>> i mean, hopefully it's worth it. i hope she enjoys this little baby she has now. >> that's joe's way of saying he misses you. >> the rest of us pay. >> have a great weekend, everybody, that does it for us. right now it's time for "squawk on the street." ♪ good friday, morning, welcome to d"squawk on the street." cramer is back on monday. big interview coming up this morning. hewlett-packard chief meg whitman fresh from better-than-expected earnings last night. we'll get an exclusive update on hp's turnaround plan which, david, appears to be going pretty well here along with the stock. >> the stock has certainly been a very strong performer. plenty of doubters when you read the notes, carl, from the sell side. i would not say they have the wind at their back to a certain extent in terms of the longer turnarounds and whether they can

really make it happen. but quarter after quarter the company has been able to deliver with a surprise when it came to sales for pcs which we know are in decline but perhaps not quite as much decline as we'd anticipated particularly on the commercial side on notebooks where they choed real strength. that did help the quarter and on the revenue side, printing went fairly well. they did come ahead on revenues and on profit. >> one of my favorite notes morgan stanley saying they are achieving the impossible keeping expectations low while increasing revenue and cutting costs and investing and so forth and cash as well. we'll talk a lot about that with meg in a minute. the futures are up a touch which means the s&p could post its first three-week win streak in three months. meantime, we're keeping our eye on the ten-year yield and overnight in asia the nikkei was almost up 3% as the markets liked the manufacturing data out of the u.s. yesterday. first up, though, ukraine's government said a tentative resolution has been reached to the crisis that has brought days of violence to that country's

capital. nbc news correspondent jim maceda is in moscow with the latest. jim, good morning. >> reporter: hi, carl, well, that's right, i got to see a hard copy of that draft deal, and it does include early elections in december of this year, a return to the 2004 constitution. that's the one that has some decent checks and balances, if you will, until yanukovych gutted it in his direction, the formation of a coalition government in ten days as well. but there's clearly tension between the opposition leadership and the -- what they call the representative council of the protesters actually on independence square. they were not happy at all with this draft because it keeps yanukovych in power for at least ten more months. his resignation you recall is what they called non-negotiable demand, certainly of many of the frontline protesters, especially now, they say, after what's happened in the past 48 hours,

the dozens of deaths, hundreds of wounded at the hands of riot police. but, still, after hours of intense lobbying by two -- three at one point eu ministers to close the deal, it's now about to be signed. still, the eu ministers point out that this is just a draft deal. it's an initial thing, not a full-blown signing, and they call it a starting point, if it is, it will have a long, bumpy road ahead. and to just to make that point, carl, almost immediately the extreme nationalist group called right sector who have been doing much of the hardcore fighting of late, they came out, rejected the deal, saying that, quote, the national revolution will go on. back to you. >> okay. jim, thank you very much. jim maceda there, live from moscow. let's just have a look at some of the other big tech earnings that we have this morning. priceline reporting fourth quarter operating profit of $8.85 a share. that beats wall street's forecast by a good 53 cents.

the travel website helped by stronger bookings and higher profit margins. meanwhile, groupon down sharply in the premarket despite having better-than-expected results for its fourth quarter, the daily deal's website forecasting a surprise loss for the current quarter as it increases its marketing spending in order it hopes to grow its customer base. and we'll have a live interview with groupon ceo eric lefkofsky later on "squawk on the street." just pick up on priceline today because that continues to be very interesting stock. higher despite the fact that its outlooks slightly soft. able to maintain the momentum on the international side which, of course, where it's basically coming from and also taking bookings.com from amsterdam to here, successfully picking up market share, albeit with a very heavy advertising spend. jeffries, evercore, a lot of people raising their targets this morning on priceline. >> and we'll talk to the ceo later on this morning. but surprise loss they see for the current quarter. a lot of discussion about

groupon goods as they move into basically an entirely new business. and ongoing worries about their distribution chain, long delivery times, their infrastructure, stocks going to open down this morning, but what a story that has been. >> yeah. >> ever since the ipo. >> ever since the ipo. of course, there has been a burgeoning story that they are in a significant turnaround that will be met with success, but this morning as you point down, the stock down over 10% there, 12%. >> and the volume yesterday, monster volume on groupon. >> mark mahaney was suggesting they are trying to be a jack of all trades here and it's unwise to invest so broadly, they need to find what they do, what the message is, what the vision is, stick to it and double down on it. to the point you made earlier, is not what they are doing. >> right. when we come back live and exclusive interview as we head with hewlett-packard's meg whitman. "squawk on the street" back in a moment.

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and there are no networks. you do your push-ups today? prepare to be amazed. [ male announcer ] don't wait. call today to request your free decision guide and find the aarp medicare supplement plan to go the distance with you. go long. hewlett-packard shares as you can see are trading a bit higher this morning in the premarket, that after the company showed its second consecutive quarter of profit growth when it reported earnings after the close yesterday. that was helped by its pc business. meg whitman is the ceo of hewlett-packard, she also, by the way, one of cnbc's 200 contenders and we're always glad to have her after each quarterly earnings report. good morning, meg. >> good morning, david. >> let's start with pcs. in your comments on the conference call that followed your earnings report yesterday, i think you used the words the

contraction is slowing. you also saw signs of strength in commercial. are we at the end of these dire predictions that the pc market is going to continue to contract at a rapid rate? >> well, it definitely is -- the market is definitely getting better. and i think it's a couple of reasons. there is the windows xp refresh which we capitalized on well. and also i think business is understanding and employees are understanding they may want a tablet, but they also need some of the more traditional compute devices to get their work done that is going to be required in this world of big data and analytics. so, you know, i do think that we're going to see a little bit more brightness in the pc market, although ibc and others do forecast a continuing decline in the continuing pc market, so our job is how do we have great devices that employees and consumers want and, you know, try to gain share in a very tough market. >> right. would you think this bifurcation will continue where you may see more signs of strength in commercial versus consumer? >> we do think.

commercial is our place that we can -- we have a right to win, david, we've got an incredible distribution. we can help cios solve security, manageability, containerization, so we have a real value proposition at the consumer level. we'll play i mean, i at the commercial level, we'll play in consumer, but commercial is where we have a right to win. >> in your comments on the conference call and your cfo, both of you mentioned price competition, not just enduring in many of the businesses in which you compete but perhaps intensifying. how is the company adjusting to that, and can we ever expect given that that you're going to be able to post a gross margin or net margin that's higher than what we're seeing right now? >> so, it is a very competitive market particularly in our hardware businesses but actually across the board, so what we have to do is what we've done in the past couple of years we have to be fit for purpose. we've got to make sure that we are -- have an optimal cost structure to compete in this new world order, that we've got our supply chain optimized and our

logistics optimized and we're transforming value right up front to make sure we can compete in the future. this is going to be a very competitive market for the foreseeable future and we can do that so we just have to keep on the productivity efforts and how we organize ourselves to compete. >> you know, i do wonder, though, how much cost is there left to take out of the business, meg? >> do you know what great companies do they figure out how to get more productive and efficient every year, they got to build that mentality into the dna of the company and that's what we're doing. so it's not just a onetime event anymore, every couple of years we take out costs. this has to be year after year and we got to look at it and say how do we get better and build productivity into the dna of the company. we're on the journey there, we're not through, but we're on the journey. >> one of the key areas that you focused on some time ago was reducing head count to a certain extent. i believe you are 29,000 announced cuts that amount to 34,000 jobs overall at the company. are there going to be additional

cuts beyond that in 2014? >> so, we've got to make sure that we are as efficient as we can possibly be in every market in which we compete and in every business in which we can compete. we'll get through the current restructuring and then, as i said, we'll have to build the notion of productivity into the dna of the company, otherwise we'll be outrun by our competitors and we're not going to let that happen. >> a number of analysts who follow the company quite supportive this morning. but you do have the nonbelievers out there, when i have you on, i prefer that you respond to those as opposed to those who are purely cheerleading. here's a note from iss, while management may trade off between revenue and gross margins from quarter to quarter, we believe gross profits is the best indicator of technology relevance by this measure, the picture remains bleak as many customers migrate to alternate or commodity solutions. how do you respond to a criticism like that? >> so, i think the headline for

this quarter is we've made progress and we got a lot more work to do because we have to -- this company will ultimately come back on the backs of innovation. great innovative products, services and solutions, and our innovation engine is alive and well, but we've got more opportunity there. you can look at sop of the products that we introduced in the quarter, cloud system 8, our converged infrastructure, sdn, a number of our other products are very innovative and we've got to stay ahead of the curve because if we don't innovate, we will be commoditized and that's not the heritage of hewlett-packard. this company is all about innovation and i think over the last two years we've done a good job of bringing that core strength back to the company. >> so, to those who would say, listen, we agree with u you bute don't see efforts are capable of revitalizing your revenue streams, how do you respond? >> i say the innovation engine is at work. some people will tell you we have the best product services and software offerings that

we've had in many years that are getting real traction in the marketplace that are uniquely suited to the new style of i.t., everything about technology is changing and we're pivoting the company to these trends. and it takes time because we've got big, important legacy businesses. but, boy, when you look at our cloud offerings or our big data offering and haven, our security product ute, arc site, tipping point, fortify, three-part storage, these are perfect products for this new style of i.t. that go right to where the market's moving and we have -- we have to do that and we have to be willing to cannibalize ourselves, because if we don't, someone else will, so we have to manage this transition from our big legacy products to where the market's going and i think we're doing a good job there. >> you do. again, one of these -- another note this morning from cantor fitzgerald on this very subject of i.t. spending growth, they claim they did not hear evidence from the company on the call last night that you are

repositioned for this next wave of i.t. spending growth. i assume you would dispute that notion, and i'll give you a chance to do that. >> well, remember, hp's a big company. we've got a lot of legacy businesses. and so this transition takes time, so i think we've made progress. we've got a lot more work to do, and the financial architecture over the next three years has to reflect the ability to generate real revenues very rapidly in these new businesses, manage the legacy profit pools, and make sure that we start with what our customer needs and work back. so, we're on a journey. there's no question about it. i would not declare victory. i think we were clear about that yesterday. a lot of progress. more work to do. >> no. as you have been throughout the two-plus years, of course, you've been at the helm. on this idea of the commoditization of a lot of your product lines, lenovo which is typically very aggressive on price, closing up the acquisition of ibm's low-end server business. i don't think they've closed it yet, but they will be in the market. is that a concern to you?

>> listen, i worry about every competitor and lenovo has done a good job and so what we need to do is take advantage of the uncertainty in the marketplace. what i know personally is when there's uncertainty, there's an opportunity. and we look like the paragon of stability at this juncture relative to what's happening at ibm and lenovo is biting off two big acquisitions so in the short term we need to capitalize on that. in the long term they'll be a tough come pet interwe need to be ready to compete and we've seen the movie before, so i think we can be better positioned than we were last time around. >> when you say that, what do you mean you've seen the movie before? >> on the pc space, lenovo came into the market and has done a good job and we need to make sure that we are fit for purpose. and also i would say that servers are different than pcs. we have a long tradition in this business. i think we've got some of the best server engineers in the world and so we'll compete and we'll compete hard. >> give me a sense as to what you're seeing in the marketplace

right now. we talk every morning here it seems about the bad weather. i wouldn't necessarily think that impacts you, but i might be wrong. you know, you always give us a good view as well of the world, europe i know has stabilized, but just take me around the world in terms of right now which the hp is seeing to the extent you can share? >> yeah. well, i'd say the bright spot are the developed countries in western europe, you know, france, italy, germany, the uk. the emerging countries in europe are a little bit weaker, but we see europe coming back. in the united states, brazil's very challenging, the u.s. continues to move along, i'd say on the margin getting a bit better, but still hard to predict from quarter to quarter. in asia, our business in china was flat relative to our competitors' that was a good result, so we're quite happy with what -- how we see things unfolding in china. japan, tough, because of the currency situation. south pac tough, but bright spots in some of the smaller markets in asia. and india was a bright spot for

us. >> right. >> so, it's a very mixed bag. >> is that one reason why -- i know you raised the low end of your guidance for the year in terms of non-g.a.a.p. earnings, why didn't you given the last two quarters have been fairly strong certainly versus expectations, why didn't you go even higher in terms of guidance? >> well, effectively we did raise the guidance, the midpoint is now 2.5 cents higher, but we are taking some of that overperformance and investing back into the business in terms of systems and tools to make sure that we are positioned in the in the company for the long haul. i think i've been really clear from the begin that we're trying to set hp up for the next 75 years and build the foundation, make the foundation very strong, so as we begin to bring the company back, there's a strong foundation and that's going to require investments in some of the overperformance back into the business to make us stronger. >> right. and i think you -- i think i remember from our many interview, meg, you have indicated that next year

