andrew ross sorkin is off today. it is friday and is we've been watching the u.s. equity futures this morning. and at least at some point you can see that the futures had been kind of hanging around the flat line at this point. we'll see where things go. yesterday, stocks rose for a fourth straight day. yesterday, though, stocks were up for the fourth straight day. and this is a pretty key level. the nasdaq actually finished the session at a 12-year high. 31% of the s&p 500 hit new 52-week highs yesterday. all three major stock indices had their best four-day winning streak since the fall. over the last four days alone, the dow is up 2.1%. the s&p is up by 276% and the nasdaq is up by 3% and, joe, all of this comes even while we had some really lousy economic numbers, it got kick started by that jobs friday on friday that showed a disappointing gain for 88,000 jobs or the month of march. yesterday, the jobless claims number that came in was a lower

number than expected, a big drop of 42,000 from last week. so when you get good news -- you get bad news, it goes up. you get good news and the stock market goes up once again. >> which is characteristic of bull markets, either bad or good. but, you know, we talked a lot about the stock market yesterday and the crazy thing is that, you know how you can find in the mental institutions, you can find a lot of people that think that the people on tv are talking about them, they think they're talking directly to them? i've had viewers write in and saying, i happen you're talking directly to me. it's a sick, delusional thing. but even my guy with the jacket, the guy at the cme, i wasn't talking directly to him about being wrong. i'm talking about if you look at a one-year chart, if you go back, let's say six months, we

were at 12,400. basically. now we're at 14,000. so we're talking about 2,500 points. a 5% correction is somewhere around 600 or 700 points. hold on this chart. go back to the other one. but people all the way up from 12-4 saying i'm worried about a correction, every 700 points the correction happened and they're still not on in. they'll come on today and said i don't know. they were saying at 12-4 that there's going to be a correction, i'm not committing new money. and they're saying it here. they'll go all the way up until there is a correction. >> i've been telling but the correction. so those are the people that are bothering, not the guys that may have -- and i'm fought saying -- >> you can't time it. you don't know exactly what's going to happen on any given day. >> people were saying my rant is signaling a stop. thiefb saying this the entire six months and not saying that i knew.

i'm just saying to people, are you sure ask we're going to hold you to it? i'm not saying either way, even all the way up, even though i do think the more people are saying it, the more likely it is that it keeps going. now, if you go back, these people aren't even the bad ones for the last six months. go back to that five-year chart and i'll tell you what you can do. go on -- if you google business insiders rally idiots, business insiders rally idiots, you will find a list of 35 people that you see appearing on this show all the time and you will see comments that they made all the way up from 6,000 all the way up to 15,000 and you can see how right a lot of these people were. really well known names. business insider rally idiots. >> not that you're going to name any names. >> not that i'm going to name any names. the guys of the last six months, they're typical. >> and there will be a

correction. >> there will be. because the market is going to -- and the other thing that i also thought, back in the '80s when we kept hitting new high after new high and new high, what was different and what was the same back then? we had interest rates. we have zero now. we have government shrinking. reagan was shrinking government and cutting taxes. i don't have to explain how that's not quite the same right now. we had a guy in who was trying to get rid of regulations, not putting a thousand new regulations on every day. we had a guy named volcker, not a guy named bernanke. i can go on and on and on. the only thing that's the same is we had about 10 or 12 years of underperformance by the stock market. i don't know how that timely plays out, but there were some really positives overall things that aren't -- there was something else i was thinking about, too. i can't remember. valuation, i don't know, it was probably cheaper in 1981 based on price werings multiple so

that probably was better. but we have had 12 years of spinning our wheels and when the sell side guys, that's what they do for a living. they never really say anything because they won't keep their jobs. so they basically say, i'm constructive, but i'm expecting a construction could occur at any time at 5% to 10% on a pullback. >> cautiously optimistic. >> cause cautiously optimistic. now i'm finished. that's my only rant. >> the problem is, if you've listened to them for five years, you have missed out on all -- >> and the people that listen to them for six months. if they would say, i don't think you should commit new money at 12,400, they're never going to change. they're never going to come back at 14,900 and say you know what? i've missed 2,500 points but now it's going to continue. they just can't i don't think emotionally or logically, you know, get themselves to do that because they've missed so much. >> and i understand that, too. >> i do, too, but i don't want them coming on and saying, you know what? at 14,900 i think this is fully

valued and i think we're due for a correction when they've been saying that all along. >> that is not to say that the correction is going to come. it is going to come. >> north korea has two missiles lined up. slovenia is running out of -- the cypress bailout wasn't 13 billion. >> but markets don't care about those things until they do. there will be a time when that changes. >> i was a broker. i've seen a five and ten -- i know the market doesn't grow to, you know, to the sky. >> i'm just trying to make sure people you understand what you're saying. >> the guys that do this for a living, we need to talk about their track record from time to time. >> we also are going to get economic numbers. yesterday, it was the jobless claims people were focused on. today, we get another big number. the march retail sales number is coming out. that's important because we're very interested in what has been happening to consumers. also, we have producer prices that are coming out this

morning. later on, we get consumer sentiment and business inventories. but if you're looking at that retail sales number, that will be a biggie this morning. polled economists are looking for that number to decline by 0.1%. ex autos, that number is expected to be unchanged. meantime, headline ppi is expected to decline by 0.4%. the core component is expected to rise by 0.2%. in europe, shares fell sharply in the last hour on reports that the president of cyprus planned to ask the eu for extra assistance. but then a finance ministry said the president is not suggesting an increase in bailout loans. julia chatterly joins us now and the big question is the math in this situation been the numbers as they had set them up, the growth they're expecting from the economy, all those numbers don't figure out to a full solution. what's your best take on what's really happening behind the scenes? >> you know, becky, there's a

definite sense of deja vu. we're going to sign another bailout deal where our country can't hold up to the news they're talking about. identities on not just the 7.5 billion euros they have to come up with now. it's 13 billion euros. we're talking about 7% of the gdp of cyprus. this when we're talking about depression style growth sta statistics. >> we look forward to the political endorsement of the cyprus program and we are ready to start work for a -- >> and will we need another deal? are we talking about 5.5 billion? >> no, no. we have a deal and is we shall make it work.

>> so this 10 billion euros that cyprus is going to get from the european officials, that's nonnegotiable. the germans have said that. but they're hoping to pull money from other funds. the question is, even if they get that right now, the mass of this situation just don't hold up. guys, back to you. >> julia, there's this huge sense, though, if they say they're not going to give any more and cyprus is having trouble coming up with some of these numbers, is there a sense that you're just throwing good money after bad after some point or they just do believe that cyprus will find the money by going back to the banks or something? >> well, i think the important distinction that we've got in the cypriot case, of course, is that this isn't money that's going to be dumped into the banks. the cypriots themselves are going to pull money from the banks. so they've got maybe up to 13 billion euros that they can effectively take from the bank of cyprus and the popular banks. but you're right, when you're

talking about depression style growth statistics, even is that money going to be enough? right now, analysts here are saying we're going to be revisiting the bailout deal in two, three months time and they're going to have to find more money. >> julia, thank you very much. we appreciate it and we'll talk to you again soon. >> she looked through all 35 -- it is not a rally idiot that i think we tweeted out on our -- if you follow us, i think you can find that error on our list. it's not a complete list. >> okay. >> soros, roubini, david -- there's some good ones. it's a good list, but it is so far from complete on who should be -- >> is that going to be your mission now? >> yeah. and it's not the last six months or the last eight months, because we have a whole new list of guys over the last eight months that really, you wouldn't

even say they were bearish, necessarily. maybe they were saying some positive things. but it's -- no, no. >> well, you understand why people get a little uncomfortable when you look at gains like that. >> but also because we've been -- the patch lovan response has been not believing anything else. that was my point yesterday about people are still gun shy. >> fear. >> because i had mentioned the cultural zelette case. none of that seems to bsh drn you're not goc to see people celebrating the stocks and feeling good and buying champagne. right now we're supposed to be worrying about -- i don't know. it's a different -- it's not a country -- and it may take a while. >> people are not necessarily between the higher stock market

and that mean corporations -- >> but they're bad. >> they're not been following through with spending some of that money. >> you know the attack on the private sector. and this -- we are in an area, washington, d.c. real estate is at an all-time high. >> i've never seen as many cranes anywhere except tore beijing. >> leon said yesterday, you know, a lot of smart people are coming to washington to solve all the country's problems. that's not the way it was in the '80s. it was a private sector. the whole idea of what we're trying to do here is different rye in and out. if you're going to raise a kid, they're not really your kids and you should really let the community raise your kid. >> i have to say this. >> you have to see it, but you've got to let the community raise your kid and let them be indoctrinated by the government to they can start thinking properly about the true role of the individual versus the

government. in corporate news, two evil banks are headlining earnings central today, jpmorgan and wells fargo. >> did you say two evil banks? >> i did say two evil banks because they are both in search of profits. jpmorgan, analysts are looking for earnings of $1.39 a share. revenue of $29.5 billion and we'll pay close attention to any comments on the conference call or the release about london whales. jamie dimon says to expect nor informati informati information. then later today, kayla touchy will sit down with marianne lake. the street is looking for

shares of wells fargo. the bank has held the top spot in underwriting home loanes and likely benefited once again from the continuing re-fi activity. we're calling all arm chair analysts, you may the call on how companies will perform. our first poll today is focused on jpmorgan. will today's first quarter earnings meet, beat or miss the first call estimates on earnings per share? it's $1.39. vote now on facebook.com/squawkcnbc. even if you don't want to do this, just click somewhere on our stuff and just click a bunch of times. we just want a lot of clicks. >> i like the arm chair analyst. i like the hear what people

think. >> you see henry plosser. he went to this party for cheryl sandberg. he put 39 pictures. do you know why? >> i don't even know because you have to click on every single one. >> those are click to business insider. >> i don't even know who is on this business insider list because you have to click on every wink to see who it is. >> so go and either vote for jpmorgan. >> or take a look around. futures are weaker. right now, s&p futures off by 4 points. nasdaq is down by just over 6 points. the dow has had its best four-day winning streak since september 14th. you've got to go back to last year for some of these numbers. take a look at oil prices this morning. right now, oil is down by just over 1% to 92.53.

