good morning. nightmare. at-sea passengers cheer as they file off a crippled carnival

cruise ship. following the money, some of the world's most influential investors reveal where they've been putting their money currently. but to russia with love, currency wars coming to moscow as g-20 leaders meet there. did liesman go? if so, it's a big home coming. "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen. andrew ross sorkin is off today. our guest host this morning is sir martin sorrell. our top story, nightmare at sea. more than 4,000 passengers on the disabled carnival cruise cry oomph docked late last night. michelle caruso cabrera is there on scene. she's going to join us with more

and what the means for carnival and the broader cruise industry overall. we are tracking the markets this morning. a lot of excitement fueled in large part by deal activities. in the last few days aloep, we heard berkshire hathway is buying heinz for $3 billion. and comcast announcing a $16.7 deal to buy out ge's remaining stake in cnbc parent nbc universal. warn buffett on "squawk box" yesterday. >> i'm ready for on the another element. please, if you see any walking by, please call me. >> how much do you have on hand, cash deal? >> year en, we have about 47 billion of cash. but we always like to keep and we will keep around 20 billion. so you might say the excess cash at year-end was about $27 billion. >> we will talk more about

animal spirits this morning. among our guests is sandra o'neal's jimmy dunn, robert caplan, cantor fitzgerald's bill nichols and former etrade ceo mitch caplin. plus, kelly evans will be joining us from some of the headlines out of that gathering. but the story out of russia this morning that everyone is talking about has very little to do with currency wars or anything else financial. take a look at these pictures. it was a strange sight in the sky in russia. a powerful blast, large plumes of smoke that were seen in the sky for more than 1100 miles. it is believed the plumes were caused by meterorites. they shattered windows. about 400 people were injured, mostly by falling glass. this is a story we'll be talking about for some time. take a look at u.s. equity

futures. right now, the dow futures down by about 11 points, and the nasdaq down by just over 5 1/2. joe, i'll send it over to you for moore of the morning's top stories. >> having fun with sir martin sorrell here already. >> and it was early. gosh, it was early. >> and we took a shot of him and it was like -- that's the way -- >> collect on my -- on your gambling debt. >> i told but that bet that -- >> and he rel muches on his bet. >> iept not welching, because by losing, you have to go to dinner with me. >> one dinner could have been okay, but two dinners? . >> he complained about how you had not -- >> i don't know when you're in town or your wife is in town. >> i am in, you know, halftime. >> you know what? he hasn't wanted to -- that's wa i said. by inwinning the bet, you actually lost the bet so you have to spend time with me.

you know what he came up with already today? >> what's that? >> you know what's on that ship every day? the poop deck. >> joe has been fascinated with this. >> i'm fascinated with the coverage of it because when we talk to someone who is on the ship and says it wasn't ta bad, we're like, get rid of them. find somebody who has had a horrible time. the anchors dance around, has it been hot? has it had food and then they get to what they're saying, did you use those bags? and if you didn't use the bags, how did you do it? >> i was surprised by how positive -- because i couldn't sleep, anticipating coming on the show so early. i saw a number of engines, obviously, and -- >> oh, krn was going crazy. >> they were. >> the passengers were saying that, but the people interviewing them were like, find another passenger. i finally said, why don't you go

at the anchor, leave and call your other anchor because they weren't getting the stories for the right people. let's go down to mobile, alabama, and talk to michelle caruso cabrera and hopefully she found someone who had a bad time. >> i interviewed five people would came off the ship and they all said it was a bad experience. they talked about the smell was particularly bad. you can see the carnival triumph is right behind me. it limped into port last night very, very slowly. we're showing you the video here. as soon as they got into port, they began disembarking more than 4,000 people on board and finally a thousand employees. one girl as she got off the boat kissed the ground she was so happy to be there. we've been interviewing passengers all last night. all the networks have. the theme is very, very similar. they're all relieved to be back.

they all talked about the smell being very bad. the crew was terrific. they're angry at carnival. take a listen. >> that was the most challenging thing that i think i've ever done. it was like literally being in a floating porta potty. human waste everywhere. the crew was great. they did a great job on keeping our spirits up, but it was tough. it was tough. >> it was very tough. we slept out on the deck. i ate a lot of sandwiches. >> and there were lots of photos and, of course, that were being distributed that people took with their foams and cameras that showed the bags in question, the tent city in question. people who had a room with an actual window were much happier. we interviewed some of those folks last night. it wasn't as hot or smelly in their room. they were probably on an upper deck, so depending on where you

were on the boat, as always. 100 buses were waiting last night to either new orleans or to galveston, which is where the boat originally disembarked from. there's going be about a dozen charter flights today by delta to get everybody home. back to you guys. >> all right, mcc, thank you. we want to hear from you, if not on a cruise ship, where would you rather be stuck? what would a better place to be rather than on a cruise ship? >> how about right here at work? >> right here at work? >> filling in for andrew ross sorkin. >> filling in for andrew ross sorkin. it smells fine in here right now. you showered this morning? i did, too. it's friday. so i did, as well. it's underwear change day, shower day, everything else. >> once a week you shower? >> is that tmi? no, no. when we were out in pebble, i got up too late and that was the first time in 22 years that i had not showered in -- >> first time ever?

>> going on the air, yes. yeah. in other headlines, airbus is dropping lithium ion batteries from its new plane, the a-350. the company citing uncertainty that is surrounding the technology problems with those batteries that, of course, led to the grounding of boeing 787. airbus says it does not expect the batteries to delay the a-350. and the deadline has now passed for outside investors and steve cohen's outside capital to withdraw funds from that hedge fund. the manager says roughly 60% of the firm's money comes from dollars invested by cohen and his employees. so the impact of their redemptions may be more symbolic than anything else. blackstone is si a c's largest outside investor. the firm did redeem some investor capital and will consider whether to remove additional funds in may. and couster's says it will oppose disney's combination of the chairman role and its executive pay plan at the

company's annual share hoeding meeting in march. that's 0.3% of a stake. so i don't think this goes anywhere. they like to be advocate and -- obviously involved if there's a centered around. >> bob iger was elected chairman at last month's meeting and if you poll ten people, nine of them would say he's worth every penny, and he's handsome. he has a beautiful wife, a lot going for him. how about the new star wars stuff? >> that's going to give them more stuff. >> it's not nbc universal, obviously, and neither is he like one of those managers, but he's -- >> but he's close, right? >> yeah. he's pretty good. >> let's take a look at the markets this morning. the futures are weaker. we're heading into friday with the markets essentially flat for the week. so the russell 2,000 is the one exception. it's up more than 1% and at an all-time high. the dow and the s&p are near

all-time highs. right now, you can see those dow futures down by about 15 points. we will be get something news today. if you take a look at oil prices, they're down by about 53 cents. 96.78. we're getting news today, the economic reports we'll be watching for include the empire state survey at 8:30 a.m. eastern time. we have industrial production coming out at 9:15 a.m. eastern and consumer sentiment at 9:55. if you take a look, you will see it's yielding just below 2% as 1.99%. the foreign exchange market, we are waiting to hear any headlines potentially coming out of those g-20 meetings in moscow. but as we mentioned, the big store people have been talking about the meteorites they're expecting in russia this morning. right now, the dollar is up a little bit against the euro at 1.3328. dollar/yen is at 92.63. gold prices this morning, let's see, they're down by about $9. $1,626 an ounce. >> time for the global markets

report. if sir martin is the earl of branson, you're like branson, at best. you're like the chauffeur that kind of made good, but now he's got no claim to the family except the baby. you don't watch hugh bonnaville? because you're a sir. are you not a sir? >> yeah, i am. >> do you have a staff? okay. let me -- >> i don't have a staff. >> do you have a valet? >> no. >> a butler? >> no. >> a walkman? >> a walkman? >> ross, what's going on there? we have sir martin here. >> how about a driver, though, right? >> correct. i'm sure he has a driver like branson. yeah, exactly. it's nice to see you, martin. we're a little softer today in europe. not by much. really flat on the stoxx 600.

volume is fairly light at the moment. the european bourses shows them pretty flat as we go through the session. the ftse 100 is still above the retail level. down 0.6% on the ibex. that seems to be weather related more than anything else. volume is much weaker than expected, but they're talking about snow being the reason we're not very good at dealing with the light snowfalls that we have here, as well. the xetra dax and ibex down, as well. the currency markets being the focus here. mario draghi speaking just ahead of the g-20 this morning saying that we've had a lot of self-defeating currency chatter. the point is, a lot of that currency chatter has indeed come from policymakers. the yen has strengthened against the dollar. 94 with that 33-month high. we're currently at 93.62. there's a thought here that the

communique will be nonaggressive and won't end up, as well. we have heard what they want to focus on on the g-20 is this idea that we need growth being stimulated. back in 2010, they said by 2013 we should be harboring the fl fiscal deficits. clearly, that's not happening and theory now saying fiscal policy should be supportive of growth. clearly, they've got to admit that they got the fiscal multipliers wrong in terms of debt reduction plan and so they have to be more relaxed about where we go with debt reduction. some of this will probably sit quite well with elements of the american government. u.s. dollar at the moment, 103.47 is where we stand. we did hear from one rba member today that came out and said his currency was far too strong. his comments from central bankers keep coming out, as you can see.

pull this chart up for you. phil lebeau was talking about this. eads and airbus, deciding that they're not going to have those lithium batteries in their new plane. the a-350. so they're going to do to cadmium. that means they can deliver the planes on time, but it shows you the impact of the boeing story on airbus. that's where we stand right now in europe. back to you guys. >> nice. how long is martin for you, by the way? >> for like an hour. >> two or three hours. >> are you jealous? >> i am. it's nice to see you got up early. >> you should be in advertising, ross. >> you once spent a week on "squawk box." >> martin, if you're going to do that, you need a sweater. >> a sweater. >> i thought of wearing my jeans this morning. >> you can hide it under the desk. >> do we consider the uk europe? >> good question.