certainly, and i don't want to put words in your mouth, will be potentially a year for growth. i mean, this quarter there was on a constant currency basis for the first time since the second quarter of 2011, 0.3 percent growth, but it was revenue growth. are you setting up for what will be consistent revenue growth and profit growth for next year? >> it's a little too early to give you a guidance for next fiscal year. but our objective over the long haul is to return hp to growth. that has to be part of our overall strategy. and as i said, as we pivot to the new style of i.t. these are going to be growth businesses for us that have to be balanced against some of the older legacy businesses, but in the end we have to grow hewlett-packard. >> a couple of other housekeeping notes here. autonomy, we've yet to hear very much about that. it's well over a year ago that you first shared with us your concerns about the accounting there to say the least. where is that investigation? and many two have expected would have advanced by this late date. >> so, the wheels of justice do

turn very slowly. the doj, the s.e.c. are looking at the case, as is the serious fraud office in the uk and we're cooperating with the authorities. so, these things take time, but we're, you know, doing everything we can to help the authorities and are confident in their ability to understand the situation. >> do you think that there will be charges brought against autonomy's foreign management? >> you know, it's hard to predict, but, listen, what we know is that there were very significant strategic misrepresentation. hardware was accounted for incorrectly. there were deals with value-added resellers that were not genuine sales, and i think that the authorities are going to see what really happened here. and it's a shame really because autono autonomy's a great company, with tremendous products, but previous management made shortcuts that, you know, undermined the -- or tried to mask what was really going on with the financials as opposed to work to build the great company and that's what we're

doing. this is a great business. we just released idol ten which is the next generation of their unstructured data search, and we just introduced data protector 8.1, so we're investing in the business and we're seeing good results. >> you know, it's almost a year, not quite, but in a few months since ray lane left as chairman, and as an interim chairman coming up on a year, i would assume you'll have a new chairman soon? >> ralph's doing a great job for us and stepped in at a difficult time for the company. and, you know, we like working with ralph. we'll see what happens over the next year. you know, ralph, this is not ralph's profession. >> yeah, right. >> he takes on different companies as projects over time and he's been a real value add to hp. >> all right, so doesn't sound like there may be anything new there. whatsapp, i just have to ask you, you're a veteran of silicon valley, of course, you were instrumental in the growth of ebay, one of the darlings that we watched so closely back in

the 1990s. what is your take on a company that sells for $19 billion? only a third of the value of hp, as i figure it out, that you have 6,000-fold the number of employees. how does that go over there? >> well, listen, i think facebook has proven that they have a great business model, mark zuckerberg has proven to be a good chief executive and he is betting on mobile. and this company i think he thinks furthers his mobile platform. i can't comment on the economics of the deal. obviously not really privy to how they came to that valuation, but i think mark's done a good job and he deserves the benefit of the doubt. >> you believe the bet on mobile is the right bet, i would assume. >> absolutely. the world has been and is going mobile. we're making a pivot towards mobility not only in our devices but in other parts of our company. and so it's -- it's the right bet. there's no question about that. >> all right, meg, listen -- meg whitman, you are one of our 200, of course, that we're trying to

figure out for the top 25 business leaders over the last 25 years. i think you are competing, though, against pierre omidyar, do you think pierre should get the vote over you? >> he was the founder of ebay, he created a fantastic company, if i had to pick between me and pierre, i'd pick pierre. >> all right, very well done. meg, as always appreciate your time, and your giving us that time today. thank you. all right. the ceo parade will roll on, later on thing groupon co-founder eric lefkofsky, one more look at futures. nbc reporting, by the way, the two sides in ukraine have signed the compromise deal and the government forces will start pulling back from the front lines. we'll see if that affects trading in europe and here when "squawk on the street" comes back.

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minutes. interesting dynamics setting up, a lot of corporate news but we are keeping our eye on kiev, ukraine. the news breaking that the president and the opposition have, in fact, signed the compromise deal you probably read about earlier this morning. a presidential adviser saying that the government will start pulling back from the front lines. they will be calling for armed people to be taken off of the streets. but still a lot of skepticism about whether anything will change unless yanukovych leaves. there have been reports of people chanting in the streets that he still must leave. subpoena, by the way, continues to see a default in their rating, report today and the state department has authorized the departure of family members of the foreign service, workers at the embassy. so, hard to tell whether or not this story is over by any stretch of the imagination. >> i guess it really is in the hands of the opposition, the degree to which the elections

may be called. >> yeah, also some discussion about to what degree is putin standing by him suggesting some sort of deal with the west. is he leaving yanukovych out to dry so to speak? >> or whether putin would like to have the ukraine has part of a greater russia? maybe he will speak more freely on it once the winter olympics are over. >> but clearly with 75 dead, some of the worst fighting we've seen in that country literally since world war ii. a couple minutes before the bell, just to recap david's interview with meg whitman a couple minutes ago. headlines, europe coming back? >> yeah, europe's stronger as we know or at least stabilized. listen, meg sounding many of the same themes that she has in her many appearances over the last two years that we've had her sort of regularly come on with us, in terms of we're not there yet, we're not done, we got to keep focused on cost, we've got to keep focused on innovating. but there are a lot of doubters out there, i will tell you. it's interesting.

but they've been doubting as the stock is up 100%. >> up 44% since leaving the dow. my question on twitter this morning what has been mr. painful ackman on herbalife? it has not been something to short. >> no, it has not. and there's a feeling that they are at an inflection point, okay, are they really going to show the growth that will bring in new investors who will then say it is cheap at seven times because they actually have some real growth. or are they not really innovating enough. can they not compete in these commoditizing businesses where it's all about cutting costs. >> it was very interesting that she came to the interview wanting to talk about cost reductions embedding it right into the company how it would invigorate and you led her to innovation almost as a secondary thought, where if you are in that space innovation should be your primary thought. >> certainly they've been stressing it. but it's a different construct to the end customer particularly on the business side in terms of what they want from you. they're not about speed any longer, they want a whole software solution to their -- to

their business problem so to speak on technology. >> all right. a few minutes until the opening bell here. as we said earlier s&p is on track for three weeks up in a row, something we've not done in about three months. there's the opening bell. and a look at the s&p at the top of your screen. down here at the big board, nrg yield ringing the ringing the bell and nasdaq, national general holdings celebrating their new listing. we'll keep an eye on that. speaking of energy, the energy concern on the cover of "the journal" today, david, bad calls made in the nat gas business years ago coming back to haunt them. >> i tell you, man, when you see the record set on the largest lbo of all-time you typically want to walk away, unfortunately for kkr, they've been part of both of them, the nabisco deal which was not a bankruptcy by any means but certainly did not end up being a home run. and the old txu which you point out coming closer and closer to

filing. $8 billion in equity from kkr and it was tpg. i remember that story. i think i broke that story. coming right at the height of the boom. of course, their expectation was that natural gas prices would rise. somebody may not have informed them fully about fracking. >> right. >> little early. >> and it's gone far off plan to say the least. >> they wrote off the equity long ago to a zero but it's still extremely important, not to mention the energy market in texas. >> retail continues to be a story. nordstrom one of the worst performers on the s&p. $1.37 does beat by four cents. the full-line comps, though, down 33 and a full quarter in a row they've been unable to post positive comps. they had silver linings. online sales up 30% and more of their cap-x, 30% of their cap-x will go to technology over the next five years up 20% historically but that will be a loser today as retail's in the

news whether it's nordstrom or amazon for that matter. >> yeah, amazon is very interesting. a couple of reports we have out today one that it's going to come through with this new set top box to enable people to more easily migrate between internet offerings and regular television to counter the likes of rocu and they'll take big retail brands and you'll be able to access the likes of nieman marcus through their site. obviously very attractive for the retailers, 240 million customers on amazon and i guess they'll take some sort of revenue share from that. >> right. >> it's not clear how many will take the opportunity. it's a deal with the devil, you get access to an enormous customer base, the platform which is completely unrivaled. they are not third party merchants, they would simply be sending you to their website, nonetheless, amazon and it's incredible what it can do in big data will get all the information on the behavior of its customer base and time and again amazon figures out a way to compete whether it's with its

third party merchants or there. it will be interesting to see what the choices are, because it is a great opportunity, but there's also cost that comes along. >> somebody like "the journal" mentions ralph lauren which has some prestige to maintain, it's not cool to be selling in costco or amazon, but that's where the comps have been and it will be interesting to see how many of these retailers look at their own comps and say you got to go where the money is to quote willie sutton, right? >> and the eyeballs, exactly. >> and actually in fairness, if you are already on amazon, to go to ralph lauren is going to be a step up. it's not like you are taking ralph lauren customers and pushing them to an amazon website, is it? they don't have to go through the portal. it doesn't necessarily damage the brand if you are on amazon, it will take you to ralph lauren. >> that's -- somebody might make an argument that it dilutes exclusivity, who knows, i'm not in retail. >> amazon starts saying, oh, look, everybody's buying ralph lauren, let's do a ralph lauren

knockoff and put it in the buy box. it could happen. i did want to note juniper networks which after the close i believe it was yesterday announced a series of steps that contributed to a rise in jnpr stock price this morning not that significant a rise, but nonetheless a rise. j juniper calls its integrated operating plan and returning a minimum of $3 billion of capital to holders in the next three years, more than $2 billion in share repurchases through 2015 and the dividend will start in the third quarter of this year, streamlining its operations. a lot of this, by the way, was proposed by elliott, they were an activist with the shares. the stock has been up and is up yet again. they seem to have adopted much of that plan. >> whole foods, well, more than half of a percent. 52.69, oppenheimer initiates with an outperform arguing they are in the best position to gain market share in what we all know is a growing business for organic food. stock still below the 50-day and the 200-day, it tumbled a while

ago after earnings and some expectations about comps came back in. and keep in mind under armour, kevin plank with scott wapner on sqoks boston red sox renewing their deal with u.s. speed skating until 2022 saying the cover on "usa today" that the brand has been dragged through the mud. the stock's held up. >> so clever to get ahead of the them coming back, to actually have extended the deal so when they come back and bemoaning the fact they didn't do better and arguably blaming under armour, people say the deal has been renewed. very clever pr. >> a day after the whatsapp deal facebook shares which were up yesterday after being down in the early part of the session, are, let's call it, flat. plenty of people still talking about that incredible deal, of course, $16 billion perhaps $19 billion if and when they pay that restricted stock over time to the 50-plus employees that are going to join facebook and a lot of interesting stories about the founders of whatsapp. always interesting to hear some of those stories in terms of

immigrants to this country and what they've been able to do, you know, i mentioned pierre earlier, another immigrant. it is truly remarkable and amazing that we have no immigration bill, by the way, i would add but that's probably a story for another day. >> it really is. the interview today with satya nadella in "the new york times" talking about the lessens he learned from steve ballmer and bill gates, right? you are talking about diversity at a very rarefied level, immigrants, running our biggest countries. >> it's what this country does very well, renews itself unlike others don't. can i mention express scripts, the big pharmacy benefits manager came through with earnings, by the fact that united health, of course, was lost as a customer and also the big deal they are betting down there at the medco health solutions also weighing on the profit. express scripts falls i believe today, carl. >> we are going to get some data out of 10:00 and the conversation will continue i believe whether or not the

weather is masking true improvement in the economy. we've had some pretty good data this week. the market flash, delinquencies are down, foreclosures are coming in and credit is being created among u.s. households, but if it warms up in some of these and businesses don't improve, it will change the conversation. >> for what it's worth i did two interviews in two areas of lodging where they've actually got good figures at the moment, marriott's ceo was commenting on how the bad weather had actually been good for them as did choice hotels with those 7,000 franchises around the country later in the day, so some always benefit, of course. home depot may benefit. it's not a one-way street. >> with all that, dow's down ten points. let's get to bob pisani. >> the dow is down but the s&p is fractionally to the upside and we could have three weeks of that in a row depending on how we end and some people are wondering why given the sort of mediocre economic data, and the

russell 2000 have been leading as opposed to the big cap groups like the s&p 500. bottom line is this nobody wants to sell on up days and buying a fairly restricted on the down days. we'll see how long that lasts. meantime, i want to comment on the ipo situation. we've had a big spate of medical and biotech ipos in the last few days. we had another one overnight. similar scientific does blood flow measurements in office, it was priced below expectations. we had six ipos, medical, biotech ipos last week and here you could see a very mixed reception. three of -- there's six of them, because only five of them up here, but there's six of them actually out there. almost all of them were to the down side. only two were to the upside. i think at the moment the flood of biotech ipos is waning and instead we'll see a lot more tech ipos in the next couple of months and certainly what happened with facebook and whatsapp is going to give an impetus to anybody out there especially in the social media space to try to get their stock out there and maybe get a higher

valuation. there are buyers in the market, that's what that whole deal with facebook told everybody. in the meantime, let's walk through some of the earnings situations. we had four companies with disappointing guidance for 2014 or at least for the first quarter. nordstrom below expectations. that's trading to the downside. i'm talking about their guidance for 2014. same with mohawk, of course, the home furnishing company, disappointing first quarter guidance and they talked about the harsh winter as well. grouponbeat, but they are talking about a loss rather than a gain. that's a bit of a disappointment even though the revenue guidance was a little bit stronger than expect expected. that is correct down 15% for groupon. and priceline is very interesting, they also guided below expectations for 2014, but a lot of the analysts are saying the guidance is typically conservative. this is how you work it on the positive side. bottom line is they did have a great profit growth for the last quarter here. finally i just want to close and give a little bit of kudos to warren buffett and the management team at businesswire. this is a company that he owns.