that number keeps coming down. consumer confidence could be an important number today as well as retail sales. yield on the ten year right now is at 1.764%. the dollar is actually up against the euro at 11.352. the dollar is down against the yen, which is sitting at 99.13. so very close to that 100 number still, looking for that to come. gold prices have dropped again more than $16 to $1,548.30 an ounce. let's get to the global markets report. we will touch on some masters action. ross westgate is standing by in london. i saw you talking to shaq earlier. i think he's down there. westy is always there, another -- are you related to him? >> oh, no. it's westwood, not west goods daits gate. he's always there. you know who else doesn't usually do well on the first day who had a good first day?

your boy, luke. >> luke did arlt playing with tiger. it's never easy to play with tiger, is it? >> no. i was disappointed. ian i hope he does better today. >> did he talk to you guys? >> and then -- >> i didn't mean it. >> sergio, who has been over the years a little yippy, he has that claw. who is that other guy from, the other guy with the claw? the spaniard. >> oh, constan -- yeah, phillipe consdan -- yeah. i forgot his name. i know exactly who you mean. >> michelle caruso cabrera, no, no, that's not him. anyway -- >> i lover it. it is the best golfing tournament on the planet. and is it's one day in.

>> people say, oh, i don't get to watch the mornings. do you see the sponsors that they're able to -- it's like you have to kiss up to them just to sponsor this tournament it's so great. ibm, exxon and at&t through maybe the top three most iconic. it's just great. it's awesome. >> what i find extraordinary, this is just a private club championship, right? >> right. >> that's the most amazing thing. >> and is it's the first major and maybe some guys might want to win your open, maybe, or the u.s. open. but it's just a matter or -- >> is it better than the ryder cup? >> ryder cup is totally different because it's different teams. >> but if you could have one -- >> individually? >> you can't do that, becky. we're men. we want both.

>> speak for yourself, not about wanting both but about being a man. anyway, go ahead. >> i'm moving on quickly. we're trying to man up on the european equities. 8 to 2 declineser outpacing advancers. i want to draw your attention to this bit of the graph. you can see a sharp point down. this is the point at which we had a statement out from the cypriot president saying we're going to ask the eu for more assistance. when that snap came out, they said, okay, we want more money. and ask then we got clarification from the cypriot finance minister who said he doesn't want more money, just technical assistance. so what that means as far as

european equity res priced right now, you had the four days of gains you've seen in the united states, the ibex along with the xetra dax, ftse mib down 1 .35%. as we wait for the bank earnings, health care, food and telecoms. banks are weakest, down 11 is.65% along with autos, as well. gives you a sense of where the selling pressure is coming from. not particularly heavy. and as far as bond markets are concerned, it has a bit of a stick up in bond produces. and a little bit lower in spain and italy. but the point is, these yields are very, very contained. we had a good, another solid bond auction from italy yesterday. still there, but it doesn't seem to both anybody.

>> they said they need some help and everybody realizes the math doesn't add up. so we figure they must be asking for additional money. they come out and say we're not asking for additional money, wee asking for technical help. we still know the math doesn't add up, but as long as they're willing to say the emperor has clothes on, everybody else believes and it says, oh, problem solved? >> no, nobody believes that at all. every single bailout we've been in, we knew the numbers still don't add up in greece. unemployment ticks up to over 27% yesterday, as well. so, no. you know, we're just tweeting on a half hour sentiment. we know somebody has to come up with the cash. i don't think anybody thinks cyprus is going to be able to -- they had problems finding the original 6 billion. come up with another 6 billion? the size of the bailout now is now bigger than the size of their economy. the total is bigger than their

gdp. >> i guess i don't understand why the market itself only reacts when we're calling it out. >> because we only want to trade on the immediacy. >> you're right, ross. no dicht than every other -- in the last three years, we've seen that. that's why you guys didn't join the currency, ross. >> yeah. >> and i always hear that tone in your voice, too, as you kind of like askance across the channel at the shenanigans, right? you feel pretty good about yourself. >> well, no, look, it's just not helping us out. i mean, we're better that we didn't get involved. >> yeah, i'll say. >> what's going on doesn't help us in any shape oshg form. >> we ever to tried with that

entire confidence. >> joe, who do you think come sunday afternoon? >> you saw how much -- you know what? that's a fool's game. but the times that tiger has won, he shot 7 0 on three of those occasions. and i know that he shot a 68 and he was in the lead and did not win one time. i know you remember that time. >> yes. >> i want to ask shack whether he's since lindsay vonn because these there walking around. that would be a big star sighting. >> yeah. when we come whack, we'll turn to three strategists to talk stocks and the rally. stick around. [ penélope ] i found the best cafe in the world. nespresso. where there is an espresso to match my every mood.

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can on. looking at stocks-related information, sergio garcia, mark -- welcome back. joining us to talk markets, john buckingham. chief portfolio manager and chief investment officer and from the cme group, scott saladay, on set, chief investment officer. if you've been watching the last couple of days, you're probably afraid to say there's going to be a correction. where are we in the market? >> we've come a long way in ra short amount of time. but when you look at where the stocks are valued and you look at the stimulus in the system and the fact that there are so many people that have been waiting to buy this rally, we think the momentum is going to continue for a while. people are trying to catch up right now.

all the people that have been fighting this for the last two years are now completely offsides. they need to buy this market. >> that's a tough trigger to pull if you've been waiting. >> it is. it's coming and people keep getting squeezed as the market goes higher the. >> and if you're managing other people's money -- it's bad enough when it's your own money and you're watching it and you're like, oh, what am i going to get in? will it ever come back for me to get on board? but if you're managing other people's money and you're picking up the phone every day and going, where do i need you to keep me -- i can keep myself out of markets. i'm great at losing money. you don't need to pay you 2% to lose all this mope, right? >> not only lose the money, but not participate in the rally. and i know you're exactly right. we' people started off with too much stock going into your

forto. then they shed off the risk going into the market. they buy at the top and sell at the bottom and you can't do that. and now there's a psychology that because we're back where we started, it's time to get out and we're hit ago top. but werings have come a long way since we started this whole rally back in 2008, 2009? >> scott, what can cows tell us about the rally in the stock market? can you tie this together somehow? >> i'll try. it's like it's the old keep it simple stupid. sometimes we just overthink stuff and i think that's been going on over the last four weeks. i had lunch with a guy yesterday who is wasting his return on buying puts up to the rally. >> oh, no. it's better than selling the futures. but buying puts, huh? >> oh, yeah. all i toad him, joe southbound is let me tell when you stop because that will be part to buy

them. sometimes we can fooledind the h for yield. the they're bad we're going up and if they're good we're going up. sometimes you have to have no memory and no experience and just relax. >> it's a little scary, scott. we do have the feds. we've got the feds, we've got japan, we've got everybody printing. but you look at all the things that are important to a stock market and go back to the '80s and is look at what we had then and look at what we have now. unfortunately, it's sort of a lot of things are not the same. like we had 20% interest rates, right? we had taxes coming down. we had government shrinking. we had regulations coming. it's the opposite. i daresay the exact opposite on all the these -- >> right. and i agree. three months ago, if i was sitting in this chair, i would have said, qe, qe, qe. but you can make the case without qe and then you put qe

around it. >> if you don't have qe, you've got nothing. that's the -- except that it's been four or five years and the consumer is deaf leveraged and housing is coming back and everything else, right? >> right. i agree. and i'll go to john. john, there are people that still tell me their parents after the great depression, they never bought another stock, ever. that was a pretty bad deal we had in 2008. and maybe it's a similar situation. there are some people that probably swore off stocks for good, don't you think? >> absolutely i do think. and at some point, they will come back. one of the amazing things out here this was the bull bearish sentiment survey, only 19% were bullish, the lowest since 4009. >> so are you saying buy now, john? >> well, i've been in the market all along.

i'm a long equity manager. so i think there's still opportunities today. i think you guys still have to be careful, but i'm -- along with the guys that are on your air saying dividend paying stocks are attractive. but when you have a ten-year treasury at 1.8, i can give you a dividend paying yield stock and we do this for our clients at 2.5% in your portfolio. i think that's very attractive in the current environment. and, you know, i just don't think that people are enthusiastic much about this rally at all. >> yeah. sometimes we -- we don't make fun of them, but watching microanalyzing said minutes and every president talks and we talk about it, that is important, isn't it, whether -- i mean, since that's really one of the major reasons when they decide to taper could make a difference. i mean, we're fought crazy to be watching them so closely, are we? >> we're not crazy to watch the fed. they're always talking more

restrictive, more hawkishness when the market is doing well. then they pull back when the markets stop. we think the fed is locked into a long-term quantitative easing path. and basically the whole group is on the same page and you have very few centers. what's interesting, when you look at the fed comments, it's really the opportunity for the decenters to get their opinions known in the minutes. >> to get on the record for saying i'm not necessarily on -- >> bernanke probably says, this week you go out. next week, you go out. >> you think we're into 2014? >> i think we're in probably 2015. they've run up debt to gdp or they've at least aided and abetted to that process to the tune of 100% in the total economy. they've put a lot of stimulus on the table and they have to keep that stimulus going in order to keep the party in play.