we have a referendum. >> you were strong enough not to join that common currency. >> yes, well, there are people that still believe we should. >> you might even leave the union, right? >> scotland might leave the union. >> you're invited over here. >> we have scotland and then we will have the eu probably about 16 or 17 after the next -- >> i've invited you to be the 51st state over here. >> that's all you will be over here. >> you try to tax us without representation, we'll try to -- >> it's a good number. >> martin b what do you think about the referendum? >> i got myself into trouble by saying that it increases uncertainty. it's what i called the fifth grace one and so there's more uncertainty now. from a political point of view, there's -- >> because of the referendum? right. the prime minister made the right decision. the uk sort of right wing party, it liked the tea party, i guess,

in some respects has gained 16% of the vote according to the polls. take more from the trres or from labor. so i think the prime minister was concerned about that. having a referendum laid it out. we did some polling, online polling after the speech. they thought the referendum was right. content of the speech was good, they would vote for the coming out of. there's a lot of work to be done until we get to the referendum what does it mean tore your business in the meantime? >> it means a lot bits more uncertainty. so in making long-term investment decisions, what will foreign companies, what will asian companies, what will lastin american companies, what will american companies do? i think they'll be more uncertain about the prospect. so it is i think a weakening and

adds to the uncertainties in the middle east about what's going to happen here with the fg cliff and the deficit and the debt, what's going to happen generally neu. we have the italian elections, the german elections and uncertainty, as well. so there are still things that china has of landing. it's definitely a soft landing and the brics generally are doing well. >> would you say people that want to exit the union are kind of similar to -- >> when you say exit the union, you have to be very careful whether you're talking about the uk and scotland or -- >> no. i'm talking about the european union. are they protected -- you might be looking at this big picture long-term you want to be there because -- >> i want to be there because it's 450 million people. >> that's what i mean. it's like free trade. >> gdp. >> but then i look at the hard working people in the uk which have already been -- you know, they've had to deal with austerity and you look at some of the southern european -- they still live high off the hog. >> that's the point, joe, is

that by the time we get to the referendum, western europe will have started to recover. >> southern europe, even? >> southern europe. they're structural and about competitiveness, but there are things that were cyclical. it was interesting. if you listen to the people like buffett, you listen to all the private equity countries, they are scouring western europe for opportunities. those economies, those five economies including the uk are all $2 trillion or $3 trillion economists. germ 23450e is, what, 3.5 trillion, 4 trillion. these are countries where there is significant opportunity. >> it's not there now. >> buffett told us yesterday he thinks america is the best place. >> but warn buffett has always been a bit more attune to investing in the united states. and you look at heinz. heinz has made big inroads into the fast growing markets. >> brazil, too. >> the interesting sning about warren buftd and 3g isg,

laymans, they're one of the best management groups, teams that you had. anheuser busch, you've seen what thoef done with burger king. and you look at heinz, what, 20% over its all-time high. people look at it and say it's expensive. it looks expensive on the front, but i wouldn't bet against those brazilians. warn buffett says the real issue here is the brazilian management team. >> i wish you could be part of europe, but less those southern countries devalue their currency. you can't force a standard of living decrease -- >> but it is about competitiveness, joe. >> but if they could devalue, then everything would be fine. it would be foifted upon them to -- >> but you're not dealing with the fundamentals. what you fully have to do is get

the labor markets -- >> now you're talking about getting american. which half? >> probably the top half. >> that would be the way to do it. >> france, italy and spain clearly have to do something about friction and the labor market. that's where we have the problems. we look at our own company, we would like to do more in terms of restructuring in france, italy and spain and we're in the process of doing that. but not as -- >> but it's complicated by the government's rules? >> well, you've got the italian election coming up. what's going to be the result there? will there be a dead like rather than like you have here in america between the lower house and the upper house, the senate as they call it, as well? berlusconi with the upper house and mo onte and the coalition with the center left lower house. so you'll have a go ahead lock again. really interesting issues. >> we'll talk more. we didn't even have to get into

the discussion. it just happens with him. he's so good. >> andrew, watch out. >> and he went like this. >> i'm in your seat. >> it's like any local news anchors. but its takes hours to shoot that for the local guy becauses does the goes -- you know, he does it wrong. but the other wasn't a manager. >> ufr never saw upstairs downstairs? >> no, it was before my time. coming, whale watching. from warren buffett to carl icahn, the stocks that the most influential investors are watching. don't forget to sweet us as thousands of carnival passengers finally mistake it to land. we're asking but where would you rather be stuck on a smelly

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sglo . welcome back, everybody. heading into today, the markets are about flat for the week. and it is that time of the quarter where we get to 13fs. these are filings by major investors releasing stock purchases and sales. the battle for apple is among the most interesting stories. david einhorn bought apple call options and upped his investments. in the meantime, dan loew sold his entire stake in apple. you see these guys lining up on opposite sides. einhorn took a stock in google. morgan stanley and news corp. among the other filings to talk about, carl icahn.

he was mum on whether or not he was taking a stake when he was fighting it out with ackman. but we now know that carl icahn took a nearly 30% stake in herbalife. these are not just war of the words. these guys are putting this money where their mouth is. >> scott on fast money, it was up like $8. so the billionaire brawl happened at about 44, 45, it dropped down to the low 30s where carl may have been amassing his stake. but carl is so amazing because he has so much money that -- this is aer sous investment. if you buy 14 million shares at 30 or 40, you're getting into something like three quarters of a billion dollars or something, aren't you? isn't that right? 40 times 14 million -- no, no, okay, that's right.

up like 100 million or something like than the. >> it's not pocket change. >> yeah. and he says he's done a lot of research and that ackman's allegations are wrong, but he would -- just to wrush ackman for the last ten years of all the act money, he would pay $100 million just to crush him. >> fight among them. >> yeah. and the fast money are good people to have talking about it. our hedge fund, you know, guru, that lady has been on for a long time that -- >> karen finerman? >> yeah. karen. she knew exactly if they were going to recap it or even more mention in the 13 deal was take it private. i marine, ackman's post serious will be in a sling. i don't want to -- >> you can't cover your shorts and you get squeezed like where -- yeah. that's why, carl, i don't -- he

may not like the company as much as he just wants to -- >> to be on the other side. >> yeah. to oshg strat a short squeeze. we don't know how it will turn out, because the ftc did that in kentucky or wherever it was with another smaller company that they thought this some type of weird marketing and you never know whether any day -- who knows. and is then, i don't know, carl could lose $100 million. >> but we are getting a bit more serious m&a activity. the company is start to go worry about top line growth, can't cut the costs any more. some people were suggesting that might be the case. >> it's a lot of money. you have to put it somewhere. >> if you're going to wait for the political environment to get better, you're going to be an old man. >> you can't wait for washington. get on with running your business. it's filibustering over hagel adds more fuel to the fire. >> yeah. >> so you just have to get on running your business. we haven't seen any change in

climate behavior. also there's a better mood, we have not seen that translate into significant change for climate behavior. we think 2013 will be similar to 2012 because we did have the olympics and the presidential election. which you remember. >> i remember. >> you remember the results closely. it will be similar to 2013. digital will be strong. data, technology will be strong. but same general tone. so we don't see the real world having changed at all, really. >> there's one other -- oh, okay, we're going to go to the weather. but berkshire in adm. >> berk share made some new moves. you have new people making investment decisions there, too, todd and ted. but as for berkshire hathaway, it did take a new state and aerch midland and it increased the stakes in directv, general motors and precision cast parts. >> adm calls itself, what,

farmers to the world or something like that. that seems like a pretty good fit for buffett, too. >> it's -- his son used to be on the board. >> there's a group of financial companies to get together with the ecb on a regular basis. and remember last year, the mid year meeting, the one company that hasn't seen any recession was an agricultural company. i think there were 15, 20 companies, only one company -- >> deere raised its guidance earlier this week based on the idea that farming was doing so well. >> and buffett was talking about farmland, as well. >> he owns some, too. >> 14 million times -- why is it 560 million? anyway, now to the national forecast, i have to think without a calculator. or a slide ruler or an abacus. reynolds wolf, not to be confused with wolf blitzer. >> yeah, reynolds is here.

>> i get mistake b all the time. my few whiskers. >> joining us from the weather channel, it's a three-day weekend so there's even more pressure on you to come up with the right stuff, reynolds. >> guys, i'm used to it. let's show you the forecast as we ease into the weekend. it looks pretty nice for much of the eastern seaboard. there is a slight chance we may see snowfall in parts of the northeast. we're not talking about the types of snow in boston that we had with nemo, but possibly 1 to 3 inches of snow. making our way back to the nation's mid section, fairly quiet and cool for you. could see some scattered showers in sports like kansas city by the afternoon. and out west we go, beautiful sunshine from seattle to san francisco. even in los angeles and phoenix. hey, no issues. no problems whatsoever. it will be beautiful for you. even in denver, partly cloudy with 40 degrees. there may be a few issues in terms of your travel in these key cities. mainly nashville due to the

rain. minor delays in miami. also in pittsburgh, minor delays possible mainly to the afternoon when showers kick in. that's your forecast. let's send it back to you guys. >> thanks, reynolds. you see -- >> we're doing this in -- >> notation. i had it yesterday. i had it yesterday. thanks, reynolds. it is over half a billion dollars because carl is now -- >> 4.1 billion in capital. >> right. 11.4 times ten to the sixth had.0 times ten to the seventh, is that comes out to -- you add the zero so that comes out to almost a billion, sir martin. half a billion. 600 million. >> i was more interesting in what when you were saying about the technology companies. you were? >> yes. about those switches between companies. we were a great believe ner google, in the strength of google. the areas that they're in and -- >> nor goolg than facebook? >> facebook is getting its act together, but i think they should just take time. >> apple? >> apple, question mark.

if you look at the history, every three years they've come out with a very significant development. i think what we're waiting on is apple tv. and if we see a major -- you know, messing around with the size of the machine -- >> i know. the color. >> whatever. it's not fundamentals. it's not the same. so it's interesting. if you look at walter isaacson's book, you look every thee years they had a major innovation. i think not the sleeper, the strongest company will probably be amazon. we've acquired a company in the uk which builds e-commerce si sites. it's a mentally powerful area. and i think amazon and google are the two, i think, that was a strong regulation. we'll see how he comes out in europe, as well. but my bet will be they'll do a good job in europe, as well.

they're in a phenomenally strong position. facebook is growing in strength. >> and the way amazon does it, and it was such a daunting task. >> and he doesn't worry about his short-term earnings. >> he's never been on since we always use his laugh. >> yeah. >> i don't blame him if you used that laugh on me, i wouldn't -- >> just be careful what you do. anything you do today -- >> maybe that look. >> we'll forget about it now. >> it made you look so good. we won't be running that again. >> he looks like the most interesting man in the world from that. >> he does. >> becky, you will go far. you should be in advertising, too. >> we are going to continue this conversation with our guest host, martin sorrell. also, when we come back, we'll talk about bee being bullish on bouillon. plus, the nightmare at sea finally ending for those us of passengers. a boarded disabled carnival cruise ship. but is the nightmare just beginning for the company? we have a few opinions when "squawk box" returns.

great, everybody made it.

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nightmare at sea. thousands of passenger cheer as they finally file off that crippled cruise ship. simon hobbs joins us with more on this and, simon, we've been following this very closely trying to figure out what it means for these stocks. >> for sure. and we know we can see realtime what is happening to this stock because carnival is the only stock to be both in the s&p 500 and the ftse 100 in london. so you have a live trade in it at the moment. many people are puzzled as to why this stock has only lost now 4% of its value globally. and you have to understand how big carnival is, how well run and is well respected it is within the investment community. this is a huge stock. it has a 30 billion market cap, far bigger than most other stocks within the t&l sector. and on tuesday night when they warned and they did, they had an 8k warning, they said this could cost us 8 to 10 cents earnings per share. that's only 4% of their expected

profitability for the entire year. most analysts on average have a buy recommendation. it's a gravy dividend play and, of course, they're so well insured. that's the other thing. if you look back at where we are this time last year, you know, when they have the tragedy off the coast of italy with the concordia, 32 people were actually killed. that isn't happening this time around. but then it was. and they came through and they said, look, we have a $30 million deductible on the ship, a $10 million deductible on the third party insurance and a month later, they had, you know, single digit to teen digit falls this their bookings. and it's a very elastic industry, as we call it. in other words, if you're not getting the volume of bookings, you simply reduce the price and people flood back. now, the real wild card, guys, as you know, is this tv event. what happens when, for example, the "today" show goes to air in 20 minutes? how bad will the pictures be? will they deter people from buying not just, of course,

cruises with carnival, but cruises more broadly to the sector? but it's a well respected company and it's a well structured company. it's structured in panama for its taxes, for example. the ship itself carries the flag of the bahamas. so i was speaking to the u.s. coast guard last night. there's a huge discussion about what the captain did, did the captain do the right thing in keeping 4,000 souls on board before that. but the coast guard is telling me, look, we're not the lead investigator here as to what happened. it would be the bahmanian authority that will investigate it. and so the u.s. coast guard is coming in in a sense as a border guard, too. there's a lot of questions, not least of course whether there will be class action suits. but ultimately, that captain took those people to shore safely.