"the wall street journal," some other publications are reporting that businesswire is going to stop giving high-frequency traders direct access to corporate earnings. you know, many companies use businesswire to report their earnings. businesswire then turns around and sells it to the media companies, to the dow jones of the world. the problem is, direct access through businesswire gives you a microsecond advantage before you go to the other media outlets and, of course, high-frequency traders and others pay for that, they decided to discontinue it. i think it's the right response. i don't have any particular problems with high-frequency traders, i do have problems with people getting access to information before other people and certainly generally, david, i'm sure you'll agree, if there are any abusive practices going on independently of all of this in high-frequency trading land, they should be investigated. back to you. >> yep, no doubt and you've are covering that so closely for years now, bob. thank you. did want to point out this morning that the biggest deal that we've seen the last year, in fact, of many years has closed this morning.

that is verizon's purchase of 45% of verizon wireless that it didn't own from its longtime partner vodafone. verizon saying as they have before and reminding us that the deal is going to be accretive to its earnings by about 10%. that's excludeing in nonoperational adjustments to refer, again, or remind you, they're issuing 1.2747 billion shares to shareholders of vodafone. that's the stock portion of the consideration, obviously a large cash portion of that as well. you remember they did that giant bond offering. also borrowed $6.6 billion under credit agreements to fund the cash portion of the deal. it has closed. shares are being delivered to vodafone shareholders. there had been some concern about throwback issues, in other words, you are delivering all these shares to accounts that don't really want to hold verizon shares although a lot of that pressure has played out over time. i do want to add here that we're going to have the chairman and ceo of verizon as our guest right here at "squawk on the

street" on monday morning to talk about, of course, verizon after the deal. and, man, a lot of other things involving this company including price competition that it sees from t-mobile, streaming questions about netflix, so many different things to talk to lowell about, so happy he's joining us on monday. in the meantime, $23 billion of cash that vodafone will be distributing immediately. >> right. >> so that hits the market and rebalanced, today or monday? >> it's all -- all of it's happening. it's going to -- >> $23 billion of cash. >> that they're distributing to -- that they're putting out, right. right. it will come in. it doesn't necessarily have to be reinvested immediately. >> a lot of money. >> and, of course, we've talked to -- we talked about the future for vodafone which is also going to be very interesting as it continues to focus on the quad play to a certain extent and buy broadband providers, deutscheland being the key acquisition it has made or will it become prey to the likes of

an at&t or even to a liberty global? those are some of the questions out there for vodafone. this was a historic deal. long in the making to say the least. >> yeah. and a busy day today. charter today i think if we haven't gotten it already, we will get it, right? and then dish or directv coming out talking about the comcast deal. >> yeah, dtv yesterday in its conference call made no secret of its opposition against it, i guess you would have to say, to the deal. mike white. yeah, directv shares were up yesterday. dish is up today. comcast is flat again. it has been down. we haven't heard from charter in terms of what their plans. can't really share much at this point. they haven't withdrawn their slate, by the way, all the nominees they put up for time warner's board who they are paying $75,000 each regardless of what happens. obviously the expectation is they're not going to come back to try to compete. talking about ceos, we're going to have on, of course, we had meg whitman on this morning after hp reported

better-than-expected profits last quarter and the stock is up slightly this morning. $30 a share. one of the key bright spots somewhat unexpected and that was sales of personal computers. i asked meg about what she's seeing in that part of the business. >> the market is definitely getting better. and i think it's a couple of reasons. there is the windows xp refresh which we capitalized on well. and also i think business is understanding and they may want a tablet but they also need some of the more traditional compute devices on get their work done that is going to be required in this world of big data and analytics. >> to those who wonder are they taking share programs from dell, that does not appear to be the case. of course, we don't hear from dell as much any longer it being a private company. but does have public debt. >> dell is more able to sacrifice its margin to compete and gain market share, does it not, if it's in the private

sector, along with lenovo. >> it's unclear how it will all play out and how they'll be able to innovate in not just pcs but other parts of the business, innovation and you can keep cutting costs but eventually that kind of runs out. >> do you get the impression she's stepping back from the language around autonomy? >> no, i thought she was pretty strong there. >> okay. >> when she leveled the charges she did, when i asked her about -- when i asked meg whitman about whether she thinks they will get charged. >> do you think she'll be harmed if it is inconclusive, if they don't get charged? she was on board. she wrote it down. >> right. i think there could be some question if nothing comes of it. it has been a long time but the wheels -- >> she said these things take time which, by the way, is a title of a smith song. it all comesmorrissey. >> it does. thank god. >> let's get to rick santelli at the cme.

>> good morning, carl, it's an great week for the equities and whether it's weather or not, whether it's continued lack of sustainability on getting traction in the economy, despite all the tale winds of help it's getting from a variety of areas, here we sit at 276 and a two-day chart would reveal we're staircasing a bit. but on a closing perspective, we're not. look at the chart year to date. okay? and look at the right side. i'll give uf some intereyou som statistics, we're trading at 276 and settled at 275 yesterday and we settled at 274 last week. if you look at the last eight trading days for tens, based on closes, which is really all that matters if you're a true technician, we've settled between 271 and 276. while the stock market is really kind of gone straight up for the most part. ponder that. and if you consider what's kept you on the right side of the

trade in treasuries, look no further than the dollar/yen. you saw those charts on the tens. look at a two-day chart on the dollar/yen and the intraday chart of the dollar/yen, they are pretty much on top of each other. and, you know, the dollar i was reading something talking about how great the dollar's been. you know, i guess it's to everybody's own taste, but if you look at a year-to-date chart on the dollar index, we are just bouncing off of unchanged on the year. but maybe more important, look back 20 years and let's think about this. in 2002 we were at 120. in '08 we were at 71. we're currently at 80. so, even forgetting the drop in that short period down to 71, we're still 33% off the highs. think about the purchasing power there, and it's only the dollar index. but it goes a long way to explain why there's so many different feels when it comes to trying to handicap things like inflation, carl, back to you. >> all right, rick, thanks a

lot. when we come back, hear what under armour ceo had to say about his company's new deal with u.s. speed skating in light of the criticism his company has been facing in sochi and around the world. and groupon taking a hit after the company forecasted the current quarter loss, will more spending on marketing really pay off? "squawk on the street's" coming right back. (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time.

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under armour has reached a deal to extend its partnership with u.s. speed skating following the controversy at the winter olympics whether this year's speed skating uniforms had slowed u.s. athletes down. our scott wapner spoke with the under armour ceo earlier this morning and has more. hey, scott. >> hey, carl, thanks so much. it's been a rough week for under

a under armour and kevin plank, some blame the company for the fact that the u.s. speed skaters did not live up to expectations and he's speaking out to cnbc and signing the new eight-year deal with u.s. speed skating. plank hoping it sends a big message. >> we doubled down literally our deal because what i didn't want it to come down was a negotiation, so we said our current deal we're going to put so much money, this will be a no-brainer for you. >> well, plank has certainly likened what's gone on the last week to a witch hunt over the brand. he insists that this new deal is not in any way a pr move. you have to wonder, though, whether there is any lasting damage to the brand. >> not at all. you know, this -- as a brand, as a company, you know, you're never i think weak enough to put everything on one thing, so this is a piece of it. this is important. the olympics are a global stage. we've had a lot of success and so, you know, this is -- this is one part of the story, but this is certainly not the story. >> the story lately has been

under armour's earnings. just a few weeks ago blowing the doors off wall street. the stock, by the way, carl, is up more than 20% year to date. that's the story that kevin plank wishes today that he was talking about. the real question is how long this controversy is going to swirl around his company. >> and i liked your question, too, scott, about international sales, i mean, this was a coming-out party. they're trying to get those sales to, what, 12% in the next couple of years? >> the great part of revenues for under armour, carl, come from the united states. the olympics in sochi expected to be the big jumping-off platform if you will for the wave of international expansion. have to wonder how all of that now is impacted by an olympics in an international market. a speed skating controversy for an international sport and how it all develops from here? so, scott, when he says to you, look, we doubled down, is he basically admitting that they're throwing cash and resources at the problem to neutralize it? that's effectively what he's doing, isn't it? >> i think they wanted to get the story off the front page,

simon, as soon as possible. there are no terms of the deal released, but i think it's fair to say the timing of this deal would certainly speak to that fact and also he, himself, saying that they threw so much money at the problem that speed skating was not going to be able to say no. it's clear they want this to go away. they also, on the other hand, want to renew their commitment to speed skating and make the situation right down the road in time for the next wenter games in south korea. >> it was a great interview. thank you, scott, we'll see you later. scott wapner back at hq. ahead on the show groupon's ceo eric lefkofsky has given guidance that's weighing on the company's stock. we'll find out now what the strategy is.

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all right. market's doing okay but not groupon, open down 13%, it's gotten worse in the course of the session after forecasting a surprise loss for the current quarter. stay tuned, a live interview with the ceo's coming up, plus existing home sales when we come right back. [ sneezes, coughs ]

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welcome back to "squawk on the street." i'm diana olick live at the national association of realtors, the seasonally adjusted rate of 6.2 million units. that's a miss. this is now a 15% correction from the high of last summer. sales are also down 5.1% year over year and before you go blaming all of this on the

weather. the chi economist for the national association of realtors himself says this is only partially due to the weather. he is citing affordability issues. he is citing tight credit. he's even citing flood insurance problem. he points specifically to the west where sales are down 7.3% month to month. we've been talking about this all week on cnbc. sales in the northeast are only down 3.1%, that's the lowest drop in sales across the nation. median existing home rice, $188,900 up 10.7% year over year, but remember, this is a mix of home issue in the median sales price so you are seeing a lot fewer homes selling on the low end, a lot more selling on the middle to high-end range. why is that? because investors are moving out of the market. they are still one-fifth of all home sales, but first-time buyers, first-timers, very important cohort to existing home sales, are now at their lowest level on record since the realtors started tracking this

in 2008, just 26% of the market. they should be up around 40%. there is your affordability and your tight credit issue right there. the only bright spot to this january report is the inventory. 1.9 million units now for sale. that's up 7.3% year over year. you are looking at a 4.9-month supply and the realtors are now seeing the worst of the inventory issues may be over, although if you look region to region we are still seeing annual drops in a lot of local markets on the inventory. again, though, they are pointing to tight credit, weaker affordability for this drop. this is the slowest sales pace in 18 months. back to you guys. >> all right, thanks very much, diana. earlier today we spoke with thee of hewlett-packard meg whitman, the company reporting earnings after the bell yesterday that were better than expected from the analysts that at least follow the company, 90 cents a share in non-gaap earnings. both above expectations and the company raised its guidance for the full year by five cents at

the lower end, in other words, it took the lower end of its guidance up and midpoint goes up 2 1/2 cents. if you really want to look for it you can find 0.3 percent of revenue growth if you "x" out currency for the company which would be its first quarter of actual revenue growth if you want to call that revenue growth since the second quarter of 2011. but, still, many questions about the future for the company, including many analysts who come out, for example, at isi this morning saying they continue to face secular challenges in printing, pc, services, networking, servers. in our view organic r&d efforts not capable of revitalizing the revenue streams in the medium terms say the analysts at isi, i asked meg whitman are you going to get back to consistent levels of real growth. >> it's a little too early to give you a guidance for next fiscal year. but our objective over the long haul is to return hp to growth.

