teams, the companies know how to win in the global market like pepsico is like ibm like many other companies are, google, apple, you can name a lot of them. >> bill george. thanks for being here. we'll see you in the alps in davos. >> yes, sir. make sure to join us on monday, "squawk on the street" begins right now. 74,000. that is the surprisingly weak jobs number for december. the smallest gain in three years. the question is how will the market respond? good morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer and faber is on assignment. futures have come off a bit on the jobs figure. but they are largely still positive, we've got a ton of retail news to get through including more stolen information in the target data breach. the ten year yield lowest since december. and europe is positive at this hour. 74,000 nonfarm jobs created last

month well below the forecast of 200k and the unemployment rate falling three-tenths of a point but the decline was largely as a result of people, jim, who are leaving the workforce. >> right. >> you called it an outlier a few moments ago. >> outlier, but one thing i learned about the numbers is when you get an outlier, the market still trades off it. we can i say dismiss it and throw it away, bonds are soaring and interest rates are down. maybe we're in a bad news is good news moment because interest rates will come down. the last few mortgage numbers have been okay. the refis are bad. this is helpful for housing. but if we dismiss this number, then we should dismiss the 300,000 numbers. you can't play that game. you can't decide, you know, this number i'll throw away. it's a real number and it's a bad number. >> we'll talk to secretary perez later in the area. the participation rate and the loafest since 1978 and the seasonal quirks, january,

february can be weird. not to excuse the number. >> no, no. absolutely. but, again, like it could be weird up or down, but we did have lots of people who knew it could be weird and we still had the 220, and it's very interesting the wond bonds did react to it. it was a weak number. and i didn't expect it and a lot of people didn't expect it. when don't expect it it's easy to say that it's an outlier and, therefore, wrong. it is an outlier. but it isn't wrong. we can say that. this is not, by the way, the eagles are going to play this weekend. they're out of the play-offs. this number is in the play-offs. >> somebody speaking of being out, somebody tweeted that bernanke is somewhere in figi building a sand castle. how does yellen react? >> she has to say, look, this is why we've been sticking with the policy. we took off $10 billion in bonds, but bernanke showed

presence. it's been good. it's been not as bad as it used to be and this number said, hey, listen, i was talking yesterday about weakness in the economy that i was worried about. maybe a little bit weakness in auto and housing. this confirms this. obviously retail will skew it. but it skewed it all one way, and that tells me don't ignore this number. >> we talked about the soggy tape that 2014 has started with. we're a third of the way through january. the major averages haven't had a losing january since 2010. that's four years ago. does this accelerate the potential for that happening this year? >> no. because i think one of the things i think that was really going to put the big kibosh on the market was the sudden run o to 3.5 on interest rates when we had the sudden run from 2 and 2.75, if you remember the horrendous days, days in may and june we were saying, holy, cow,

it's going right to 3.5 and this takes it off the table. it's still not what i want. it confirms what our call was saying yesterday, there's pockets of good news. alcoa's more generally positive than the previous quarter, the u.s., not about china. but this is not a strong number. a lot of the stocks that started going up this week were the cloroxes of the world. they got downgraded. they'll go up today. the banks will not like this, because the banks were hoping for 3.25 to 3.50, the regional banks. let's watch suntrust, i bet they don't have a big move because this is not the yield curve they want. >> even as we see reports for lending growth for 2014 not looking especially robust. >> i don't want that. if you are thinking there's a transition out of the fed doing its kind of life support into a stronger economy, this is a chink. i also don't want to say, hey, look, you know, i was looking for a strong number but i was really, this is a strong number, don't ever sugarcoat anything. this is a number that doesn't

fit the depiction of a stronger economy. and so, therefore, you can't throw it away, because that just sounds ideological. i'd throw it away because i'm for obama, i'm not going to do that. that's what jokers do. >> speaking of which, now that the number is out, did you nail the number? all this week we've asked you to tweet us your predictions. our staff combing through these entries. i'm not sure how many 74ks we got on twitter but we're looking for the twitter. one lucky person will win this clock autographed by the let's staff. and you would have had to take the under consensus. big news in retail this morning target with an update on its investigation into the recent data breach involving the company shows that stolen information, including names, mailing addresses, phone numbers, e-mail addresses for up to 70 million individuals. 40 million were previously announced to be affected.

they actually said that the quarter had been progressing ahead of plan until that news came out. >> there's a very interesting upgrade today by goldman sachs. when i saw it, i happen -- it hit my desk at the exact moment that becky and joe and andrew hit this target number and the news. and then i read the goldman, what a bunch of clowns. and then you read the goldman recommendation ande eit says, ts number is bad because of the breach and then you have to get in. it was prescient. i like the upgrade here. i have not been a fan of target, but i think what they are saying the worst is over. when you fill out that -- i was rejected for a kohl's credit card, it was quite humiliating. ten people behind me. and it was because they somehow dropped a zero from my income, maybe a couple zeros, oh, oh. what do they really know about you that they leaked? it's not that you tell them, listen, here's my problem, i hit the booze too hard. there's nothing leak that on the

application, they have your address. they had your address before. this is target being very forthcoming and wouldn't surprise me if we got a surprise crescendo bottom in the target. >> they had a lot of the information have been disclosed partially and they are trying to talk to customers that may have been affected. you talked about becky and she joins us from hq. you'll have a lot more about this monday morning. >> we'll be sitting down with the chairman and ceo of target. target is a company that really doesn't talk to the media all that often, so it's going to be interesting to sit down with gregg. i've never met him personally, but i am a target shopper and i see a lot of these things. they've got a massive problem on their hands. this morning our guest host on "squawk" was bill george. he pointed out this is the ceo's worst nightmare. to have something like this happen, it's a crisis, it happened at the worst possible time right in the middle of the holiday shopping season when the retailers counts on so much of the profits coming in.

they have two things to deal with here, you addressed the investor's point of view, from an investor standpoint it could be good news if this is everything and the last announcement, sure, it could be a good time for the stock. and the target has to think about the consumers, how do you make sure that you don't lose confidence that people still want to come into the store. i will tell you that i was one of those people that shopped at target, the wednesday before thanksgiving and the first day of this breach. my mother was there with me and i did have some concerns when i was thinking about it later in the holiday season of thinking about going back in, i don't really want to use my credit card yet. i'm not sure i trust it yet. other people had come in with cash and i think that will be a real issue for them trying to make sure the consumers feel comfortable. they take steps toward that today, and the comments made in this press release today says that they want to make sure that their guests know that understanding and sharing the facts related to this incident is important. they also say that guests will have zero liability for the cost of any fraud dulent charges

because of this breach. it may raise questions down the road, but i think that's a really important point and something they have to do that make sure people feel, the shoppers that come into the store, feel that they're taken care of. >> i want to know when we've seen breaches before what is the lent of time where people forget about it. and i say that because i've been breached many times. repeated new cards. i know the nsa knows everything about me. i know the people who -- at what point do we -- are, one, we just inured to it and, two, does target be able to say, do you know what, we've seen 3 1/2 months after people forget? >> that's an excellent point, jim, because my credit card got stolen right before this happened, so i just had a new credit card issued to me. i would tell you that personally i don't know what the studies show on this, but i will tell you just from personal experience, yes, i was concerned about shopping there before christmas, after this breach announcement came out. i am less concerned today. i would probably feel more

comfortable that, yeah, they probably really ramped up security, at least i certainly hope so. it does make you wonder just about security overall, though, just this idea that you need to be checking your account all the time, that theft and identity theft is on the rise. i don't know what to tell you, but, you're right, i don't know what the length of time is, but there is some sort of a half-life before people say, okay, they'll go back. >> i'm dead if amazon -- >> this is a subject that becky's been close to for years. they are closing eight stores. >> right. >> in may. the question will be just how long this will affect them and for how many quarters if it goes that long. >> i think the longer we talk about it, frankly, becky, i think this is one of those effects that the media has. if this is on the nightly news for several days and the morning news. bec becky, you got to admit, do you know what, i got another story i can go to. >> right, right. that's true. jim, i -- you know, i don't know what the studies show, but this will be an interesting experiment. and my guess is, whatever happens, whether the future says

that target dealt with the right way or not, this is going to be something that is written up in the harvard business school books to say, you know, this is how you should or shouldn't deal with it and it will take a while to determine which way history's going to look at this. >> becky, thanks for sticking around a little bit later, and we'll, of course, see you monday morning with the big interview. >> have a good weekend. >> what a prescient thing. i love target as a place to shop and i think they are also very forthcoming. this release was about as negative as you're going to get. >> they threw it in there. >> i think they kitchen sinked the release. speaking of releases that needed a kitchen sink, earnings season began last night with alcoa, they did report fourth quarter profit of four cents that missed forecasts of six in the wake of lower aluminum prices. revenue was above consensus, here's what the ceo told jim about his china outlook last night on "mad money." >> i believe that china's growth is going to slow down a little bit, but you have to put it into

relative frame. i believe that in 2013 we probably saw a 7.6% overall gdp growth and my projection for next year is probably around 7.3% growth, now if you apply that on a much larger growth, absolute number, the absolute growth number is higher for next year, so i continue to believe we're going to see quite nice growth coming from china. >> not bad. especially when it comes to products that are engineered not just the raw material. >> the value-added business is stronger. people should know that he puts out a 50-page report, going through everything. it's by far the most thorough, even more thorough than caterpillar, caterpillar used to be the most thorough. alcoa did no favors talking about china, the united states is stronger, which doesn't jive with the unemployment number, but he's talking about the commercial construction. it's a big jobs generator. he said the autos are strong, don't worry. a lot of articles say aerospace

is there and truck business very good. so, i think that people want to sell the stock down. i totally get that. i mean, because the primes of aluminum, boy, that -- talk about -- i mean, that stuff is like sand! i mean, everybody makes it! you and i should go in the aluminum business. >> you are probably in it already, but i'll join you as a partner. the foreign corrupt practices settlement yesterday. >> right. >> the smelter charges, the closing down some smelters. it's not a clean quarter by any sense. >> this is not macy's. this is a dirty business. making aluminum is a dirty business. but i will say this, they are -- the big secular trend that is in their favor is lightweighting and new truck engines, but people don't understand, cars and trucks use a huge amount of aluminum. and because of the -- of all the ecological issues, because of all the problems of pollution, alcoa's going to be a long-term winner, but the chinese have not cut down their shelters and the chinese economy is weaker.

wow, it would have been better if they'd done seven cents. again, i'd like to look through it and say the revenues that are better. in the end the people that are bearish of alcoa will still be bear icial. it's given back some of the gains. >> deutsche maintaining a sell. >> he hates it, but he raised his price target. he despiles spises alcoa, someo wrapped him in aluminum foil. the guy hates it! you got to like claus. >> the headline out of dow jones that alcoa kicks earnings season off with a thud, ul think that's unfair? >> it said that chris christie was a hack, too, you can't necessarily take it -- everybody picked that one quote from the 247-minute conference that he had. i think alcoa, free cash flow and balance sheet are better. i'm not going to tell you the market is wrong about alcoa, it shouldn't be down, it should give up some of the gains because i think people thought better earnings per share and

revenue and they didn't get that. >> we'll go through a lot of the other earnings when we return. first reaction from the white house to this morning's jobs number, we'll talk to labor secretary tom perez live and first on cnbc. one more look at futures, we're hanging on to gains with an implied open of almost 40. the s&p and nas are up for the week. dow needs 20 points or so for a positive week. we're back in a minute.