they might be angry, they may not have liked it, but nobody perished and the one person that was sick was taken off. >> simon, the captain of that other ship, the italian one, he was in the bar with some bimbo and he was going -- he wanted to get close to the shore and he was firing off some cannons to wave to some people, like, showing off. that was ach better captain story than this one. >> allegedly. you have to qualify that. >> lisp to you. allegedly. all right. we'll qualify it. >> they did front run the question about whether less of an impact. i mean, they have kept the market informed. >> yes. >> and you're listening as i went to sleep last night, i was watching some of the interviews on cnn. actually, the pass ekers reaction was far more favorable than i thought it would be. >> and ericsson went on and

boarded the ship. >> though, i don't think he did. it would have been nice if they did for some of the passengers pb but the question for a lot of people, if you've got 4,000 people trapped on a ship, at what point do you let them off if they want to get off? is there a habeas corpus here is that the call in the military? >> but i mean, from other people we've heard, too, that that is a pretty difficult undertaking to get them off. >> you're left liable as a company if you ensure their safety and keep them on the ship than trying something tricky at sea. >> you have 4,000 on the ship, why do you want 4001? he's just going to be in line for the bathroom. >> it's a technical position. it's how you deal with the technical position. >> and the offshoring of the authorization, the fact that it is a few market in the minute, the fact that it is a flag carrier in the bahamas

complicates it. because you did offshore wpp's market for a while, didn't you? >> if ireland is offshore, simon, yes. we're back in the uk now. >> where are you now? did you unshore wpp? >> we're in the uk. >> quit pulling my leg, simon. >> we will take this a little further later. thanks, simon. the world gold council releasing its latest forecast on the commodities. joining us on set, juan carlos artiaz. he is the world globe council ahead of investment research. everything looks positive. we're looking back at 2012 knowing it's rord demand and all these banks and things happen yet the metal had made its move. what are the key determinants of whether the price actually moves up and do you think it will? right. so i think 2012 was a very good example on how gold is a very global market.

there are multiple factors that influence gold prices. so if you look at 2012, on the one hand, you have emerging market central banks purchasing in a very strong way. you also have inflows into gold backed cts as investors were positioning for a quantitative easing. >> that wasn't enough, though. >> but you also have on the other hand india and china that are very important markets for gold. in fact, they account for about 50% of the man and that's something that sometimes investors forget that, you know, gold is truly global and part of it, a large portion of it is in emerging markets. so what we sell in india and china is that in india in particular, there was a softer year in terms of demand. nevertheless, indians spent more money in rupee terms buying gold than they did in 2011. and china demand was more or less flat in volume terms. however, in renminbi terms, it was higher, which basically means that the overall dynamics

in the gold market seems to be still very healthy. >> i don't know. >> what about inflation? >> well, i think that what's has happened in the west, and it is important to note, while the economy looks better, there are serious structural issues. and, well, we haven't seen direct signs right now, but that's not so is that all the monetary policies and aggressive monetary policies that have happened are not -- >> the dollar is -- people say there's currency wars, but the dollar is still the best house in the neighborhood and it hasn't collapsed. and it's that simple. gold has gone nowhere in the past year and a half. >> well, it was 6% off on average in 2012, right? >> it was supposed to be every single pundit that was supposed to be above 2000 in 2012. based on every central bank in the world printing more money.

it should have been a slam dunk. you saw the chart. it's in the low 1600s. and is it going up above 1800 had this year? >> well, i don't know about the price this year in particular. i think the best way to think about this is, again, in terms of supply and demand and, again, the fact that it's not only investment money in the west. that's part of the story. that is also what is happening in india and china. and if you only concentrate on what happens in the west -- >> is this time next year going to be higher o lower? you say it's going to be higher? >> do you want to take another two dirps on it? >> wait a minute. higher than 1620 or -- >> than where it is now. >> no, i'm not doing that. above 2,000? i'll bet you -- >> no, not 2,000. above where it is now. >> you got me on a sucker's bet the last time, too. i didn't realize if you promise that you're going to tax 2% of the people and everybody else is going to get what you tax from the 2% -- i didn't realize you could do that to win an

election. >> you miscalculated he's a great communicator. tremendous communicator. >> and a real uniter, too. >> no. but for the electorate, very strong. wait for the midterms. >> you saw the last midterms. we'll see. maybe we'll bet on that. >> seriously, just looking back, i think it is not only about rice, right? >> if you're buying futures or investing in it, it's about price. >> it's about portfolio performance, right? the reason why an investor has the portfolio, it will be great if you only were able to choose one option and that equitier that stock would go up. the reason why you diversify is because you need to balance and gold is hedging that. >> thank you. want carlos, thank you. >> we're going to take a quick break right now. when we coming back, sir martin has the last word. >> he always does. the patient, presented with

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a final word from sir martin sorrell of wpp. we've been talking a little off camera, and you say it's actually good news in all of this. >> well, look, despite the fact that life is difficult. despite, you know, 2012, i describe we've got the ugly, you know, the analyst, i'm not exactly allowed to say what our results are. analysts are forecasting another -- >> for wpp. >> and you know, most of our clients are doing extremely well. and the world is about the new markets. it's about new media. it's about digital areas, as you well know on cnbc. it's about application of technology, and big data. and last but not least, very importantly, it's about getting people in our organization to work together. because the 166,000 people now in 110 countries working together effectively for clients. because they want the best people working on their business. now, joe said i'm a midget don draper.

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>> we still have a lot of cash on the balance sheet. >> i'm ready for another. >> we think it increases

competition. see no issue whatsoever with regulatory authority. >> so who's next and what companies could be on buffett's short list? dan tremack of fortune helps us pick up some of the potential targets. >> nightmare on the high seas. triumph towed to safety and the passengers are off but the cruise line's woes are far from over. should investors stay on board these stocks or is it time to jump ship? >> plus the g-20 and your money. a special friday trading block that gets you ready for the three-day weekend as the second hour of "squawk box" begins right now. >> all right. good morning, everybody. welcome back to "squawk box" here on cnbc. i'm becky quick along with joe kernen. andrew has the day off. it is friday, and to this point we're going in to that last trading day of the week with the markets relatively flat. you can see there, indicated slightly lower. but just barely. s&p futures down by just one point. dow futures off by just over two

points. we have been doing some whale watching. the 13 fs are out. filings by major investors that reveal their stock purchases and sales. among some of the most interesting stories to come out, we've been watching more about the battle for apple. david einhorn, you night have guessed this based on what he's been saying recently but he did up his stake in the company by 45% to 1.6 million shares. he also bought apple call options. dan loeb sold his entire stake in apple. so again you see guys setting up on each side of these things. einhorn's green light also by the way, new stake in google and upped his stake in microsoft cut his holdings of yaw hue. loeb's stake in herbalife. carl icahn, we had been waiting to hear about this. people were wondering if he was actually an investor in herbalife after that entire deal back and forth with ackman. turns out, yes, he did take a nearly 13% stake in herbalife. as for berkshire hathaway.

it took a new stake in averager daniels midland and verisign. it also increased its stake in general motors and precision path cars. and breaking news from scott wapner who joins us on the phone. a little bit more insight into what's been happening with herbalife. >> i do, becky. good morning to you and joe and andrew, as well. the first public comments now made from bill ackman regarding this massive position that carl icahn has taken in herbalife. bill telling me the following. we invest based on a careful analysis of the facts, after 18 months of due diligence we have concluded that it is with certainty that herbalife is a pyramid scheme. our conclusions are unaffected by who is on the other side of the investment. our goal is to shine a spotlight on herbalife. to the extent that mr. icahn is helping achieve this objective, we welcome his involvement. i would ascribe mr. ackman in my dvrgs conversations with him as

being resolute, unwavering in his opinion of how he feels about herbalife. i've spoke with carl icahn last evening, as most of you know, he's going to be on our show at noon today. to talk more about this stake. a 13% stake revealed yesterday in that filing. shares, as you know from looking at the charts, soared the moment that all of this became public. icahn telling me that they've done a lot of research. that he's spoken with herbalife's ceo michael johnson several times, that he thinks he's doing a great job and that what bill ackman has been saying is completely off base. he said in the filing that herbalife has a legitimate business model. ackman thinks it's a pyramid scheme. so, guys, this is game on. i mean mano a mano at this point. bill ackman, really, versus carl icahn over herbalife. and we're going to hear from carl icahn in the noon hour today. >> how much -- i mean, it won't work, scott, but did you beg ackman to come on? there's no way. because i loved him because he

gave you a 20-minute answer last time and said, but you know, this isn't helping any cnbc few viewers. after he talked for 20 minutes. there's no way he's coming back on with you. then icahn like was mad at you. thought you were being mean to him. >> i'm actually surprised he's coming back on. >> i love carl, though. i can't wait to see that today. this is a great talk about -- i can't do an ack man imitation. i was offering to call up and pretend to be ack man so we could do round two. but that probably is you know, illegal or unethical or something, right, scott? >> maybe. some people may have an issue with that. but i think it's fair to say that bill ackman will be watching. he will be listening to what carl icahn has to say on the program later today. it certainly makes for an interesting story. this is not a small position.

this is a massive position for icahn stake holders. >> we didn't know -- we should have seen last time with you how mad he was about the last ten years and that adverse ruling which was chump change for him, to put $600 million up just to crush someone. it's fascinating, scott, isn't it? >> you have to wonder, joe, how much of this is business, so to speak, and how much of it is personal. and those are the types of things that i'm sure we'll get into today with carl icahn. he's would be obviously made it clear that he doesn't like bill ackman. ackman's made it clear he doesn't like icahn. it's a relationship that's festered, really, for a disagreement that's festered for a decade, as you said, joe, and just bubbled to the surface on television a few weeks ago. and we'll have -- >> scott, there's nothing more painful than a short squeeze. it's like almost like a life script.

could you hear in ackman's voice he realized when you're short, if you need to cover, if there was like, you saw in the 13-d taking it private or some kind of recapitalization you're not going to be able to get the stock back to cover, are you? >> i would say this, that at listening to this voice, and certainly making a judgment of how he sounded during our -- >> he's very calm. >> which was quite lengthy, he sounded as resolute as unwavering, as unmoved by that as anyone could possibly sound. >> he's a cool customer. >> i think one of the issues is, you know, there may be a lot of people squeezed royally today and some of the weaker hands, if you will. might be interesting to see where they go. he tells me he's not going anywhere. >> it's not just icahn. we were talking about dan loeb. guys really lining up on both sides of this. >> yep. it's a classic trade. right? as you got the big hitters on

one side, and a really big hitter involved, as well. it's going to be really interesting to see where this all goes. >> we will definitely be watching, scott. >> we'll be watching, scott. but andrew's not here. thanks for you watching. anyway -- no, i'm kidding. you probably just got up. you were up late last night? >> i was up late. i'm in a car on my way in. i haven't seen the show. i apologize. >> good for andrew. >> you might have been saying hi to him wherever he is. >> that's true. that's a fair point. >> andrew i'm sure is watching. >> 7:00. i'd be sleeping. you would, too. scott, this has like turned into such a great thing for halftime and for you. i can't wait to see it today. >> joe, appreciate it very much. >> we're kicking off this hour on "squawk" with a double dose of market gurus. bill nichols hoe head of u.s. equities at cantor fitzgerald and mitchell caplan chairman and

ceo of jefferson national both of you guys a great day to be here. bill, start with you. there were quite a few deals yesterday and it was welcome, and it might be a harbinger of something good. is that how you see it? >> i think we all hope so. and i think, you know, definitely the direction we're going in the right direction. you know, seeing these deals across multiple, different industries, and airline deal, obviously, the deal in the ketchup space. but i think the reality is that across all industries with the market having a nice run that it's had people still think valuations are cheap enough they're going to start coming after companies and that can only be good for the market. >> i don't expect any more deals in the ketchup space because you could not urge k-e-t-c-h-u-p with c-a-t-s-u-p, can you? >> it will happen. >> that could happen? >> it will happen. >> and i'm glad you're here because you can talk the deal. i'm glad you're here because i remember very well last time you were on mr. e-trade said that

the game is rigged so there's no individual investors anymore. >> even when you think about deals today, hard to do. i mean, for people who ran companies and lived through it, the world waits for it. you see the value in consolidation. you understand how much wealth creation there can be. but, it's more than just looking from the outside in at the numbers. it's all politics. >> when was the last time you were here, do you remember? >> three or four weeks ago, month ago? >> okay. because it's gotten better -- have you seen any additional interest or i guess comfort in the individual investor with coming back in to the stock market? >> yeah, i think so. i think part of it also is one of the things i've learned, and i see the individual investor now more today through the eyes of an adviser, because our business model is really supporting advisers, but you see advisers in the market. what they're afraid of is volatility. and they want to figure out the best way to manage volatility, what are the right asset classes. but i think they're interested in the market, and in funds that help them manage that volatility and put money to work.