that has to be part of our overall strategy, and as i said as we pivot to the new style of i.t these will be growth businesses for us that have to be balanced against some of the older legacy businesses, but in the end we have to grow hewlett-packard. >> and, of course, whitman has been talking about that as a challenge, but, of course, as a goal since she took over the company in the fall of 2011, we're now almost halfway into the hoped-for turnaround at this company and many would say it is at least going according to plan. certainly costs have come down, revenues seem to be stabilizing in certain parts of the business although thought in all of them. pcs, though, was a bright spot for this quarter with actual revenue growth, particularly in the commercial sector. they did sell a lot of notebooks. in pcs they compete against the likes of lenovo and dell. lenovo certainly the leader and the price leader in many ways. that company also getting into the low-end server business in the not-too-distant future in the purchase of ibm's server

business. i asked whitman whether that will also pose a challenge to hp. >> when there's uncertainty, there's an opportunity. and we look like the paragon of stability at this juncture relative to what's happening at ibm and lenovo is biting off two big acquisitions, so in the short term we need to capitalize on that. in the long term, lenovo will be a very tough competitor. >> of course, pcs, again, was a bright spot. you can see the stock, though, is now down after trading up after hours and up in the early part of this morning's session. carl? >> meantime, overall the market is shrugging off the existing home sales numbers which diana said were no good. slowest pace in a year and a half. thanks, david. a wild ride for group-on, the daily deal company said yesterday that earnings and revenue topped expectations, that sent shares higher after hours, but the stock is sinking today thanks to a weak outlook for the first quarter. our julia boorstin joins us now to break it all down with groupan's ceo, hey, julia.

>> thanks so much, carl. and eric lefkofsky, ceo of groupon, thanks so much for joining us today. your fourth quarter was strong, eric, but the first quarter that outlook for earnings really is concerning to investors, how can you explain to investors why this makes sense to lower outlook so significantly? >> actually, i think the guidance for the first quarter's actually fairly strong in terms of revenue. i think we guided a $710 million to $760 million which is pretty aggressive. it's 22% at the midpoint. and we're fortunate to be able to guide to growth, you know, 2013 was all about building a solid foundation. and 2014 is about growth. to get some of that growth you have to invest in marketing and so we told the market that we're going to be investing about $45 million in marketing to drive that growth. but the growth is pretty dramatic. and we also told the world that our 2014 ebita would be slightly at or above 2013 levels, so to have a company our size growing in the mid-20s that's still

delivering, you know, $300 million of ebita is pretty strong and we actually view it as a sign of strength that we're able to make that investment. >> just to clarify, it was the earnings outlook for the first quarter, not the revenue outlook that seemed to disappoint wall street. but there seems to be a lot of concern and we heard it yesterday our earnings call that you're going to have to continue to make those kinds of investments to drive consumer demand and to perhaps reverse an inequality between supply and demand. is there a demand issue from consumers? >> i think demand was never higher. i mean, we sold 56 million groupons in q-1, it was record in billings and revenue, revenue was up 20%. so, demand has never been strong. we're shifting from a daily deal e-mail business to a largely mobile marketplace. and you have to make some investments to create -- you know, to get awareness and so that's where that additional marketing investment is going and we think in the long term it's the prudent thing to do. >> and as you shift businesses, you are going up against a whole

bunch of new competitors, now effectively you are going against the gild groups of the world that are flash sale businesses as you shift away from the daily deal business. what is it going to take to reeducate consumers about what groupon is now? >> yeah, i don't think really think we are going up against gild, we did acquire ideally which is a small acquisition for us which is in the flash sales space. but we're the leader in local commerce by far and we really view mobile and local as connected and we're trying to become the starting point of mobile commerce, that's how we're ultimately going to win as people consider groupon to be a shopping mall in their pocket. they pull it out when they are out and about and we curate the world around them with amazing deals. in that space we're fortunate to be the leader. our mobile adoption worldwide is 50% which is staggering for a company our size. we had 9 million app downloads last quarter and we are at 70 million downloads to date, so we're very focused on mobile. we're very focused on building that marketplace of deals and we're leader in that space and

we're just trying to forge new territory. >> eric, i understand that you're focusing on the platform and i know mobile is everything. but content and product is also very important and you're going into two areas that are already dominated by people that do what they do very well, goods with amazon and ebay and travel with the likes of priceline and we've seen this staggering growth overnight from priceline and expedia again. a lot of people would say you shouldn't be in these areas. this is -- this is not your knitting. you've got to find something else that you specialize in and do that really well, otherwise why would people buy travel license from you or travel deals when it's so much deeper and so much more vertical in other places? >> yeah, i mean, look, sorl those companies are great companies, but we're very focused on the local elements of those. we're not trying to compete with amazon, for example, and build, you know, millions of skews that you can come to and buy anything you want. we're very focused on curating certain items and having unbeatable deals and we're very

focused on the local element of those, right? i give this example all the time of you are walking down the street, we want you checking groupon first, opening up your phone, let's say it's raining and you want to buy an umbrella, i'll offer you five amazing umbrellas and you can click buy and have those umbrellas either delivered to your door or find a local retailer a block down the street and pick it up. that's the space that we have to win to become relevant. we're not trying to build warehouses and compete with amazon or offer every hotel in the world to compete with priceline, we want to control the local commerce experience. >> eric, in is kayla at the stock exchange. you and another executives have noted that a change in gmail at the end of last year whereby the organization of the in-box put some of the promotional e-mails at the back of the in-box leading people to delete them easier would hurt business. did you see that actually making dent in the amount of consumers that were actually clicking through to some of the e-mails which were a huge part of your marketing before? >> yeah, we've been shifting away from e-mail no question and the gmail change did have some

impact, we called it out in q-3 it was obviously there q-4 we didn't call it out because it's an ongoing effect. we're very focused on building up a search for us now, seo and sem which are the two primary drivers of search represent iina low double digit for us which is up virtually from zero a year ago and we've made huge progress there and we are focused on the areas we can win and e-mail while it's a great business for us, clearly we need to shift to getting traffic from other places. >> eric, it's david faber at the nyse and i'd love to get your take on the blockbuster facebook/whatsapp deal, you are somebody who chose to take a company public as a founder and chose not to perhaps take the big money from a google or facebook or any other suitors you had out there. what does that deal say to you and what do you think about it? >> you know, i mean, i wish i could provide some great perspective. i don't use the product, so, you know, typically when you comment on somebody else's technology,

you should use the product a lot and i don't use whatsapp although it obviously is used all over the world because they have a huge user base. but, you know, we decided not to sell because we believe that the opportunity especially the opportunity to really build the true local commerce platform was just too big to not try to go at and build. and i don't -- the decision to sell or to stay independent is always a tough one. and, you know, you got to commend them. it was a great sale. >> eric, i want to get back to this mobile question. you keep on talking about mobile and it seems like groupon is at a mobile tipping point with nearly half of your transactions coming from mobile. what does this mean for your strategy coming forward? do you see groupon shifting even more solidly into mobile and away from the desktop and the e-mails that kayla was referencing? >> no question. our emphasis is mobile. you know, we believe -- we're already in rare air, right? i think more of our business is mobile than virtually any e-commerce company certainly in north america and we want to

continue that migration. we believe we can achieve levels that have never before been achieved in mobile. and that's where consumption's occurring. people are more and more and more, you know, pulling their phone out when they are out and about and making purchases and that's where groupon has to win. >> just a quick final question about china. you said yesterday that you were not going to be investing as heavily in china. pulling back there. why is that? >> i mean, we're in 48 countries and you have to at some point decide which are the markets you want to win. we're in a lot of geography and we doubled down in korea with an acquisition that we're excited about and we looked at china and said we really don't think we can win there without a dedicated partner and a dedicated strategy and so we decided to exit that market and being focused, one of the things it's allowed us to make the forward investments that we're now making to drive growth in 2014 is that the management team has gotten very focused. and i think that's one of the things we've done well in the past year and exiting china is part of that. >> interesting strategically.

eric lefkofsky, thanks so much for joining us today. guys, back over to you. >> julia, thanks very much. groupon, of course, still down 15%. up next on the program, shares of hp also in the red this morning even though its pc business grew for the first time in seven quarters. hp ceo meg whitman thinks the turnaround is working, but should you be buying the stock now? more in a moment. ♪ announcer: where can an investor be a name and not a number? scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: ranked highest in investor satisfaction

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we have some breaking nubs

on the federal reserve. steve liesman live in washington with some details. >> carl, thanks very much, the federal reserve beginning to release the transcripts from the critical year of 2008 probably one of the most calamitous years in american financial history since the great depression. we just got the september transcripts. you remember what happened that year, carl, there was bear stearns, there was lehman brother, fannie may have, aeg, the t.a.r.p. came out, the fed brought the fed funds rate down to zero, these are the transcripts with the individual statements by the members, bernanke was there, janet yellen was there, tim geithner was there and, of course, the hawks were all there as well as the doves and we're going to be reading these transcripts throughout the morning and bringing you some of the nuggets from arguably one of the most historical financial years in u.s. history, carl. >> obviously it's on the fed website, steve, and september 16th, 2008, good morning, everybody, sorry for the late beginning. you don't need to dig very far for some nuggets to give you a

sense of what we all remember was the mood back then. >> no, i think that's right. and just how worried the federal reserve was. remember they brought the interest rates down at the beginning of the year of january when there was some concern about recession by 1.5 basis points including two emergency metings that month alone. but it was down 3%. and remember they paused again in june, so there were times when the fed felt a little more sure about the outlook and a little less sure obviously when september rolled around and just how concerned they were will be something and what some of the key policymakers thought during that time is something we'll be following very carefully. >> steve, correct me if i'm wrong, this is a usual release, this is a five-year release, it isn't anything special, it's kind of the automotive process. does the fed still feel there are questions over the way in which it acted? is it still on the defensive to some extent in your view? >> you know, i think i -- i think what bernanke believes, simon, who, you know, just left office, is that over time these

decisions they made have been seen to be correct. and i -- the way it looks in the market right now is qe-1 was much less controversial than 2 which was less controversial than 3. and i think he thinks that over time as these things -- history plays out, they'll have seen to be effective. yeah, they think it's controversial and they know that. and they also -- the way these things work, simon, is you need time, not just in the transcripts but from the data to know how things worked out and there's a lot of research going on right now about the efficacy of the quantitative easing programs. >> steve, it's interesting, i'm reading through it as well right now, of course, september 16th, you and i know it very well, i think we were that night before sitting with each other at headquarters there. but this was before aeg went down, after lehman went down. i'm just looking through it. you know, talking about the intensified pressure on morgan stanley and goldman sachs and that morgan stanley is starting to see some not insignificant

pulling back of their counterparties that eat into their liquidity buffer by a measurable degree. there is still a lot of drama here. and also mentioning dollar liquidity for foreign banks being a very serious stress in the marketplace. >> yeah, i mean, we go back and we understand this stuff in hindsight, david, but you remember that you and i along with the federal reserve were figuring out these things in real time. there wasn't a whole lot of knowledge of the underbelly of the financial system at the time. and we were learning about things like auction rate securities and essentially the vast extent which we know was underestimated of the shadow banking system. and that was a daily thing where we'd come in and you and i would talk and figure out, well, there's this cloo and cbo and some new three-letter abbreviation that was all of a sudden bringing down the capitalist global financial system. >> yeah, he goes -- it's just interesting to look at some of the broader concerns that we all knew were there but as you say, in real time, it's very different when you look back on

it in terms of the money funds and, of course, aeg which was only really creeping into their consciousness hour by hour as perhaps the biggest threat to the financial system. >> that was the biggest slap that i remember. we had just gone through lehman and then all of a sudden it was, what, several days later that we learned that there was this massive problem in an insurance company that, of course, we knew and we covered as a company, but not as a major cog in the shadow banking system that had a major liability across -- that had to do with real estate. i don't think anybody knew it at the time. but then you sort of get a as a matter of fact call in a few minutes we're going to be releasing, what was it, an $85 billion bailout is my recollection is the first go-round with aeg. >> yeah. >> and then, what it was $150 billion or something like that on the second go-around and that's to mention the takeover of fannie may have ae and fredd earlier that month. which if that was all it was, it

would have been an incredible year. >> a fair amount of laughter in these transcripts, jokes about how they had not had anything to eat other than what's in the vending machine. china cuts their main policy rate 27 basis points, chairman bernanke said three's a lucky number in china, don kohn was going to tell you that three cubed is 27. these are human bealings dealing with a high stress situations and it's interesting to get the human element out of it, too. >> it's definitely something i'll be looking for, carl, because these guys were having the emergency meetings. a lot of them were on the weekends and there's a funny place where the fed has these videoconference calls that looks a little bit like mission control in houston where they do this stuff, and it's very -- these were times when the fed would tell you essentially how hard they were working. and i don't know, a lot of people don't necessarily shed a tear for them in that regard, but these were interesting times where everybody was -- and you can imagine a little punchiness might creep into some of the trimts. >> by the way, anybody who wants

to read it can go to federalreserve.gov and, steve, we'll let you get to work. thanks. >> yeah, be back soon. >> steve liesman. up next we're live in sochi for the latest on what's happening in the winter games. "squawk on the street" will be right back. are you still sleeping? just wanted to check and make sure that we were on schedule.