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♪ pharmaceuticals soaring again today after quadrupling in thursday's session. now increasing speculation the company could be a takeover target. this after intercept announced the upbeat study results regarding its treatment for liver disease and the price target moves on this name, jim? >> 800. >> 872. >> i've never seen it like this. this is one of those drugs, a lot of people have the disease. this is the noncirrhosis -- this is the nonliquor kind of cirrhosis, joe kernen, by the way, had the best description of anybody that i've heard. but this is basically the test you couldn't give the placebo to these people, this is just such a positive thing, they had to break the test. it very rarely happens. this would be a remarkable drug. do i advise people to pay 100

bucks, no, it's a small cap stock. it's a $500 million company the other day. but one big drug as you mentioned, this reminds me of pharma-cet, and the takeover target is not so wrong and gilead thrives from it. if somebody like merck bought it, merck stock would go higher not lower. >> bmo, 375. oppenheimer, 360. more in the range of what we're looking at today. >> you hardly ever see a test broken up because it's not fair to the people who are taking the sugar pill, so, i mean, i totally understand it. biotech is amazing. ten guys in a room and they come up with a pc and ten guys in a room real smart guys that come up with a pill. there's 100 companies that are trying to do something special. more than -- more than one happens and that's why the stock market is such a great place to be. >> is there any way to figure

out who is next? there really isn't, i guess. >> another company thought they had one, and bristol-myers bought them and they had to write it off, it is unfortunately a very hit-or-miss industry. >> after the gains yesterday they'll pile on to that. >> i don't ever like to chase because then something turns out to be not as special as we thought, but this is a very big deal to break up a test. when we come back, some ideas for making money as we end the trading week. we'll get to cramer's "mad dash," and futures as we wrap up this jobs friday. we'll talk to the labor secretary about this participation rate. whether weather had a factor in the jobs number and, of course, what the fed does about it now. a lot more of "squawk on the street" from the nyse. straight ahead. so ally bank really has no hidden fees on savings accounts? that's right, no hidden fees. it's just that i'm worried about, you know,

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♪ i got work to do ♪ i got work baby ♪ i got work to do i got a job baby i got work to do ♪ about seven minutes before the bell on this friday morning, time for cramer's "mad dash" ahead of the market open, sears was down 13% after hours. >> a horrendous quarter, a great analysts of all-time from credit suisse is saying this is getting serious. sears holdings running out of options. everyone should read this piece because it's about how sears is selling off the good pieces to fund the bad which, of course, is quinn essentially what you shouldn't do as a money manager and it's an ironic piece about

how the guy that runs the company was a former hedge fund manager and it's devastating. he said, look, there's nothing here. it's really a magnificent piece of research by gary. >> some of the comps were unbelieve, sears down 92 and kmart down 97, and he's talking about selling lands end and spinning off businesses. >> and the best canadian stores being sold. go back to what home depot and lowe's said, this was the moment, and they didn't. look, i would love to come up with a positive, eddie lampert wants to call me on air, on air only, i don't have anything good to say. >> yeah. >> i just -- i am kind of speechless. >> we've talked about the discounters this week, the family dollar news earlier in the week. five below. >> five below is a very exciting retailer. it had a plus nine comp last time. now it went down this time. this is too variable. they blame the weather. this is very close to home. the stern agp says, this is a quote, like the eagles, good

year, bad finish. >> oh, man. that hurts! >> but, yeah, it's painful. i think it will bounce back. it's a region national story but the inconsistency has made me take down my enthusiasm by two notches. >> there are some i don't know unlikely success stories. abercrombie will have a good morning. tiffany will have a pretty good number. >> abercrombie, if you cut the numbers low enough, you will beat them! that's what they did. the last quarter they were saying, listen, we'll do horribly, and what happened is they did somewhat less than horribly. >> tiffany, u.s. comps up seven, the best in two years. >> some of it is me, candidly. i'm not kidding. every time somebody has a baby, i send them the silver bank, the piggy bank, but this has just been a remarkable, remarkable story. japan's turned to incredibly well run. the rich -- the rich are unhappy, it's their own fault, that's vladimir lenin, and for me and you, fitzgerald, and they

shop at tiffany. >> they certainly did in the quarter. we'll talk about some of the other retailers in a moment and we'll talk live with the labor secretary tom perez about the december jobs number and the picture for jobs creation in 2014. that interview and the opening bell are just a few minutes away. and you're like. a good deal or not. looking at truecar.com. there's no buyer's remorse.

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you're watching cnbc "squawk on the street" live from the financial capital of the world, the opening bell in about 60 seconds from now on a busy, busy day. the target breach apparently is back. some newly disclosed stolen information. of course, the jobs number at 74k. if you're joining us is the lowest of the -- the smallest gain in about three years. even though that unemployment rate, jim, at 67, got to go back to 2008 for a sub-seven number and we'll talk to the labor secretary how you get there with this participation rate. >> i know. isn't it interesting that the fed, bear nrnanke had the presc to say, don't hold me to the seven number and don't hold janet to that, that turned out to be smart because the 6.7 was arrived at the wrong way. >> yes. although we're hanging for a

positive week for the s&p and nasdaq, january itself, now that we're about a third of the way into the month is not shaping up to be so great. >> no. >> as we said earlier haven't had a losing january in four years. >> yeah. i don't want this to happen in the sense that china's not so good. the mixed numbers, the retailers, really now when you look at it macy's and tiffany did well, and i think costco, you know, and anf. >> sure. >> there's too many that have been bad. i like to hear of a good holiday season. i do believe amazon really decimated a lot of retailers. >> seven retail changes have cut their q-4 estimates according to who we spoke to. there's the opening bell. and s&p on the bottom of your screen. citi and howard miller investments, over at the nasdaq, staples, celebrating the launch of its campaign make more happen to focus on its expanded product line-up. >> the master limited partnerships have been very weak as have the real estate

investment trusts. notice they are coming back today. they were just terribly bond market equivalents, and interest rates are coming down, and that's why people might say, hold it, how can the market be up nicely? the answer is that there's a whole cohort of stocks that always react positively when you get the ten year going from 3 to 2.9. it just happens, which is why bad news can be good news. it's very counterintuitive to people at home, but that green screen is because of interest rates, not because of earnings. >> it's a good perspective today. we talked about intercept pharma earlier in the show. your eyes on pharma on a broader scale. >> people are making upgrades and downgrades like they are talking about the ponies.&j upg lihillilly has become the whipp boy. and the colts win this weekend, they'll go through the upgrade and say it will be a good day for indianapolis. >> it will be a good day for

indianapolis. >> they think like that. the civic pride! >> "the journal" has a great piece this morning about how many times belichick has smiled this season. seven times in all the tape they went through in all the postgame press conference. >> belichick wants to get rid of the extra point. he's the conscience of the nfl. i know he's probably a really neat guy. i was asked the other day, do you think you could ever have a good conversation with belichick? no. but he is the voice -- they're probably going to win tomorrow. >> with the jobs number being a weak surprise and alcoa the biggest laggard on the s&p, it's down 7%. you had pointed out it run up 30% in the fourth quarter. >> it wasn't great. the cash flow is good. balance sheet's better, best since 2006, but in the end you got to beat the earnings and the revenues in order to go higher. a lot of companies have beaten the earnings and not the revenues and they tend to react better than the ones that beat the revenues and not the earnings. a lot of people say you like clinefeld, he's an idiot and a

joker, he's a thoughtful man. the aluminum business is a tough business. if you were running a freeport, the copper business is a tough bus. it's in glut. when something is in glut, it doesn't matter what you do. you try to do as much value added as you can and the rest of the business is the global -- the global role wasn't that big. does that make him a bum? you know, i'm not going to call this guy a bum. i'm just not. >> yeah. >> he's doing everything he can to get as much money and working capital down big, big saudi arabian plant opening up. but in the end he sells aluminum, okay? he does not sell diamond rings. like tiffany. >> right. which we talked about a moment ago. after four straight days down twitter's having an up day finally. it's off 17% for the week. someone i think it's "the journal" took stock of the ratings, 11 sells out there. 11 holds. 6 buys on twitter. facebook, linkedin have no sells. >> no. the last time i was at a book signing barnes & noble people

want to know about twitter, they don't want to know about twitter to sell but to buy it. the most common off-the-record discussion has it come down enough to buy, has it come down enough to buy. i think people think yes. you actually are going to get earnings someday. you'll get an earnings report. >> on february 4 5th. >> when that happens, oh, look at that guy! his hand got tired. but i think that they want -- everybody wants to buy this. i tell them go buy facebook. you like twitter, i'll give you facebook. i'll see you a twitter and give you a facebook and, you know, i'm putting twitter unique -- twitter, i'll give you ten points over facebook. >> stefil upgrade facebook. >> people talk about putting ads in facebook. and i'm getting heat for liking yelp. here's the reasoned approach i want to take for people that give me heat for yelp. go pound sand, you jokers. go look at the numbers. sometimes the numbers matter. it's not just momentum. yelp could show any earnings numbers it wanted, but they are trying to take over the world like amazon.

yelp is like that. >> a whole universe of companies that are adopting that. >> it's a juggernaut that doesn't cost money for the content. you love the content. you call the people that they are writing about, would you like to put an ad against the content. that's a great business model. it's a cloud mod -- it's the best single application of mobile i know of all the companies. it's made for mobile. >> finally microsoft, barclays ups it to an overweight, price target from 42 to 35. it's up almost a percent even though we know what pc shipments did last year. >> but there's a lot of chatter that there's at a trough. a lot of people, michael dell, thinks there's a trough and one of the reasons why is people are starting to really like the new -- or adopting the new microsoft, the last iteration of windows and that can matter. that's a big driver of sales. i continue to think that pcs have bottomed. my charitable trust is buying intel because it seems very cheap. there's a new religion at intel, and the religion is we blew mobile, and we blew tablet, but

we're not going to do that anymore. they have a lot of firepower and they should stop buying the stock back. 74,000 nonfarm jobs created. let's get the first reaction from the white house this morning here first on cnbc is labor secretary tom perez. mr. secretary, it's great to see you. good morning. >> good morning on this beautiful day in washington. >> yes, finally some warmer weather, although some cooler temperatures on the jobs number. how disappointed are you? >> well, the numbers are lower than expected. we always want to see higher numbers, but, you know, when you look at the last three month mo for instance, there's 177,000 jobs on average including 240,000 last month. you look at 46 months of consecutive private sector job growth to the 8.2 million jobs. so, you know, the economy continues to move in the right direction, but we have to pick up the pace, and the president has been the first to say that. and this jobs report reminds us that we continue to have work to do.

and the president has laid out a very ambitious plan of investment in infrastructure. passage of immigration reform. a number of things that have historically enjoyed bipartisan support and the most immediate thing we have to do is pass the extension of emergency unemployment compensation. because if our goal is to keep people in the labor market and move labor force participation up, one of the most important, immediate things we can do is make sure that we pass that extension. because in order to continue to receive those emergency benefits, you must continue to look for a job. that's why that bill is so important. in addition to providing that critical lifeline for the 1.3 million people who have lost a job. >> mr. secretary, jim cramer here, do you have guys who said, do you know what, we look at all the reports, we look at adp reports in washington that was 238,000 added, i talked to the paycheck ceo and they are starting to see jobs created. how do you do a labor report that's more updated and

automated, because those numbers don't jive with those numbers? >> i have a lot of confidence in our bureau of labor statistics, in their moethodology and how they do this. i speak with employers with regularity, large, midsized and smalls and i speak to the employers, they tell me they want to grow their business. i was down at louisville, kentucky, at the ford plant recently, they have 4,400 now and growing. and so we need to make sure that they can continue to grow by matching their needs with the skill sets of employees. i talk to workers. i met with a group of long-term unemployed workers this week. it broke my heart. you know, one of them told me he had cancer a few years ago and, you know, fighting cancer was easier than fighting long-term unemployment. and the thing that angered them the most is when people suggest that they are sitting home eating bonbons. that just is so incorrect.

and so as we debate this bill on extending emergency unemployment benefits, i hope that discussion will be off the table. and we can focus on the merits and what's happening. because i'll tell you, the people who are looking for work, they're looking every day. and the reality is we're growing jobs, but we're not growing enough jobs to meet the need, and that's why the president has this plan. >> you know, a lot of economists i think can be said are scratching their head over the headline number today, mr. secretary. construction, for instance, down 16,000. that's the biggest drop in 20 months. how much of this had something to do with the weather? >> oh, i think the weather is a factor. i spent the christmas holidays in northern wisconsin with my family. went out, you know, each morning the last day i was there, it was 15 below. it's hard to build a house or build an office building when it's 15, 20 below. it's not just that your hands are cold, but you physically can't do it.

