the tenth amendment rights of the states, and then they read it, and we found out that it is absolutely a debacle that's going to cost the states substantial amounts of money. you know, hopefully, we're not going to have to see this thing come to fruition, that we can

elect a president and a congress that will repeal it. >> we have to. i mean, this is -- it's going to be horrible for patients, it's going to ration care, it's going to -- tax increases are ridiculous. it's going to put american businesses, florida businesses at a significant cost disadvantage. so it's going to be horrible for jobs, which is the biggest issue we have in this country. >> governor perry, i want to know what you think about the supreme court ruling on immigration. >> i think it's a disaster. i think it was a big -- >> governor scott. >> rick, do you want to answer? >> yeah, listen, on its face, this thing was absolutely an infringement on the states' rights. we go back again. federal government is failing to defend the border. that's the bigger issue here. whether it's rick over in florida or suzanne in new mexico or the governor in california, governor brown. having to deal with these porous

borders that are just open and people moving back and forth with immunity. i mean, the bottom line is the federal government has failed to defend the border. and then we have to deal with these issues. and so, whether it's putting legislation in place, like i want to pass sanctuary cities in the state of texas, where the cities can't give these sanctuaries to people who have come into our states illegally. >> so, governor perry, you agree that we should not give sanctuary to the children of illegal immigrants. >> i think you have to have an immigration policy that is thoughtful in this country -- >> sorry, that's a yes or no question, governor. >> no, it's not a yes or no question. i know it makes it easy for people to say yes or no, but the issue is, until you secure the border, you can't have a conversation about are you going to do this or are you going to do that. and that's been the problem for too long, is that washington, d.c., has absolutely failed. and one of their constitutional responsibilities to defend and secure that border. until you do that, you are

wasting your time. >> governor scott, your opinion on the issue? the children of illegal immigrants? >> i think governor perry's got it right. you can't do it by itself. you can't just pick a group and say we'll give that group amnesty. you've got to do, step one, secure the borders, have an immigration policy that everybody understands in america. then you can have a conversation about what you do with the people that are here. but until we stop the problem, you can't even have those conversations. >> do you support the arizona law as it was written? >> here's what i support. secure borders. i support making sure we have a federal policy that makes sense, don't put florida businesses at a disadvantage. we need a work visa program for individuals who come to our state and work. we need them to come to our state to work and then go back home. but if you're in our state and you're doing something illegal, we should be able to ask you if you're legal or not. >> all right. governor perry, appreciate it. thanks for your time this morning. >> absolutely. rick, keep working over there. we'll keep setting the bar high for you. >> all right. we're going to compete. good luck.

the news on qwest software that was pending a few moments ago, remember the stock was halted? well, it's now out. dell is buying qwest software for $28 per share in cash. we're waiting for the stock to resume trading after the halt. the $2.4 billion deal follows the back-and-forth bidding war between bell bell and private equity firm insight venture partners. >> more on that when we come back xsion an interesting deal. coming up, "american made" series continues with iconic guitar-maker gibson. they employ people in their plants in nashville, memphis and montana. the ceo joins us next. [ tires squeal, engine revs ] ♪ ♪ ♪ [ male announcer ] not everything powerful has to guzzle fuel. the 2012 e-class bluetec from mercedes-benz.

see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz f. we asked total strangers to watch it for us. thank you so much, i appreciate it, i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money ? if your bank takes more money than a stranger, you need an ally.

ally bank. no nonsense. just people sense. the teacher that comes to mind for me is my high school math teacher, dr. gilmore. i mean he could teach. he was there for us, even if we needed him in college. you could call him, you had his phone number. he was just focused on making sure we were gonna be successful. he would never give up on any of us.

♪ ♪ all right. when you think of a guitar in "american made," you have to think gibson. the legendary company is the largest guitar-maker in the world, who has not missed a single beat since the dawn of rock and roll. joining us now on set is henry juszkiewicz, chairman and ceo of gibson guitars. is that right, you're the largest in the world? >> yes, we are. i believe we are. really, in the last four or five years, we took the number one spot. >> the big story that over the last say 10 or 15 years, maybe 20 years, has been foreign-made guitars. and yet, you've managed to maintain production here in the united states. how has that happened? >> we've not only maintained, we've increased substantially.

we've grown our factory. last year, we doubled production here in the u.s. >> doubled. >> continued -- yes. >> did you bring stuff from overseas? what was the reason for doubling? >> well, effectively we did in that we're gaining market share. so, really, it's a great guitar, and we're investing very heavily in technology. a lot of our -- if you're a cost-based business in china, you know, you're looking at everything to strip costs out of the product, and price competition could be quite brutal. we're looking at putting value into the instrument. >> what does that mean? it means you're not lowering your cost, the retail cost of the guitar? >> right. we've been increasing, actually, our pricing and translating it. for example, we have a machine made in germany called the pleck

machine, which every one of our guitars goes through, which is a substantial improvement in the way guitars are manufactured. but they're enormously expensive, the german machines. but every one of our guitars goes through that. >> how hard is it for you to keep production in the united states and to actually increase it, given the much higher labor costs? and is being the only nonunion guitar shop, does that make it easier for you? >> well, it makes it substantially easier. more because of work rules that are often limited with union contracts rather than cost itself. >> so, it's some of the rules associated with it. >> because we try to maintain a really high labor rate intentionally. we want to have the really best people -- >> best ones. that all sounds good. would you say, honestly, has the government helped you keep jobs

here as an ally, or have they been an impediment to keeping jobs here? >> well, i would say they were pretty neutral until our latest foray with the government where they have been enormously destructive. >> what happened? you had some wood -- i don't understand. you're not allowed to import wood from madagascar if it's used to make something here, but you could make it in madagascar? >> more or less, that's right. they cited a law that is -- >> and they rated you. a couple of raids. the fbi -- >> the whole thing. >> oh, man, yeah. >> was eric holder with them when they came, do you know, or was he down -- >> he was fighting "fast and furious." >> was he running guns somewhere? >> i don't know. it was a bizarre thing. you know, it's a guitar factory. mostly filled with ordinary folks. and you know. >> and the s.w.a.t. team shows up. >> it was almost like a drug --