>> scott, anything else? last comments and then john. >> you know what? i'll say sometimes you just have to relax and let it happen. you can overthink it, overanalyze it, but you have bernanke that says he's going to print. i agrees it's probably sometime around 2015. but this thing has every excuse to go higher the. >> at&t at 4% or 5%, right? if you keep it simple, it seems like you want to buy something that's between $4.50 and $so 10 one right? >> forget about time to time the market. >> i think you could buy the augusta portfolio. >> i was going to say, everybody that was there sponsoring it? >> only three, exxon, ibm and at&t. or at&t, exxon and ibm -- or -- no blank favorites, right?

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welcome back, everybody. we ever quarterly results coming out from wells fargo and jpmorgan. joining us now is bill isaac. he is chairman of fifth-third bank corp. bill, these numbers that we're looking for today, we know this is a different environment. jamie dimon warned about it in his annual letter. it's not the banking environment of all. what are the key things that are going to probably stand out with some of these numbers today? >> i'm not looking for anything terribly unusual about the numbers. most of the banks report decent earnings. but there is a new normal and decent earnings are different than therve in the past. return on assets, return on equity. we used to have much higher expectations about those things than we're going to have as far as i can see into the future. >> that's just the way of the

world given the post 2008 situation given regulation that's out there today. >> exactly. >> sheila beah had a column that just came out this way talking about how too big to fail may be resolved at this point, saying there's a way to wind them down and i -- i think what most people are thinking is that the regulators don't have the will to do it. and i think the fdic may have the will to do it. i'm not sure the rest of the government has the will to do it. and if you look at pricing and availability of funding for large, very large banks, it's more available and it's cheaper than it is for smaller banks which suggests that the markets don't believe too big to fail is over. >> although i think about it from the political will and i

know that it would be difficult to do. but i also think because they would want to set an example, i think the next big bank that gets in trouble is going to have a very difficult time of it. it would seem to me that the push from main street saying, hey, you can't bile these guys out again, my guest would be some politicians would be loathed to look anything like they're doing a bailout again. if you have one bank in trouble, versus a bunch of bax, you have to isolate that and see what we're doing in the middle of a crisis if we get there. what we've been vo eking is like all these models. i want to see very high, tangible equity and i want to see a lot of long-term subordinated and senior debt.

and those debt holders will discipline those banks. the regulators can't do this alone. we need more market discipline. the long-term debt can be exposed to risk of loss and in the event of a failure. the fdic can take the bank, put it into a bridge bank and wipe out ar at least the exposure to critters. >> but are critters going to be as r degreesive? >> a lot of people argue for a lot more equity. i'm happy to have more equity than we've had in the past, but equity can only go so far. equity holders have -- first of all, they have limited ability to discipline. they can't declare an event at default. they're in. and they have upside potential, so they're not nearly asterisk averse as the long-term debt holders. long-term debt holders, best

case, they get their money back with an interest rate on it. so when banks start to look more risky, those long-term debt holders are going to pay a higher interest rate, they're going to say no more. >> bill, you bring up an incredibly important point. that works when a spinl bank is in trouble. your plan would keep the banks solvent. aig with a part of the problem here? >> that's the really different question. we can figure out how to deal with the banks because they have a very extensive regulatory regime wrapped around them and they have the fdic toby there to deal with the problems. and the federal reserve can provide liquidity.

it's the nonbanks that are really difficult to figure out. if you have banks that are taking excessive risks, if more leveraged -- >> it's the chase for yields, though. >> pardon? >> chase for yields. >> and if you chase yields, he deserve whatever happens to you, frankly. chairman of fifth third, about 2010? >> about three years ago. >> do you have to live in cincinnati to be the chairman of fifth third? >> no, i don't. i live in florida. >> but you're chairman. >> i'm chairman. >> do you know -- >> did you? >> i'm name dropping. i did speak to him, actually,

last night for separate reasons. and then i was thinking with my kids trying to explain -- >> greatest radio? >> he's the greatest country -- it's weird would because it's like knowing baeb ruth. >> like johnny and roy camp nell la. you have to think about it after that, et was just water. >> when i was in school -- >> so the northwest part of the state. >> when i brew up, i was a catching in high school. >> you were? a catcher. >> a catcher. folks, we are calling all analysts this earnings season. we want you to make the call on how companies mr. perform. our first poll is focused on jpmorgan. will today's first quarter earnings meet, beat or miss the current wall street estimates of

$1.39 a share inspect vote right now on facebook.com/squawkcnbc. we should put that on the screen because that's complicated. then stay tuned to squawk for the you're -- >> it is the shot of the day from the masters, it went to jamie donaldson. he pulled out a 7 iron on the par 3, just handed his position. becomes only the fifth player to make a hole in one on the hole that is called juniper. 24th player to hit a hole in one in the masters history. as for the leaderboard, spain's sergio garcia, australia's steve leashman -- no, i'm sorry. mark shakdman.

>> i've going to have a forward conversation about dustin johns job's girl prepared.

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welcome back. day two at the masters, cnbc's brian shactman joins us from augusta. we'll talk when you're friday, bri. >> yeah. listen, there's a lot to talk about, a lot going on. i want to touch on a few business things before we get to that stuff. it sounds cliche, but the masters seems to be recession proof. augusta national golf club doesn't need the money and there's always a lot of people with enough money to go.

but this year there's such a supply/demand dislocation, it's unbelievable. you have to think about it from the perspective of why is there such a spike in demand, tiger woods just became number onewor. and corporations are absolutely flooded with cash. and because of all of those factors, fans cannot find tickets. when they do, the prices, through the roof, guys. we have seen four-day badges go for 10 grand. face value is $250. friday-only badges for $2,500. we talked to one seller, jimmy d., who summed it up. >> tiger is in the lead. stock market all time high. they're coming in droves from all over the world. france, india, iceland, japan. it's the tightest ticket i have ever seen. it's tight. probably twice as hot as last year. twice as expensive as last year.

>> and it's not just tickets, guys. where we are, the double eagle across the street they host corporate clients all week. open bar, help them get housing. business is booming, right? it's because companies are finally taking off the recession spending shackles. >> this is the first year i think it's been no holds barred with companies coming out not worried about spending. they're sitting on a lot of money. they're sitting on a lot of cash. they need to spend that on promotions. there's no better way to do that than entertaining their clients. they want to attend the masters. he's great for the business of golf. everyone wants to go see tiger even if you're not a golf fan. >> disney, capital one, wells fargo, jpmorgan, spend $500 per person per day. that does not include tickets or housing. basically this place is open one week a year and it is well worth

it. >> wow. we only have a minute, bri. so many things to talk about. >> sorry, sorry. >> no, that's okay. but i wish you could come back. are you walking around -- do you get to go on? are you walking around the course? >> they didn't credential us. i waited around here for a while. some of these guys represent the companies said we will give you a badge. i just want to buy a shirt for my dad and walk for half an hour. i'm still hopeful it will happen today. >> masters at the same place every day. hallowed ground. if you're walking amen corner you have seen it your entire life. >> i actually understand what you're talking about. >> bobby jones is. unbelievable. i'm going to have my brent musburger moment about dustin johnson's girlfriend. >> i want to see it. >> you have to watch then.

get to a tv. >> brian, we're going to check in later we hope because this is a great story. when we come back, quarterly results from jpmorgan. ♪ ♪ here we are, me and you ♪ on the road ♪ and we know that it goes on and on ♪ [ female announcer ] you're the boss of your life. in charge of making memories and keeping promises. ask your financial professional how lincoln financial can help you take charge of your future. ♪ ♪ oh, oh, all the way ♪ oh, oh ♪ oh, oh, all the way are you still sleeping? just wanted to check and make sure that we were on schedule.

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coming up, jpmorgan's quarterly results. we have the numbers and instant analysis.

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jpmorgan. that should be a current quote. wow, almost $50 a share. the company and, you know, let me just warn you, there's always a lot of discuss in these numbers. estimate $1.39. company is reporting $1.59 on revenue view $25.86 billion. 25.86 is what we were looking for. we need to back out whenever a bank reports a revenue number, there's always a couple of them that you'll see. >> one is 25.12, one is 25.8. both close to that estimate.

>> exactly. and it depends on what you -- the headline from reuters is 25.8 number, which would put it right in line with expectations. now, depending whether you're an analyst and own the stock -- >> here's something you want to know, though. they are raising second quarter stock dividend to 38 cents. the street will pick up pretty quickly. that's a gain of -- >> that's a lot. >> yeah. >> that's a big jump. and it was 2.4% yield. that will get it up above 3% easily at this point, right? yeah. in all banks the strongest versus the ones that are in trouble, you have to check. >> you had to talk to

regulators. this is one of the big ways they will be giving money back to shareholders. second quart tore 38 cents from 30 cents a share. >> also nonperforming assets, $11.6 billion. provisions for credit losses, 549. that compares to 642 the prior year. so that's down. decrease of 5,300 workers. positive signs that the economy is healthy and getting stronger. >> let me tell you a little bit more about that dividend. this is a key number. the federal reserve had been talking to the bank. they have submitted the plan. not only are they jacking it to 38 cents for the second quarter dividend. they authorized $6 billion of common equity commencing with the second quarter of this year

through the end of first quarter 2014. federal reserve asked to submit an additional capital plan addressing the weaknesses. jpmorgan was one looking at very closely. they say the firm is dramatically increasing the resources deployed and plans to fully address the requirements. the federal reserve may require the firm to modify its capital distributi distribution. we'll see what happens. >> the first quarter included some reference coming back. reduced mortgage loan officers 10 cents a share. when companies take reserves usually you penalize them. when you bring them back you say that doesn't count. >> dimon is saying they're doing this because we are seeing positive signs that the economy is healthy and getting stronger.