because the materials in that cold weather don't stick. so, weather is undeniably a factor. and, again, i think it's important in these numbers to appreciate that, you know, one month does not make a trend, you know, you look at july of 2013, for instance, you know, there were 89,000 jobs created. and that evoked a lot of concern, but you look at the fact that they were sandwiched between two months in which growth averaged over 200,000 jobs. that's why it's important in this context to make sure we're looking at the trend data. >> all right. mr. secretary, there have been a bunch of articles including one today in the paper about how china is exporting better than ever to the united states. do you ever sit there as a labor secretary and say, do you know what, maybe we should question the whole globalization issue, china takes our job, they pollute the world and they are not playing fair on global warming, maybe we should actually think about protecting american jobs, maybe even think -- i know this is against

the orthodoxy, putting a duty on the goods coming from countries who pollute the heck out of the world and maybe saving some american jobs? >> well, you know, i participate on the export council. we had a meeting a couple months ago and, you know, american exports are going gangbusters in many sectors. and i think, you know, the reason the president is talking about trade and he wants to make sure trade is an issue that works both for america and american workers, and the reason he talks about it is because there are americans out there. i've spoken to employers who are exporting out to foreign countries at larger rates. i think there are many forces in the manufacturing context, for instance, jim, that are resulting in employers wanting to bring jobs back home, you know, the cost of natural gas is going down. labor costs abroad are going up. those supply-chain issues that you have pointed out, you know, the most important currency any company is its reputation. and if their supply chain is

problematic, that undermines their reputation. so, there's a lot of forces that are working in the direction of producing more jobs here in america and increasing our exports. so, i think we're actually well poised as we move forward to make real progress in this area. >> finally, you mentioned the debate about unemployment insurance. and we're obviously continuing to track that. what do you say to those who argue that the reason we are seeing participation so low is because americans have become accustomed to those kinds of benefits, that getting them off of those benefits is what gets them to start looking for a job again? >> you know, that -- my response to that is talk to a group of folks who are long-term unemployed. i talked to a couple dozen literally this week. and, you know, they are -- the hardest thing i have done, one person told me, is look for a job. because i'm looking every day. and i'm not getting a job. and the reality is, you know, at the beginning of this recession,

there were seven jobs -- seven workers for every job. we're now down to about three workers for every job. we're moving in the right direction. but, you know, the folks who are long-term unemployed, they're trying like heck to get jobs. and it's not a question of laziness, but what the evidence shows -- long-term unemployment, you will increase the discouragement because they are no longer attached to the labor market. again, it's important to underscore for your viewers that a condition of receipt of long-term unemployment benefits is that they must continue to look for a job. and the average duration right now, as you know of unemployment, is 36 or 37 weeks. which is over twice the duration of the beginning of this recession. and so people are looking hard. there's more jobs being created. but we need to create more jobs. that is the problem.

and that's why this notion of blaming the victim is something that i think is really inaccurate and, frankly, unfair to long-term unemployed who are unemployed through no reason of their own. you know, the person who introduced the president earlier this week, i met with her for almost an hour. her story breaks my heart, you know, single mother of two, both her kids are in the military. she has her home heated at 58 degrees right now, wears a hat and a coat in her house every day. she's lost 15 pounds. she's looking for a job all the time. >> yeah. >> can't find one. this is the story of the long-term unemployed. she's not sitting home eating bonbons watching football. she's looking and looking and looking. and we need to support them. that's what america's about, you know, we lend a lifeline to people during these times of need. and the most important thing we can do for her and for everyone else who is unemployed is grow

the economy, grow it at a faster clip, pass immigration reform which grows the economy, invest in our roads and bridges and in our other infrastructure. give people the skills to succeed. pick up the pace. we need to have our foot on the accelerator and not on the brake. and that's what the president's trying to do. >> mr. secretary, i appreciate as we do every month to come and talk about the jobs numbers. >> it's always a pleasure to talk to you guys. tell your staff to take their coats off. it's pretty warm down here. >> getting warmer. labor secretary, tom perez, take care. we may make it nine jobs friday in a row, that we continue the rally. >> looking closely at it, again, i mean, the bond market's taking this number seriously it's a negative, that means interest rates go lower and reignites a lot of area where people stopped buying in. >> courtney reagan is on the floor. >> you take a look at the s&p futures this morning when we got

that jobs number you saw the initial dip and then you saw it actually climb back up. why? some traders think maybe this gives a little hope to reversing what the fed has said about the taper. possible? maybe. who knows, but apparently there is some hope in the market today, as you mentioned, major indices are moving higher. there was a comment made last night that we need to be careful about what we do to reverse or slow the monetary policy. if you are keeping tally, this is what the fed is dealing with when we look at the major economic data points this week, some good, some bad. we start with those that were better than expected. the ism manufacturing, adp, factory orders, construction spending. on the flip side, those worse than expected, ism and the jobs report to this one today as well. what i like what is going on in the market today it's very fundamental based and we're talking about jobs and the consumer and retail. take a look at some of these names that are actually outperforming this morning. abercrombie & fitch a surprise, while their comps sales were

down they actually revised their outlook up, that was a nice surprise to the market and the shares moving at two-month highs this morning. gap, comps okay but reaffirming guidance and saying they comfortably believe they'll be coming in at the higher end of the range that was good. and tiffany, comp store sales up around the world and also reaffirming their outlook but then you got the bad and there's a lot of them so i'll hit on a couple of them. five stores not so great, preannouncing very disappointing holiday sales, deutsche bank is maintaining their bullish stance and sears is losing money hand over fist. i don't know what's going on there. the forecast was so bad and i had to look at it three times and make sure it was a quarter forecast and not for the full-year loss. fitch and pacific is changing their name to kate spade and william mccomb the ceo is stepping down, and then target giving an update on the data

breach saying more folks probably were impacted. and as a result they did see a meaningful impact to sales. they took a dip. the company bringing down their estimates for the quarter. though goldman sachs actually gave them a buy this morning. carl? >> yep. as jim pointed out, you seemed like you're on board with that goldman call. >> yeah, that was very prescient, did predicted it would happen. and kate spade, you know, i get -- i find that they in -- >> inventory clearance upon canal street. >> a lot of chinese factories. let's get to the bond pits and rick santelli where the story largely is today. morning, rick. >> really largely. listen to labor secretary perez, some traders around, they agree. you know, let the economy do its thing. don't try to control it. but i have one issue. there's 330,000 initial jobless claims. the 2.8 million in terms of continuing claims. we have a governor in new jersey who is not sure what's going on with people he can see from his

desk. how does the labor secretary know what those 330,000 people are eating, whether it's bonbons, whether they're watching football or whether they're applying for jobs, okay, he really doesn't. we need to start talking about all the studies out there and claims and how it impacts employment and how did that number impact rates? jim cramer had it! you see interest rates moving down. look at the five, look at the ten. now, let's look at yield curves. i continue to say that flattening really does seem to be correlated with weaker equities because it seems to be pushing the fed. and even with this weaker data, we all know the issue's december with employment, look at 2s versus tens, continue to flatten on the two-week chart. fives versus tens, a little bit steeper but you see the move there. if you open up the chart for two weeks and xon senn trait on the ten-year, if we close under the 2 nine yield it will be the first time since the 20th of december. look what happened in europe. do they not pay attention? all the high sovereign quality trades the same?

bond yields did the same. foreign exchange euro versus the dollar, it popped. the dollar index went down a bit as we continue to monitor the ultimate effect of a weak jobs report that everybody knows has december and holiday adjustments that probably weren't smack on. carl, back to you. >> all right, rick, we'll see you a little bit later on. rick santelli in chicago, busy day for him today. after a challenging 2013 will the new year bring better times ahead for the cruise industry? simon hobbs is going to interview the ceos of carnival and royal caribbean, coming up. [ bagpipes play ]

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get 6 in 60. >> citi buy mutual. i mentioned this because the labor secretary talked about this industry, this company is putting people to work building a huge facility in louisiana. >> upgrade for vtr. >> this is very important, people, because this is the beginning with that bond market off of employment, you're watching the real estate investment trust having a big move. this is a great stock. >> big downgrade for pulte. >> yeah, do you know what, i think this is the wrong downgrade, you bought pulte on this employment number. >> barracuda. >> the people want too much from the cuda. >> downgrade of blackrock. >> i think you stick with blackrock. i don't like this downgrade. >> thoughts on hertz. >> a lot of people think that hertz can be broken up and activism going, i agree with the sum of the parts, very good call. a lot of football to watch this weekend. >> do we ever. >> before that, though, what's coming up on "mad money"? >> will they let us?

will they let us? that's what everyone wants to know. i want to find the next twitter. we'll go over the next twitter. what will go public this year. john's a terrific contributor to cnbc. we'll go through. you got to put your bids in now if you want some stock if they are going to go public. >> it will be a great weekend. go broncos. >> i still like seattle and i still like the niners. their base! >> see you later, jim. >> see you late, buddy. >> the jobs number after the break. est tends to stay at rest... while a body in motion tends to stay in motion. staying active can actually ease arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain so your body can stay in motion. because just one 200mg celebrex a day can provide 24 hour relief for many with arthritis pain and inflammation. plus, in clinical studies, celebrex is proven to improve daily physical function so moving is easier. celebrex can be taken with or without food.

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november wholesale inventories rise half of 1% and sales rise twice as much, up 1%. both of those are month over month. both are better than expectations. better revisions to our last look, and this all, of course, compliments, supplements or confuses benchmarked against the weak employment numbers we had this morning, carl, back to you. >> all right, rick, thanks so much. dow has gone negative we're now down 20 points. let's get to the jobs numbers as well. the u.s. adding a disappointing 74,000 jobs in december. our senior economics reporter steve liesman back at hq with more on the internals. >> i'm looking at the wholesale numbers because it adds to the

confusion as rick said, another upward revision of gdp. let's look at the numbers, up 74,000 versus a forecast of around 200,000. private payroll is 87,000, upwards revisions of november and december. and average hourly waging lackluster up 0.1%, unemployment plunging on the decline of the participation rate. people dropped out of the workforce. almost 400,000 dropping out of the workforce and that's why we are at a 35-year low in the participation rate. a caution, watch for rationalization of the jobs report, every economist will be looking for a reason to discount the jobs report. given the disappointing jobs report flies in the fames of every other metric of late. we would put most of the surprise down to bad weather rather than a bad economy. i want to show you the better indicators that everybody relied on including myself, adp was strong and small business, best numbers since '06.

gdp has been strong and we just learned probably stronger. challenger, lowest job cuts during the year since 1997. rbq coming forward as for the fed and the potential weather influences we still expect a further reduction in qe of $10 billion to 65 to be announced at the january meeting and morgan stanley adding weather an important contributor to the softness in december payroll job growth but not enough to explain all of the softness. i want to show you some details. now, it's the minus 16 on the construction where economists get their weather effect. government adding again to the decline in jobs manufacturing, services up as well. guys, we're just going to have to see how the fed treats this. we know they want to do more in terms of rate guidance rather than taper. i would say at this point they would be on track for a taper again depending upon how the other job and economic indica indicators come in over the month. >> all right, they have to be sort of scratching their heads as well at this jobs number.