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we are approaching the final days of the winter olympics and yesterday was a pretty tough one for the u.s. women's hockey team, as you probably know, our brian sullivan is live in sochi with the latest. hey, brian. >> reporter: hey, carl, thanks very much. gr yeah, i mean, it certainly was. they got the silver and we spoke to them and you'll hear from them in just a bit. they were pleased about the silver, but when you are up 2-0 with two minutes left to go and you end up losing the game in overtime, that's certainly a

difficult one. 2-0. canada pulled the goalie. america took a shot, almost made the empty netter just a few inches to the left it would have gone in and it didn't. and canada scored twice and sent the match to overtime and canada indeed scored and won the gold medal. a bit of a tough day but the silver certainly nothing to sniff at as well. and earlier today we got a chance to speak to four member of the u.s. women's team hockey and something very cool happened. they put a brave face on it. and they are proud to represent america but during the middle of our interview i was tapped on the shoulder and the usoc had just made the decision that julie chu would be the flag bearer for the closing ceremony and i actually got to deliver the news to julie chu, look at this. julie, you've just been asked to be the flag bearer for the closing ceremony. >> yay! >> i didn't really expect that

here. i don't -- >> it's awesome. >> speechless. >> reporter: it just -- literally we just got that news. how do you feel? >> speechless. because this team it's about our team this whole time so it's weird to think -- i don't know, i wasn't even thinking about this, i'm just going to bumble along. >> something, get ready for the flag. >> i don't even know what to say but what an honor. >> reporter: yeah, genuine, spontaneous emotion, very heartwarming to be part of that maggie moment, wins the gold medal in the women's ski half pipe, the first time in olympic history this sport has been in the olympics, soaring by the rails, looking like a helicopter. she's 20 years old, she was by here earlier today just beaming as you might imagine from a gold medal win and that brings america's metal 's medals to 25 of the netherlands 22 medals

have come in speed skating, two more events left and a chance for the u.s. to get on the board in speed skating. but you know, in our business so often what you deliver and you just referenced 2008, bad news, there are rare moments in this industry where you get to genuinely deliver good news on a semipersonal level and be a part of somebody's raw emotions and that's what it was like to give that news to julie chu and they kind of almost teared up a little bit. my lower litch was quivering a little bit, just a great scene and a real honor for julie chu to carry that flag and i think a spectacular move by the u.s. olympic committee for the closing ceremonies after what was certainly a heartbreaking defeat silver or no. >> a lot of raw emotion in that segment and certainly a moment that she and programs you will remember for a very long time. thanks for bringing that to us. >> sure. meanwhile, elsewhere in the u.s. this winter has been so cold that the great lakes are literally freezing over. in fact, the freezing is the worst we've seen in two decades.

scott cohn has more and he's live on a ship in the st. clair river in michigan, scott? >> reporter: i'm scott cohn aboard the u.s. coast guard cutter "holly hock." and take a look the great lakes are clogged with ice. it's the worst season in more than 20 years. the economic impact potentially huge. and so is the effort to clear the ice. we're going to show you coming up. the frozenomics of the great lakes. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances. [ car alarm chirps ] ♪ [ male announcer ] we don't just certify

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about an hour into trading some of the stories we're squawking about. shares of priceline seeing a nice gain after fourth quarter earnings did beat estimates. the travel site was helped by stronger bookings and higher profit margins during the quarter. and according to the "journal" amazon is talking to major retailers about offering direct links to their own websites. amazon reportedly targeting retailers that have largely ignored its online marketplace like abercrombie and nieman marcus. and steve jobs spurred sales of a lot of things over the years and now that list could include postage. the u.s. postal service has approved a commemorative stamp honoring the apple co-pounder which goes into circulation starting in 2015. everyone from the northeast to the midwest knows this has been an incredibly cold winter. in fact, it's so cold that 90% of the great lakes are completely frozen. and all that ice is taking a big toll on shipping. scott cohn explains. he's live with his electric blanket aboard a ship in the st. clair river in michigan, scott?

>> reporter: good morning, kayla, and there's the problem dead ahead here. you can see this is the ice that's clogging up some of the key parts of the great lakes. as you said, 88% of the lakes give or take frozen over and particularly choke points like this. and as you can see, the ice is a little bit kind of broken up here. that's the product of the work here on the coast guard cutter "holly hock." the problem is that that refreezes and when it refreezes, it's thicker than it was before. basically about two feet thick and so they have to keep on going back and forth and essentially plowing out this path. let's give you a sense of what our mission is today. so, we started out about 8:00 this morning from port huron in michigan, about the southern tip of lake huron, we're heading down the st. clair river to lake st. clair and basically continuing to clear out this path ultimately this pathway leads into lake erie. lake st. clair, the detroit river and then lake erie, a very key passageway. and as far as ice goes in

wintertime, it really doesn't get a whole lot worse than this. >> this is my third winter up there. there is by far the worst i've seen talking to some of the locals, this is the worst winter they've seen in their lifetime. beyond that, i don't know the numbers, but from our perspective as well, our mission, it has, you know -- it has placed a, you know, we're working longer hours, using our ships a lot more, the amount of ice, you know, it's more than i've ever seen in my career. >> reporter: they're working considerably more hours and so are all the companies that are still trying to ship things through the great lakes in the wintertime. it's taking about seven days to make what would normally be a one-day trip because they have to get through the ice. they're actually generally escorted by a cutter like this one. come back to me live, and you can see sort of the pathway that we have here and what we're looking at. it sort of looks like slush, but it's a lot more than that. a lot tougher than that, and actually getting through it is a feat of engineering of this

vessel which actually sort of is designed to come up on top of the ice and push it down and use about 2,000 tons of pressure to get us through. we're going to continue to keep you posted on our progress here. coming up on "power lunch." a look behind the scenes of this massive effort. back to you guys. >> wow, that is what they call a live shot, scott. nice stuff. and an important story. our scott cohn in the midwest. after a rough start to the month, auto dealers are starting to see buyers return to the showroom. our phil lebeau joins us with the early read on sales for the full month of february. hey, phil. >> hey, carl. this is new data from jd power and it's encouraging data when it comes to the strength of the american consumer, remember, auto sales really took a hit in january and early february. now according to jd power and lmc automotive they are starting to improve at least in the second week of february they did. jd power expects february auto sales to be at a pace of 15.7 million compared to january which was 19.2 million. so, hoarse how the month has gone. during the first week, sales were down 5% according to jd

power. the second week improved so that the first half of the month down just 1%. and the full month estimate is now for sales to increase 5%. and the other piece of encouraging news coming from jd power february transaction prices, they're up about $400 year over year and that means the transaction price for the month of february, and it still needs to play out over the next two weeks, but it's likely to be north of 29,000. take a look at the auto dealer stocks. year to date these guys for the most part have had a rough sledding because of the weather and because of business being lower and frankly because they had a nice run for the first half of last year and a lot of investors said, do you know what, we're talking money off the table, autonation the only one in positive territory. guys, the bottom line is this, we are seeing some improvement in terms of as the weather is clearing, people are starting to come back into the showroom. >> okay, phil, thank you very much, phil lebeau live from chicago. let's get an update on the situation in the ukraine this morning. the government there says it's

reeff reached a tentative deal with protesters that will hopefully end the violence that we've witnessed in the capital city of kiev. jim maceda is monitoring events in moscow, jim. >> reporter: hello there, well, the draft agreement on ukraine was signed by the besieged president victor yanukovych and three opposition leaders and witnessed by two eu officials and a kremlin representative. it includes early elections in december of this year, a return to the 2004 constitution, the one that had some decent checks and balances until yanukovych gutted it, and the forming of a coalition government in ten days. but there's still clearly tension between the opposition leadership and representatives of the protesters, those on the -- on independence square. they're just not happy at all with this draft deal because it keeps yanukovych in power for at least ten more months. his resignation, you remember, was a non-negotiable demand of

many of the frontline protesters especially now they eight after the last 72 hours dozens of deaths and hundreds of wounded at the hands of riot police. but after hours of intense lobbying by a couple of eu ministers and towns to close the deal, it's now a done deal. still, the eu ministers are managing expectations. they're pointing out that this is just the initialling of a draft accord, just the starting point on a long, probably bumpy road ahead. and as to make that point, even before the signing, the extremist nationalist group called right sector who have been doing much of the hardcore fighting of late, on the square, rejected the deal outright, pledging the, quote, national revolution will continue. back to you. >> nbc's jim maceda. take a look at shares of intuit, rallying as it raises its forecast for its online tax

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nice 5% move for intuit, an all-time high, let's bring in jon fortt who is bringing in a special guest. jon? >> thanks. take a look at those shares up quite nicely. the small business software company reiterated its full-year earnings forecast due to a strong start first couple weeks for online tax preparation software, turbotax, with tax season under way, what could this mean for your portfolio? brad smith is the president and ceo of intuit joins us now. hey, brad, good to see you. >> good morning, jon, good to see you as well. >> so, you generated i think more than 90% of annual earnings just during this quarter we're in right now, the tax quarter, the april quarter. it sounds like your start to tax season was stronger than the market, but at the same time a

few people evercore is convinced based on surveys that taxes are just getting so hard people are going to be driven to accountants. is that something that you're worried about? is that why you are ramping up marketing spending to convince people your software is really good enough for them to do their taxes themselves? >> first of all, our marketing spending is down year over year and we have a bold ask clear message but if you look at the results over the last ten years, the digital tax category has been growing by 5% and the assisted tax preparation is growing 1%. so far this season the numbers are even more contrasted. right now digital is up 6 1/2 percent and the assisted category is down about 5% and that's as reported by the irs so we don't see that trend happening at all. >> i keep telling myself every year that my taxes are getting too complicated and i will stop using turbotax but i give it a try and i end up doing my own

taxes which makes a lot of people scratch their heads using turbotax. but you are moving into the strong cloud quickly. quickbooks had more subscribers in the quarter and that's why your stock is up so strongly. what is the potential if you are really are able to continue the momentum and up-sell toer on other small businesses? >> we see the potential of small businesses to be unlimited, there are 29 million small businesses in the u.s. today and we serve 5 million and there's another 600 million around the globe that we are starting to reach. when you look at the cloud-based version of our product the ability to buy additional services is so much easier than if you bought a desktop software version so we see the lifetime value 40% higher, the business is growing north of 30% in terms of subscribers and outside the u.s. is growing over 90%. >> brad, this is kayla at the

stock exchange. it's no secret that small business faced a lot of headwinds last year, sentiment bounced back toward the end of last year, but what is the state of small business from your perspective on the macro scale? >> you know, it's still tough sledding. if you look at their hiring rates and we pay about one in 12 americans with our payroll service it's modestly up and for the last two months it started to trend in positive direction but still nowhere near where it needs to be but overall small businesses are resilient, adapt to the environment and they find ways to persevere and that's what we're here to do is try to help them succeed. >> one of the things that caught my attention on the earnings call i believe you said that thus far, it's early in the season, but you're seeing three times more people start their taxes on a smartphone or a tablet than you did last year and i believe you said last year you saw about 5 million people do that. how big could this get and do those numbers surprise you? >> jon, we continue to be amazed at how the mobile platform has