>> are they interested in the market because the market's hitting new highs? when individual investors start seeing that is it, oh, i've missed this? >> i think we're seeing two things. one is without a doubt, part of it is capitulation. i mean you've just got to generate returns over the long-term for your clients. if you're trying to do that the only way to do it is to be invested. you can't do it at five basis points or ten basis points. at some point you're looking for an entry point. when does it make sense? what's the right thing to two? how do you structure it in a way that you can make sure you can get out. you've got liquidity, you can have movement. the other thing tax rates are going up. so what they're hearing from their clients is we're afraid about taxes. how do you invest more tax efficiently for me? what are interesting tax advantages. so i think it's a lot of that discussion that's going on, and advisers are trying to figure out what's the balancing act with all that information. what's the uncertainty in washington. what's the risk around sequestration? there's so much out there.

>> but both of these things that we talked about might be manifestation of the same thing. the deal's getting better and the stock market are higher. it's almost as if both people decided well, the world might not end at this point. we may not have the greatest growth. we may not get washington doing what they want but i got to do something. so with deals, life goes on. i'm not waiting four years to do a deal. and for investors i'm sick of 1% in the money market. >> totally agree. >> so it's a fan nestation of the same thing. >> sentiment is getting better. you have the g-20 coming out and it's not the same doom and gloom you've had over the last three or four years. you don't get the same sense that it's the end of world. >> the meteorite over there. >> that could be the end of the world. >> if you can avoid, you know, a cruise life could be pretty good, right? as long as you just don't go on a cruise. >> depends the brand of the cruise you're looking for. i was going to ham say, you

know, shih tzu can happen to anyone. now we know it did happen to carnival. any cruise line. we've seen this over the last ten years. >> we were -- >> we did -- >> italian cruise liners. >> five years ago we decided we'd never take a cruise. >> it was after the norovirus. >> the nor walk virus or whatever. >> anything you touch on the entire ship. >> i think there have been literally five big things in the last two or three years. >> and i mean you have to realize you get in a plane every single day, how many planes really crash? it's the same thing. >> don't even bring it up because it's been so long. >> agree. >> but it's the same thing with the markets. you finally say, okay, i'm going to go back. >> yeah, listen, interestingly enough, the cruise lining compared to financial services, the trust and the value proposition and what it is you're trying to deliver to a client, and the consistency of experience, right? and for a long time financial services have been out of favor

because consumers said it's the conversation we had. it's rigged, i can't win. what's happening with the cruise line? i'm saving, i want a vacation. here's the experience i'm looking for from a cruise line. here's the brand i've built and what i promised to deliver around value then it goes up. how long does it take to rebuild that trust? >> we're going to go to break because i'm trying to think of a ask theological reference. >> i always do. >> i need a break. >> we're going to continue this conversation. these gentlemen are sticking around with us. when we come back we'll be talking about theo logic saying 2013 is off for the best start for mergers and acquisitions since the year 2000. yesterday warren buffett told us that he is not done buying so we're looking for names that could complement his ketchup business. right now, take a look at the futures. markets are indicated slightly weaker. dow futures down by about five points. s&p futures off just by 1.5 as we were getting into this last

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more than 4,000 passengers and crew members on the disabled carnival cruise liner "triumph" arrived back on land late last night. the ship was pulled to dock by tugboats in mobile, alabama. the one thing, michelle, where you are, number one, it's a boat and somehow there's 4,000 people, and then i also heard some guy saying the elevators don't work, so i'm going to disembark, and i've got to go 11 floors, with my luggage. so it's a boat that holds 4,000 people, that has like 11 floors. i mean the whole thing is mind boggling, isn't it? >> it's a city behind me. it's a huge, huge ship. you can see it. it's still here. they're going to move it to dry dock later so they can begin repairs. 4,000 people can fit on that ship. so yeah, it's bigger. that's one of the issues the cruise lines have been facing. the ships are getting bigger and

bigger, so when there are issues the numbers just multiply or the issues multiply dramatically. so everybody arrived last night. we heard cheering, people kissed the ground. one of the key issues that carnival and the cruise industry faces are when things like this happens, what happens to sales? do people decide not to book a cruise? we spoke with a lot of passengers last night. asked them a very simple question. would you ever go on another cruise? would you ever go on a cruise again? >> not for a very long time. never on carnival. >> no. >> why not? >> it was miserable. every information they gave us was incorrect and they just acted like they were treating us well, but there was a lot of truth, and a lot of -- >> i would. with carnival, probably would. >> why? >> the crew, obviously, the crew was amazing. >> you were discussing with

mitchell caplan in the previous block about how many incidents have there been? we built a graphic up for the studio wall there where you can see what's been happening with the cruise industry since roughly 2006. 2012, last year, january, was the big, big incident, the cost ka "concordia" off the coast of italy where 32 people died. by the way, that's also a carnival brand. the casualties extremely high compared to any other incident that we've seen. and it happened in january. january, february, march, are what's known as the wave season. that's the biggest booking time of the year. this has now occurred in february. that's going to impact summer bookings, it's believed, by the cruise industry. they saw that happen last year. that could mean lower prices as they try to fill up the boats if they don't get bookings. whether or not it's going to have any kind of permanent damage to the whole industry is another big question. but certainly, they're worried about impact in the short term, in terms of the number of bookings. back to you. >> yeah, one thing we keep pointing out, you know, i guess

maybe some minor -- minor injuries. no one died. >> agreed. >> the lifeboats. can you carry lifeboats that would be able to have 4,000 people? >> you have to. >> i guess you do. >> ever since the "titanic," you must have, you absolutely have to have lifeboats for every single person on the ship. what's happened since the ships have gotten bigger and bigger and bigger, in about 2010 they decided the best policy was, if you can keep everybody on the ship, it's actually much safer than putting them on the much smaller boats. and then moving them, you know, 100 miles. >> and the problem becomes if you find another boat that size, you end up overcrowding. the problem was they couldn't find another cruise line to pick them up, that has a bunch of people on it -- >> those breaks in half. >> leo was up here, with kate winslet, and then remember looking down. >> a lot different than the

inconvenience. >> yeah, exactly. >> a lot of people brought up why didn't they send helicopters? you'd need massive helicopters. where do you land like a military size helicopter up there? how many trips could they take? >> that's dangerous. >> you're going to make it to mobile eventually. it's just going to -- i don't know. >> it's just not going to be pleasant. >> thanks michelle. we want to hear from you. if not on a cruise ship where would you rather be stuck? i don't know who came up with that. >> rather be on a cruise ship than in an elevator. >> @squawkcnbc. greg, if we don't know who he is, but he says he'd rather be stuck in his bed in his house. i'm sure we can all agree with that it says here. and peter wrote, under a meteorite weighing ten tons before it entered the earth's atmosphere. i guess that's the one that went by -- came within -- wasn't very close. 40,000 miles or something.

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welcome back, everybody. there is some amazing video, you've got to see this to believe it. there was a massive meteorite shower, there's still some debate as to what exactly happened. it took place in russia and it injured about 500 people. this meteorite or meteorite shower created a 125 mile long sonic boom. a lot of people were injured by

shattering glass that was falling along the way. russia's emergency ministry is urging people not to panic. but there are reports from our team news that some people are worried that this was a ufo crash. some people saw this on their way to work this morning in russia. and because of the availability of camera phones everywhere, basically, at this point, there are all kinds of videos that were shot of this. so you can get a lot of different looks at this. it is some pretty unbelievable stuff. up next on "squawk box," we have your tools of the trade. we're going to talk the dollar, oil and equities. also what's working in the market right now. and later, the super bowl champs will have a new place to shop for football gear. under arm our opening its first store in baltimore. brian shactman will have the details.

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welcome back to "squawk box." in the headlines this morning, investor bill ackman tells cnbc he's now certain and is still certain that herbalife is a pyramid scheme. and his opinion on the stock is a major short position. is unaffected by who's on the other side of the trade.

and that would include, obviously, investor carl icahn, who has a nearly 30 13% stake in herbalife, as detailed in a new s.e.c. filing. like 500 million dollars above that. a handful of economic reports ahead this morning. the federal reserve is out with industrial production and capacity utilization at 9:15 eastern. while the latest university of michigan consumer sentiment survey is out at 9:55. and i think they're in a good mood in michigan, with -- they have a great team. >> basketball? >> yeah, and airbus is dropping lithium-ion batteries from its new a350 jets. they're not dropping the batteries from the jets. they're not going to use the batteries anymore. those would hurt if you got hit. that follows questions about the batteries after they were the focus of a probe that led to the grounding of boeing 787 jets. and airbus will use now conventional nickel cadmium batteries for the a350. >> also warren buffett's

berkshire hathaway and 3g capital showing a little bit of acquisition love with a surprising valentine's day deal to buy heinz. the legendary investor says he is not done buying. >> i'm ready for another elephant, if you please, if you see any walking by, just call me. >> so, how much cash do you have on hand after this deal? >> well, at year-end we had about $47 billion of cash every place. but we always like to keep -- and we will keep around 20 billion, so you might say the excess cash at year-end was about $27 billion. >> dan tremack is the senior editor at fortin' and he joins us right now with his take on the m&a landscape. is it fair to say that this is really the beginning of a new wave of m&a? >> i hope so and i think so. kind of it's about time, right? because we thought at the beginning of 2011 there was going to be a big wave of m&a and the beginning of 2012, and you see these confidence surveys

and they looked very similar. this finally seems like we're getting it. because all the macro conditions have been there actually for years. >> what do you think is really driving things at this point? is it just man we've got to get on with it? >> i think that's partially what it is. dealmakers get paid to do deals. that's ultimately their job. there's only so long you can sit on the sidelines and do nothing before you start to question your career path a little bit. so i think people are finally doing it, plus there's also finally a lot of interest on the sell side. people always talk about buyers in m&a. there's also the issue of selling. when do people think our stock is finally at a value where we're willing to sell. i think people were constantly looking back at that pre-lehman number saying that's what we're really worth. we're not worth what it's been since then. we're worth what it was before that. and finally a lot of shares are back at that price. >> any sectors that you think would be more in focus than others? >> you know, i think kind of everything's in play. i think tech is interesting, not because i think dell is going to spark a huge wave but you've got