for more reaction to jobs and the impact on the market, let's bring in the u.s. equity strategist with jpmorgan and diane swann, chief economists with mesereau financial. what does the fed do with the number like this? >> they take it with a grain of salt, there's no question about it. it makes it more difficult to continue the tapering and there's a chance they might punt to janet yellen's meeting in march, that said, the bottom line this number adds more confusion and clarity and is inconsistent with everything else we've gotten on the u.s. economy. the weather i would argue beyond construction, we saw construction manufacturing-related jobs in things like lumber also decline during the month. we also saw in leisure and hospitality up, but not as much as it could have been, so there were other weather-related elements in this number. the surprise on the number that was on the positive side was those temporary hires at 40,000 over 40,000 jobs in the temporary sector. that tends to be a precursor of additional hiring. you really had a lot of mixed

economic figures in this number and the drop in the number of people participating. that just is something that the fed does not welcome at this stage of the game. >> well, with those temporary hirings unless it's a result of obamacare. tom lee, want to turn it over to you, you've been known for your bullish forecast on the tock market. i know you are bullish again in 2014. fundamentals, the economy, does this jobs number make you rethink or get confused a little bit about that outlook? >> um, i mean, i think it is a disappointing report. i don't view it as a change of trend or the economy sort of apexing. i think it's important for investors to keep in mind a couple of things. one is, you know, the central bankers are really pro growth. i think it will be helpful for them to be reminded that we've got, you know, low for long, lower interest rates are actually going to be a tailwind for consumers as we're seeing bonds rally. but also i think it's a chance when markets sort of start to consolidate like this, it's a chance to really be adding to

exposure. i think investors should be willing to buy the dip here as well. >> diane, i hate to take you back to the jobs number, but how do you come down on this ui debate and the dynamic between a jobless benefit and your willingness to go out and look for real work, not pretend looking for work, actually participating in the labor force? we had some comments from the labor secretary, he's obviously in the middle of that debate. >> it really is a difficult issue, we have seen when people lose their jobless benefits, they've not been rejoining the labor force as we thought they would. on the other side of it, you do know in order to qualify for unemployment insurance, you have to actually be looking for a job, so it does people more engajed, how engaged they are. we also know the length of time you're unploimemployed, the les look. it's not -- there's no clear-cut, you know, good or bad here. it is a difficult issue. but i don't think unemployment insurance given how low it is in the united states relative to

elsewhere, it's not like living on the dole, you don't get enough benefits to really make it worthwhile. it's not like you are out there profiteering from it. >> tom lee, question on the fed. is this a market that's going to be driven by tapering, how big and when it happens, are we going to start increasingly pay attention to earnings which we're just starting to get and other economic data? >> ultimately what matters to investors is that the economy is strengthening and, you know, policy response and also the data has to support that. so, i think it's going to ultimately matter for, you know, growth to strength in a lot of these measures to show that. and as you point out, i think it's going to be reflected bottom line in earnings accelerating which is what we're expelling to happen in 2014. >> breaking the jobs report down, as we spin this conversation forward, what's going to be the most important data point to come out of this jobs report to really confirm that it was an anomaly and it doesn't square with the rest of the economic data we've been getting? >> unfortunately we know the cold weather actually got worse

in the month of january, and so i don't think we'll get a clean report necessarily in the month of january. we also had some distortions in the household survey that were from earlier government shutdowns, so we've got a lot of confusing data out there and unfortunately, you know, i think the cold weather defers and delays a lot of economic activity. it does not fundamentally destroy that activity and that's what we have to hold on to at this stage of the game. but we're not going to see until february and march, i can't forecast the weather, it's hard enough to this do the economy, some real clean economic data. >> economists turned weather forecasters. >> no, i don't want to go there. >> tom and diane, good to see you on this jobs day. thanks for joining us. turning to the massive data breach at the target stores during the holiday shopping season, it was nearly twice as large as previously revealed according to the retailer. target says that customer information apart from payment card data was also stolen. our own becky quick will be speaking with the target ceo this weekend and as if doing three hours of tv this morning was not enough, she joins us this morning from headquarters.

becky, we are going to let you leave eventually. >> that's okay. love it here, love it here, carl. previously, carl, target had warned that 40 million credit and debit card accounts had been compromised, today the retailer is adding additional information hacked, names, mailing addresses, phone numbers or e-mail addresses for up to 70 million customers, that's a huge hit and comes as an unwelcome shock to anybody who shops at target. they are taking pains to tell shoppers themselves will not have the liability for the cost of fraudulent charges coming from the brech. and it's upgrading guidance for the fourth quarter, the news of the breach definitely put some dents in the holiday shopping season for target which it says it now expects to earn $1.20 to 1.30 a share, well below the prior guidance of $1.50 to $1.60 but it's within the range that the street was expecting, probably figured people weren't shopping there that often and the street consensus was $1.34 a share before the latest data and

that's right within the consensus of what they're telling us. you knew some shoppers would be staying away from target after that news. the retailers is that sales were much weaker than expected after the original breach announcement but they said the sales showed improvement just in the last several days. the whole situation is a ceo's nightmare. bill george is the former medtronics ceo who also served on target's board. he said at least right now he thinks target's chairman and ceo seems to be reacting as best as possible. now, bill george also seays the most important thing for target to do is reassure its customers and he said past examples are the proof and he pointed to how tylenol's ceo reacted to the poisoning crisis. >> he stepped up to the consumer and he don't worry about all the other stuff. it cost him several hundred millions in the short term, of course. it wasn't his fault. this is equivalent of a terrorist coming into their system, same thing you had with tylenol. it today is the number one brand. he brought it back.

that's all that really matters, if you're in the consumer business, you have to reassure your consumer. >> target shares have taken the latest news in stride. the stock's down by 1.2%, down more than that earlier this morning but has rebounded a little bit from those levels. obviously there are still a lot of questions left. one of the big ones has to be how soon consumers will get over this and whether or not this is really all of the bad news. we'll dig into all of that and we'll have answers for you monday morning on "squawk box," and we'll be bringing an exclusive interview with the chairman and ceo of target. >> that's a big interview, becky. cramer was just pointing out that carnival cruise lines that we'll talk about in a moment is at nearly a three-year high today and we think back to the "costa concordia," but there's a point where consumers will forget. >> i shop at target. i'm guessing that you shop there, too, carl. it's one of those things. i shopped actually during that period, the day before thanksgiving. my credit card would be one of the ones that would have been in this issue. i will admit honestly, i didn't

go back during the holiday season. i've already gotten to the point i think i might go back. but target is going to have to navigate this very carefully particularly with this new news comes out today. >> thank you. the cruise lines have seen their problems recently everything from engine fires to technical malfunctions, can the industry redeem itself with american consumers in simon hobbs in ft. lauderdale today looking at just that. good morning, simon. >> welcome to ft. lauderdale. welcome to the royal caribbean "equinox" which has its own real lawns. well, obviously. look, this weekend is absolutely critical for the cruise industry. the booking season kicks off big time and over the next few weeks usually one-third of annual bookings are made. but this is the first wave booking season since those very public failures that we saw mainly from carnival last year. today, throughout the day, i am going to give you exclusive access to the power brokers within the cruise line industry.

ceos who will tell you that frankly they were horrified to see the carnival "triumph" drifting as it did for so many days. how could both of its engines have failed? i'll take you inside a carnival engine room and the head of technical operations will explain the design fault that they had and how they've spent hundreds of millions of dollars to fix it. we're also going to speak to the ceo of royal caribbean international, he says this year is not just about safety first. it's about redundancy for those consumer elements like refrigeration and bathrooms. we will also speak to one of the most powerful african-american frankly in business today, arnold donald, the man that billionaire mickey arison put in to turn around carnival. if mickey arison can get the bounce on carnival stock that royal caribbean has had, he will generate $8 billion of shareholder value. credit suisse says there's some compelling valuations at the moment, guys, back to you.

>> all right, simon hobbs, looking forward to the coverage. we miss you here at the new york stock exchange. up next target revealing its data breach over the holiday season hit nearly twice as many people as originally thought. we just told you everything from names to phone numbers to home addresses being stolen. we'll tell you what it all means for the future of the company and, of course, the stock. and later goldman's chief economist jan hatzius weighs in on today's jobs number. "squawk on the street" will be right back. the job jugglers. the up all-nighters. and the ones who turn ideas into action. we've made our passions our life's work. we strive for the moments where we can say, "i did it!" ♪ we are entrepreneurs who started it all... with a signature. legalzoom has helped start over 1 million businesses, turning dreamers into business owners. and we're here to help start yours. female announcer: get beautyrest, posturepedic,

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welcome back to "squawk on the street." cnbc has confirmed that president obama today will nominate stan fisher to be vice chairman of the federal reserve and jerome powell to be a fed governor or to comment as fed governor. he was filling a seat whose term expired this month as well as the undersecretary of the treasury for international affairs, so those three nominations to go over to the senate today. stan fisher being probably the most interesting of all the three. he's the former governor of the bank of israel as well as pretty much a renowned monetary policy expert who taught many of today's central bankers, carl? >> yes, indeed. taught almost everybody you could think of. >> ben bernanke, draghi, he's considered the ultimate educator. what stands out to me, steve, actually between fisher and brainard, it's more of an international flavor to the new makeup of the federal reserve. perhaps the fed will may more attention to the impact of its policy on emerging markets and

the rest of the world. >> i think that's an excellent point. and i think part of the reason is not only the need to understand more what's happening in the economics or the economies overseas but also in terms of coordinating regulation. lael brainard sent an awful lot of time in basel trying to coordinate u.s. financial regulation with international financial regulation and i'm sure she'll build on that expertise over at the federal reserve. >> thank you for that, steve. meantime, target is updating the public on the recent data breach. they say the stolen information includes names, mailing addresses, phone numbers, e-mail addresses for up to 70 million of its customers. target also says that same-store sales fell 2% to 6% for the rest of q-4 since the announcement came on december 19th. let's bring our cnbc contributor of sw retail advisers. good to have you back. how much does it hurt and how long does it last? >> this is much more painful than we first expected and it's interesting target pointed out,

you know, comps are down 2 1/2%, but they said after the hack, you know, traffic meaningfully fell off, which tells you that the consumer is actually concerned about target security. so, you know, target was already having traffic challenges. they were already having issues with a bigger dilution number for their canadian venture than originally expected, so this just adds insult to injury. >> they say the quarter had been going actually better than expected prior to the announcement. do you believe them? >> well, you know, i think that their traffic was challenged and probably continues to be challenged, probably average ticket was up a little bit. but i think, you know, this hacking incident, i think it's legitimate that sales really did potentially fall off a cliff after all the media attention and after all the concern. and i think also target just said that they're going to attempt to contact the consumer. how do you know that it's really target attempting to contact you by e-mail and that you're not actually being hacked?

>> and the thing with retail, stacy, as we've seen in so many instances, is that once you lose your customer, it's tough to get them back. jcpenney, sears, some of the other underperformers. how hard is it for target to regain the trust of its consumer? >> well, i think it will be tough, but i also think this is maybe more of a widespread industry issue, that it's really put some fear into the consumers' minds. really going online and putting all their information out there. it's crucial. because those particular private label credit cards, people spend more on and they also shop more often. so, if that becomes a risk, that's a real issue. >> all right. stacy, thanks so much for joining us on target. >> thanks. coming up next on "squawk on the street," twitter seeing a double-digit decline this week. several analysts coming out with negative calls on the stock.

so, what's behind all this new negative sentiment? we'll talk to an analyst who just initiated twitter at sell. plus, simon hobbs talks to the new ceo of carnival cruise lines. still to come on the program we'll be in ft. lauderdale where the new ceo of carnival, will tell you why you should book a cruise this season. >> it's absolutely the best vacation value there is. come cruise with us. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. ...and the little room above the strip mall off roble avenue. ♪ this magic moment it is the story of where every great idea begins. and of those who believed they had the power to do more. dell is honored to be part of some of the world's great stories. that began much the same way ours did. in a little dorm room -- 2713. ♪ this magic moment ♪

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the jobs numbers are in. showing the u.s. add ed fewer jobs than the forecasted number. considerably less. today's number the last read on jobs for 2013. jan hatzius is the chief economists for goldman sachs, he was looking for 200,000 as a lot of people were. why so disappointing? >> i think it's just a weak report. and weather can maybe account for something, like, 50,000, you know, construction was relatively weak. our research has shown that

construction usually accounts for 50% or more of an overall weather impact. and if we crunch those numbers, we can explain some of the downside surprise, but it still leaves a lot unexplained. and the weakness in other areas. >> laker force participation, how do you explain that? >> so, that's the second question. the first question is why was the establishment survey of job creation so weak, even there it's not totally clear because it came in a number of different areas. then you go to the household survey, and employment there was not particularly unusual. but participation was very weak. down another 0.2, explains the entire 0.03 percent drop in the unemployment rate. and this is before the impact of the expiration of emergency unemployment benefits. so, you can probably expect another drop in the next one or two months just on the basis of that. and that gets you to something,

you know, at least very close to 6.5%. >> people are now saying bernanke was prescient or lucky to smart to say don't hold me to 7, don't hold me to 6.5, right? >> that's the positive way to put it. or the negative way to put it is he probably shouldn't have gone to 7 in the first place, but, yes, i think that's right. >> are we in for more months like this? >> in terms of the jobs numbers, i wouldn't expect it, no. it is a weak report. however, you look at all of the other indicators that are coming in, and those are quite consistent. i think with the idea that the economy is accelerating to a faster pace. second half of 2013 was quite strong from a gdp perspective. other indicators weren't quite as strong, but in general there's been a nice sort of acceleration over the last six months. and i think that's going to show up more in the employment numbers as well. >> as long as we don't get more snowstorms, that is, in january. you brought up the federal reserve and the policy, the idea of promising 6% level, promising

certain numbers. we see a new transparent fed janet yellen on the cover of "time" magazine. we know she's pushed the communication strategy forward at the federal reserve, though. is there a risk of oversharing as the fed continues to do this delicate dance between communicating and not upsetting the market during taper? >> i think it's -- it's a delicate time, partly because we've got the transition in the leadership. now there's quite a bit of continuity, of course, with yellen moving into the top spot. but we do have some new governors. we've got a new vice chair. >> stan fisher. >> stan fisher being nominated here. so, that's going to -- >> is he going to outshine janet yellen? >> he's such a superstar. >> i don't think he'll outshine her, it will be clear who is the chair and the vice chair. but this is a very strong appointment to the number two spot. i still think, though, that markets will particularly watch yellen in terms of signals. but, you know, there is more uncertainty than normal.