housing price continue to improve. new home purchases are starting to come back. we saw strong performance in our credit card portfolio. another sign consumers are healthier. he said that's why they reduced the allowance. >> yeah. there's 10 cents there. 10 cents there. 500 million pretax benefit. >> he said we're likely to see further releases. >> it's 18 cents. that was 20 cents above. >> exception is loan growth across the industry has been softer this quarter. small businesses remain cautious about the recovery. fiscal uncertainty and are not investing their capital. >> it is now a little bit lower. the low 50s back before the

financial crisis. it traded at 50 in recent -- recently. now it looks like down it's down 48. >> they're so can clear on this. understand what they're talking about. thank you. >> i don't know what the real number is. 18 cents from reserves coming back. by the way, later today kayla -- it's hropl like kayla, because her last name is hard to pronounce anyway and because she has risen to the point of being kayla. she's going to talk to mary ann lake, ceo of jpmorgan. she will be interviewed by kayla. >> we'll keep an eye on the futures. we started out with futures looking down by 38 points or so. jpmorgan coming in. it's hard to say where it will open. dow down 28 points.

nasdaq off by 7.8. this is after four days of gains where all three have seen massive gains that they have seen since november of last year >> in our other morning headlines, the head of kpmg said london passed confidential information to a third party. the ceo says he was appalled to learn about those actions and that the firm unequivocally condemns them. trading resumed today after a 12-hour halt. it came after a surge in activity caused extreme volatility. they dipped to 65. they were last quoted at 106. if you don't like the quote you have seen, wait around a little while. twitter will launch a new music app. it will suggest artists and songs to users based on individual data, figure out what you like and tell you other

things you might like as well. >> and the situation on cyprus is high as they meet in dublin. shares overseas of all these european markets fell sharply early this morning on reports that cyprus planned to ask the eu for extra assistance. a finance minister said they're not looking for extra assistance in terms of extra cash. they want tech assistance, whatever that means. michelle, the interesting thing here is they're kind of pointing to the obvious right now the numbers don't really add up. >> yeah. i don't have any independent reporting from the grouped that they're asking for more money. it would not surprise me they're asking for more money. that is the m.o. of this president as we have seen throughout the negotiations. let me give you a 20-second history lesson so you can understand why we are where we are today. cyprus first asked for a bailout of 17 billion euros.

they said let's assess your total financing needs. are you really going to need that? yeah. 17 billion. you have the right number but we're only going to give you 10. you need to come up with seven. they had to recapitalize banks. deep recession meant the tax revenue they were bringing in is not enough to fund the government. they have a deficit every year and have to fill that gap. ever since they got the loan agreement, remember the economy has taken a sheer drop into hell because they shut down banks for two weeks and they have deep capital controls. the economy is contracting dramatically. what does that mean? even less tax revenue. the europeans said your total financing years are no longer 17 billion euros. they're 23 billion the next three years. but we're still only going to

give you 10. you still need to come up with the rest. so that means even deeper cuts to government salary. cyprus agreed to sell all the gold in their banks, reserves. they're talking about forcing local bondholders to take cuts. they're going to have to come up with a much bigger number how they do that, i don't know. i have no doubt they try to get additional financing in some way because they need it because the numbers don't add up. this is a country that i think is the most likely to leave the euro because the numbers are so big they're asking for. remember, $23 billion they're trying to get to number two on a country with 800,000 people. >> michelle, thank you. we really appreciate it. >> bye. >> joining us is our guest host, squawk master steven roach, senior fellow at yale university and former chairman of morgan

stanley asia. michelle laid out the case for all these problems. we know the numbers don't add up. we know this is going to come back to bite us. north korea looking at this point like they may actually have a nuclear weapon. we worry about the economy in the united states and the market continues to push higher. how is the market looking past all of this? >> well, you said earlier when you and joe were talking about jpmorgan, there's one force that's really driving and managing this company. and that's the federal reserve in terms of managing the capital structure of the bank, and other central banks doing the same thing around the world. and the fed is facilitating the government's fiscal financing by buying a big chunk of the deficit. a lot of power in one institution. let's especially hope they got it right.

>> when steven first sat down off camera i said we have been looking for bears looking for a correction for too long. and you're one of them. i said how long have you been negative about where the market is going? you said, let's see, when did the rally start? >> come on on. i'm a master of the market. >> you were so honest. when did this rally start? but who cares? you've got a rational and intellectual reason. it's been hung on most of the time, the consumer, which in your view, had been leveraged up way too much and hadn't completely deleveraged. so now here we are. what month is it? april. >> masters month. >> april 2013. any improvement there? >> no. look, if i have one pet peeve about this wonderful show, you have people on every day, every

month, every quarter, every year who always say the american consumerer is finally coming out of the blue. things are looking good. stores are showing improving retail sales. the government's numbers on the consumer do not suggest that is correct. you have had five years in a row where consumer spending, i know i'm a broken record on this, averaged less than 1% per year. it's it weakest period of consumption. they have too much debt relative to income. they have a long way to go in terms of releveraging and getting their balance sheets square again. japan had zombie corporations. we have zombie consumers who are just walking around and barely able to make ends meet. so the next time somebody comes on your show and says, yeah, the american consumer is back, ask them to try to justify that against that one number. five years of consumption growth.

>> with housing doing a little bit better. >> definitely. >> shouldn't that at least -- shouldn't it be less bad each month it passes? the jobless rate. you know how great that's doing. >> terrific number. 500,000 people leaving the labor force. the unemployment number went down. >> the economy doesn't feel like a rip roaring -- it's not something -- it doesn't feel really good. >> it's not. and actually to their credit that's what the fed, especially chairman bernanke, vice president yell in, bill dudley are saying they want to stay in the game in terms of providing in extraordinary stimulus even though the gdp growth is up. the economy doesn't feel and look good to them. can they get it up with that?

that's the the question. >> when you look at the consumer historically they must be in a better position. given everything we went through five years ago and maybe that's what the market responds to. >> i think it's a stretch. you pick the consumer apart quarter by quarter. you have two phases of the five-year slump i'm talking about. it was unprecedented decline in consumer demand. normally you get a big snap back after that. we have only had 2% growth in the following three and a half years. so that's a very anemic rebound from a horrific down turn. so consumers are just not conform to go normal expectations. >> but how do you match that up to some of the retailers who have done so well? not all of them. you have losers like jc penney. but macy's as done so incredibly well. car companies have been able to sell tons of cars coming back into this. i understand why some of the

stocks have done really, really well. >> it's a broad cross-section of companies and products. some go up, some go down. you're getting early reports on sales in march. well, they're disappointing because of the weather. >> right. >> well, maybe there's more to it than blaming it on the latest glitch in the climate. this is a five-year trend. some companies will do okay and some companies will not. the underlying trend is extraordinarily and uniquely anemic. >> i like knowing that a lot of this is because of the fed. but then you could still say it's either the 85 billion just in to inflate assets or the the 85 billion is work to go help heal the overall economy so it's justified things are getting better because it's working. i hate 85 billion. >> you're an overly in debted consumer household.

your central bank is doing qe. how does that help you as a household? >> kwraous your wealth effect feels better because your house is going up. >> and the math is that for every dollar of weighing the the fed rates in the stock market 4 cents goes to consumer spending. that's a smidge on. the fed has got to just pump out enormous amount of water into this water balloon. >> we have talked all our viewers not buying in the stock market because it's going to correct. >> that's my fault. i take responsibility for that. >> we have a lot more to talk about. also, if you have any comments or questions about anything we have been talking about, e-mail us or follow us on twitter. up next, more on jpmorgan earnings. that stock is down. [ penélope ] i found the best cafe in the world.

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jpmorgan reported quarterly results a short while ago. banking analyst from raymond james. whenever we do the reserves, adding them in, taking them out, it doesn't count. it does count. do you take 18 out and say it's

two cents above, anthony? >> that's a good question. we have to look at what the street was looking for. in general it was looking for about 16 cents in reserve releases. and they probably have an extra four or five cents in there. >> so it's still above. beat by how much if you had to say? four cents? >> tax rate was a little low too. i'm going to penalize them a little bit for that. at the end of the day i would say they reported about 1:48 maybe. >> how about all the credit quality issues in terms of what they're setting aside? how does it look like it's performing given the state of its customers? >> you know, we had a couple of different aspects here in this quarter. on the very positive side, trading and capital markets was exceptionally strong. even stronger than people expected. on the other hand, the mortgage banking side slowed rather dramatically from the fourth quarter. expected but maybe less revenue

than we thought. also, if you look at the balance sheet growth and loan growth in particular, that was somewhat disappointing. now we knew we had that spike in the fourth quarter. we were wondering how much would it slow, but it was slightly disappointing. >> real quickly, we know they raised their second quarter difficult deposited to 30 cents a share. what were you expecting? was that more or in line with what you were expecting. >> 38 cents was in line with our expectations. >> really? >> that's a big hike. >> can you give us any gossip on the whale? the "new york times" might want to do a story on this. that's all they're interested in. anything on the whale? >> or combination. did they make too much money? give me the "new york times"

angle. >> the problem with the whale is jpmorgan is probably going to be scrutinized for big losses and big gains as well. i think if we took the combined p&l of the whale we would all keep the whale and be happy with whatever we netted from that business relationship. >> right. okay. 19 cents or so. thank you. appreciate it. >> big props to all you armchair analysts. you were right as a groupon jpmorgan. beat estimates and 64% of our viewers who test their own forecasting skills voted that way. congratulations to you. 15% were looking for a meet. 64%, beat. but the vast majority right on. tom donahue with harsh words for the aap the other day if you were watching on squawk. we will replay what he said. and then we'll have the president of the aarp join us to

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welcome back, everybody. up next, we'll shine the sector spotlight. then aarp president will join us. we have his take on something that was said about the aarp the other day by the better of commerce. earnings from wells fargo. a busy friday morning. stamps.com is the best. i don't have to leave my desk and get up and go to the post office anymore. [ male announcer ] with stamps.com

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jpmorgan chase's earnings are in the books. wells fargo numbers coming up at the top of the hour. they are expected to report $26 billion. a busy morning for economic numbers. in an hour we will get march figures for retail sales and producer price. retail sales, we will be watching that very closely. expected to drop 0.1%. i saw you waving your finger on that, steven.

we'll be watching that number. jc penney hired blackstone group. we will be developing a strategy under the new ceo hike olman. >> tom donahue on squawk earlier this week addressed the urgent need for entitlement reform. >> we have to bend down the cost curve. if we don't do it in a dozen years it will need all our national revenue. the organizations in this town that are driving people to pretend this won't happen have to get out under their silver lining cloud and face up to the fact that we can fix this problem or we can leave it alone and let it destroy us. >> are you talking aarp? >> yes. >> president of aarp. good to see you.