a lot of smaller, undervalued tech companies. i know a lot of folks, particularly in private equity, are looking there. >> how many of the deals do you think are going to be driven by private equity going private versus mergers like the airlines or totally different? >> it will be a combination. look, private equity does have a lot of capital. i think what's interesting about some of the deals we've seen lately, take dell, take the heinz deal where you have 3g which is a private equity firm, they're playing supporting roles rather than driving the deals, per se. you know, silver lake is helping michael dell. 3g is helping warren buffett. that's an interesting sort of thing. it's different than the private equity firms themselves teaming up to do the transactions. >> what happens with private equity in the dell deals? they have to actually start ponying up more money. what does it mean for the private equity if they feel like the deals can get retraded on? it's a little bit tricky. private equity firms, any buyer doesn't really want to start negotiating with large shareholders. you know, if you say we're willing to go up a dime, suddenly you know, the t. roe price will say how about 15, how

about 20? it's a real slippery slope. the person who really has the money to go up more in that deal is michael dell more than silverlake. >> you know, bill, we always start looking around and trying to figure out if people are overpaying or not for these deals. yesterday people were wondering that with heinz. because it was 20% premium to what was basically an all-time high for the stock. what do you think? what's your sense of where things stand right now? is there a fervor out there yet -- >> i think with the market continuing to rally, you look at where we've come just, you know, where the s&p has come on the left, you three, 3.5, 4 years, and as we ratchet higher then prices paid, even premiums from this level are a little bit easier to swallow because you've seen such a nice up move. and i think the real question is, people feel they're being left behind. and all of a sudden the market continues to rally up another 1%, 2%, 3%, then someone who had a deal pending says okay i wish i'd pulled the trigger. you get people to start capitulating and jumping in. you haven't seen that in a long time and i'm not sure you're

going to get it necessarily right away. people sitting there saying okay, buyers remorse, right now, you know, with where interest rates are i think these deals look pretty good. >> dan, that's a fair point, too. the momentum trade is very active in this situation, not just in the equities market. >> no, you're right. it is. look, all the conditions, and this isn't new. but the conditions are there. huge -- on the strategic side huge amounts of cash on the balance sheet. as i said the interest rate environment, capital markets. you can get debt from every deal that's not called best buy appare apparently. there's huge opportunity there. >> dan, thank you. great talking to you. >> thank you. >> meantime, another one of the big stories we've been talking about all morning long, some of the excitement and adrenaline peaked as the cruise ship "triumph" was pulled into mobile, alabama last night. it was followed by overwhelming relief for thousands of survivors. federal investigators are now going to be trying to piece to the what happened and why. we're trying to piece together what it means for the cruise industry. joining us right now is mauricio garrido, president of p&t

salvage which does salvage and emergency responses for vessels worldwide. also standing by, our very own simon hobbs at the nyse. mauricio, you watched what's happened with this. if you try and figure out from this point on, how unusual is it for something like this to happen in the cruise industry? >> well, morning. the fact is, you know, there is a lot of ships out there. if you look at carnival corporation, they move about half a million people every day. and accidents do happen. accidents will continue to happen. 9 fact that humans continue to be part of the equation in everyday transportation systems are just a fact of life. and accidents will continue to happen as long as we're involved with it. the key is to have a system in place that is able to respond effectively, as carnival has done in this particular case. >> you think this was an operation that was well-done by carnival?

>> absolutely. total success, to move that amount of people from the middle of the caribbean ocean quickly, organize tugs, and bring a ship, which as we've said earlier, it's a floating city, quickly into u.s. waters, i think, was rather successful. >> simon, you've been analyzing what this means for the stocks, not only for carnival but for the entire industry. and that idea that this was a job well done is something that we're starting to hear more and more frequently this morning from industry experts, but you still see the headlines. >> not what the media is looking for. >> i think we've all been on the journey with this event during the course of the last 24, 48 hours. and there is a clear difference in perception between what the general public may think about the terrible, human story. >> right. >> and what wall street thinks. i mean, just going through the papers this morning i'm struggling to find this story in the "journal" or the financial tmts, though, of course, it's front page of "usa today." the fact remains that this is a

very well-liked company. great capitalist business. as far as most people are concerned. the london quote don't forget quoted in london and new york, the london quote has recovered. people clearly think it's a buying opportunity. the diffident is 2.7%. the average of 20 analysts rated a buy. you know, they're talking about just losing ten cents, possibly, in earnings, on what has happened so far. that's about 4% of their entire earnings forecast for the year. so -- and the other point, remember, guys, i said this in the last hour, this is well-run, and very well insured. even when people died in january of last year, in italy, the hits that they took financially were actually very limited to the extensive insurance. you can bet there has been a huge amount of discussion within carnival, if not externally, about how they handle this. they very deliberately kept all those 4,000 people on board, and took them to their destination no matter what. and that clearly was an attempt

to limit their liability. >> it's not on the cover of "the new york times" anywhere. it's not -- >> it's on b4. >> it's the -- it's the very last thing in the 12-point on -- whatever in is it 10? it's been shrunk? and then the tabloids, both the tabloids, the daily news, and "the new york post" both have the pistorius story. >> in fairness, you know, they were going to get the pictures for that until the middle of the night. and the important thing is the pictures coming out aren't so grueling. you know, there was discussion yesterday where people kind of like monsters from the deep emerging from the triumph but they haven't. they've just been a bit flushed saying, oh, might cruise again. the other thing is people who take cruises a lot are less worried about this than people that don't take cruises. it terrifies me, but then i wouldn't go on a cruise. >> mauricio, is the our perception or is it reality? seems like things like this are happening more frequently. is it just we have more social media, more people with cell phones, bigger cruise ships out there. explain to us what's really

happening. >> absolutely. i mean, incidents, there's a lot of ships out in the ocean. probably 80,000 to 100,000 ships cruising the waters of the world. and the fact is, accidents do happen. we do have zent access to those events now through social media, as you well said. >> right. >> and we just become -- we're more aware of it. we are more aware of it. and everybody, you know, can see this on youtube very quickly. the fact is, that the industry as a whole, the shipping industry, maritime industry, has come a long way in getting ready for these types of incidents. contingency praning is, you know, part of the culture. the ability to the react quickly to events such as this one. you're talking 4,000 people in the middle of the yucatan peninsula. i mean that's pretty serious. you know, had it been outside of new york or outside of houston, a lot -- big difference. we're talking about way down

there, you know, and carnival was able to orchestrate pretty good response. this only happened, you know, 4, 4 1/2 days ago. >> mauricio, thank you very much for joining us today. simon we will see you a little bit later this morning. thank you guys. when we come back, u.s. undersecretary lyle brainerd speaking to cnbc live from moscow this morning. we have comments on the state of the global economy right after this. and then what it all means for the markets in our trading bloc. after that it has become a staple in the world of sports now under armour is making a push into everyday life. the company opening its first stand-alone store. we're going to go shopping with brian shactman in just a little bit. to find "squawk box" online and on mobile, follow us on twitter @squawkcnbc. like us on facebook. visit our show page. squawk.cnbc.com. we'll be right back. all stations come over to mission a for a final go.

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welcome back to "squawk." global markets are waiting on currency signals from today's g-20 summit. the euro is under some pressure as the meeting kicks off and the yen continues to strengthen a little, as the race to debase

goes on. meanwhile, oil is inching closer to that $100 mark. that's the one thing that, if you're looking for anything that just has been consistently headed higher and stronger than maybe people out it's oil. joining us to talk about currencies is forest schlossberg from bk asset management. here on the set to talk oil is phil silverman. his managing partner is kings-u capital and our guest hosts continue mitch kaplan, that's bill nichols, actually. head of u.s. equities at cantor fitzgerald and that is mitch kapl kaplan. that's not your only claim to fame. >> i have a day job running a company. >> yeah, you do. boris, it's all -- >> jefferson nation. >> we talk currencies a lot. and i think i could have shorted the yen. i didn't -- i'm not even george soros. i think i could have figured that out six months ago. but it's a little bit harder to figure out now or not? >> it is a little bit harder.

a couple of weeks ago i tweeted out any time we hear the word currency wars it's a drinking game. i had a huge update from all my irish and british followers i think, because we're getting a little tired of 98 theme here. but it is very dominant theme. i think the europeans are clearly concerned at this point. we saw very weak numbers yesterday out of gdp. and exports will definitely be affected if the euro goes higher. they're kind of trapped. they can't honestly say we want to lower europe but they're very much cautious about trying to contain the market and push the euro down. that's why euro is still very much a sell in the rallies. it needs to be weaker for the eurozone to recover using exports. >> kind of interesting, because you know, there are people, boris, that no matter what they want king dollar and they think that's the answer to everything. to some extent i understand that because it represents our purchasing power and you don't want to devalue our standard of living and our purchasing. but it's almost like we're getting stronger against the yen for their problems. we're probably get stronger against the euro because of

their problems. and we deserve to be stronger because they're doing better than everybody else. and it's almost like it all comes out in the wash and all makes sense. >> ironically enough part of the reason we're doing better is because we were weaker against both of them for a long time. i think it brought back a lot of our manufacturing and exports. at this points we're going to absorb this train which gets too much it could affect us going forward. the other big thing the market is looking for is berlusconi. the italian election coming up next week and he's basically a one-man wrecking crew for the eurozone. if there's a serious chance he comes close to winning that's going to be a negative for the euro. if he passes by, maybe we see a relief rally in the euro. >> i was hoping he won just because i think he's crazy and i like watching his personal exploits. so i should not hope for him to get back in? >> not unless you want to see complete turmoil in the capital markets. >> 408d on. okay, maybe not.

i do -- i mean he is classic. i mean -- >> i don't think there's any political leader on the current stage who can match him for color. >> no way. putin's up there, but he's -- >> he's much too serial. >> this guy is -- >> he's a fighter. >> okay. so, phil, we have not been overly impressed with global growth. why has oil just been so solid, so strong? >> you've had a lot of stimulus around the globe, this debate. and you've had -- and you've had oil's been kind of moving essentially sideways for a very long time. in a range that's kind of getting narrower and narrower. we've been going up for three months and moving to a pretty important point in the $98 to $100 a barrel range. i think we would need to see a little bit stronger growth to get this convincingly above $100. so, my position right now is more -- in a way, neutral to see where we -- how we perform at

this $98 to $100. >> it's weird. if it goes we need stronger growth to get it there. when it gets there, it's hard to have stronger growth. >> that's the tough part about it. the higher oil goes, the more difficult it's going to be. because it's the direct tax on the consumer. >> is there supply waiting at higher prices? do you think people are waiting for that $105, $110 to unlock -- >> i mean, obviously the higher it goes the more supply you will get, because it's more cost effective to drill it. but i don't think there's a large amount of oil that's going to come flooding onto the markets at $105 or $110 a barrel. >> do you think there will be a lot more volume as a result of funds? a lot of funds are in all these commodities because they think they're not correlated to the market, alternatives are an interesting strategy? >> it appears there's a large buildup in the futures position. and i would imagine that if we start to get moving in one direction or the other, in the large trend following, cta, and

macro funds get on board it could start to really move. but right now, yeah, traders are looking to get on anything that's moving and people are chasing wherever they can get some gains that so many people have underperformed for so long. >> we're seeing even with advisers, 60%, 70% of them are pushing into alternatives. they think of it as being anti-correlated and really drive volume. >> and the managed futures has had that reputation for a long time, you know. so, you know, when the trend followers get behind it you really got to watch. but you've seen, you know, an interesting move because if you look back to 2008, you've had a real sideways market. the highs have been getting lower the lows have been getting higher and converging on this high 90s point. we'll see what happens because it's going to need to resolve one way or the other. >> all right. we got to wrap. not phil silvers. >> no. >> silverman. >> silverman. >> you remember phil silvers? >> i've heard about phil silvers. >> all right. phil silverman. i like phil silvers. next time you come on we're calling you that.