and, of course, they need to tell us a little more what to do, you know, about the employment thresholds. we're almost at 6.5%. they declined to lower that threshold, and i think what they're going to do is go to a somewhat more discretionary, we'll tell you when we -- >> yeah. >> when we see stronger and more sustainable and broader labor market improvement and that's also trickier. >> the actual pails of bond buying doesn't sound like much. it sounds like they pretty much agree with you. >> i think there will be another taper. >> $10 billion. >> yes, in that sense i think no change. but a further gradual reduction. >> what would it have taken to change the ten, the number ten? in terms of a jobs number. >> i think if you had had, say, the same payroll survey but an increase in the unemployment rate and really weak household number, then i think you would have had that discussion a little more in earnest.

but with all of the other numbers, i think the hurdle for january's pretty high. beyond that, that's a different story. i mean, you can tell a story in which there's a pause at the march meeting, if you get another weak employment report. wouldn't be my expectation. but you can't rule it out, of course. >> and on the flip side, how quickly would too quickly be when it comes to tapering, that it would upset the markets? >> i mean, i think any signs that they wanted to accelerate the pace of tapering would upset the markets, because the markets would say, gee, with the $10 billion per meeting, that takes down to zero later in the year. and if they want to go faster, maybe that's telling us something about the pace of rate hikes eventually. i think that would be a delicate thing to do if they said we're going to $15 billion or 20 billion pace of tapering, then i think that could again call the forward guidance into question a bit. >> finally today on the ten

year, it's the single biggest one-day drop since the 22nd. more volatility in the ten year, or is today an outlier in terms of the jobs numbers? >> in terms of volatility, we should see more. this is a delicate time as we just discussed about, you know, for monetary policy. and so it's also one in which i think attacks of nerves on the part of the bond market, you know, should be expected. and especially if the economy, you know, does ultimately show sustained, above-trend growth with the federal reserve that's still telling a pretty dovish message on the -- on the first hike and the funds rate, you know, that -- there will be discussions about whether the fed's right to do this or the fed's wrong to do this. >> it's funny, you think it would ease the tapering. just as strongly as ever. jon, thanks for coming in. the exclusive interview with the new ceo of carnival

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and one hour into trading, here are the stories worth squawking about. 7:30 on the west coast and 10:33 on wall street. alcoa is the biggest decliner on the s&p 500. down 6%. reporting fourth quarter earnings coming in below wall street forecasts. the commerce department said wholesale inventories rose 0.5% in november slightly above

expectations but, still, less than half the percentage increase back in october. and microsoft one of the biggest gainers on the dow up almost 1.5%, barclays upgrading the stock to overweight from equal weight saying microsoft is in a better position right now when it comes to cloud services than its peers. the cruise industry has seen better days, so as the peak booking season approaches can they turn things around? our own simon hobbs is live in ft. lauderdale this morning with an exclusive interview with the new ceo of carnival, morning, simon. >> reporter: carnival remains the eye of the storm for this cruise industry, it has an amazing 45% worldwide market share. the repeated failures over the last two years meant the billionaire mckie arison had to put in a new ceo to run things and i met with arnold donald last weekend here in ft. lauderdale as he got off a cruise with 16 members of his extended family. donald is rejiggering management positions and listen to this

very clear, value proposition he's giving the american public as we start this crucial wave booking season. >> sales on the wester dam here with my family, with 16 of my family members, my five grandchildren and my daughters. and the value proposition for everyone is the same as it is for all of us, which is, there is no value better from a vacation standpoint than cruising. >> reporter: staying in a hotel in orlando, it's cheaper than that. >> it's less costly for the value received and you don't have to unpack, you know, frequently. >> reporter: and how do you, then, translate that value proposition to how you motivate your 91,000 staff? >> our goal is to exceed the guests' expectations every time. and if we do that successfully, those guests promote to the new cruising people who don't know any better because they haven't cruised yet what a tremendous value it is. >> reporter: thatholy grail. >> exactly. 3% of the population has

cruised. >> reporter: let's talk about the moments with the advertising ad campaign that started in november, your first advertising campaign in many years. where has it positioned you? >> the advertising certainly helps to soften the beachhead, to get the information out to folks, but we're optimistic about the wave season, it will be crowded in the caribbean again this year. >> reporter: mickey arison said you deliberately left quite a wide guidance for shareholders coming into the wave season because they are dealing with the recovery of not one but two brands. let's talk about the "costa concordia." everybody saw the writing of that ship which was a phenomenal engineering experience. you're now being able to raise prices on the "costa" and that has left ubs quite confident. it says if you can do it on the "costa" you can do it for the carnival brand because the problems at sea were so much less severe. >> oh, absolutely. with regards to carnival, reputational recovery is up 70% from a brand reputation stand point from the low that occurred around the time of the events

and we are seeing strengthening in pricing but we do have to get through the wave season to ensure that the momentum is sustainable. >> reporter: on carnival, why don't you be straight with people, saying, look, we were horrified when we saw "triumph" drifting on the sea, but the power systems for all those engines kind of run through the roofs of all the engine rooms and, therefore, when there was a fire in one, it knocked out all the engine rooms simultaneously, well, we're putting that right. we're spending hundreds of millions of dollars to separate those command-and-control lines. why don't you say that to people? there was a problem. we fixed it. it's now different. >> to be honest with you, our passengers who sail often, they know already. and it's the new to cruise that we have to reach, and we're going to have to reach them not just by us talking about it but by those who sail with us frequently talking on our behalf. >> reporter: you know what gets investors excited, it's your scale. 101 ships, i think you have 45%

of the world market share in cruising. and the question becomes at what point can you turn up the margins on those 10 million passenger voyages a year. >> we have 78 million passenger cruise days a year across our ten brands around the world. and so we have tremendous opportunity to leverage. what we will not do is we will not centralize. centralize means single point of control. our brands have been very successful because each one caters to a different graphic. >> reporter: arnold donald remains one of the most powerful african-americans in business today. he actually grew up in a real poor neighborhood in new orleans, a child of five, and his father was a carpenter and built his own house. he made his name in monsanto. and i asked him about being an african-american in business today, and first of all he paid tribute to the board of carnival for giving him the job that he had, and then he said this -- >> i'm confident that we'll be

able to do some things internally in carnival to help young people strive and achieve their dreams like i have mine. >> reporter: young people of color? >> young people of color and young people around the world. but african-americans, too, absolutely. you know, and there is a dearth, there is a lack of african-american leadership in corporate america. and that's not by design, but it's also not by accident. diversity requires proactive intervention. diversity requires courage. >> reporter: and that is the subject that is very close to arnold donald's heart, before he came the ceo of carnival, he was president and ceo of the executive leadership council, guys, which is a network of african-american ceos within the fo fortune 500. back to you. >> looking forward to it. simon, i have a quick question about the cruise industry. i know that americans like cruises and it's a huge market for some of these companies. what about internationally? is there international growth potential, say, in the emerging

markets? do they like going on cruises? or do they have different ideas of vacation? >> reporter: it's mainly been an american industry and a european industry, they are seeking to expand in asia. but the issue for them is not that, the issue is how do you get people to spend here in america $5, $10 more. because the volumes, are so large, that's how you make money and that's what arnold is trying to do. if they can do that, there's no question carnival becomes a real good investment. back to you. >> i'm not a huge fan. carl, do you take cruises? >> i've never been on a cruise. >> i don't like the idea of communal eating, having to eat meals with everybody else. all right. simon hobbs. looking to check in. we're jealous of him and the weather and the fact that he's not having to wear his winter coat today. and later we'll hear from the ceo of royal caribbean cruise

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the negative 2 at 1834. let's get over to dominick for a market flash. >> welcome back. check out what's happening with microsoft, moving higher here. barclays is upgrading this stock to an overweight rating with a price target of 42 bucks a share. analysts saying with allan mulally out of the running as an outside ceo candidate and an outside ceo unlikely, they'll work on improving fundamentals with the company. >> thanks so much. still ahead from custom-made burritos to pizza baked in two minutes, chipotle is working on a new kind of restaurant in colorado. we'll take you there live to show you what it's all about when "squawk on the street" continues. tdd#: 1-800-345-2550 trading inspires your life. tdd#: 1-800-345-2550 life inspires your trading. tdd#: 1-800-345-2550 where others see fads... tdd#: 1-800-345-2550 ...you see opportunities.

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linkedin. it's up 100% since its ipo, far below the high of 74 bucks that it hit back in november. john blackledge is the analyst that made the call. why are you not so optimistic with twitter's revenue growth possibilities? >> really, we have two main concerns. one is price and two is that inventory. on the pricing side, like you said, like you just mentioned, the ad buyers we surveyed believes that twitter is below peers which we think will eliminate ad pricing upside. one of the things they cited was the high cost of campaigns and the minimum spend. given the low, we think the pricing lever is limited, and just for context, facebook last year when their fundamentals turned up, pricing was one of11. and the other is the inventory. user and engagement growth is decelerating which we think will limit ad inventory. and engagement growth which is

defined by twitter is timeline views per mile, that growth went from 30% in the first quarter to 8% in the third quarter and on the user side twitter obviously has considerable scale with 232 million users, but growth is also decelerating and we expect that to continue longer term. we think facebook and instagram and linkedin have more powerful network effects than twitter and we think we're actually seeing it play out right now. for instance, instagram added 100,000 more users per day between 2q-13 and 3q-13 than twitter. it drove up estimate s 2014 and 2015. >> is it important that they are still going for scale that minimum spend you're talking about will change once they move into a monetization mode and they start saying, look, you want to use us, you got to pay us? >> yeah. you know, they're actually not that young. 2006 it started. they started to monetize the platform several years ago.

and we're just concerned that, you know, if the pricing's high right now, and you can get much better roi on a facebook or a linkedin or other platforms, you know, it concerns us relative to their, you know, revenues kind . >> price target 32. is that the level in which it has to be to get interesting enough to buy or would you be nibbling at levels above that? >> if it dips down into the high 30s, low 40s, we could kind of start to look at -- recheck our thesis. >> it comes to the price action i know there's a lock-up expire rags. would you look for those periods to be selling, twitter under some pressure with the lock-up expiration? >> there could be some selling pressure obviously during those two periods. then we also have february 5th, a reporting of earnings.

so we'll see how their first earnings report as a public company shakes out. >> quickly, john. we know this stock has more than doubled since the $26 ipo price. what is the number one thing that investors you think are getting wrong about this one? >> i think the expectations are obviously too high. valuation is multiples ahead of any other internet company. it just expectations are too high. that's what we try to beat out in our report, that the key drivers of the revenue, we have concerns about and people should check into that. >> all right. thanks, john, for joining us. nesh yating twilter, underperform. shares, 57.51, boy. >> dow is down 29. let get down to the cme group in chicago. rick santelli with the santelli exchange. >> good morning, carl. everybody is talking about the employment report. listen, there's nothing we all want more.

we're all trying to get through under the job side. we lost 347,000. we just don't count them. they were unemployed. poof. not that they have a job, they just disappeared. we see the unemployment rate go down. we talked about this years ago. that maybe the best news isn't the unemployment rate going down. maybe it's the unemployment rate going up. one of the other barriers, of course, to get into the labor market is education. the stats are all there. so we can listen to labor secretary give us anecdotal evidence that he knows what people are eating, whether it's bon bones or steaks but he doesn't. but there are studies and ways. structural unemployment don't pay people to be structurally unemployed. that's insulting. let's get them through the wall of employment. now, another barrier to entry is, in my opinion, some of the stock markets. you know, the debate between wall street and main street. so on the wall street side i see things like tesla. 18 billion market cap. i look at netflix.