>> good to see you, joe. >> is there a way to do this? what's your suggestion if we don't change any type of age where you get retirement or if we don't do any means testing? just tax people enough to where we can afford the benefits as they are? >> well, i think the first thing we have to recognize is social security in and of itself shouldn't be part of the deficit discussion. it's a separate program. self finance. we have been advocating having to take it out of this discussion, having a separate discussion not only about social security but with retirement security. cei is a -- not a good solution. it basically reduces benefits at a time when social security becomes even more and more important. >> how about raising the age? >> that is very problematic. it has already been raised to 67. you and becky will have to wait until 67.

i have to wait until 66. >> the latest i saw a person 70 years old today has the same chance of dying in the next year as someone 30, 100 years ago because of the advances we have made. i know 78-year-old men that look like they could bench press me. >> right. there's no way you can't recognize the strides that have been made in lifestyle. >> it's no question. >> it's at least five years different than it used to be. probably 10. >> there's no question as a society we're living longer. but when you parse the numbers, it's very unequal. when you think about it, the data tells you it's getting to be by fur indicated. if you're fortunate to be in the upper income, you do. you get a six-year longevity thing. but sort of 80% of us, particularly people of color, they don't live that long. >> so means testing of older

americans before they retire. >> well, i think this is part of a larger conversation to take it into a retirement conversation. one of the things we all have to recognize there's a $6.6 trillion savings gap in terms of retirement and what people are going to need. how do we think about that? it's not the only thing. >> rob, what do you think about the idea that the payroll tax was cut for two years? it is not even going to fund social security. >> it's been refunded. the agreement was the trust fund will be replenished. >> again, you understand my problem. when that is part of the broader conversation, when that's getting put in. people look at these things. that is money that should have continued to come out. if you're not going to do it, fine. that still leaves a shortfall somewhere. >> again, it's been replenished. >> where are you willing?

i watch your ads. the in trancejence is trying to fix a problem for promises we made that we're not going to be able to afford. you can't put a dollar it of medicare and take $4 of benefits out of it. it wasn't work that way, right? if we don't do some of the things that the aarp is lobbying against, what should we do? >> first of all, let's take social security and medicare separately. social security is part of a larger conversation. we think it's appropriate to have that conversation about solvency, retirement security. remember, social security was started as a three-legged stool. >> what does the larger conversation include? >> the larger conversation -- remember, the three-legged stool was it is a foundational element, pensions and savings. we have to look how those three work together and where social

security plays in that. >> and the current budget, what is it? >> in the current budget that's been proposed they're putting a cap on how much you can save in your own individual account. 3 million. it drops to 2.2 million. >> and, again, that's part of a larger conversation in terms of, you know, social security is part of a larger conversation for everybody. >> but let's have the larger conversation. how do you fix the shortfall? what are you in favor of saying here's how we come up with the money. the fixes become more tkra cone yann. if you are 40 years old, you can't retire into you are 68. and you better plan for it the next 28 years. if you wait 20 years, you tell people who are 67, guess what,

it's not going to happen. we haven't prepared you and you are not going to be ready for this. >> we couldn't agree more. we would like to get it separate from the deficit discussion. we believe there are responsible solutions. it has to do with revenue, benefits. you have to understand how it affects people. the issue is not just the math, joe. it's about how you affect people. the average benefit is less than $15,000 a year. two-thirds of the people who receive it. >> was it designed to be anything other than supplemental? >> it was designed to be foundational. and not comprehensive. there's no question about it. it was designed to be a significant contributor to retirement security. not the only thing. we watched roosevelt when he signed it last night he said it's part of a total system. it's about pensions. and you have to save for

yourself. but where are we now two-thirds of the people who are recipients, it's half their income. >> and we don't save because we have the central bank trying to encourage people through a bubble. we have a lot of legs of the stool that are missing here, rob. >> that's the entire point. >> means testing sounds like a good solution. >> right now social security has a progressivity to it. >> so you're advocating taking the the cap off at $115,000? >> well, that's one of the possible solutions. we ought to look at all of them. the other issue is how does that interact with the other key piece, which is health care costs, right? how do we measure that. when you're in an environment where your average benefit is 15,000 and every senior averages $4,600 out of pocket.

so if you have 15,000, that doesn't leave you a whole lot of room. even if you're, up to 30,000, two-thirds of the people. we have to focus two things. >> health care costs, which is really the driver of the medicare challenge, and we have to have a separate conversation about social security. >> would you put the deduction for medicare parts a and b, would you allow those two to be combined? >> there are principals on medicare. we basically want to look for solutions that don't do any undue harm to beneficiaries and have a responsible ability for the the costs to go down. we came on to talk to tom. we agreed on two things. we can solve entitles without cutting benefits. secondly, one of the things he said which we agree with, it's the health care cost system burdening medicare recipients and individuals. we have to get the health care costs. medicare say key player in that.

one of the things that we look at is, you know, the president's budget had a proposal to focus on prescription drugs, which is a key thing. >> yeah. >> and one of the things that continues to be something to think about, if walmart couldn't negotiate with probg tar and gamble for the price of tide, we would have a problem. >> you sent me a card. i got the thing. thanks. you sent it to me. and where do i use it? you go to a movie theater, you have to be 60 or 65. can you send me a list? >> we have a great number of values. >> olive garden at 4:00 p.m.? >> go to denny's. >> subway pass, joe. >> dunkin' donuts. >> you know what, i'm not

retiring ever. just know that. >> you can still use the card, though. >> two words, andy rooney. thank you. you make a lot of good points from your side. i didn't think you had that money but you do. >> when we come back, why you should be overweight discretionary. wells fargo's earnings at the top of the hour. things got a little heated between the dodgers and the padres last night. it is going to cost the dodgers one of their top line starting pitchers. >> ouch! that hurt. >> grenke hit carlos quintin. greinke fractured hesitate collarbone during the brawl. wow. this off-season he signed a six-year $147 million contract

to join the dodgers. ouch. "squawk box" will be right back. carfirmation.

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futures tkho u7b points so far this morning. it's time -- oh. time for becky to find out what sector sps regions are a good bet. >> that's right. we will do just that. our next segment is what's working right now. joining us is regional chief investment officer at wells fargo. you have some real sectors working for you. we have been talking with steven roach about the consumer and the problems with the consumer. what's going on that has helped the sector in some of the stocks. >> we have been overweight, becky, for quite some time. 700 basis points. when you look at q1 earnings growth, probably somewhere in the 6% to 7% earnings growth coming out of that sector. it is on the back of the wealth affect, increase in housing

price, certainly the equity market is doing better. and the consumer discretionary stocks have done a lot of hard work on the operating expense side. they have been able to kind of pull the efficiencies out of that sector maybe more so than any other sector. it's been a really good place to be the last 12 to 18 months. >> steven has made very valid points about troubles facing the consumer. some of the big issues out there the last five years, many have been struggling. and here in the united states we have zombie consumers walking around. how do you pair up what we see with some of the numbers coming in from the government economic numbers with what's going on with with some of these stocks. is it a disparity between the haves and have notes? >> maybe a little bit. certainly you remember consumer discretionary stocks upwards of 40%, 50% of their earningings growth comes from overseas. it's not just on the back of the u.s. consumer. i would also say -- >> places like japan, europe,

maybe china. >> i would tkprae with you. when we see retail sales number later this morning. >> i wish i could be here for that number. >> i know. stay. >> it will definitely be weaker. remember, january and february numbers were absolutely great on retail sales. >> you would stay stick with these and you're still overweight. >> still overweight. a little pricey at this point. >> telecom, you're still overweight there too? >> about the same period of time, 12, 18 months. it's funny, telecom year to date, 100 basis points. and the 12-month number is 1250 basis points, 12% better. it should be one of the sectors. almost 10% earnings growth in

q1. think about it. when you have what's going on in that space you have the cloud computing, g4, this crush of smartphones and tablets that need spectrum. there is just a really void amount of spectrum in that space. go try and get spectrum from the fcc these days. >> we are out of time. your underweight energy. what's working now is also what's not working now. you say stay out of the sector. >> the earnings growth is probably going to be negative in energy. down 12%. crude is down from 125 a year ago back down to 103. that could give the kaoufrpl a nice tail wind into q2. energy margins will be squeezed. >> thank you for coming in.

>> my pleasure. >> when we come back, parting shots from steven roach. and earnings from wells fargo. >> and i will do the brent muss berger. i'm not nearly as big a perv so it won't be as good. >> but you are going to take your best crack at it. >> jpmorgan came out with earnings that beat expectations. that stock is down by almost 1%. conference call coming up too. we will wrap up our week long market masters series with a special inductee. stay tuned to find out who it is. who will be wearing the green jacket today? "squawk" will be right back. [ penélope ] i found the best cafe in the world.

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golf has come a long way. in the old ways you didn't think there were any sworts mapp really. the hockey guys, hockey dudes, baseball players, justin verlander, kate upton. well, lately it's a guy that the girls really -- that sort of like a chick magnet. et wasn't always this way. was the plaid pants, white belts. not so anymore. okay. so maybe tiger had something to do with it. this is tiger. here's what people are watching at august a. lindsey vonn is

there. he's not the only one. rory mcilroy. carolyn wozniacki. this is my brent moment. but has janet jones and wayne gretzky's daughter dating dustin johnson. big long swing. hits it so far. >> you know the gretzkys. >> my comment was i remember wayne's family from playing in celebrity tournaments 12 years ago and she was like a little 10-year-old cute little blonde girl. >> with braces, right? >> with braces. next thing you know, people are following her -- schactman is probably in the bushes. >> trying to jump out. >> janet gretzky won the michael jordan tournament. she's a good golfer too. really nice people. >> time goes by.