schiffed the entire landscape in our industry and all industries. we now have out of 45 million customers, we serve around the globe over 10 million use a mobile platform to either do their small business accounting or to do their taxes. and, yes, it's amazing to see a 3x improvement year over year in terms of people doing their taxes from a tablet or a phone. >> when you see facebook paying $16 billion to $19 billion for whatsapp and you're looking at international expansion, you are looking at strong mobile growth in your own business, what do you do as a ceo to react to that? do you have to do something with tax preparation through messaging? >> well, we've been working with messaging and mobile platforms for several years. we've made some strategic acquisitions ourselves and for us it's capitalizing on the trend and making sure we have the easiest application to use on a mobile device so we can actually outpace the competition. >> when you look at some of the

changes to taxes that we're seeing with the health care law, is that good for you? is that bad for you? how are you seeing your customers reacting to that? >> well, this has been a two-sided coin. there were some people who felt that with the affordable care act people will be driven to go to a tax pro to help them. we actually have not seen that at all as evidenced by some of the numbers i shared earlier. in fact, the research suggests that less than 1% are actually going to switch their method because of affordable care. now, with that being said, we have a free web-based tool that helps the consumer under what does the actual affordable care act mean for them, do they qualify for a subsidy or penalty and we help them get insurance if they need it. we've had over 3 million people visit the site so far, 600,000 who were not with insurance and we've been able to direct them to the right avenue so they could make the purchase of insurance. >> brad smith, thanks for joining us on cnbc. good luck with those taxes, buddy. >> thank you, jon. meanwhile, intuit still up sharply. we have a lot of other movers in

the market. let's send it over to dom chu for a quick market flash. >> check out a couple of assisted service providers, brookdale is buying emeritus for $1.4 billion in stock, $21.48 a share, a 32% premium to emeritus thursday close and upon completion of this dale brookdale will have a facility within ten miles of 6.5 million people age 80 or older. investors like the deal. both stocks are higher, simon, back over to you. >> okay,dom, thank you. like it or not we seem to be entering a new era for virtual currency, the first bitcoin atm in this country officially launched in austin, texas, and the question on the mind of some who probably should know better how exactly does a bitcoin atm work. we'll talk to the owner of that machine in a few minutes. we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you.

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welcome back. let's send it to the cme group and happy friday to rick santelli. >> thank you. exactly how happy of a friday is it is what we may be discussing on the exchange today. you know, let's throw something on the screen. you know, on february 6th, and i'll read along. the "wall street journal" reported on february 6th that

business wire was selling direct access to news releases to high speed trading firms. such direct access isn't illegal. well, our own eamon jafers have been doing a boatload of work in this area for many months now and actually i'm kind of shocked by the whole thing. you know, you talk about a bottom of the food chain issue. you talk about the notion that we have prosecutial discretion with regard to the department of justice. they look at certain things maybe different than others. i think there's also a regulatory discretion that seems to be going on. in my mind, and this is just my opinion, but just because something is not illegal and just because technology allows something to happen doesn't mean we should allow it to happen. i think in many ways this high frequency trade, this putting your server right next to, you know, sources like business wire is kind of like the market's version of the nsa issues that the country's grappling with.

very similar. but let me weigh in very simply. i know many high frequency traders and firms, not bad people, but, boy, when you have that many quarters in a row wind up without losses, you really have to question yourself. i guess i was also amazed at how nice and sit-down all of this happened. you know, regulators sitting down. the story talks about attorney general's office being involved. i don't know how it's going to turn out but from where i sit, if you don't have losses, you don't have risk, and if you don't take risks, i don't think it's kosher. now, let's switch gears a bit. let me write a number here and see if you guys and girls can decide what this is. and i'm just roughly doing what the last debt clock said. 36912. okay. 36912. this is, of course, 17 trillion and change. 17 1/3 trillion.

that's what the debt clock is running at now. quickly, the president on a budget. the president will focus on pumping new cash in job training, early childhood education. who could disagree with that. as einstein said, trying the same thing over and over. my school district spends boatloads per pupil. if you charted the output it keeps going down. we have the kind of debt. we need to try something new. political perception is not reality. and i think maybe we should incentivize the private sector through things like apprentice programs and try something that may work versus just sound good and, of course, nobody can possibly disagree with. back to you. >> rick, thank you very much. rick santelli on the santelli exchange. up next, it looks like news corp's chairman and ceo will be able to celebrate his 83rd birthday in what may be manhattan's ultimate bachelor pad. now on his new quad drink plex

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the residential tower in downtown manhattan. his latest purchase believed to be the highest paid ever for an apartment downtown. real estate broker to the super rich closed the deal on the 10,000 square feet of raw space. spanning floors 57 through 60 of the building. sources tell cnbc he's planning to spend millions more to turn the space into a residence. murdoch recently divorced his third wife, wendy murdoch, who kept the couple's fifth avenue penthouse, purchased for $44 million in 2005. >> it's clearly unlivable the way it is now. i think you need to do some work. >> fixer upper. i'm sure he's going to make it very nice. >> always reminds me we're in the wrong business. dolly lenz, 3%? 3% of $57 million? a commission of $1.7 million? >> sometimes you can negotiate it down a little bit, just a little bit of price. >> dolly? >> i'm not sure, either. i know. we helped her show it.

look at that. we added on. >> maybe rupert murdoch was watching cnbc and saw the footage and said, i'll buy it. >> he's going to rock out downtown. 83-year-old can do a lot of damage downtown. >> surprising. previously, $52.5 million, howard marks on park avenue. >> good weekend. >> good weekend, david. see you in a little bit. if you're just joining us this morning, here's what you missed early on. >> welcome to "squawk on the street." here's what's happened so far. >> still have a great shot at hitting the podium. regardless, we want to make sure that our message is there. that this isn't just a one and done. i think there's speculation of how to react to it. i want people to be clear that we will stand up and come back and that is nothing more american than that story. you may have pushed us a little bit but what do your see us in 2018 in south korea. >> on going worries about their distribution chain, long dlufrly times, their infr fra structure, stock is going to open down this

morning. what a story that has been. >> i think the headline for this quarter is we've made progress and we got a lot more work to do. because we have to, this company will ultimately come back on the backs of innovation. great innovate i products, services, and solutions. >> there's the opening bell. >> existing home sales in january down. 5.1% month to month to a seasonally adjusted annual rate of 4.62 million units. that is a miss. >> we're shifting from a daily deal e-mail business to a largely mobile marketplace. you have to make some investm t investments to get awareness. that's where that additional marketing investment is going and we think in the long it's the prubt thident thing to do. >> the federal reserve beginning to release the transcripts from that critical year of 2008. ♪

good friday morning. live here at post 9 of the new york stock exchange with a check on the markets. take a look at the dow. we've been holding on to some gains even though some of the data has been disappointing. existing home sales, worse in 18 months. microsoft and mcdonald's leading the dow higher. price line hitting all new-time highs on the travel website's better than expected earnings. helped by stronger bookings. the daily deal's website falling after forecasting a loss for the quarter. highlights from our exclusive interview with groupon ceo is coming up. hewlett-packard down 1 1/2% after opening to the upside. one of the big stories this morning after the company's better than expected earnings report. david faber spoke with ceo meg whitman. wide ranging conversation about growth, competitive tletsz and autonomy and the status of that investigation there. >> we've been trying to follow up on that. it has been well over a year, in fact, since we first heard of what essentially was alleged fraud on the part of autonomy,

alleged by hp. they sent that case, so to speak, to the us s.e.c. and counterpart in the uk. it has been a long time seasons we actually heard something and some wondering did hp in some way perhaps use it to its advantage, if you can call it that, by taking some write-downs and the like on autonomy. i asked the company's ceo as to where that stood and whether she believes at this late stage already charges will finally be filed. >> what we know is that there were very significant strategic representation. hardware was accounted for incorrectly. there were deals with value added resellers that were not genuine sales and i think the authorities are going to see what really happened here. >> we're going to be watching that, of course, as it continues to perhaps evolve as a story. overall, of course, hp reported better than expected revenues and earnings. though its stock is actually down. continued questions about

whether this turn around which has been in place now for over two years and still has at least two more years to go, according to wittman, is going to take root in things like real revenue and profit growth, innovation, or indeed that is going to result in product advances. those are, i think, some of the questions at least being asked. and perhaps one reason why the stock has stalled here after what has been an extraordinary run over the last, let's call it, 18 months. >> did offer some barbs to her competitives. ibm and lenovo. >> we can listen to meg on that. lenovo is not just buying motorola it's buying ibm's low-end server business and has typically been a very strong price competitor for a company being hp seeing price competition throughout many of the business lines. i asked meg how is lenovo going to take to it hp or will we

stand more price competition perhaps at the lower end of the service business. >> jon fortt joins us here at post 9. microsoft the highest almost since thanksgiving. >> it's a little bit of both. the commercial pc trend is something you can't get too excited about because you've got windows hp getting ready to reach the end of support in just a couple of months. we heard a lot from microsoft and from others about commercial businesses doing some buying and anticipation of that and since hp said they got some benefit from that you don't know how much to weigh in. also, printing has gotten some benefit from the yen. and you just have to feel overall like printing trends, not going to be the growth driver that really takes hp forward. it's been stable. there have been profits there. you look at the services margins. those are still bad at 1%. you look at software despite the autonomy stuff. we don't know which way that's going to go. the business still needs to grow

one way or the other. it missed analyst targets. yes, overall top line better than people expected. wittman doing a great job managing on the bottom line. there's only so far you can cut though which she acknowledged in her conversation with david. and you have to wonder where that growth is going to come from. >> she's doing a lot of different things, david, managing expectations as we said. cutting costs, trying to invest for growth, getting the cash cycle back. what kind of grade would you give her at this point? >> i would say at least a b plus if not more than that. i mean, given that she took over, let's not forget when it was, october 2011, the company in disarray in many ways. there are lots of tackling and nuts and bolts things that i think whitman has done successfully. whether you can engineer a return and the kind of r&d and product innovation is a larger question. i think that is still being asked. in terms of delivering according to your point, getting cash conversion rates down to 16 day, for example, managing it to

actually get cash flow again in a company that exit this quarter 1.7 billion net cash they had a great deal of debt when she took over. those are positive things. it's almost like you're coming through what has been not the easy part but the lockheed has gone very well. now you can see if you can run down the open field. >> the hp we see now structurally was a scale case, was a share of wallet. the idea if we get compact, if we get all these other things and become this massive machine we'll get more enterprise spending, we'll be able to drive costs down. now that fundamental case has been challenge by some that's happened in the cloud. we see cisco talking about point competitors, f 5s and others, pm is in that same boat. how do you grow faster than some of the scaled businesses are shrinking? >> tough challenge. i'm glad we don't have to come up with that answer. >> we just get to talk about it. >> jon, thanks. david, thanks. earlier this morning groupon

ceo appeared on "squawk on the street" on the heels of that disappointing earnings guidance despite efforts to reposition the cohn company. take a listen. >> really think we're going up against, acquired a company called ideally that's in the flash deal space. >> john steinberg is the president and ceo of buzzfeed and cnbc contributor. john, good morning to you. whatsapp one day, groupon the next day. where do you make of where they're trying to go versus where they have been? >> i think the whatsapp comparison, it's a radically simple business. right? actually brian sent a note to the founder and said no ads, no games, no gimmicks. that is the success story of watts ap whatsapp. when i was listening to him it's so complicated. you can't figure out what this business is anymore and how you structure and operate your business is how you present your business to customers in the world. i think that's really a big

issue for groupon right now. >> one of the issues brought up on the call is that e-commerce on average people buy two items from their shopping cart. groupon is barely one. and they're trying to give that up. groupon is a business where people go to buy multiple things at one time? >> that is the point. me hanie has a great article on this. it's excessively ambitious for them to be the starting point for mobile commerce. i agree. they're trying to beat amazon. they have doubled the shipping costs of all the peers. the margins are killing them. the margins have gone down so dramatically as they transitioned to now an e-commerce business. they're becoming an over sto stock now. >> is there a comparison to be drawn with foursquare, too, reverse of this starting with the maps and the mobile marketplace and moving backwards into deals. but arguably they have a better map software. >> i think any time that you go into an e-commerce business, especially late, and you're going up against amazon which is all about efficiency, you have to have some very unique

offering which they ultimately don't have right now. this is going to be the ongoing challenge for groupon. when people say to me -- sometimes a tough picnic is better than trying to find a new picnic spot. when people say is buzzfeed going to go into e-commerce? no, we're going to stick to our ni knitting. if you keep it simple and on point, you build a whatsapp and not where you don't know what is what? >> what about the bona fide that the backers have. why would he be going along with the strategy if he didn't believe in it? >> i don't know which strategy it is. when you go through the transcript or you look at the reports right now they've got the local business pap they've got the travel business. they've got the direct business. they've got the goods business. i think they're just trying to figure out right now which direction to go. and i don't really know what the backers think right now. >> we're not really done with the whatsapp port mortem quet. there's a story on re/code

saying that google is trying to leap frog the offer but the founders rejected it in favor of facebook. what do you think is the mindset? >> i heard the re/code story as well. i think the board seat is a brilliant offering. when you're a founder like this team who has so fiercely wanted to be independent and build their vision, it's an iconic vision. 50 people in often marked office in mountain view, no ads. zuckerberg saying i want to be partners with you on mobile, i want to make maps and give you 10 pors of the company for you and your qulemployees, come joi the board. larry page never had a passion for this business. it was all about blocking facebook. if you're looking to start a business, that's not a compelling offer. >> thanks. that takes us to the update on the situation in the ukraine. the government says it has reached a tentative deal with the protesters that would hopefully end violence in the capital city of kiev. nbc is live in moscow with more. jim, are we seeing any signs of that violence is evading?