>> it was a drug raid, you know. i mean, it's the same guys. >> and you were told at some point that if you just imported the wood from -- what did they say? how could you get around it? they said the pressure will ease if you do what? >> well, there was an interesting citation in one of their filings in a lawsuit we filed to recover our goods that they seized. and they said, you know, you would have been better off to manufacture guitars in madagascar. >> they said it would be -- >> so, send the jobs overseas. >> yes. >> can i just ask, the les paul is the best selling guitar you have? what percent of total sales is that? >> oh, wow, i don't know. i would guess it's well over 50%. >> and what is the best new product you've introduced? what is the coolest new thing? >> the firebird x guitar. >> the firebird x. that's over there, guys. that's the back left? what's great about that guitar? >> well, it has a boatload of new technology, like eight

microprocessors -- >> really? on a guitar? >> microprocessors. not that one, guy. >> wireless, blue tube, just way ahead of its time. >> wireless blue tube on a guitar? >> no, it's the brown in the black left. >> your other left. >> very often, a guitar player will use pedals. >> no, that's your right. >> there it is. that's the firebird right there that you're talking about some. >> and it's got the wireless bluetooth on it? >> well, no, it's the blue guitar. >> i was wrong. you had it right at the beginning. eight microchips, but that's a firebird, too, isn't that? >> that's the traditional one. >> that's the one i know. i'm such an old -- >> do you play? >> i do. i do. i've been playing since i was 8. and it's one of the reasons i got into it. >> did you buy it originally for profit or for fun? >> well, absolutely i bought it for profit. i'm a business guy. but i also have a passion for the product, so that really also influenced me to do a really hard job, because it was in

pretty bad shape. >> he's raised prices because you've made such a great product, adding more value and people are willing to pay for it. >> and i actually tested that when i -- i'm, you know, an engineer, pretty analytical. i tested pricing. and we had an inverse price curve. so every time we raised prices, our sales went up. >> more desirable. >> so, our customers wanted -- >> pay less. >> so, you could afford to pay people better and make sure you had the best talent. >> absolutely. >> so many beautiful guitars. >> shocking. really classic, classic guitars. >> it's what i called attack. >> thank you so much. and thank you to the guitarist we've been listening to, grammy-nominated songwriter and composer gary lucas. what a great american story. >> great >> great job. thank you very much. all right, coming up, we'll have the latest buzz from wall street. we're going to head down to the new york stock exchange next. i haven't seen any fbi agents

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welcome back to "squawk box." david faber has more -- we're going to wait on this for one second. you know, there's four anchors on the show, but no one's available. >> nothing like throwing your colleagues under the bus. >> i'm excited, because the ceo is miking up -- there's faber. >> he's playing a cool guitar over there. >> melissa and carl are here. >> they told us nobody was there. >> not that many people on the floor the of exchange this morning, but we're here. >> it's merger monday, faber. >> it's going to be a quiet week, though we're coming off that enorm ago rally on friday. we're going to talk markets at the top, see what we expect from

this expectedly quiet week. we have some deals. bristol-myers, amylin, lindy lind care, so we'll be looking at a lot of different things. >> did lindy and lind care happen because their names are so familiar? >> yes, that is the reason. as usual, you have cut to the core. >> the synergies, the stationeries, the signs. >> huge. you don't have to change anything. >> the best one was the peanut butter and jelly of all time. implts that is finally the sinner engine. >> total mayhem. >> see you in just a minute. playing with gary lucas, joe talking to faber, michelle talking over -- >> i just wanted everybody to see so cool. >> ceo of gibson guitar on the

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talk of the day, knock on technology, micron announced it would buy bankrupt japanese chip maker lpita memory. and pay the creditors over the next seven years. some parting shots from our guest host, florida governor rick scott. last time you were on, you had on the tip of your tongue actual companies. this company hired 450 guys. what's happened since you were on. >> mind did tree, 400 jobs in

gainesville. it's a back office company, it's an indian company. you know how it happened in a professor at the university of florida responded to an e-mail and got it to me, and they potential could do 3,000 jobs in gainesville. >> they're from india. >> yeah. >> why florida? >> they needed our students. >> you didn't bribe them, no tax breaks, nothing like that. >> it would have been insignificant. i don't do big deals like that. if i'm going to do a transaction with you, i'm responsible for the taxpayers, just like shareholders, taxpayers of the state. the only way i get money back is through sales tax, because we don't have income tax. i can't do a transaction unless i'm going to get sales tax dollars back. >> that's sort of a high-tech. >> a lot of them are high tech. time warn are, today ace airbus

announcement i think it's already announced some mobile, a lot of technology jobs in the panhandle. we're the third biggest state as far as the number of technology companies. now the fourth biggest exporters. we're opening our 12th university which is just technology. >> a state-run university. >> state run. >> you have no income tax. why do people think you can't have a state when you don't have income tack. >> new hampshire has no income tack. >> if they keep doing it, we'll get more companies, because they're -- think about it. their customer is not willing to pay more for their product, because the company pays more taxes or it costs more money to comply with regulations or takes longer to get a permit, so texas, florida, other states are constantly better place toss do business, so companies are moving there. the system does work. >> what about corporate tax. >> we have