>> it does. that's the point. it is financial literacy month. you also teach. >> i do. >> as you said, grades are for sale where you are. >> not at all. we believe in academic integrity. i'm a tough grader. >> how would you grade this show? >> a-plus. >> do you have something we can hang the hat on? it's important. i don't see a lot of it. we need a whole month to try to help. >> yeah. i think to me the big issue i continue to focus on, joe, is china. not just emerging power but transitioning power moving from one model that's worked really well to doing the unthinkable, moving to a different model, a

consumer-led model. i don't think we keep get the full implications for the rest of asia and for our own economy. they save less. they have less of indiana clinician for them. we don't seem to focus that. the third largest and most rapidly growing export market. >> they dope like buick. >> audis making a big play there. we have to complete to get the market share. it's a huge growth opportunity for us and one we really need given the weakness of our domestic consumers. >> in closing, you like what bernanke has done or something comes home to roost. >> i think it comes home to roost. like they did after the equity

bubble they are staying far too easy for far too long. they don't know how to turn off the extraordinary policy stimulus. this has been a classic problem of the fed from a long time. it's tough to turn it off. they claim they have the tools but do they have the will, political will to do it. that's the test. >> when you say it will come home to roost -- >> they're creating bubbles right now. credit bubble. equity market is sort of doing a near vertical a september right now. a lot of froth injected into the markets. this is a conscious effort on the part of the fed to use risky assets as the fuel for economic recovery.

i'm frayed it's not going to work out too well this time either. >> you're leaving. you're not staying. >> i wish i could stay. i have to put on my academic hat and go meet my students. i'll do three hours to make up for it. >> all right. we'll hold you to that. >> thank you, becky. pleasure. great to be in andrew's chair. such an honor. >> it is great. >> he will be back soon. steven, so are you. >> i forgot about arnie. anyway, we have to go. >> when we come back, wells fargo earnings out today. plus, a special market master inductee. stay tuned to find out who it is. futures ahead of the numbers have been indicated a little weaker after four days of gains.

earnings parade. first jpmorgan.

>> 1.39. company is reporting 1.59. >> they are actually raising their second quarter stock dividend to 38 cents from 30 cents. next up, wells fargo. the numbers and the instant analysis. >> and it's a balancing act. why squawk master john taylor is worried about washington and what the fight means for the markets. plus, another new market master. a special presentation you won't want to miss as the third hour of "squawk box" begins right now. ♪ >> welcome back. you hear the weird song. >> it's from the music man. >> wells fargo is reporting --

looks like the stock is indicated a little bit lower at this point. let me get all these metrics for you on wells. uh-oh. i just hit it and then it disappeared again. >> mine did too. let me just say. increased the quarterly dividend. we will start with 25 cents a share. same thing that had -- wait a minute. i already had it at a dollar. increase the quarterly dividend. >> 92 cents versus 88 they were looking for. i can't get into the release just yet. 21.26 billion in terms of revenue. the street was looking at that same level. 28.59. 11.79%. >> that's reuters saying that about the dividend increase. i already have it at a dollar. i don't know what to -- we'll

have to check into that. >> $21.3 billion for revenue. >> very close to 25.59. >> 1.4 billion in this quarter versus 2.4 billion in the year ago period. nonperforming assets decreased by $1.6 billion. common equity ratio was 10.3%. i don't know how that -- that's under one. >> in terms of capital plan, 2013 capital plan, they received a nonobjection to it. they did not object to the 2013 capital plan, which included 30 cents a share for the second quarter of 2013 subject to board approval. that plan also included an increase in common stock repurchase activity compared with the actual purchases. >> so then it will go to 30 cents. >> yeah. >> what is this thing? raising it to 25 cents. >> this is a subject board approval. >> yeah. raising it to 30. so this wire needs to be corrected.

the the stock at this point for some reason looks down about 50 or 60 cents. >> here's comments from john stump, chairman and ceo. he talked about quarterly earnings and earnings per share increased to double digit rates. loans and deposits continued growth and challenging economic environment. always interesting to hear what jpmorgan and wells fargo have to say about the environment. returns on assets and equity increased and remained among the highest in our industry. yeah. capital levels remain strong. we were pleased to increase our dividend to 25 cents a share. the plan is to get to 30 cents. 25 cents for the first quarter. 30 cents must kick in after that. >> yeah. because it is already at 25. >> yeah. >> okay, good. >> all right. in other earnings news, we had

jpmorgan out. $1.59 for the first quarter, 20 cents better than the street was expecting. revenue in line with consensus. jpmorgan said at the time they were doing that because they see an improving economic environment. they expect it will continue to be broke down. 2% from a year ago. some are telling us it's the quality of the earnings why that stock is down. again, it did beat on the bottom and top line. you can see that stock is down 61 cents to $48.70. >> and stocks had been on a hot streak. spring time could be making investors more optimistic. a private wealth investor consultant at -- you have a group at morgan stanley? >> a group, yeah. a team. a club. >> you're not a retail broker, are you? >> yeah. >> really? >> yeah.

wealth manager. about eight people on the team. >> what do you make of the markets? you think it might get better. >> under no circumstances could we ever say the market is frothy. 2% yield. the efa, trailing pe is like 13 with 3.5% yield. so nobody can say it's overvalued. the question is, does it go, you know, strong from here. i think there's a lot of reason to be cautious. but what's interesting to he me is how people continue to avoid the international space. in 2008 it was more like, you know, companies making mistakes. in 2011, 12, 13, countries are making mistakes but we paint them with the same brush as if there's no decent companies. no company in italy ever worth putting money into it. it bears a lot of luck. still talking about just the algebra of the international markets saying you're going to get some yield and you have good growth potential. >> when you look at what we've been talking about, just the

economy, wells fargo, jpmorgan. it at least was pretty positive in terms of what they see and how the consumer is faring. housing is going a lot of different places. do you see that too? >> anecdotally it's interesting to watch the new college grads and whether or not they're getting decent jobs. that's been a dry spot for years. >> that's a big, big problem. a guest said watch out or you will start to look like spain just in terms of trying to get our jobs picture fixed. how do we see that? >> we start to see the light at the end of the tunnel. the kids are starting to get interviews. it is starting to work itself out. also, i'll tell you my clients who may be 50 years old were laid off. and you thought, well, maybe that's it. they are starting to get really good opportunities again. you have to work really hard to find them. but i do feel like we are starting to see the iceberg

break up a little bit. >> you can give us a lot of great insight as to what they are thinking and feeling. there was an article yesterday how investors got scared out by the two 50-cent declines in the market. do you think it's hard tore convince the people even though the market has been climbing the last five years? >> it's interesting. most of my clients we polled in risk. it's important to know how much risk you are taking in the port will folio. i think that should be the message to the people. if you've got a lot of different things going on in a portfolio, you will pull down the volatility. in anybody send us flowers in 2008? no, we didn't get flowers. but you can actually help to do that for individual people if you're saying, what's the allocation risk you can really handle. >> and they are not as allocated to stocks as they had been five years ago? >> typically not. we have been doing a lot more

nontraditional growth. they will be satelliting around the normal portfolio. think about global real estate. we don't have inflation. dollar hedge. is that a problem? cash flow, growth potential and an area that nobody wants. that's where you want to be. so you can actually have completely different performance records with those kind of nontraditional asset classes. >> would you say investors have been curious lately seeing the markets if they wanted to dip their toe back in or think it's too late, we missed it. >> the only time people want to get back in is when it's gone up. wall street is the only place things go on sale and nobody wants to buy. when it's on sale, people want to stay away. we will systematically invest once a month. we will smooth out volatility. i don't care if it takes 24 months to get in. every month is a new adventure, right? >> right. mary, thank you very much for coming in. really great talking to you.

by the way, back to wells fargo. numbers just coming out a few minutes ago. joining us to talk more about the numbers is scott siefers. what do you think of not only the earnings but the quality of the earnings. >> yeah. good morning, guys. at first glance i like what i see. the reported number ahead of us in the consensus. reported 92 cents. consensus 89. we were more conservative. would like to see the headline beat there. a couple of the main things, probably about as solid as i could hope given the environment. having said that, reflective of some of the challenges based on the group. as i look at morgan, the key issue for this name, total revenues only down 2%. that's a little better than i had anticipated. people are looking at gain on sale margins, applications, pipeline.

so it held pretty firm around 2.55. answer down 8%. pipelined down 9%. so that's going to be tough to sustain this level of mortgage activity. thankfully that's not really a surprise to people. so, you know, mortgage kind of a mixed bag in my mind. loan growth as you can match people are quite concerned with. looked a little better than i had thought. concern you would see a slow down given one heavy activity in front of the fiscal cliff and evidence from regular larry that would have suggested a slowdown. so happy to see loans come in, annualized growth rate. that's a plus. on the negative side, the margin came in eight basis points. a little below our 3.50 estimate. at least at first glance as i weigh all these things together,

probably as good as i could hope for. >> stocks down about 1% on the news. you would buy here? >> yeah. one, we're still going through a lot of the numbers as you appropriately noted earlier. two, the other thing i would note, this is a group very, very strong over the last six to nine months. really that's been, you know, in the face of no real change to earnings estimates, which means it's been all p.e. expansion. to to see a little give back that's not unexpected at all. >> scott, thank you very much. great talking to you. we appreciate you coming on so quickly after the numbers. >> all right, guys, thanks again. >> coming up, much more on the quarterly reports from jpmorgan and wells fargo. we'll talk to an analyst about the quarter and implications for next week's financial reports. we're calling all armchair analysts. you make the call how companies will perform as a group. now it's time for our next poll. citigroup is posting on monday. wall street expects $1.17 a