>> so far it's remaining relatively quiet on independent square in kiev. obviously we're monitoring through video streaming here, watching it very carefully from our perch in moscow. carl, after a lot of 2:00 a.m. moments when nobody really thought it was going to come off, the draft agreement was signed. the draft agreement on ukraine signed by that unhappy looking president victor yanukovich and instrumental in keeping the pressure on yanyukovich. his name had a space on the page but it wasn't signed. not quite sure what that will mean in the days and weeks ahead. but it does include this deal early elections and december of this year a return to that 2004

constitution. one that has some pretty decent checks and balances before yanukovich gutted it up. the key demand as well by the protesters in ten days' time. but there's still clearly tension on the ground, certainly between the opposition leadership and protesters on independence square and who were not at all happy that this draft keeps yanukovich in power for ten more months. it's a compromise. like every compromise, no one gets 100%. let's just hope it's not, again, just words on paper. >> well said, jim, thank you. in moscow watching the situation in ukraine. detroit's emergency manager has filed a plan detailing the city's eventual exit from bankruptcy. the plan makes cuts to pensions and creditors and was filed a few moments ago in federal bankruptcy court. it's just a plan. many of these aspects are still being negotiate with

stakeholders. the deadline, kayla, was actually march 1. they're a little early on this. trying to bring that $18 billion in debt down. we'll see how it's received by the court. >> as always, a lot of negotiation goes into this. so always a good thing to have that earlier rather than later. coming up, a different kind of link-up with amazon. we'll look at the company's move to turn retail rivals into partner. also, rick santelli in the windy city. rick? >> we had existing home sales today. what did we learn? one thing that jumped out at me that diana olick hard, first time home buyers represent 26% versus a 40% historic average. wow. so we're going to discuss the buy side of housing. not the buy side like you're thinking. the bifurcation of housing. what's going on to create really two different housing markets. who are we going to talk about this with? vince. you want to make sure you see this one bottom of the hour, weather versus statistics.

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sector p one of today's bigger gainers and overall range bound market. dominic chu back at hq with more. >> leading the utility stocks higher are ameren shares. posted better than expected

quarter quarterly earnings in line with analyst expect tagss. shares are up big. public service also continuing its strong run after reporting better than expected quarterly profits yesterday. now, rounding out the top five you've got con eddisoedison, ex. yes, the biggest gainers but it's more of a range-bound market, carl. the fed earlier releasing transcripts from 2008 shedding some light on details of the financial crisis. our steve liesman is live in washington. he's been combing through those. he has some details. >> flashback, carl. it's quite amazing. concentrated on the september meeting right after lehman. and what i find is this amazing debate from the federal reserve. should it address the banking crisis with monetary policy. i just want to give you some of the comments that came from this. fed chairman ben bernanke talking about the swap lines create with foreign countries says he wants an unlimited squawk mine to have my own ba ba

sook a. there was laughter in the room because he was quoting paulson. the kansas city fed chairman back then arguing against policy changing saying we have an inflation issues throughout these minutes, what you see the hawks arguing about inflation and concern about it. jeff lacker comes in and says, what we did with lehman i obviously think is good. this is several days after lehman declared bankruptcy and he's among those who say it was a good development with lehman because of the moral hazard issue. eric rosen graham comes through and says, i don't know. too soon to know. and, quote, i hope we get through this week, is what rosengren said. richard fisher, most the most rhetorically flamboyant quotes bob dillon, money doesn't talk, it swears. i want to play for you where fed chairman ben bernanke summarizes the remarks says, hey, guys, we

don't have rules here. we have found ourselves in this accept sewed in a situation this which events are happening quickly and we don't have a set of criteria. we don't have a fiscal backstop, and we don't have clear congressional intent spop in each event, in each instance, even though there is this sort of unavoidable add hock character to it we are trying to make a judgment about the costs. that's how ben bernanke ends it. the fed leaves interest rates unchanged at 2%. they would come back three weeks later and cut by 50 basis points. eventually bringing it down from 2% to 0% within several months. carl? >> steve, i'll take it from there. quick follow up though that i had, reading this it reminds you how much money was needed to keep the system going right after that meeting these banks were borrowing close to $100 billion per week from the primary dealer credit facility. that is an unbelievable amount of money. when we debate these bank capital levels now, when you compare what they're actually

having to hold to what they needed from the fed they're pretty much on par. >> i think that's right, kayla. there's a lot of talk about the tri-party repo system. a lot of lack of knowledge about how the whole system works. and it's interesting to hear the fed really groping around in the dark is probably the best way to put it. they come in. bernanke comes into this september meeting says, guys, we have a lot to do here. i want everybody to be short. tell me what your economic forecast is and tell me what you want to do with policy straight up here because we don't have a lot of time. they take a coffee break. bernanke has a lot of calls to make. in this september meeting t.a.r.p. has several weeks later but bernanke is hinting to the possibility of fiscal intervention at that time. it will happen several weeks later that they will come in with the $700 billion chart figure. already issue on the table in the middle of september. >> hesitant to put a limit on what they were going to let some of those institutions take.

steve, thank you for bringing us that flashback there. i want to move on to modern day, amazon, and a report in re/code jon fortt they could be gearing up to take on apple and roku again, a streaming tv box. >> that's peter's report at re/code and there were rumors at a holiday season launch for this product. didn't happen. now it looks like perhaps march, interesting because overall in the tv market we've seen the tv makers are trying to come out. they're throwing everything out there. 3d didn't really work and now trying to curve the screens. low led. larger sizes are capturing people's attention. traditionally in technology when we see that it's a chance for an innovator to come in with a solution, pc market, kind of stagnated before apple came in with some innovations. so the question is, i think, where does amazon price this and how does prime work with it? as we know, there have been rumors about them potentially

raising the price of prime. carl sniffed that outcoming a bit in advance. but if they do that, it potentially makes their video offering a little less compelling because you've got to be a prime member to see this stuff. so it will be really interesting to see how they do that, when at the same time they're trying to maneuver themselves into a better position on the retail side and the apparel side with some of the deals. >> how tough of a conversation is that going to be? how much polling do they have to do with the likes of a neiman or ralph lauren? >> it's a tough conversation because they give up the front end of the customer experience once they go with amazon. i really doubt you're going to feel like you're buying from abercrombie or buying from ralph lauren if you're coming in through amazon and really this is supposed to be ebay's area and shop runner. so if amazon gets in here it's dangerous for those retailers but especially bad for ebay. you've got to bet john donahoe is picking up the phone trying to stop this from happening.

>> so many shifting winds right now, jon. unbelievab unbelievable. when we come back, taste tests involving one particular toothpaste brand. you might find the flavors to be somewhat outrageous. but first up, we'll go to the winter games going to the home stretch. i'm beth...

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what a winter games it has been in sochi. our brian sullivan and michelle caruso-cabrera is live in olympic park with more to set up not just this afternoon, guys, and a big hockey game was obviously the weekend ahead. how are you doing? >> we're going all right. michelle, you've been doing some excellent reporting and i think russia might have gotten the better of your larynx. >> you're going to do most of the talking. >> i usually do anyway. it's fine.

michelle did reporting consistently for a couple of weeks here. over the shoulder, medal ceremony. huge turnout. maggie bowman getting a gold medal in the ski halfpipe. that brings the medal count to 25 to the united states, russia closing in a bit with 24. there's your count. canada, 23. norway and the netherlands. and we're just about 30 minutes away from the beginning of that usa/canada semifinal in hockey. there's a lot of electricity in the park around that. there's been a lot of great athletic achievements but there's been some great and maybe not so medal-winning moments on our side of the camera, as well. >> thank you. from the slopes above sochi. with all of these -- whoa! [ bleep ].

>> oh, boy. >> i told you that was heavy. >> you are so narrow minded. you've raised a lot of good talent in sport. >> i brought you guys -- these are cavier flavored, these are crab. >> and where are these from? >> i'm guessing russia. >> hollywood, health care. >> yes. >> so different. >> yeah, you spend enough time in hollywood you need some serious health care. >> anyone that can make health care sexy it's this man right here. >> is this the olympic snuggie? >> get a shot of vodka next to you just in case. >> carl, you did the "today" show taste test. you did it again. >> it's really well. >> go team usa. >> no, i am not holding --

>> you already had your say. you already had your say. you already had your say. >> you're just envious of our medals. that's what you do. >> joe, you got -- you're getting the bronze in this. >> you're an idiot. >> you're getting a bronze. >> that's good. >> super cute. >> anything to wash away, carl, right, the taste of those cavier and crab flavored chips. >> i have a feeling that russia is going to say thank goodness cnbc is gone. >> for sure. >> not the vodka industry apparently. they wish you would come back, carl. although i have to say that the fact that you're from colorado, okay, and did that on that slope you're taking home the lead. quintanilla does not medal. >> it's a giant shame that you

can bring upon me that i don't already feel. >> i'm sure you've heard it from friends and family in colorado, right? >> yes, yes, embarrassing. >> carl -- >> i would argue, though, even though -- >> did you get these gloves? >> guys, i mean, the interviews, i'm just thinking of the dutch coach, michelle, i'm thinking of al michaels. the voices we heard from sochi have been, i think, some of the most memorable things we've done. >> i thought the interviews were a lot of fun this time if dutch speed skating coach -- speed skating coach was, i thought, so funny when he sat down and the first thing he said to joe kernan was, you can't believe you lost. you must be an american. i thought that was a bit of a compliment. but you know, it's funny you talk about the voices here, my lack of voice, dominantly russian olympics, i thought, carl, and brian, you tell me, all the other olympics i've been to were multi-ling galual and h

it felt less olympic to me. >> we will find out if we can snooek into the hockey game tonight before "street signs." i thought the hosts here have been welcoming. everywhere we went people were warm. they were smiley. they were friendly. and they were apparently very ven generous with the vodka. >> they were. you summed it up this morning, brian, two weeks ago people had much different conversations about these games. we were always on alert for the story to change quickly depending on the news. had some minor scares regarding airplanes landing in different parts of the world. but that didn't happen. and we hope you guys get a chance to see at least closing this weekend. great, great work, brian and michelle. we'll talk to you later on. >> thank you. big weekend up ahead for them. meanwhile, coming up, virtual breakthrough. meet the ceo of the company behind the nation's first bitcoin atm. that story on "squawk on the street" after this. so ally bank has a raise your rate cd

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europe is about to close here. it's mostly been a green session. >> we've drifted higher through that session. the markets are wait for $23 billion of cash distributed by vodafone as a result of the verizon deal. that may come on the market maybe tomorrow. maybe monday. maybe earlier next week. retail sales were poor in the uk today as a result of all the flooding.