20 billion market cap. i look at twitter, 30 billion market cap. i think the king of them all, the king of the mountain, is has to be facebook. 140 billion market cap. we're talking over here to traders. one trader said, geez, with a market cap like that they can buy greece and still have money left over and put a down payment on portportugal. the feeling of main street because they can't get jobs on wall street because of the high fliers. the barrier to entry i worry as much about for people to get into the labor market is the barrier to entry to why a facebook or twitter. let's say you have three brilliant programmers and you bring them in a room. you can emerge with the next facebook or the next netflix or next twitter especially. the bafr barrier to entry is very low. you need to be careful because when the barrier entry is low your stock might go down! carl, back to you. >> wow, did not see that one coming there. >> people are literally already

tweeting a picture of mr. kool-aid after that. >> i think he was more worked up than usual. >> you guys are fast. nice work, rick. >> especially fired up on his disappointing jobs day. coming up on "squawk on the street," on the heels of the target data breach news, we talk to a corporate security expert about what companies need to do to protect themselves from hackers. we'll be right back.

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welcome back to "squawk on the street." sears is getting whacked today. it's projecting a fourth quarter loss much lanlger than wall street was forecasting. it was a year ago that eddie named himself the ceo of sears holdings. that stock is down about 11% during that time frame and it's down again today, sarah, in trading. back over to you. >> thanks for bringing us that mover. sears under pressure. lots of big moves in retail today. courtney reagan is torn floor with a look at the other ones moving. courtney? >> i want to point out some of the names moving higher. i know we've really focussed on a lot of names hit pretty hard because, let's face it, it wasn't really the brightest holiday season we've ever seen. look at shares of tiffany. this is a case where in line is good enough. we saw broad base growth, comps worldwide up 6% for november and

december. in the u.s., strong growth across categories as well as in europe. investors like that. it's good enough for today. move on to abercrombie and fitch. it's been in the news a lot over the last year. yes, preannounced and said comps were down 6%. that's better than we expected. so we're going to go ahead and up that guidance. and that's something that wall street really liked to see. wells fargo says not so fast though. keep in mind we have weak margins likely to see when the full report comes out and it's still probably 40% lower than last year. welsz fargo a little skeptical on abercrombie. fdr says he sees potential for further cost cuts beyond what the company already discussed and thinks there could be a potential for board reshuffle. perhaps hopeful but that could move shares higher as well. starting out at two-month highs. we can't forget about macy's. the bright star all season long. that's what had been forecast and turns out what we saw as well. the company sort of surprising the street announce that comps

were for the holiday up 3.6%. announcing further organizational changes that will bring in more cost cuts. $100 million per year starting in 2014, including job cuts. a lot of people don't like to hear about job cuts. wall street often does though because it saves money and makes the business leaner and more efficient. >> what a week for your beat, court. oh, my gosh. so much retail news. courtney reagan here at the nyse. today's all important jobs number. 74,000 jobs were added last month. the question is, did you nail the number? we've asked you to tweet us your predictions for a chance to win a great prize. something right on time for the new year. this world clock autographed by the "squawk on the street" gang. we're going to announce the winner. we do have a winner. i'm not going to tell you whether or not they did nail the number. >> this one was an especially tough one to nail. >> you would have had to really gone on an outside bet to the downside. >> big bear. >> yes. in the meantime, dow is with some moderate losses here.

and as cramer pointed out earlier on, you get a drop in the ten-year this dramatic, decline for a single day since october, you would think it would help some stocks, for a while it would. but we have lost ground. >> perhaps it's what is preventing the stocks from going lower. there's the question of the qe trade. what does this number mean for the federal reserve. expect another $10 million taper the next time around. >> if you're just joining us this morning, here's what you missed earlier on. welcome to "squawk on the street." here's what's happened so far. >> we have to have geographic scope, product scope, to be able to play the portfolio game, the product, you know, options game, to make sure that we can deliver results in spite of this global confusion that's going on. december nonfarm payrolls increased by just 74,000 jobs. the unemployment rate is 6.7%. >> if we dismiss this number,

then we shouldn't dismiss the 300,000 numbers. you can't play that game. you can't just decide, you know what, this number i'm going to throw away. it's a real number and it's a bad number. >> this is target being very forthcoming. it wouldn't surprise me if we got a surprise crescendo bottom. >> interesting take. they have said a lot of this information has been disclosed partially and they're trying to contact customers who might have been effected. [ bell ringing ] >> the economy continues to move in the right direction but we have to pick up the pace. and the president has been the first to say that. and this jobs report reminds us that we continue to have work to do. >> cnbc has confirmed that president obama today will nominate stan fhischer for the federal reserve. >> this is a weak report, however, you look at all of the other indicators coming in and those are quite consistent with the idea that the economy is

accelerating to a faster pace. good morning. we are live here at post nine at the new york stock exchange. let's get a check on markets on this disappointing jobs day. the dow, s&p, and nasdaq all under pressure. nasdaq is now in positive territory. not a steep sell-off perhaps being held back a little bit by the decline in yields. very dramatic. shares of sears are taking a big hit this morning after quarter to date sales fell over 7%. sears also projected a fourth quarter loss. that is a lot larger than what analysts were expecting. meanti meantime, shares of abercrombie and fitch rally. same-store sales in the fourth quarter fell 6% but the teen retailer raised full year forecast because of higher than expected sales in the current quarter. >> all right. road map for this morning, big miss on jobs today. u.s. adding 74,000 jobs in december. is this just a blip on the radar or a bad sign of things to come? we'll take a closer look in a

moment. plus, the situation at target looking a little worse this morning. the retailer now saying that personal information including phone numbers and e-mail addresses were stolen from as many as 70 million people. we'll tell you just how bad this would be for target. is bitcoin on its way to full legitimacy? the state of new york holding a hearing on bitcoin and the possibility of regulating it. how would a regulated bitcoin work? we will ask a top financial official in a few moments. from burritos to pizza, fast casual change of chipotle with a new concept in colorado. we'll give you an inside look at what chipotle pizza looks like later this hour. we'll start with the december jobs number, well below estimates. hurting the markets a bill as sarah said, down 28 points ten-year seeing the biggest retreat since the middle of october. let's bring in stosteven wood, bauer with principle global

advisers. gentlemen, happy friday. good to see you. bob, what do you make of the number? >> i think it was certainly weak number. nothing anybody anticipated. if you look at the job revisions, 38,000, you add the adp to it. really nice number. i think this is just kind of something we'll ignore for a little while. >> the trend that we had been seeing of acceleration and in back half of last year continues? >> i think that will -- i think that will continue. what we're really seeing i think is some pent up demand for consumers. i call it pcrd, post crisis relapse disorder. house holds and business had that for a long time. you wake up every morning thinking there's going to be a recession right around the corner. the financial crisis is in the past and we're starting to see pent-up demand. >> can you ignore a number as big as a jobs report? forget the fact that part of it was blamed on the weather. there are fundamental underlying issues that are troublesome. >> sure. i don't think you should ignore it but you do need to put it in context as a volatile number and

recisivision revisions. i thk up with of the numbers we need to look at is how the revisions come in. what will dr. yellen think about this number and how does it translate into market effects. i think the fed is going to be cautious. i think they did that first taper of 10 billion and they will see how the market digest it and how the economy digests it. it is still a glacial improvement in labor markets. it is an improvement and it is glacial. we do see the trend pumping up a little bit in 2014. the economy right now doesn't face a lot of fiscal headwinds that we saw in 2013. it's very unlikely now that watch washington is going to subtract 1.5 to 1.7% off the gdp in one year. >> do you think taper is in text they're? >> at least for january. if we get another bad number at some point, then i think the fed will rethink it. but, you know, this jobs number didn't -- it didn't mesh with the purchasing manager employment numbers. neither the service nor if

manufacturing. so i think it's just a little out of context here. >> it's not like everything is peachy when it comes to the economic numbers. auto sales disappointed for the month of december. ism services didn't come in too hot. courtney has been showing the retailers. a lot of disappointment on that front. it's not like the economy is in the clear. >> did it with the seasonality a lot. they always do. but from a longer term perspective though you see europe stabilizing. it's not going to be growing quickly. but that end of the world scenario in europe stabilizing. china has began a landing process. that's going to be very important to the global growth story. so i think between the u.s. global growth is going to accelera accelerate. it does look better. i don't think it's going to be gang busters. our number at russell is 3% gdp growth rate for 2014 which would be a doubling of last year. in this environment i think revenues are going to be more important, pricing power is more important. security selection in a nullity asset for the pole you you want fixed. i think security is going to be very important. >> steven mentions europe.

there are still people who believe the story is not over over there. duration is a threat. draghi has to defend himself saying what instruments he has at his disposal. >> i think that's true. there are some positive things going on there. numbers in spain and industrial production were up fairly dramatically this morning even in france where the numbers had been weak. pmi has been weak the last month or two. numbers are looking better. steve mentioned china. the import number came out this morning was really quite strong and showed that the economy is continuing to continue -- continuing on its slower path than 10 mers. we think it's certainly solid. >> all right. that's going to be -- you think last year was interesting. we're in for another one this year. >> i think so. >> thanks for coming in. >> thank you very much. >> keeping the optimism. >> yeah. >> meantime, another top story today. more trouble for target. investigation into that recent data breach now shows that up to 70 million people were impacted. it also shows stolen information includes name, mailing addresses, phone numbers, or

e-mail addresses. paul is the krerceo of risk con strategist. so, beyond these disturbing headlines, if you were one of the shoppers at target over the holiday season, paul, how worried should you be right now? >> i think pretty concerned, sarah. no question about that. i mean, the issue that we really need to look at on the macro side is the business model that's associated with the criminal mantra for identity theft and who the targets are and what the information is being used for. from a consumer perspective this is something that credit card reports are going to have to be looked at as well as all of their financial statements on a monthly base sis because the bottom line about identity theft is once it's stolen, it's stolen. you're going to have to manage it from this point going forward. >> paul, based on what you've seen so far does this look like something unique to target or do you think it's more of an industry wide vulnerability in retail? >> right. excellent question. and the point is that we should not be throwing target under the bus at this point. it's irresponsible.

this is not a target issue. this is a national issue. it's an epidemic. identity theft and data theft is the fastest growing business in this country and probably even in the world. and we have to understand that the business model behind it is, is really centered around negative migration. negative behavior migrates the path of least resistance. any corporation that is not conducting assessments or individuals that are not properly protecting their personal information are leaving themselves vulnerable to this type of occurrence. it's not necessarily a target issue. it's not even a retail issue. it's across the board. >> paul, target says all these data points, your phone number, name, address, were probably accessed partially, not completely, and they're trying to get in touch with those customers that were effected. how would you know if you were one of those customers whose name or address had been op obtained and what would be the first step a hacker would take to take advantage of you? >> really, carl, it depends on what -- once the hacker gets the

information, again, think of this from the business perspective. they make a business case just on really the low-hanging fruit. so if there's a significant amount of personal information available and they're able to, quote, unquote, google that information and ascertain a potential net worth of that person, the higher the net worth, the high ter target because the larger the pot of gold. the information that's available, whether or not someone's actually going to know what was stolen, is slim to none. target is doing the responsible thing and putting the information out there. the unfortunate part about this is the part we can't escape is that once the information is gone, it's gone. the consumer is going to have to monitor this on a monthly basis from not only their credit card statements but their credit bureau itself. >> interesting. you're saying the criminals, whoever they are, are essentially screening all this data to find the richest of the victims? >> there's no question about that. and if you look at it this way. again, if you take the passionate side out of it and look at it from a business case.

bath of least resistance. if i can go after someone who obviously resides in -- because this information is going to lead the criminal to where the people live, how many homes they have, where they travel to, what they buy, that whole pattern of whether that person is affluent or not. clearly if i can get into somebody's home living in grenich as opposed to the south bronx, i'm going to grenich. that information is going to steer the criminal in this particular case towards the path of least resistance as well as where the greatest return on their investment will be for that crime. >> all right. scary stuff. paul, thank for joining us with your perspective here on the target security breach. wider than initially expected. >> incredible story. turn to tech this morning. there's some big trouble for the pc industry, idc and gardner releasing numbers for worldwide and u.s. sales. sg chromebooks were included in the count while tablets were not. what could these numbers

forecast in pc trends to come? bjo jon ford is back from las vegas. >> i look like i raided yours closet, too. >> your tooth is not chipped. >> back to new york and talking old school technology. >> they cleaned me out before i came in this morning. >> interesting data on a day where the journal points out that apple is selling more than -- to the enterprise, too. >> yeah. so the two particularly interesting things about this. one, the u.s. data, it's interesting how far off these two are. one says apple was down more than 5% year over year. the other one says they were up 28% in the u.s. bottom line, saying it was a tablet quarter. large tablet quarter. we want to see what apple got out of that. and they're saying that chromebooks are having minor impact on the low end. overall, it looks like margins are under pressure across the board in the pc business and kind of a stabilizing business.