boris? schlossberg i have to have a big pregnant pause between it to get it out right. thanks guys we'll see you later. >> have a good weekend. >> when we come back, we will talk about what it's going to take to keep the bulls running and the bears at bay. jimmy dunne and robert cap lan will be joining us at the top of the hour. first brian shactman is in baltimore where under armour is getting ready to protect a new kind of house. >> it is a cool house. let's face it under armour starting 2013 ready for a fight. a brand-new ad campaign, and this 8,000 square foot store which is going to be a bit of a test lab for them. details on the store when "squawk box" comes right back. (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online

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big day for the home of the super bowl champion baltimore ravens. the city is getting an under armour store. cnbc's brian shactman joins us from inside the store which isn't even open to the public yet. hey, brian. >> it opens up tomorrow. let's face it under armour is growing up, right? 18 years as a company, seven-plus since its ipo. in this store, 8,000 square feet, and 74 full-pledged mannequins is sort of their effort to get past adolescents. because, of course, with growth comes growing pains. and there are two sort of issues to deal with when you talk about ua which is an incredibly successful company. but it's still very much an

apparel company. 75% of revenues come from apparel. the shoe business, less than 15%. now that's growing pain number one. they need to get more traction with shoes which are pretty prominently displayed here. number two issue, ua is american centric. less than 10% of revenue comes from outside north america. that could be the subtle test of this about the more store. you see a lot of under armour's retail stores come from stores with influence, dick's, macy's et cetera. those companies aren't overseas. if this store does well it's a template for stores beyond our borders. even with all that and a stock that underperformed the broader market, this company is still growing revenue about 20% plus every quarter, and it's also getting the youth of america totally hooked. you go to high school or college games, guys, and you know full well it's under armour is dominant. but this is the key. the shoes. and you see a collection here you won't see in any other store that they have in north america.

and they want people to see from head to toe how you can wear under armour. and we're going to talk to kevin plank about all of these issues coming up on "squawk on the street." you know he's a huge fan of this particular show. >> he is a friend. brian, thank you. we're going to be watching that a little later this morning. we'll be joining you in the next show "squawk on the street." right now we want to thank mitch kaplan and joe nichols for spending the last hour with us. thank you for your thoughts on the market. >> my pleasure. >> nice to be here. >> when we come back, another kaplan who is going to be joining us. former goldman sachs. plus jimmy dunne and whether this wave of action will continue into the spring. squawk will be right back. when they tell you that you need your oil changed you got to bring it in. if your tires need to be rotated, you have to get that done as well. jackie, tell me why somebody should bring they're car here to the ford dealership for service instead of any one of those other places out there. they are going to take care of my car because this is where it came from.

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another day ♪ >> but the problems for the cruise line are just beginning. we'll bring you a live report from mobile, alabama. where the ship has docked and we'll talk to an expert on marine technology as the third hour of "squawk box" begins right now. welcome back to "squawk box" here on cnbc, first in business worldwide i'm joe kernen along with becky quick. andrew ross sorkin is off today. he planned a four-day -- >> smart man. we're dummies. we didn't know we were off monday. >> u.s. equity futures indicated down about nine points. overseas, in asia, we'll take a quick look, see if there's any movement on this cruise ship debacle. no, nothing happening there in the asian markets. let's check out europe and see what's happening. europe up three on the ftse.

really quiet trading. we can't even get a full point move in france, becky, for us. look at that. you don't see that often. and then germany down about 14 points. >> among the stories that we are following this morning, we've been doing a little bit of whale watching. the 13 releases last night, the filings by investors that have to reveal their stock purchases and sales. several interesting stories to tell you about. we start with apple. david einhorn increasing this stake in the company by 45% to 1.6 million shares. also buying apple call options. in the meantime dan loeb sold his entire stake in apple. loeb's third point also took a new stake in herbalife. the call of the morning. he's got carl icahn calling in a little later this afternoon on the fast money halftime report. carl icahn actually showing up with a nearly 13% stake in herbalife. you may recall that fight between carl icahn and bill ackman last month on cnbc. ackman gave a statement to cnbc earlier defending his short

position in herbalife. he said, we invest based on careful analysis of the facts, after 18 months of due diligence we have concluded that it is a certainty that herbalife is a pyramid scheme. our conclusions are unaffected by who is on the other side of the investment. he goes on to say that his goal was to shine a spotlight on herbalife and to the extent mr. icahn is helping achieve this objective, we welcome his involvement. again, carl icahn's going to be calling in a little later. you can see shares of herbalife this morning up by about 20% in the premarket. up more than $7.50. icahn is going to be on the fast money halftime report at noon. that is an interview you don't want to miss. go that's for sure. the carnival "triumph" was supposed to return to cal vesten on monday. after a week-long cruise it finally reached land last night but it wasn't in texas, it was in alabama, in mobile. and that's where we find our own michelle car use row cabrera who is an international correspondent, but it was in the caribbean, i guess, wasn't it? so i think that counts.

>> it's the gulf of mexico. >> okay. that's enough. that's enough. you >> you see the triumph behind me. it's going to be moved to dry dock later. they got all the passengers off last night. the nightmare is over for the passengers but carnival still has a lot to deal with. particularly more than 3,000 people who are tweeting and talking about how tough the trip was, and how awful they felt it was. for example, take a listen to this gentleman, who was talking about how he felt that the company just didn't do enough when it came to fixing the situation. >> i was really disappointed when one tugboat showed up, and we were moving 4 or 5 miles an hour out in the middle of the ocean. >> absolutely. >> we've been on boats before. the seas were a little rough but we've been on boats before that they tender, and took us all in, and you know, it seems like they could have maybe sent another ship out and tendered us over to the other ship. seems like they could have done something better. >> a lot of people that we spoke

with were very negative on carnival. very positive on the crew, by the way. stock is down roughly 5% this week. the company already has to warn because they're going to cancel 14 cruises, it's going to cost them eight to ten cents in terms of earnings in the first half of the year. but you have to wonder what is going to be the effect on bookings in the entire cruise industry, after the costa concordia, the horrific accident off the coast of italy last year, which was also a corn val ship, with the entire industry did see a decline in bookings, and then hence a decline in pricing of somewhere between 5% and 7% according to a lot of news sites that specifically cover cruising. guys there were lots of pictures tweeted out. and i know that a lot of us have looked at the ones of the bags that people were forced to use as toilets, and where they were sleeping. i think one series of photos that hasn't gotten as much commentary, really speaks to the state of how we live are people desperately looking for a place to plug their phones. there were just a couple of outlets that appeared to be working and you can see in a lot

of the photos that they've added one, two, three different extension cords, and then added what appear to be 20, 30, 40 phones. people hovering around them trying to get their phones charged. we all live in search of an outlet these days, it seems. abc, always be charging. back to you. >> listen to what you're saying, though, michelle. some people were without their smartphones. for days. >> you're right. >> unable -- unable to text. unable to -- >> to text and tweet! >> you know thing? people that live on the east coast that didn't have power for 18 days and were standing in line for gasoline, 50 deep in a gas -- six hours to get put in a can to start your generator to maybe then plug your cell phone in and charge it in your own home where you have no food, heat or lights, you know, it's

unfortunate, it's four days. >> it did smell of feces. >> that's what we love. i've been to the zoo. i know that. that's what we're hanging our hat on here, is there was a lot of poop. we know that as humans. unfortunately, we're never going to -- what's wrong? we're never going to escape that. but that's implied in all the coverage is the bags. everybody wants to talk about the bags. >> that's why i put up the phones. >> i know we were. and you know, visualizing, is the rail safe enough for men to get close enough to where you don't have to -- you know, depends. anyway, thanks michelle. we appreciate it. see all those wires all crossed. >> crawled together. >> yeah. >> going to make people rethink cruises. >> it will. i know it was hard -- >> well, there was one incident. a guy who was taken off. but, okay, all in all the people in the industry we've spoken with have said that this was handled very well. as well as it could have been given the situation. we'll see how it plays out for the stock.

we've been talking to simon hobbs about that and at least in the london trade on this for carnival, it seems as if the shares have stabilized. let's talk a little bit more about what's been happening with m&a. warren buffett and nelson peltz calling in to "squawk" yesterday talking about berkshire's deal to buy heinz with 3g and the appetite for more mergers and acquisitions. >> i'm ready for another elephant. if you please, if you see any walking by, just call me. >> so, how much cash do you have on hand after this deal? >> well, at year-end we had about $47 billion of cash every place. but we always like to keep -- and we will keep around $20 billion. so, we might say the excess cash at year-end was about $27 billion. >> i think there are many more deals coming. i'll show it again, that's why we made our investment in lazard last year, we think this m&a market is back. revenue growth is hard to come by.

i think most of corporate america feels that they have skinnied down their operations to a point where they can't get much more out of it. so synergies are the next way of getting eps growth. >> joining us right now is jimmy dunne. he is senior managing principle at sandler o'neil. also our guest host for the hour is robert kaplan. former vice chairman of goldman sachs where he was in charge of m and a as the investment banking head. now professor of management practice and senior associate dean for external relations at harvard business school. he's got a new book we're going to talk about later. but these gentlemen are here to talk about m&a. and guys we've seen the deal pool really start to pick up after a few deals just this past week people are saying maybe this is the beginning. maybe there's really been a spigot turned on. you think that's the case? >> it should. i think you're going to see more financial services, banks have to get bigger. not the big, big banks but the middle sized and tertiary

financial institutions have to get larger. i think you're going to see valuations where they'll start to recognize it's a good stock to get into. i think you're going to start to see more of it. that made big, big, big deals but a lot of middle-size smaller deals. >> especially in the financial sector? >> for sure. that's all we do. that's the only thing i can talk about. but certainly in the financial sector. >> but this year does that kind of set up just by the way it's gotten harder and harder for banks under a billion dollars? >> i think it's been going on, really. i thought you would see, becky, sort of the first quarter of '11. so i think it's been much later than i thought it would have taken off. i think there are a lot of reasons for it, too, and not to. i think you have capital and credit where they were a problem in '07 are now real positive. but, regulations still makes it difficult, it's going to get -- it's very sticky that way. you don't have a lot of loan growth. you have some loan growth. everybody's awash with deposits. but i think, you know, i think the reality is the middle -- the secondary tertiary financial institutions have to get bigger.