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todd, one of the questions that's been raised is the quality of the earnings. the numbers came in and looked good. both stocks trading below. what do you think happened here? >> a couple of things that investors are going to focus this morning. number one, again, the reserve release or the provision for bad debts, if you will, relative to expectations. we calculate at least 10 cents in terms of the difference between consensus relative to reported results. and the second thing on the mortgage banking. it looks like both jpmorgan and

wells fargo looks to be a bit light relative to low expectations, quite frankly. those are really going to be the two focal points here this morning with the stocks. >> and in terms of the reserve releases, the banks got punished when they put them on. >> right. >> but i looked at some of the comments particularly from jamie dimon who said the reason they're doing this is because they think things are getting better. do you think the street is overreacting or do you think this is the right reaction to the moves? >> if you look at the underlying trends, certainly credit quality on balance is getting better. as an example, if you look at the home equity line as well as the card line, which has really been the two principal drivers for the reserve release, they really didn't -- they basically are showing stabilization as opposed to air steady, pronounced improvement quarter

to quarter. that's what jumps at at people. you have a pretty meaningful release. you are seeing more stabilization quite frankly within the loss rates, which raises a few concerns in terms of we're really at the end of the reserve release quite frankly. and that should start the trend higher relative to what we're seeing this quarter. >> what do you think about the stocks in general and individually each one of these, the banking stocks in general? >> well, clearly expectations were pretty high going into today's result. and the stock certainly traded up in anticipation of some pretty good numbers, quite frankly. i think what we're likely to see today as you point out, is folks are probably going to pick on some of the nuances with mortgage and release. but i think more importantly is the mortgage banking numbers. that was really the focus point

with investors over the course of the quarter. and granted, expectations were low coming into the quarter. but i think we're seeing a little bit softer results relative to expectations. that's certainly not going to bode well next week. >> why do you think that is? having read through these releases, do you think there's a trend we weren't expect something. >> a couple of things. one, production volumes effectively dropped more specifically relative to expectations. they are dropping precipitously over the last couple of quarters. and number two, while volumes are up, they are more thanoff set by the margin pressure. and another notable statistic with jpmorgan is their applications volumes slipped in the quarter.

so it doesn't bode well going into second quarter the rest of the year. >> that suggests there's weakness with consumer overall? >> yeah. i mean, certainly, you know, the growth -- underlying growth rate was better here in the first quarter. >> right. >> and we would have expected, you know, a little bit better numbers relative to the consumer. and their activity in the quarter. but now certainly with an expected slowdown in the second quarter, we have obviously seen very mixed economic data the last couple of weeks. i think, again, i think we're going to see some softness here in the sector in the coming days. >> okay. todd, thank you very much. >> you bet. still to come on "squawk", breaking economic news, key reads on inflation and the the consumer just minutes away. >> the best and the brightest in

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welcome back to "squawk

box", everybody. google is launching a tool that lets users decide what happens with their e-mail. google plus and other accounts, after they die, they become inactive online. it's called an inactive account manager. for example, google will let users choose to delete their data after 3, 6, 12 months or they can choose specific people to receive that data. these things can live forever. i tried the get off facebook and it lived out there forever anyway. you can't shut anything down. >> that's what you need to tell your kids. if they ever want to get into college. >> or get a job. >> and you know who knows that? >> merrill wiener. >> why did i not jump? >> i don't know. i read his explanation. i almost started feeling sorry

for him. compared to spitzer. >> at least he felt sorry. >> compared to spitzer. >> broke down in front of the "times". >> bankruptcy court judge. out going amr thomas horton. the payout is not allowed under federal bankruptcy law. the merger approved on march 27th. rejection was not given at that time. >> he blade his father. that's a copout. >> and the other thing was, the only reason i lied i love my wife so much. had nothing to do with his ego. >> mixed ratings. >> yeah. >> at some point you become

responsible. >> why is he trying to get back? he has $4 million. >> he does? >> yeah in his campaign coughers. burning a hole -- he doesn't wear pants. >> when we come back, breaking economic numbers, march retail sales and price index. later, we're inducting the week's final member of squawk masters class. well-known name on wall street. here's another hint for you. he may be the only market master who used to live in his car. i know who it is. i know who it is. don't miss the jacket ceremony. this is going to be good. that's in the next half hour. as we head to break, the u.s. equity futures. i figured it out.

welcome back to "squawk box". steve liesman is in studio with us. we have been watching the bank stocks and the futures. first of all, the first of the big banks out with earnings this morning. jpmorgan and wells fargo. both beat expectations. you will see both stocks have been trading lower. analysts we have been speaking with through the course of the

morning brought up issues what's been happening in terms of the quality of the earnings and some concerning things the analysts we just spoke where, mortgages in particular. there's been a drop in the demand for some of the things. this is a big indicator. it will give us a bit of a sense of that to expect next week as we start getting into situations next week. more banks will be reporting as analysts pointed out, watch the regionals. >> they never get credit for bringing reserves back. they get penalized they wh they take them out. >> do you see who is leading the masters? >> marc leishman. >> i heard you made a mistake this morning. >> i was shocked. i thought it was steve liesman. your australian cousin. his name doesn't spell lies-man

like yours does. >> steve, you have rosengrant. >> boston fed president. and a bunch of other fed guys out there. >> we have numbers coming up. straight to rick for the numbers and then we'll talk about them right after. rick? >> retail sales headline down 0.4. if you strip out autos it is down 0.4 of 1%. if you take out autos and gas, it's down 0.1 of 1%. ppi for march headline is also less than we were looking for. but maybe that's in a good way. down 0.6%. take out the all important food and energy, up 0.2. look at year-over-year, headline up 1.1. that's definitely on the light side. if you look at core year over year, 1.7. that's pretty much been

constant. so let's summarize. retail sales is much lighter than we were expecting. and i can't blame the aircraft or autos at least by the looks of it. if i look at ppi this shouldn't be a big surprise. headline of course is reflecting some of the commodity and energy movement we have seen. overall, to summarize, i think inflation, whether ppi or cpi is more an issue down the road. hopefully somebody will worry about it. this data is certainly taking the steam out of the preopen equities. down 61 in the dow futures. down 8 in the s&ps. that's not fair value. that's where the futures markets are right now. we are under 1.75. 75% of all fixed income stories are how you have to be absolutely three fries shy of a happy meal to be long treasuries. good thing that's not litmus

test for cashing the check if you have been long treasuries. >> not great news. rick, stay there. back to steve in boston. retail sales number stink, steve. >> yeah. that was the expectation of a bunch of folks. we have been warning about this for a while. this was the catchup from the increase in the payroll tax and from other cutbacks out there. and the bigger story was how the consumer hung in there for january and february. when i look down the line, becky, just one negative after another, negative on electronics, food and beverage, big negative in gasoline station sales. >> you can kind of get rid of that. sporting good and department stores. you wonder why jc penney and others are doing poorly. decline of 1.1%. only the internet category up 0.8% for miscellaneous store retailers the only one that did well. and i think what the ppi numbers

and these numbers are showing you what we have been showing you for a while. the bigger concern is not inflation. >> can i ask a question, steve? >> yeah. >> can i? >> absolutely. >> i don't think this is sequester. i worry about the payroll tax because money comes out of the private sector. there's other taxes that we know went up. the 600 billion. i know rich people just put money in the bank. but here's the disconnect that i don't get. say the sequester was -- the remainder of 40 billion. not spent by the government. was it 45? 40, 45. all right. that's money not spent by the government. when we propose a trillion dollars in new taxes in this latest budget, that would be another 100 billion coming out of the private sector that's not spent by the private sector. what's the disconnect between worrying about the government not spending 40 billion and that's going to end the world

but taking 100 billion away from people that own the money. that does not seem to bother this administration. can you tell me? >> well, i think if you think about what the biggest problem is in the country, joe, and a lot of people i think wrongly are on this issue of the deficit being a big issue, the upside of taking that money ostensibly would be to resolve the deficit about but that's not what we're doing though. we're spending it. we're taking it and spending it. >> every year we spend more. every year. all the budgets of all the parties spend more every year. >> but isn't it the same dollar, steve? if it's a dollar -- i would even argue that a dollar -- i would rather have a dollar spent in the private sector because i think it's more effectively spent. but they don't even talk about it like it's the same thing. >> joe, i heard you yesterday. >> why am i wrong? >> you are absolutely right.

you are absolutely right. the private sector is way more efficient than the government. but what i think you're wrong about is the reason why we have government is to do all those in efficient things. and we can't even measure -- >> maybe that's the reason that certainly people like government. i would certainly not speak for we. >> but if we were going to be afraid of a dollar not being -- you heard what was going to happen with the sequester. you heard what was going to happen then. the oceans are going to rise. the planes are going to not take off. why aren't we scared of 100 billion a year -- >> joe, the answer is marginal propensity to consume. when you take money from poor and middle-class people they end up not spending right away. if you take it from richer people, ostensibly it doesn't affect their savings and spending quite as much.