forget about it growing again. stabilizing is the hope. >> that's the tact that cramer had this morning, trust is longer intel because they, in his view, they accepted, they blew mobile but they're not going to blow it further from here. and we've got an upgrade of microsoft today. there is a sense that it can't get a whole lot worse for pcs. >> it can. i i think it can. >> you do? >> yes. mobile is still early in the cycle. there's a lot more technology that you can build in to tablets to take away more of the functi function functionality, if that's a word. more of the things that pcs used to do. there are still some things, keyboardwise and storagewise that tablets are not as good at. it could get worse. >> who is adapting the fastest to the shift, industries that really rely on the pc? >> who is adapting fastest moving from pcs to mobile? >> to tablets and mobile. >> well, i think part of what's happening, i think it's finance. i think there are a number of retailer who are outfitting

people with more mobile technology. a lot of that is happening. they're just not buying more pcs. they're buying extra stuff, it's tablets, it's phones. >> good to have you back, jon. >> what was the coolest device? >> i like the health stuff. i think that's going to be a lot of the wearable health stuff, on your chest, on your wrist. >> ekg is very cool. jon fortt back at post nine. the pizza business sa and under the radar move, chipotle is investing in a pizza chain in chicago. we'll show you what it looks like in a moment. hope fully the lines are a litte shorter. rick santelli having broken through a brick wall in the past hour. rick? >> i'll tell you what, i haven't not been on the floor for a jobs number since 1979. i'll tell you what, there's only one guy i want to be on with after the jobs number. that's jim bianco. he's going to be on here. we're going to stalk about stanley fischer. and, of course, labor force

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now i have three here from three different restaurants. each with a big bankroll behind it. let's start with this one. i bout it in denver. wow, i don't know what to get. >> what kind of cheese is that? >> artichoke, mushroom, and roasted peppers. is that basil? if it sounds like i'm ordering from chipotle. i am. it's backing a pizzeria. but there's also blaze pizza created by the wetzel pretzel folks and pizza rev started by buffalo wild wings. chipotle partners have no plan to franchise or grow fast. >> the nice thing about the relationship is that we get to run it the way we want to. help with real estate, stuff that we haven't been very good about. >> the peers in this stays are always like, okay, we want to have this done, this done, this done. it's always, to me, daunting

race to say how many stores they're going to open. i think we're so different on that. we're like, okay, let's build a team. do that next space. >> i think they'll do great in pizza. >> rick rosenfield should know. they founded cpk. coming out of retirement now planning their own new pizza concept. >> it's a land grab. i think that's true. you know, as we look at it, because we're not the first into this game. and we won't be the last into it. >> woong i don't think we will one out of demand for pizza. i think it's growing. >> prices are competitive with domino's. pizzeria lowered prices because it turned out to be more efficient than expected. i was in colorado covering the pot pizza, pizza and pot. check out the snap guys on my way home. new signs at denver airport warning of fines up to $999. i guess that's the largest you can have for a misdemeanor if caught possessing, using, or growing marijuana at the airport even though it's on state land,

it is abiding by federal rules. >> i have one question, jane. was the pizza from chipotle any good? >> oh, delicious. it's just like chipotle, fresh, hormone free. just -- like the you go to naples, that kind of thing, except with that sort of sourcing of food and freshness that you get from chipotle. the cofounders, they are james beard award winners. they came from the french laundry in napa. steve els of chipotle loved their food and this is what came out of it. there's a lot of competition. >> i'm into it. >> yes. so am i. thank you, jane. our jane wells joining us with that chipotle news. let's head it over codom ch >> check out the homebuilders moving higher as yields, interest rates fall in the wake of a very weak december jobs report. lennar, kb home, pulte.

home affordability becomes that much better. watch the homebuilders in today's trade. >> we are watching dominic chu. last hour he broke down a brick wall. find out what he's breaking down this hour. santelli returns in moments. and even though it's the middle of winter it is peak booking season for the cruise industry. our own simon hobbs is getting an inside look at the state of the cruise business live aboard a royal caribbean cruise ship in ft. lauderdale, florida. ahoy, simon. >> 78 degrees. let me tell you, i a head on the program, you know, this is an industry that really has changed a lot over the last 12 months. has reponded to the crises. we're going to highlight with that a remarkable honest interview with a ceo of royal caribbean international. that's next, live from florida on "squawk on the street." 06 35t the old dining table at 25th and hoffman.

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for cruise industry that is a lot more confident than it's been over the past few years. royal caribbean may be the most confident of the entire bunch. simon hobbs is live on a royal caribbean ship in ft. lauderdale, florida. simon, good morning. >> one of the reasons i wanted to come down to florida and do this today is because the more i dig into this travel beat i see there's a mismatch between headlines that journalist s wrie about the cruise industry and cruise think about the cruise she stri and ceos is giving me and they are confident. they have reacted to what happened last year with the triumph drifting for so many days. more importantly than that, the perception out there that, for example, two years ago went that ship went down in italy and 32 people lost their lives, that that's normal. that isn't normal for this industry. that's why it is as confident as it is. listen to what adam goldstein, the ceo of royal caribbean international told me yesterday

in an exclusive interview, very honest, candid, exclusive interview. >> having been in this cruise business for over 25 years now, my frame of reference is 2 1/2 decades of an, trard narally safe of track record of great duration. tremendous attention to detail and training that prepares the crew and the officers to do everything that they need to do to delivering satisfaction to the guests to being extremely safe and environmentally responsible. and so there's no question in our minds, in my mind, that the last two or three years have been an anomaly. and given the foundation of discipline and attention to detail, the cruise industry will resume its long-term very safe track record. >> you did a lot to drive the industry forward. there were passenger chart that came out of that. what did you as a business do to react? what did you feel you needed to do? >> regardless of which ships the events occurred on or which

cruise line or company, i think it was horrifying for all of us, knowing first of all, how strong we feel about delivering safe and great vacations to our customers. millions per year. knowing how important each one of these vacations is to a customer's quality of life for the year, to have customers end up in very difficult predicaments is not why we're in the business. it's not why we do all the preparation and training of our people. it was very off base and we don't want to see it anymore. >> the cruise industry, as a whole, a step forward as worked together in a different and better way than before the sequence of incidents. we are much more proactive as an industry on the safety front. the second thing though that we took from the sequence of incidents from the industry is to do even more to ensure guest comfort while we were keeping them safe. we looked for reredundancy of comfort systems, making thur the air conditioning, the heating, the toilet systems, the food

provision, everything could continue even under very difficult circumstances. and we've made progress in that regard and i think the whole industry has. >> in case you didn't realize it we shot that enter inside a ship. that is the atrium they created it in liberty of the seas. he would much rather talk about the cruise industry. i got the opportunity to go to a simulator where they teach them to drive ships. yesterday i had some difficulty getting into manhattan. that's on "power lunch". for the moment, from a sunny south florida, back to you. when we come back, is bitcoin on its way to legitimacy? it could be thanks to a move by the state of new york. we're going to explain later this hour. don't go away.

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orse, you know. i'm happy with my purchase. it's the truth. when you're ready to buy a car, save time, save money, and never overpay. visit truecar.com the european markets are closing now. >> just about a minute or so ago, pretty nice action on the continent today to end the trading week. stocks in the green on some upbeat corporate news. off of their high following the release of that weaker than expected u.s. jobs number. here's a look at the european markets. one of the big gainers of the german airliner, passenger traffic in december. forecasting shrinking fuel costs for the current year. and swatch, the world's largest watchmaker saying it expects double digit sales growth for 2014. easing concerns about a downturn in china. that news giving a lift to high-end retail names like burberry, the maker of cardia

julie. the job impact of u.s. markets putting a dentd in it. courtney reagan is here. >> before i get to that i want to provide some new information that we understand out of target before i jump into the market movers. what target is now saying is that that 70 million number, 70 million customers that could have possibly had their phone numbers and e-mails detained through this data breach was not necessarily confined to that same time period they had disclosed. that november 27th to december 15th. now target is saying that it's possible that even if you did not shop during that time period that your data could have also been compromised. i want to make sure our viewers and investors in target understand that new clarification. as you mentioned, markets getting weaker here. the dow down 48 points. s&p futures selling off on the back of that weak jobs report. a lot of traders discounting the

jobs report. this doesn't jive with the rest of the jobs number and employment picture we've been seeing. we think it's going to get revised upward for next month but we will see how that all pans out. interest rates of course really are taking it on the chin. falling lower than ten-year rate below 2.9. then got those rate sensitive sectors also moving on that news, of course, makes housing cheaper if interest rates fall as well as reits, utilities, those numbers moving higher as well. >> rick santelli has reaction to that jobs number this morning. rick? >> absolutely. and thanks. of course, like to welcome jim bianco and happy new year. >> happy new year to you, too. >> stan fischer, the president will nominate him for vice chairman. you know, you ever have big holidays when your wife is in the kitchen cooking, maybe your mother-in-law is in the kitchen cooking. he's a smart guy. market loves him. is this too many cooks in the kitchen?

>> i think that is the problem. he is great guy. stan fischer is a brilliant, should be in the fed, but you know, he maybe should be fed chairman. >> cast a big shadow. >> we have a fed chairman, janet yellen. we don't need two fed chairmen. that's going to be a big problem for her moving forward. >> let's digest. good news, good news, good news, bad news. lately most of my sources, pretty big traders say the fed wants out of qe. the rest is information. your thoughts? >> i think so. that was clear in the december meeting. the fed wants out. they're going to look at the data. they're going to massage the data to get out of qe. now they have a bigger problem. 2 that is their guidance. they want to tell us they're going to raise rates when we get to 6 1/2. we're going to be there next month. >> don't lose your train of thought. let me see. the power of a $4 trillion balance sheet against the power of guidance. i'm seems like david and goliath. you were talking agent the unemployment rate. >> we've got a million people

rolling off of unemployment insurance. that's going to drop the participation rate even more. that's going to drop the unemployment rate. >> what you're saying is in a couple of months it's going to be whatever the target is. maybe low sixes. what does it mean? >> it means we have no guidance. the fed thought we would be there in 2016 and then talk about raising rates. we might be there next month at this point. are we back to the fed makes it up as they go along? >> you don't think there's this master plan there? it certainly sounds like it's kind of, you know, thinking about it? >> they're making it up as they go along. right now they have no guidance. we're already at our -- very close to target. >> not for the right reasons. >> exactly. what's the metric they're going to raise rates? nobody knows. >> today a lot of big economists, you know, from the top of the academic tower cell dismissed this number. you say maybe the numbers they like, adp, ism should be dismissed. you have a theory. tell us. >> let's take adp. it hasn't beening rate for month to month to years. it's still not accurate witness

today. ism, ism, the word is this is the word, that up to a third of the people in the survey have no longer in the survey post crisis, post 2008 because either went out of business or emerged. so it always reads much better and with claims you've got big seasonal factor which i know you talk about every thursday as well, too. all that data is flawed. you're going to take all the flawed data and say we like that so we're going to ignore today's number. >> it sounds like pick and choose to me. jim bianco, you're the man. back to you. >> i'm going pick it up here because i want to share bill gross' tweet. the bond king of pimco sharing his thoughts on the jobs number. whether or not influences report? a little perhaps but not the anemic wage growth or decline in workweek which we saw 3% growth gdp for all of 2014 a challenge. so there's bill gross' perspective. not too happy about what we saw when it comes to the jobs market. coming up, could bitcoin

soon become legal tender in the big apple? the state is holding a hearing on the currency and at some point could actually issue bitcoin licenses to different businesses across the state. could it really happen? and just how would it work? we'll tell you next.arned the moon in 1971. orbitg afghanistan, in 2009. on the u.s.s. saratoga in 1982. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve. [ male announcer ] here's a question for you:

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who found a magic seashell. it told him what was happening on the trading floor in real time. ♪ the shell brought him great fame. ♪ but then, one day, he noticed that everybody could have a magic seashell. [ indistinct talking ] [ male announcer ] right there in their trading platform. ♪ [ indistinct talking continues ] [ male announcer ] so the magic shell went back to being a...shell. get live squawks right in your trading platform with think or swim from td ameritrade. coming up, the market is living in the land of confusion today after this morning's surprising jobs report. not to worry though. we're going to find out how the pros are playing it. target is in the crosshairs yet again.

more information about the company's data breach is coming out and it's not good. we're going to get the latest details, plus find out which stocks could be impacted. it's only the second week of 2014. our playbook playoffs leaderboard is moving like crazy. we're going to find out who is in the lead now. who dropped the last place, and who might be making a trade already. it's all at the top of the hour. see you then. as federal regulators and lawmakers begin to wrestle with what to do about bitcoin and other virtual currencies new york top financial regulator is ready to take the crypto currency head on. he is a superintendent of financial services for the state of new york. joins us now to talk about bitcoin. share with us an announcement that you're working on on this front. >> sure. so later this month, january 28th and 29th, we're going to have two full days of hearings related to bitcoin and the regulation of bitcoin, whether there should be a special license for bitcoin, things like that. we're going to have -- it's going to be really two full days very intensive.