and then you know, the top five leave them alone. but the rest of the world has to get, you know, has to get larger. really does. >> robert, yesterday we were focused on this deal between berkshire and 3g for heinz. now, buffet said it's not really anything that's happening in the broader environment that does this. he just likes deals when they come along. if you can find the right deal at the right price he will jump in on this. you do have that sense of spirit where you start to see several deals in a row and maybe people start to think okay i better do something before prices get away, before this deal gets away. >> well, yes. and there's just enormous liquidity out there. you can raise capital easily, rates are low and i think that's a driver. one of the negatives is g&p outlook is still relatively sluggish. one thing you notice on a number of these deals, a lot of them have a global element, including heinz who is very big yut siout the united states. you can't get topline growth right now. companies have done better

getting bottom line growth although it's still single digit. i think they're going to look at appropriate mergers to get global growth. but the difference between this and the '80s and '90s, you had lots of competitors for companies, corporate competitors. and you had rates going on. i think this is different, in that you'll see these deals in order to get more global growth, but i don't think you -- i think you're going to see also companies stay more focused and are not going to be willing to venture outside their core expertise as much as they have in prior years. so that will put also a focus on these mergers, a little more discipline. >> what about the technology sector? things like dell, obviously a one-off, too. >> dell is a one-off special situation. here's the issue on technology. there's so much disruption going on and things that you thought were great opportunities a year ago, there's a new product that's innovative and they're not. i think it's harder to do mergers in the technology space. >> are there areas aside from financials that you think are

ripe? >> i think there are certain -- and the problem as jimmy mentioned with financials is still the regulators. i mean the government has made it clear to the financial institutions that we're going to expect you to have more capital and they're focused on returning capital, shareholders maybe even before they do mergers. but are there sectors that are right? yeah. i still think health care and some other sectors that need margin improvement are right for consolidation. there's certain other sectors. actually the mutual fund industry if people are interested is ripe for consolidation. anything where scale matters and you need efficiencies i think you're going to see activity. >> robert, new -- it occurred to me when you said that the new products come along, suddenly someone else is the hot item. is apple immune to that or not? >> no one's immune to it. >> apple's not immune? >> none of us are immune to it, i'm afraid. >> it's a combination on one side that the market penetration globally is still low for all of apple's inkred ill products.

on the other side, you have people arguing that, you know, samsung doesn't just sit there with its thumb up its nose. i mean, it has got android stuff. any time it's not steve jobs. couldn't any time someone had something really hot and then the market penetration going from low where it is now just assuming it's going to 40% or 50% doesn't have to, does it? >> nope. the only thing people have -- i would say have underestimated a little bit on apple when you have that much installed base and you know that much about customers, and their activities and you have a retail chain where you get to talk to them every day and you have this much cash, they're in as superb position to be the known vative leader as long as they keep their culture. i think they may surprise people on the upside. >> i haven't updated my experience with the iphone and it's all -- people said it will change your life. it's amazing. >> are you kidding? >> it's unbelievable. the iphone 5. you type, but it -- the words --

if you do two of them it comes out. and then you just hit space and you go on. you don't need to hit every one of them. and you can dictate if you want to if you go slowly. i've got a little icon i just hit stocks and anything that i've looked at recently. i've got a contact list on this phone that everybody, remember when i used to send viewer answers to viewers. every person i've ever answered is saved on this. >> oh, great. >> it's un -- right. but it is unbelievable. i mean compared to a blackberry. it's so far and away superior that it's not even -- >> to hear this from you. >> and maps. and it knows exactly where i am and knows when i want to do things. and it's also, i did have some time on an ipad so i'm not totally new to it. but it's all sort of -- you can figure it out justs from instinct how to do everything on it. it's intuitive -- it's unbelievable. it actually has changed certain -- and you know, gps, if you don't know how to work it. so easy to go on there and know

exactly how to do it. i mean, it's amazing. >> guys, will you stay with us for just a minute while we flip in a quick break? when we come back we're going to talk more about the markets. again we've got two great guests with us and you're going to want to hear what they have to say. >> take the plunge. still to come forget about that key board you don't need it. and i downloaded brick breaker. >> that's why you brought it. >> and it was free. what carnival needs to do to restore confidence after the so-called nightmare cruise. and we head to break check out the "squawk box" market indicator.

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to deposit checks from anywhere. [ wind howling ] easier than actually going to the bank. mobile check deposit. easier banking. standard at citibank. welcome back to "squawk box," everyone. the futures barely budging today on this last trading day of the week. markets are closed on monday. so this is the last opportunity you're going to get until tuesday. right now dow futures down by under a point and a half. s&p futures down by just a quarter of a point. heading into this day of trading markets flat for the week. why don't we take a look at some of the earnings reports that have crossed the wires. campbell's soup earning 70 cents a share for the fiscal second quarter. four cents above expectations. campbell says it was able to achieve more cost effective

marketing over the course of the quarter. burger king holdings reporting eight cents above consensus. this is a 3g company, too, by the way. the partnership with buffett yesterday for heinz. the company credits an increase in sales as well as expense reduction. joe? >> let's go back to our conversation robert kaplan, former vice chairman of goldman sachs and harvard business school professor. and sandler o'neil's jimmy dunne. what we've seen, which has been an improvement, has come i guess once we got over the cliff, and we've done -- there's been a couple of things that we got through. but it's really not any clearer or any less uncertain about where we're going, but, would you say people have come to the realization that, hey, if i'm an investment banker and i'm 56, i don't want to wait until i'm 60 until i do something? i'm not going to wait around until i'm 60 to do something. better do it. >> i agree with that, joe. but, well --

>> can't you just sit there and wait for the world to turn into what you want it to be. >> i've given up on that a long time ago. i don't reallyion stand the uncertainty issue. i think we're quite certain as to where it is. >> you look at the election, three bodies basically were empowered. reid in the senate, the president and his team, and the speaker and his team. so basically the american people voted -- there were other three groups of people that needed humility, but those three people and those group of people were the most emboldened. so it's set. this is the way it's going to be. this is what it is. i mean, i don't understand the uncertainty. we're going to have more of the same. >> right. >> and just deal with it. >> do it. so how do you do it, then? >> i think i think margins are going to be difficult for a period of time. you're going to have to do deals, generate deals that -- i think the notion that we're going to go back to three times

book and 2.5 times books is over. >> what would you tell like retail investors to buy in financial services? >> i think banks now are probably as decent an investment as they've been for some period of time. because i think the valuations are -- >> no small -- >> i think secondary and tertiary. i think they're much closer to book value. i think you're going to get m&a activity. i think they're going to go back to sort of 2% to 4% in dividends. 2% to 4% on organic growth and 2% to 4% on capital management. >> you do that right now? >> i would. i would. >> how about you? >> well, if i talk about the markets generally, i actually think there's nothing that looks that cheap, actually, and that a lot of this market move, we have to recognize is funneled by the fed policy and ecb also. we've got a flood of liquidity. it's very hard to own a risk free asset right now.

i actually think if you think the s&p is going to earn this year 110 dollars and the market is already at 1520 we're close to 14 times earnings already. this is why people like byron lean and others i respect a lot are saying be careful here, we're record margins. you could have some deterioration. we don't have a lot of topline growth. maybe the p/e shouldn't be much higher. maybe it should be lower. >> but if the central banks keep their foot on the pedal? >> the issue is can they do it -- they can't do it forever. i still happen to agree that for companies, this is not a bad environment. and that we always talked about companies can manage through sluggish environment. they can do it very well and they're doing it very well. they can't manage to do chaos. and we've had a lot of chaotic risk over the last few years with either the government policy, the fed has done a lot, though, to remove extreme events, and the ecb has, too. in europe. so what we're seeing is there's

a little more clear outlook even though it's sluggish. but i still think it's going to be sluggish. >> all right. excellent, gentlemen. thank you. thanks to jimmy dunne. you leaving? >> out of here. >> this makes you mad, every time. there's no reason you can't stay and guest host for an hour. >> i got to go to work. >> you all -- you're doing great things for sandler being here. you're showing -- >> nice to be with you. we're a private company. >> there you go. all right. anyway, jimmy, thanks. you're welcome any type. robert kaplan you will be gracious enough to stay for the rest of the show. thank you. >> my pleasure. >> coming up a reprieve for the passengers of the carnival "triumph" after their extended stay at sea. we've been asking you to tweet us on the answer to our question, where would you rather be stuck? than on some smelly ship? we're going to read some of your responses next. it's a new day.

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welcome back to "squawk box," everyone. passengers of the carnival "triumph" cruise finally on dry land. we've been asking you all morning to go ahead and tweet us, where would you rather be stuck? instead of being on a cruise? here are a few of 9 answers you've written in. john says key west, it sure beats this baltimore cold. joey tweeted, our required human resources class is not nearly as squalid but probably took a lot

longer. and adam said i'd rather be stuck at the chuck hagel confirmation hearings. that tells you -- >> i'd rather be stuck in the donald's hair. >> saw that earlier. >> do we have anything else? >> i have to admit i haven't been in. >> more later. keep sending them in. >> keep sending in the tweets. when we come back your guide to the trading day ahead. we're just a few minutes away from the february empire state survey numbers. we'll get industrial production numbers for january at 9:15 and consumer sentiment at 9:55. as we head to a break, take a look at the u.s. equity futures. market can't figure out which way it wants to go today. s&p down by one. dow futures off by seven points. but that doesn't mean i don't want to make money. i love making money. i try to be smart with my investments. i also try to keep my costs down. what's your plan? ishares. low cost and tax efficient. find out why nine out of ten large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes

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welcome back, everybody. we've got a lot of interesting things that are happening here. get to rick santelli for the numbers from the february empire state survey. rick? >> wow, this is fascinating, becky. 10.04, now the last look we had, minus 7.78, unrevised, was the worst level since november of 2010. this 10.04 now jumps to the best level since may of last year. so, it doesn't take it all back but it certainly is a welcome bounce, and one of the best

empire reads in awhile. so, of course, we're going to pay attention to that. we have international treasury international capital flows at the top of the hour. capacity utilization so there's a bit more data. maybe the most important aspect of today, and some listeners and viewers probably understand well, three-day weekends. this is the type of holiday, of course, where pretty much the rest of the world will be trading. so traders in the u.s. are going to have to get their books in balance. many traders are still going to be watching their screens on monday. but three-day weekends always present a bit of a challenge to kind of tweaking your position. so watch the market in the last half hour of whatever commodity or future or cash or equity instrument you're looking at. probably get a little extra volatility. back to you. >> great tip, rick. stay right there. let's bring in steve liesman, as well. >> yeah a three-day weekend with a g-20 meeting. when they're really struggling over there in russia where they are right now to come up with

the right language to talk about currencies, currency manipulation. >> currency wars. >> growth versus austerity. we had an interview this morning with undersecretary of the treasury for international affairs, spoke to her in moscow and she was saying that it's okay to target policies that target growth, and end up depreciating the currency, but not policies that depreciate the currency per se. >> it's a fine line. >> this is what she said to steve sedgwick. >> we obviously want to see members of the g-7 adhere to these commitments, and i think they are doing so. it's very important to avoid loose talk about currents and it's also important for members of the g-20 outside the g-7 to move on their commitment to market determination of their exchange rates. >> so market determination of exchange rates, if you stay with

me on this -- >> this is like sophisticated manipulation is okay. >> so let's say you decide to do policy, cut taxes, and cutting taxes were to, i don't know, increase growth outlooks, which would ferret out strength in the currency. the other way, do more deficit spending, and that would end up weakening the currency but the deficit spending, the aim of that -- >> let's say you were to increase the balance sheet 0 over 1 trillion dollars. >> we're going to be looking up for how they come up with the language to talk about this. and loose talk, i think that refers to people who say things like currency wars. >> exactly. >> how if i could just pivot real quickly, i was able earlier this week to emcee a event at the new york federal reserve which is a competition among college students to create an advertisement to warn people about the dangers, wharf kids their age about the dangers of too much credit and not paying your debt, bill dudley gave a little speech there.