>> moneyen mass. >> it depends what you're using it for, joe, paying for people's retirement and medical care, what are you judging? what's the value system you're judging taking money from? >> i just want it to be equal when we talk about scaring people about money being spent. i think there's a cost to the economy ando jobs by taking 100 billion. you cut it in spending or take it out. there's a cost. anyway, rick, i didn't. >> hey, joe, joe, we need to do some research. i want to know in the last month who said fairness more? hulan or our president. it's a tie in my research. i have seen each of them say it three times in the last four days. the rich guy, i forget his name, was in the journal yesterday. he wanted to be a citizen

outside france but changed his mind because the business he's in high-end apparel might sufficient if the honesty of leaving high taxation. they talk about fairness. i'll tell you what, joe, fairness to me is a word that describes the absolute opposite of free markets and free people because when you are free you don't need to ever wake up some morning and wonder if the guy in charge of definition of fairness is going to change. >> guys, thank you. and happy friday to everybody. see you all on monday. steve, see you a little later today. steve, as we mentioned before, this is a first on cnbc interview with eric rosengrant. >> and kayla has been on the phone with jp management. we have been watching the stock reaction even though numbers are better than expected. jpmorgan stock a little bit

below. >> i know investors are bearish on the earnings because so much are made up of the fact that it's coming from cost cuts and the release of some reserves set a little for losses and mortgages and credit cards. we asked the executives, the cfo and jamie dimon on the call this morning about this. they said it's lumpy every quarter. we see the credit landscape improving. and these are high quality earnings. they are on track to reach a billion. that's what they outlined before. they made comments about mortgages. we saw weakness in mortgage banking. rates starting to rise throughout the quarter. originations still strong. what they saw was mortgage applications falling towards the end of the quarter. that hurt margins as well. jamie dimon getting questions about certain regulatory orders that he pointed to in his shareholder letter this week. he said they're going to be regarding things already pretty much laid out. he did make some comments about

washington saying the economy is poised to grow. capital markets are on fire. and he commented about sequester and said it didn't affect their earnings. and it is dwarfed by other government spending. the real elephant in the room is the question whether shareholders will move to try to split the chairman and ceo role. dimon reiterating that's a measure left up to the board. the meeting is not until may. he said they have plenty of time to think it through. but his feelings about it hasn't changed. the interesting thing, there's a report this week that he bought an apartment, actually an office on the first floor of his co-op leaving a lot to speculate about the fate of jamie dimon. maybe he's thinking about stepping down sooner than expected. i asked him what we should read about that office space. he said that's more for my wife than me. >> i would have been shocked. wow. that would have been good, though. interesting. >> we will see. >> kayla, thank you. we know you have the interview

with the cfo of morgan as well. >> kayla. is that going to be okay from here on out. >> it works for madonna, cher, elvis. i don't see why i should be complaining about it. >> i make you an icon and everybody is happy. >> as long as we don't hire another kayla that works for me. >> we can live with that. >> we won't. >> coming up, closing out squawk masters week. john taylor on inflation, the fed and the economic recovery. and then we will give out another -- it's a "squawk box" green jacket. i don't like imitating augusta. i don't. anyway, here's a hint. is it a retail broker? >> no. >> the newest member of the squawk masters vest. i.r.a.s. frequently makes meals of the free samples at costco.

welcome back. john taylor, former treasury secretary. hoover institutional senior fellow. we always seem like, and you've been on many times the past couple years. we seem to be getting a little traction. we see it again with the good jobs number. two steps forward, one step

back. lousy retail sales today. are we still muddles along? and if so i need to know why. is it still, you know, the hangover from the financial crisis or self-inflicted? >> well, i think we're still muddling along. we probably have a good first quarter, which is great. but it looks like it's back to the 2% which we have had since the beginning of the recovery. as you know, unemployment still remains high, especially certain parts of the country. i think the reason, joe, is the policy. it's basically if you like the self-inflicted characterization. we've had a lot of uncertainty about the policy, about tax policy, the budget submitted for the administration. it still doesn't balance. it's out of line. deficits continue. spending. share of gdp remains much higher than it was back in the year 2000 of 2007. >> john, is it -- we've been having a running debate.

is it possible that the multiplier, r -- and i was calling it 40 billion for the sequester. let's give the 80 billion or whatever. the 80 billion. maybe there is a multiplier. it goes into the pocket of let's say it was payroll tax or something. they spent it immediately. and the 100 billion a year that the president's enough budget has. another trillion dollars in taxes. that's all rich people. all they do is just collect interest on it supposedly. does that explain why one is seen by most people as much less delitteer kwrous. 40 billion and the sequester scares people. >> i think it's just not very logical. it's 40. that's right. that's the outlay effect. it's a quarter of a% of gdp. it's part of a long-term strategy which is we need to have happen, consolidation. it shouldn't be a scary thing. it's remarkable to me how people

say that will cost jobs at the same time and not say larger rather increases will. we have done a lot of simulations and find it is really a good thing. it's going to provide more certainty about the deficit. it's going to make it less likely we'll have large tax increases. those all feed in to be positive for the economy. the short-run things is overemphasized unfortunately, still after all these years of learning the models don't work very well. >> steve has been telling us actually the trillion dollars in tax increases, that's the good thing, actually, because it pays for government services that we need. >> john, hold on for one second. steve has breaks news. i saw some of these flashes. i want to make sure i'm interpreting the right way. he is saying the fed should be more aggressive and high unemployment. is that justification for what they're doing right now? >> he goes back, becky, and he looks at some of the data the past 20 years. let me just get to the monetary

economic stuff. the current fed policy is appropriate and necessary. notes that the fed is missing both on the inflation and its unemployment targets noting it is well below inflation targets and well above its unemployment targets. data suggests over time during times of high unemployment the fed should have been more aggressive than it's been over that period of time. and then he talks a lot about the dual mandate versus single mandate and notes in the dual mandate has led to inflation levels on par with countries with single mandates. an up side it gives a fed an easier way to communicate with the publicment finally, he says a lot of companies are coming the u.s. way towards a dual mandate. becky, it's interesting. i think your question, i'm sure your question is getting at whether or not this is one of those times that rosengren is talking about. i don't see that exactly in the

speech verbatim. i think the suggestion is clearly there. certainly rosen tkpwrepb is not one who would argue for cutting back on qe at this time and whether or not he means to suggest more. well, that's what i'm going to ask him at 10:40 in our first on cnbc interview, becky. >> good tease. we will certainly be watching. steve, thanks. >> and back to john taylor. if a lot of our other policies are making it impossible to add jobs in a real way, effective way because of the participation rate, people on disability examine all this other stuff and we stay stubbornly high, the fed could be doing this forever. the macro policies on the fiscal side of things. >> absolutely. that's what they seem to be going in that direction. i think it's counterproductive. i haven't seen the study it's referred to. my look at history is the times the fed has overdone it it led to higher unemployment.

that happened in the 70s. a lot of this crisis came because of policy in 2003, 2004, 2005 which didn't focus on the longer term. the uncertainty has made things worse. growth rate 2% instead of 4% is what we have seen. >> we need -- i mean, one thing we could do to try to get the growth rate up so that we get real jobs and -- it just doesn't feel like the recovery we have seen in the past. what's the most important thing we could do? if we could just convince them of one thing, john. >> get back to the kind of policies that worked well in the 80s and 90s until recently. that's basically keeping the debt from growing, keeping spending under control, keeping monetary policy predictable in a rules-based way. regulations, contain those a little more as well. but i think the first two are most important. >> we're not going to do it,

john, but thanks for the idea. we're headed the other way, my friend. maybe some other day. thank you. appreciate it, john. see you. >> all right. when we come back, we will close out squawk masters week with one more presentation. we have a "squawk" green we have a squawk green jacket to give out and we'll see if you have a lucky guess on who the lucky recipient. he does a daily 90-minute workout at 4:00 a.m. i know who it is. tweet us if you do, too. [ male announcer ] here at optionsxpress, our clients really seem

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it is masters week on squawk and we've been speaking with some of the successful wall street veterans and introducing new name, we are finishing the series with the final inductee into the masters class. we've been giving you hints all morning. nuggets like he used to be the only master who lived in the car, and he makes sure to get ten hours of sleep a week and while his day job keeps him busy he also works as a breakfast

line cook. the newest squawk market master if you haven't guessed already, our very own jim cramer. yes, we are honored to welcome, jim to the exclusive club and we want to present jim with his very own green jacket. there you go, jim. i feel like i'm the eighth grader in the group. the 14-year-old in the group, and joe, right? i've got game. >> can i, some day? i didn't know it was open to cnbc employee. >> only jim. >> only jim. that's awesome. i am honored, guys and thank you. yes, costco is crucial. you always have to fast before you go to costco, and you wear hats and sunglasses so you can keep coming back to the really good things. >> i don't remember when you were sleeping in your car, jim. i don't think i knew that story. >> yeah. '78 and '79. i had a ..22 caliber pistol and

a bottle of jack daniels and you're ready to go. >> that was after harvard? >> that was when i was roughed by the police i always tried to use the harvard line and they said that's funny. >> you know, condy rice, they make a more tapered jacket, but that looks good. >> becky has green eyes so it goes with her -- >> green-eyed lady. >> retail sales, jim? >> yeah. i think when they go to the individual companies that reported yesterday. they all said the same thing. it was 20 degrees colder in many of the areas of the country and the last week of march was very good which is why all of these stocks went up yesterday. i think we have to take into account when a ross stores goes higher and a macy's goes higher, these are very big retailers. everyone is taking share from jc penney. jc penney did not have $90

billion in sales to take away. otherwise it wouldn't have been the disaster before the makeover. >> he has been a huge bear on the u.s. consumer. he talked more about that earlier, but he makes some decent point about some of the troubles some consumers were facing and it doesn't add up with what we've seen with discretionary stocks and i wish we could have them here together. >> when ralph lauren and pvh and these are power companies that control the gigantic amount of every department store and when we take a lessen to the companies to everyday people. i'm talking about companies that are like target and walmart. walmart is up from 57 to, what? 78? wait a second. that's not so great. tiffany, williams sonoma, just hitting the ball out of the park. at a certain point, the retail sales, maybe they don't look that good, but the retailers are

on fire. >> thank you. and you deserve that green jacket. this is a terrific honor. thank you very much. >> we'll see jim in just a few minutes and when we come back we have the week's final squawk of the day. that's when we come back after this. zap technology.

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