for the week, european equities overall are up about a quarter of 1%. standout stocks today, the french automotive sector which makes wipers and headlights, doing particularly well in the united states and china. it's lifted the rest of that french sector as you can see. on the downside today, sales of gucci are decelerating. slowing down for the almost to a stand still for the first time in years. and that's whatted on the parent kering. restructuring charge there as well. disappointed on the session. we're watching rbs. it's widely reported that next thursday rbs, the bank, which is 81% owned by the british taxpayer, will announce it's axing 30,000 jobs potentially here in the united states and internationally as it goes back and retreats back to be a more domestically focused banks. we'll wait for the announcement next thursday from the new ceo.

still waiting in rome for the man who will be italy's new prime minister to announce his cabinet. mr. renzi was due at 10:00 new york time. we will get details throughout the day. optimism of what he can deliver in terms of reform, taxes, or whether he will be basically stuck in his tracks as the two previous prime minister were from the two institutional drag there. italy's bonds in the meantime continue to rally and the yields fall as you can see now at 3.6% on the ten-year. guys, have a great weekend. back to you. >> thank you. let's bring in bob pisani with a look at what's moving on the floor. slugging off existing home sales. >> we've been talking about how the markets don't react to negative news and we saw it again today. we've been trying to figure out the effects on weather on things. put up the existing home sales numbers by region. i don't normally cover by region but the west was down 7%. now, there is no polar vortex that was occurring in the west.

the older numbers were disappointing but that's a real telltale sign that it's not just weather that's getting involved here. now, you would think that this would be a little bit of a disappointment. it's not weather. other things may be going on. maybe they can't have access to enough credit, something like that. but homebuilders are nicely up today. in fact, they're among the market leaders. many big names up 2%. this is what we're talking about. no going down. market not going down. generally bad economic news. some traders have been calling it the great disconnect. i've been hearing it all week. we've got poor economic data. china contraction now for a couple of months. the fed is keeping taper. political risk abroad and venezuela and kiev and in other parts of the world. and the stock market is essentially sitting right near new high. i'll show you the reverse head and shoulders. it's a d bottom. put up the s&p 500. you don't get a better v-shape than art cashin standing to the left of me here. that's a reverse head and shoulders. if we can close above 1848, the

old closing high, that's why i keep emphasize that. that will be a breakout in that reverse head and shoulders. they will go crazy if we hit closing highs. 1848. pay attention to that. finally, guys, the group that never declines. every day they keep on giving. this time pharmacyclics. every day, regeneron. look at the main biotech etf, the xbi, 27%, carl, up since january first. that's on huge gains in 2013. back to you. >> unbelievable. golden age of sorts, bob. bob pisani. if you haven't heard, existing home sales fell sharply in january. at their lowst level on record. more on housing there's rick santelli in chicago. hey, rick. >> yeah, i know, always a near and dear part of what i do is housing. it was the straw that broke the

camel's back about five years ago. after all the bailouts and then to think that we're going to have principle reduction. it's been 5 1/2 years, my guest, vince. 5 1/2 years since the conservativeship of the gses. the fed gives them time to figure out how to finance so the middle class can have home ownership because renting doesn't do it. you become part of pottersville when you rent that wrong. what have they done to change the renter's finance in 5 1/2 years with 0 interest rates. >> not a lot. >> you heard carl. 20% versus 40% historic average of first-time home buyers. i think this is terrible. >> i would agree with you. hen you really look at it, as i'd said, the last time i was here, rick, it was a bifurcated market. it continues to be. what you've got is professional investors and affluent homeowners and buyers. then you've got joe every man. joe every man is 26%, should be 40%. should be a 40% of that market. but he's not. if you listen to diana olick

yesterday, the average cost on a monthly basis goes from low 700s to mid 800s. that's a car payment for somebody. we've got to work on that. and the reason that you've got prices up so high, you don't have a lot of foreclosures. foreclosures are sitting down and staying low and they're staying low because of government intervention. not that investors wouldn't help anybody who needs a hand. but i'll tell you what, you got to get this foreclosure backlog moving or you're not going to get the supplies to get the housing prices down a bit. >> whether it's if president talking about we need more job training programs in the government. like we need any more. wasn't it a year ago the vice president was trying to trim them back, spend more money on education? the correlation between input and output doesn't seem to be there. the fed talking about 0 interest rates to help housing. it was really to help main street and the middle class. the top of the pyramid keeps getting higher and higher. what about weather? i hear all this about weather and i know it has an effect. but this home ownership first time, isn't really effective by

weather, is it? >> no. if you look at the west again following up what pisani just said. 7% down. there's no snowstorms in los angeles last time i checked. okay. no 30% -- 30-degree weather. more importantly, talking agent the government. they haven't even reupped the tax forgiveness bill on home forgiveness modifications. if joe every day gets $50,000 forbearance or forgiveness or a mortgage, he now has a $50,000 tax bill. >> between students loans, renting instead of owning, if the middle class makes this country powerful i certainly wish they do something about it because if wishes were horses, beggars would be riders. it junt just didn't working out the correct way. vince, you're the man. thank you for being my mortgage guy. carl and the gang, back to you. >> rick, always compelling stuff. thanks for bringing it to us. coming up, atms are not just for cash anymore. the first bitcoin atm in the u.s. is now open in the city of austin, texas. how exactly does the bitcoin atm

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tesla stock is flying high. one analyst downgraded it to a sell. we'll find out why on "the half" straight ahead. kayla? >> thank you, scott. appreciate it much. the u.s. just got its first bitcoin atm in austin, texas. robo coin dispatched the machines close to where south by southwest will be held. they launched the first bitcoin atm ever in vancouver. the virtual currency has been vause tell. right now looking at a value of $561 on the coin-based exchange. we want to talk about the atm and bitcoin in general with jordan kelly, ceo of robo coin which oins the atm. thank you for joining us. obviously no coincidence you're putting this atm in a hotbed where some 60,000 tech experts are going to be descending over a matter of days. how much activity can this thing handle and what are you expecting? >> oh, it has maximum capacity we have a knew more atms

delivered in the next week to handle that demand and put it into awesome spot for everyone to enjoy it. >> i know the vancouver atm processes roughly 60 transactions per day. are you expecting that in austin, possibly more? >> oh, i think you can. i think we're going to be doing a lot more than that. >> when you think about the fact that bitcoin itself has been so volatile. we just showed the coin base exchange roughly $561. elsewhere it's trading for under $100. when people want to celibate coins back through your atm, how do you calculate the value and what are some of the risks there? >> yes, we use the bit stamp price and the exchange rate has been really volatile just based on the fact that they're going away at this point. i think it's going to stabilize and continue to -- we're probably going to see a surge in growth in the very near term. >> jordan, what do you expect that people will actually use this for longer term? i mean, it seems to be kind of a novelty at this point. and could you also address, is

this mostly people taking cash out from bitcoins or putting cash in and getting bitcoins? >> i'll go b to a. right now it's actually 50/50. when we started in vancouver it was 80/20. people are starting to see how convenient the sell and accessibility it is and it's super easy. to jump into your next question. i think that once people -- once more accessibility to the currency, i think people are going to understand better. really i think it's the best store of wealth right now. i think it's a really exciting way to store people's wealth. and that's why i think it actually stands, you know, across the globe and is going to be understood and well received. >> jordan, to use this atm you have to have your palm read. there's facial recognition technology. but you also need a government issued id. that's a lot more information than a four-digit pin. can users be sure that's secure? what are you doing? >> we tried to apply banking's

best practices to enrollment process. also make it even easier for the customer so we care about speed and ease. so all the customer needs to enroll in our machine is their phone, their id, their face, and their hand. all very, very easy things, things that people carry with them everywhere. >> very interesting stuff. jordan, one quick take away though is that potentially if someone is using a fake id do you notify the government? >> we actually run all ids through our proprietary technology making sure that it's not counterfeit, that the customer is not indeed not who they say they are. however, if a customer does do that, they are bio metically tied to that fake id putting them at identity fraud risk. we believe the machine deters people from that and does a good job of protecting our operators from anti-money laundering and making sure they adhere to all their customer compliance. >> jordan kelly ceo of robocoin.

good luck. >> thanks so much. got some breaks news. to that, eamon jaffers in washington. >> the scc is announcing at this hour that it is entered an agreement with credit suisse to settle for $96 million and admitting wrong doing for providing unregistered services to u.s. clients. credit suisse provided cross border services to thousands of u.s. clients and collecting fees totalling approximately $82 million withouted ed adhering t regulations of the federal securities laws. this stands in contrast to the settlement from ubs back in 2009. that was a $780 million settlement. this one $196 million from credit suisse. we're expecting a big hearing in the senate on swiss banks next week. a lot of attention in washington on this issue, guys. >> eamon jaffers in washington. almost lunchtime on the east coast. how did some ice cream sound? maybe a nice cool mojito? you can have both and all you have to do try some toothpaste.

our jane wells explains. jane? >> um, chocolate, vanilla, lime, a party? no. this crest goes after the millennials. we do a taste test after the break. understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates.

let's face it, not everybody really enjoys brushing their teeth. but toothpaste brand crest is trying to change that. jane wells, what are they doing? >> carl, a warning.

you're going to see people spit. procter & gamble is going edgy with crest. colgate is number one. hoping to gain market share with nu new flavors targeting, quote, daredevils. all right. we have lime, spearment zest, mint chocolate trek, vanilla mint spark. what do you want to start with? >> vanilla mint spark. >> we assaulted students for a taste test. would snazzy flavors change that? we also went to usc's school of dentistry where most students agree this is a great idea if it gets people to brush more, if they like the flavors. of the three the overall winner it was mint chocolate trek. >> that's good. >> i would lie the chocolate one. >> it's really good. >> it tastes really good. i wouldn't mind doing it, like brushing more than twice a day. >> it's almost like dessert but like healthy for your teeth. >> oh, yeah, this is like ice cream. yeah. the most controversial, the lime

spearmint zest which was supposed to take kind of like a mojito. >> some people said it's like a mojito. >> no. >> no. >> no. that's enough of that one. >> a little too pepperminty for me, i think. >> it kind of tastes like that mojito gum that doesn't taik taste like mojito either. maybe the person who thinks it tastes like mojito had that mojito and has never had a mojito in real life. >> what does it remind you of? >> limeade. >> no, no, no, no, no, uh-uh. that was gross. >> that's delicious. >> is it? >> that is delicious. >> you like it? >> i do. >> see? not everyone is a hater. the only downside the dental students said little kids might want to eat the toothpaste from fluoride in the stomach is not a good idea. >> never man at the sink interviews, jane. that was great stuff. jane wells still rinsing apparently in los angeles. former s.e.c. target mark cuban crashed a speech by mary joe white.

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billionaire, former target

of the s.e.c. mark cuban crashed a speech being given by agency chair mary jo white and tweetding about it. eamon jaffers has more on that. >> unexpected celebrity guest here at mary jo white's speech this morning on the s.e.c. talking about the variety of issues including the need for the s.e.c. to have more funding. cuban live tweeted the event as he sat there in the audience. look at mark cuban watching the speech. i'll give you the tweets he was wheating out in realtime. he said i'm impressed by sec chairwoman's confidence and salesmanship. unfortunately when it comes to her comments on enforcement she showed a lack of self awareness. but to her credit she's selling hard. he mentioned she had mentioned funding so many times i'm feel like i'm being pitched at a fund-raiser. you get a realtime sense of what mark cuban thinks about the s.e.c. today. of course he's had recent tussles with the s.e.c. i e-mailed him after the event to ask him what he was doing there, he said he was in d.c. anyway for another event and decided to stick around for the chair's speech.

>> outspoken critic of the agency and market structure in general. eamon, and certainly not afraid to let his opinions be known. eamon jaffers. if he were on "shark tank" he would say, i'm out. >> exactly. for people following him on twitter they got a play by play of that meeting. scott wapner has the "halftime" coming up. >> thanks. another weak number regarding the economy and yet the stock market proves resilient once again. it's up and there are a number of good stories. under armour, groupon. you have talked about all of them. >> and that under armour we owe to you. good stuff playing today. >> appreciate it. have a great weekend. welcome to the "halftime" report. following the biggest stories of the day. under siege. under armour ceo talks to us about his new speed skating deal and the damage that's been done to his brand. clipped, groupon shares plunging on the company's weak outlook. is the social media stock a bargain now or a bust? short