there is me emceeing. suze orman was one of the panelists. we had a guy ashley springer who is an actor in upcoming martin scorsese film, there he is third from the right there holding up the scores there. this new scorsese film is called the wolf of wall street. and i want to play for you the winning video which won a $2500 award and a tour of -- there's the winners right there. from laguardia community college here in the tristate area. $2500 check. here is the winning video. >> thinking twice before you swipe is really good advice because sometimes paying for your mistakes takes sacrifice. i had to put aside stuff i like and return my new car to the dealership. i had to act responsibly and smart so i came up with a plan. i only bought the necessary stuff. i never bought anything i couldn't afford. i set up a payment plan. and it took me eight years to pay off my debt. to repair my credit. but you know it's worth it at the end because new doors opened up and new opportunities come

along. >> what's nice about that, by the way, is it follows this behaviorial economic add of a positive message. a lot of videos showed people who were destitute at the end. this guy got his act together. suze orman had a great quote there are highways into poverty in this country but not even a sidewalk on the way out. there's big industries telling people take credit but not a lot of industry telling people how to help themselves out of it and be responsible. so i kind of applaud everybody who is doing this, near-community bankers association was involved with this public service and cnbc is big on the issue of financial awareness and literacy and thanks to suze orman for coming out and doing this. >> hugely important message. rick i know that that's a message you can get on board with, too. >> for the country as a whole. >> listen, self-reliance, self-independence, you know, self-responsibility, fiscal responsibility, i'm all for it. i really, you know, my heart

bleeds for young people. you know, they have no idea how those slightly nefarious issues that's the person steve was interviewing was trying to paper over, how they're going to be robbing their future, their potential savings, their potential wages. it's not fair. it's really not fair. good job on that, steve. we want to try to promote young people in any way we can. you know, try to teach them about the ills of the printing press. >> i think that's what we do, rick, if we do anything good. it's to try to help people to understand how all this stuff works. because, you know, you get the ad in the mail and it seems like a ticket to a new car, or a new, you know, a new guitar in somebody's case. rick i guess in your case a new car. and then all of a sudden -- >> i don't like new cars i like old cars. >> that's what i mean. >> it really is wonderful. the whole folly wood thing, you know, they high to help people but i think they're helping the politicians that are trying to

take the short cuts, and as -- as huggable as they all are you know commercials like that i think will force young people to take a step back and realize, you know, i think everybody really likes their vote. but i have a feeling that they're a bit disingenuous about their future. being married to the government might sound romantic but in the end, it is just going to be lined with poverty. >> you know rick there was that article in "the new york times" into the to long ago about young people now thinking more favorably about government than they had in the past. >> what you need to do more commercials to enlighten them, steve. >> well, it's an interesting question. i mean, right now-and by the way, rick, this is something that happens in almost every wealthy society is that the more -- the wealthier we are, the harder it is -- >> stone age wealth. >> that's true. but the harder it is to justify not helping the needy. and finding that right balance is really what i think you and i have been arguing about for i don't know how many years now, right? because the healthier we are the

harder it is to justify not helping the needy. the more we help the needy -- >> it's not a question of wealth. it's a question of truth to power. it's a question of truth to power. that is the problem, and that's what we need to truly do. you know, you can't look people in the eye and tell them things like, you know, they're trying to, you know, take away your benefits or they're trying to take away your health care. you can't promise these things when you know that after you're out of office, that many of these programs are going to be in jeopardy. sit them down and tell them listen, you know, we need to come up with a workable future for you. young people. steve, next time you do one of these benefits, call me up. you know? i'd like to go with you. this is something we see eye to eye on. >> robert you want to wade in here? >> i talk to students about this every day. and if you -- because i teach.

but, when you step way back we've had 50 years, 60 years since world war ii, of rapid gnp growth and more leverage. at the household level, at the government level, at every level. we're now in a period that's painful where we're having to deleverage at all levels. the households are deleveraging. you can't live on debt anymore. the government has not yet deleveraged but it's going to have to. and the next generation and for the rest of our lives we're going to have to learn to make -- to spend what we produce. i've got to tell you in the last 60 years we've gotten away from that a bit and we're not going to have the gnp growth like we used to. we're going to have to spend what we produce. it will ultimately be a good thing for this country. >> robert wrap together the new york fed financial learners video and the g-20. right? which is really -- they're two sides of the same coin with no pun intended right there. >> yeah. >> i mean, what is your

prescription right now in the growth versus austerity? should the united states right now be seriously deleveraging on the federal level, or is that something that it ought to do over time? >> it's got to do it over time. a lot of people think the fed policy and the ecb policy are policies in and of themselves. they're not. they're bridges to allow the fiscal policymakers here and in europe to get their house together. house in order. they've just been slow in doing it. but i think this is a window while rates are low, when you've got this much debt the only reason it's not exploding on us is because rates are very low. we've got to get this rate down -- this debt down and the fed can't keep doing this forever. and so we've got to start making moves now to get on a path of lower leverage. and we've got to. >> rick, 11,629 people go on food stamps each day. 31 million when obama came in. 47 million now. that's more than the population of spain, 47 million.

we all want to help people that are needy. but it's probably not a good idea to create and add to the people that are needy and then feel virtuous about helping them. if policies were able to take -- the 16 million back off food stamps that are on now by giving them jobs, by instituting policies that give them jobs to where they're -- i mean it's so good to feel good on the front end about being virtuous about helping people that are needy but what if you're adding to all the people that are actually in need, steve? >> one statistic that summarizes it, sequester. everybody's talking about the sequester. if "the wall street journal" pointed out, the amount of money we're talking about for one year on the sequester's cuts is one-third of one percent of the 3.6 trillion that we would have if we had a budget. but that's the number. we can't -- one-third of one percent of our budget?

oh, my god! if anybody thinks we're going to give those young people a chance that says it all. >> it would be nice if the young people were, you know, experiencing earnest success and able to find great jobs in an economy that's growing at 3% or 4%. not trying to figure out how to take care of everyone -- >> we'll get on the right track. this country is going to figure it out. young people are going to have that wake-up call. we have that alarm clock, right? that's the alarm clock we really need in this country to wake young people up to their diminishing future. >> steve thank you for bringing us a psa. sparked a good conversation. >> that's a prostate and a -- >> that's what you associated -- >> yeah, i guess it's my age. >> we'll see you again, soon. rick thank you as well. when we come back more on that carnival cruise. we're going to ask a marine technology expert how carnival can come back after this disaster. plus a consumer brand company issuing some guidance.

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>> welcome back to "squawk box," everybody. again the futures barely budging this morning. nasdaq futures slightly higher. s&p and dow futures slightly lower. boy, s&p futures just turned around. this could go any direction. we were heading into this week a that week. check out shares of kraft foods group. the company -- >> want me to listen? >> preliminary guidance on its fourth quarter earnings although that report won't be out for another month. the company kraft says it does expect a report profit of 15

cents a share, well below estimates of 22 cents. it was hurt by inventory reduction. company is also raising its forecast for the year, though, mostly because of accounting changes. kraft is still dealing with some complexities related to the spinoff from mondolese international. >> we've got the carnival cruise nightmare covered from all angles. michelle caruso-cabrera joins us live from mobile. michelle i understand they've got some already new rules in place for new ships, more bags or something, that would have prevented this fiasco, right? >> so this ship behind me that you see was built in 1999. there's a new rule that said any ship constructed after july 1st of 2010 must have a redundant, separate electrical system that can power the propulsion system of any cruise ship. so what happened on this ship, in theory, will not happen on future ships. this was put in place by the u.n. organization that oversees

safety on the high seas. because they knew that this was going to be increasingly, perhaps, an issue, if you have a fire in the engine room, as we've seen several times now, and it ends up shutting down the entire ship. >> all right. let's go now talk to someone who knows a little bit more on this on the "squawk" news line bob kunkle, president of alternative maritime technologies and technical adviser from midocean tanker company and that sounds like a pretty good idea just hearing it bob it would be nice if you had electricity, it would have made the towing back to shore or a lot easier and a lot less troublesome, right? >> well, absolutely. and i think what you have to look at here is that the regulations are built upon lessons learned from the accidents that happened at sea. you know, in this incident the crew extinguished the fire. it contained the fire in the

space that it occurred. it was no reported injury, or no loss of life. and that's a hollywood ending when you talk about, you know, fires on ship at sea. but we're governed by the international safety management system where near-misses or accidents like these have to be reported, and then reviewed, and new pro-feed yours put into place to try to make sure that it doesn't happen again. and the imo, the u.n. association and group that takes care of these kinds of issues does a great job in trying to make sure that they do build on the regulations to try to protect everyone that's at sea. >> do you think that it is -- is there a good reason to have a ship that carries 4,000 people, bob? >> well, you know, this is a very intricate piece of machinery. and you know, as we start to hear about what the conditions were after the fire, you know, i think everybody needs to

understand, if you've ever worked on a cruise ship, your largest maintenance issues are plumbing, and household issues, light bulbs that are air, my air conditioning, my room is not cold enough, and you're trying to take care of those issues to keep your customers happy. but you know, this industry has seen roughly 90 fires over the past eight to ten years, and the truth of the matter is, is that the cruising public has returned to the ships, and they've been able to return to the ships. i wouldn't look so much of, you know, what carnival is serving for dinner as much as having a very capable crew that's going to be able to take care of me and make sure my safety capable crew that's very able to take care of me and make sure my safety is my number one concern when i am cruising with them. >> if you think 4,000 is a lot, they've got ships for 6,000. >> you need to find out for me

why. request can jou? >> it's my understanding is that people like a large ship. it's a lot bigger community. there's a lot more to do. when you have that many people, you have a revenue base that can have the climbing walls, the extra pools, the spas, et cetera and it makes it cheaper because you spread it across a much larger number of of people. we've gone from 7 million north americans to 17 in something like ten years. >> they do sail cruises on sailbo sailboats with like 80 people. >> those are much more expensive. >> tlen there's larry ellison. he doesn't want anybody on it. >> can i recommend something? i bet you becky knows this, but david foster wrote an article -- >> something i will never do again. loved it. it's hilarious.

>> thank you, michelle. great work. >> when we come back, a vote in congress that could impact the pay of 2 million government employees. plus, more of the video of the morning. we'll be right back. this is from russia and you're going to want to see it. incredi. otherworldly things. but there are some things i've never seen before. this ge jet engine can understand 5,000 data samples per second. which is good for business. because planes use less fuel, spend less time on the ground and more time in the air. suddenly, faraway places don't seem so...far away. ♪ some brokerage firms are. but way too many aren't. why? because selling their funds makes them more money. which makes you wonder -- isn't that a conflict? search "proprietary mutual funds." yik then go to e. we've got over 8,000 mutual funds, and not one of them has our name on it. we're in the business of finding the right investments for you.

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welcome back. in our headlines, the house is voting today on whether to extend the current pay freeze for the nation's 2 million federal workers. republican leaders argue by blocking the raise by president obama, it will save $11 billion and that will compensate federal employees if they can afford that. the legislation is expected to pass the house, but receive a cold reception in the senate and check out this video. a ten-ton meteor streaked into the skies overrussia today and caused shock waves that injured more than 400 people. the meteor entered the earth at 333 miles per hour. with with so many people seeing this, they were on their way to work this morning, already, there are theorys, people thinking this is a ufo crash

landing. but again, pretty amazing video. when we come back, our guest host has been robert kaplin, former vice chairman at goldman sachs. we'll give him the last word when "squawk" comes back. >> tuesday, equity market flirting with all-time highs. can bulls continue to climb? plus, our guest host will be the always outspoken ken langone. >> i'm a bull. "squawk box" starts tuesday at 6:00 a.m. eastern. i love making money. i try to be smart with my investments. i also try to keep my costs down. what's your plan? ishares. low cost and tax efficient. find out why nine out of ten large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal.

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