360-degree view of everything bitcoin. we're going to academics, technical people, we're going to have law enforcement, we're going to have beam in the industry, investors in the industry, really dig deep into understanding everything bitcoin to decide how we should be regulating this. >> everybody is trying to do this. carl and i spoke to tom carper, senate homeland committee, earlier this week. they've been holding hearings, a number of congressional hearings have already. why do you have to take this up at the state level? >> i think we're going to need a lot of coordination between state and federal regulators. money transmission has been traditionally been regulate bid the states. now we're going to have this new question about bitcoin and how it should be regulated and primarily released in the beginning at the state question. bank secrecy act issues which are both state and federal issues. the second point is i think the federal hearings have been largely about law enforcement efforts thus far. again, our hearings are going to

be a little broader and really look into not only law enforcement but also the markets, how they should be regulated from a regulatory side and not just law enforcement side and understanding the technologies, understanding where it's going, where it's been, and what we should be doing. >> all that said, you've spent time as an assistn't u.s. attorney for the southern district. you've looked into white collar crime. how much of this is going to focus on the currency's ability to make white collar crime easier? >> i don't think it's going to be the main focus. at the same time, i think it's very obvious if we don't regulate bitcoin in the right way, if we don't regulate other currencies in the right way they could become a place where you're going to see a lot of bad conduct and we've already seen it. seen a couple of cases in a place where i used to work in the southern district already. manhattan d.a. is working hard on these issues as well. there's no question that a lot of the an themity that virtual currencies provide can lead to real problems. the question is can we allow

virtual currencies and all the new technologies to grow? we want new york to be a place where the companies are coming. and thriving. at the same time, putting the rules of the road and the protections to make sure we don't have money laundering. >> what is a bit license? >> well, it's a term we've been using for this question of should we tailor our licensing procedures. right now we license money gram and western union. should we have a special license when it comes to money transmission with virtual kurnsz si. >> what's the answer? >> the answer is that's what our hearings are going to look at closely and examine. >> do you think -- you're going to answer the same way. but is bitcoin on a path to be an accepted currency long term? >> i think that's the million dollar question or the -- >> question we don't know. >> we don't know. we'll see. >> if you can successfully eliminate some of the criminal capabilities of bitcoin, if you can ledge mize it with things like a bit license, does that mean you want to ultimately see more transactions in virtual

kour currencies? >> you might. what people haven't been talking at yet is this. by delving deep into bitcoin and the virtual currency world we also are going to have a stimulative effect on our money transmission rules and the money transmission market in general. right now you have a bank account, you want to transfer money online from your bank account to pay your credit card, it takes two or three days. that seems odd. it seems like we could be doing a better job as -- in the world of financial technology. and it's a big market that's growing. we want it to thrive here in new york. regardless of where bitcoin ends up at the end of the day, i think really working on how we set the rules of the road that prevent problems that allow these technologies to thrive is going to improve things for everyone, take some frictions out of transactions. make our mobile banking -- mobile payment systems better. >> cross roads of different things. you mentioned jobs, innovation, but also protecting the

americans from abuse. we'll be watching closely. thanks for coming? >> thank you. >> joining us from the new york state financial services superintendent's office. as today's jobs number shows the job market in the u.s. still struggling, when you take a closer look, the job market is especially tough for recent college grads. today's squawk breakthrough is looking to change all that by making it easier than ever for grads to get a job. tdd#: 1-800-345-2550 trading inspires your life. tdd#: 1-800-345-2550 life inspires your trading. tdd#: 1-800-345-2550 where others see fads... tdd#: 1-800-345-2550 ...you see opportunities. tdd#: 1-800-345-2550 at schwab, we're here to help

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good a good read on jobs today. the u.s. economy adding 74,000 jobs in the month of december. according to the national fed, the job marked for recent college grads remains challenging. that's where today's squawk breakthrough comes in. designed for college grads that creates a recommendation system similar to pandora. the founder and ceo of college beat joins us this morning from palo alto. good morning to you. >> good morning. thank you for having me. >> that pandora metaphor makes it clear. for 50 years the job search once you get out of school has not

changed at all. >> that's exactly right. you know, it's particularly hard for millennials today because it's a triple whammy. you wednesdspend money going th college and wrack up college depp debt. they're either unemployed or underemployed. >> launch in may of 2013. you now have tens of thousands of active students and new glras on the site. how do i use it? how does it translate to me ideas of things i should be looking at? >> absolutely. so the way it works is that we help college grads and young alums and current students really showcase themselves through a rich college feed profile and tell us what they're good at, what their skill sets are, even if they don't have a lot of work experience right now. we take those signals and we use technology to go ferret out all the jobs out there, all the companies in our network that will looking for college grads like them because we have very strong employer network that has told us here's the skill set i'm looking for, here are the college grads i'm looking for.

and we save them a lot of time and trouble by essentially taking an individual profile and sending it out to all the right employers that are looking for people like them. so it's sort of like pandora in the sense that as a college student i may have heard of a few companies, may applied to ones that i think i like but there are a whole host of other companies i may have never heard of but are looking for people like me. >> i get how it's different than linkedin. still, that is the giant here. how do you compete with such a force in this job market? >> right. you know, the biggest difference between us and linkedin or monster is the fact that we're a connection service and we're not a job board or resume board. hope is not a good strategy. if you're out there you put your resume somewhere or you post a job somewhere, chances are it's a shot in the dark. suffering from a black hole problem of students apply for hundreds of jobs and never hearing back. with t. way we compete is adding

value beyond what a job board or a resume board does. it's us promising to a student, hey, look, if you do a good enough job creating a collegefeed profile we will do the work for you, we will take that profile and send it into the inboxes of ceos of small companies, of large companies that are looking for people like you and so the difference is that on both sides, one packaging you as a student and making you marketable which we don't see any job board or resume board do. on the other end making a drop dead simple for an employer to start receiving feeds of qualified students without having to do much. >> you've run some marketing some google. you worked for mckenzie. it sounds like this is a business you could easily run on your own. on the other hand, it sounds like a natural pick-up for something like linkedin. you want to remain independent or sell to somebody else? >> well, look, no entrepreneur starts the company thinking i want to be sold or they shouldn't be. for us, we want to solve the hard problem which is to make

millennials, young alum, college grads, more employable. so if it's best done independently, we'll do it independently. we have to desire or any particular need to be acquired. i have sold two companies before, so i know how that's done. but that said, this is a problem we're really passionate about and we want to solve this problem with linklinkedin, with other partners, whoever comes along but the goal is to solve this problem for millennial sglsz what types of jobs are there out there for recent college grads? how quality are they? >> right. so iks you know, the the obvious ones, tech jobs, jobs in finance, jobs in design, everybody knows about them. some of the learnings we've hadded a collegefeed which are different is liberal art students believe there aren't that many jobs for them out there. i'll give you a couple of anecdotes. connected a bunch of english majors and journalism majors to tech companies that are looking for good writers. that's a classic example of a little chain that's really not that well created.

and so there are jobs obviously in tech, there are jobs in finance, there are jobs in marketing. but then it's really the long tail of jobs in writing. the long tail of jobs in design that we're helping students with as well. >> interesting stuff. we'll watch you closely. thanks for stopping by. >> thank you for having me. >> college dl fefeed. let's go to eamon javers in washington, d.c. >> carl, that's right. "the washington post" just within the last couple of minutes here or thing new news on the health care beat saying that the -- according to the "washington post," the obama administration is now prepareded to jetson cgi federal. that is the company that was responsible for the healthcare.gov website which has been to plagued with difficulty fps "washington post" reporting here within the past couple of minutes that federal health officials are now preparing to sign a 12-month contract worth roughly $90 million with accenture after conclude that

cgi federal has not been effective enough in handling the problems of get that website up and running. so accenture looking to be the big beneficiary here on the corporate side from this contracting change at "the washington post" is reporting right now. carl? >> all right, thanks for bringing us the breaking news. coming up, a pretty surprising read on jobs this morning. and u.s. economy only adding 74,000 in december. so, did you nail the number? we'll talk with this month's nail the number winner when "squawk on the street" returns. over the pizza place on chestnut street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i-95. ♪ this magic moment it is the story of where every great idea begins. and of those who believed they had the power to do more. dell is honored to be part of some of the world's great stories. that began much the same way ours did. in a little dorm room -- 2713. ♪ this magic moment ♪

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we got the jobs numbers this morning and after sorting through the guesses we finally have a nail the number winner. kevin paul came closest to the number with a guess of 105,000 on january 8th. >> got knot t bad. >> not quite 74 but closer than anybody else got. kevin joins us this morning on the news line. kevin, congratulations. >> thanks. even wasn't pessimistic enough. >> i'm told you saw everyone trending hi. you decided to go low. it's actually the second month in a row you've done that. >> right. i've just went count ter trend. i would expect the december number to get revised higher in

the future reports. what are you seeing out there, kevin that makes you so bear risch on the economy and what are you seeing that wall street economists are not seeing? >> i'm not bearish at all. i think the economy is recovering fine. i think the government, their numbers, you know. >> it is like the lottery to some degree. and it's the only number we have. we have to go with it. we all know sort of the circus like atmosphere that surrounds it every month. i'm told you're mr. mom. you trade from home quite a bit. you have a couple of favorites. united and cablevision. i understand united which has been a thing of beauty. what do you like about cablevision? >> cablevision i really think that down the road maybe time warner, cable, in order to fend off the charter and malone will step in and buy cablevision and get the dones out of the picture. >> how long have you been riding

the airlines? >> for the last year. so it's been a great year. >> what about twitter? how do you use it for trading? obviously you tweet and you follow cnbc and the shows and we appreciate it. how does it change your life as a trader? >> for twitter, i follow it but this is probably only my fifth tweet. >> really? >> yeah. >> beginner's luck, as they say, kevin. >> exactly. >> congratulations. enjoy the clock that cramer and faber and r and all of us have signed. it will keep you honest as to when "squawk on the street" starts in the morning. congratulations again. >> thank you. thanks. >> kevin paul, our nail the number winner this morning. not bad. 105 versus 74. nobody else -- people weren't close at all. >> economists right now, the researchers are coming out and trying to figure out how this number happened. yes, temperature. the cold weather played a role. but there are other factor there's to worry about. lower labor participation rate. didn't see the bump up in wages they were expecting and other factors.

>> we do have breaking news on nasdaq, by the way. nasdaq expects options trading to restart at noon after an earlier halt. we're still sorting through some of the detail on that story. that's the latest from ndaq. have a great weekend. >> have a great weekend. >> see you next week. let's get to headquarter and scott wapner and "halftime." >> our starting lineup today is pete, joe, mike murphy, and stephanie link. let's get sdrtraight to our gam plan. moving target, the staggering new numbers have just how many customers were effected. playbook playoffs. which traders portfolio is in the lead now and what picks is the panel giving up on already? buzz kill of the employment report. only 74,000 new jobs created. stunning disappointment for those looking for more than 200,000 jobs. so the question now is what does all of it mean to the markets and your money? pee pete, to you first. >> i think in