barrack for being with us. can you make a quick point for donald trump? >> there's no one who has transformed the skyline of new york from the very beginning or really defined reality tv and created a clean brand all over the world. anywhere you go in the world when you say trump, you know what it is. >> thank you very, very much. right now it's time for "squawk on the street." ♪ good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. got a report card on the housing market, case-shiller index at the bottom of your screen we'll talk about them with robert schiller in a few moments. a bunch of pots boiling, home deem poe earnings, macy's big analyst move on tesla. take a look at futures, ten years steady 272 and a rough

overnight in shanghai down almost 4% as the yuan sits near a six-month low. the roadmap begins with the markets, the s&p starting off shy of the fresh record high and the nasdaq beginning from right around its highest level in 14 years. home depot is posting quarterly profit above expectations and boosted dividend. different story with macy's and shares slipping after same store sales came in below expectations. and jpmorgan expected to announce job cuts in its mortgage and consumer business. the bulls off to a good start, the dow jumped more than 100 points and closed at 16,207 and the s&p hit 1858 before pulling back and closing at 1847. that's a point away from its all-time closing high. and as we said, the nasdaq reaching a 14-year high before closing off its best levels. jim, you said last night you

would try to play the role of the skeptic. >> i do not like to see the nasdaq at a 14-year high. i took to heart some of the comments we said on yesterday's show which is when you start talking wompam you have to listen. there's two markets going on. the s&p is percolating nicely. 17 times earnings, i would prefer 15, 16 times earnings good profits. and then there's the other end of the market and we'll talk about tesla and the morgan stanley analyst has been terrific. but i get nervous when i see price targets double. i get nervous because we've been around when price targets double and stocks don't double with the price targets. >> you're referring to morgan stanley note on tesla. >> and he's been good. i'm not denying that. this adam jones has been very right. >> target to 320, a bull case of 500 basically saying it's not just a car company, if they can commercialize battery packs they can take on the global electric

utility business. >> disruptive and elon musk i compared him last night, you can compare him to henry ford. look, you can compare elon musk to, you know, pretty much, tesla, edison, it doesn't matter. but i think to be skeptical about some of these. and i'm not being skeptical about the banks. we'll talk about jpmorgan. i'm not skeptical about retail, they are getting hit. but the cohort of the market trading by a different set of rules has never been something that i have made a lot of money at. >> and can end badly. it can. doesn't always. and sometimes it is reflective of something we may not be appreciating fully in terms of a growth rate that is speeding up because of technology or because of -- a lot of what we saw in overvaluation from the '90s did end up being proved out in terms of its significance. >> and amazon did come through, and there would be a couple of survivors and that was right, there were a couple of survivors.

but there were 301 other companies that went to zero. >> at least 300 full bankruptcies of companies. i remember the lists we used to look through in 2002 as you watched them all disappear. >> the class action suit. look, i came out skeptical last night. i apologized for being skeptical, that's a mistake, you should never apologize for being skeptical. going over what i said last night, i didn't want to be a bear, i wanted to play skeptic, thank you for using that word, but you can't have two stock markets at once. it doesn't work. you can't have a stock market valued on eyeballs and another one valued on minus two, minus three, minus nine comps and we say it's okay. so, i want to be a little cautious here because of the late mark haines who taught me when i came on this show in 1998, 1999 that as great as the church is what's happening now it's not the church of what happens in the future. >> all right. well, let's get back to the

church of what is happening now which includes retail earnings this morning. in fact, two big retailers heading in opposite directions. home depot rising in the premarket after posting quarterly profits above street estimates and revenue fell slightly but u.s. and global comp stores were essentially in line for the quarter. and they increased the dividend by 21%. and meantime macy's is falling by posting a higher quarterly profit. they were hurt by, yeah, guess what it would be? hurt by? oh, yeah, weather. >> yeah. maybe they were buying shovels and not sweaters, my friend. >> i mean, depot, well, there's two, you mentioned the two, the down 78 for january at macy's, that's really light. >> my charitable trust owns both stocks. when i saw home depot, i thought it wasn't that bad.

and terry lundgren is squeezing everybody to get the numbers. maybe january is not so bad, he is calling it very disappointing and he's a very bankable guy. can it snap back? we had a terrific analyst on "squawk box" saying, listen, the last ten days have been good. this is a little bit worse than weather and i'm going to graph on zu lily, i know it's small, 45% mobile and it's flash online, people -- >> zu lilly? you went from macy's to zu lilly? you got to go more slowly for me to get the transition. >> why don't you get on the case, whatsapp with you? i'm just saying that people are buying. this is the howard schultz, brick and mortar problem. i think macy's can snap back because macy's has the best gross margins and they are the great executor. we got to stay on the idea that zulilly actually beat the quarter and came out and did a great job because 45% of the

business is mobile. you go into the mall, you look at what zulilly has and if you are younger than we are, you buy, younger and different gender. is that okay? can i use gender? >> yes, you can. >> i've never seen david in a dress nor do i want to get that image out of my mind. >> some like it hot, my friend. >> i'm very proud of my legs. >> you beat me to it. >> people are joking, not joking, worried about the depot guidance, right? >> right. bl they see comps up four six for the year. other people say they forecast three and they end up doing six eight and a couple of the blowout quarters we remember. >> frank blake is the master. does he need warmer weather for planting seasons those of us who get our flats at home depot don't want to find the ground frozen beneath us. the only people i'm worried about today is office depot. >> not to mention depot had

tough comes because a year ago was the rebound from sandy. all of those people buying what they needed to fix up the shore. >> and owens corning did a good number and you would like to think they had the post rebound from sandy. i see no flies in the home depot. i like the quarter. i think they did a terrific job and it's constructive and the conference call is an important place to go to, a lot of new business within the stores really well run. not taking at the macy's did worry me. they just worry me. >> not to dwell on it but to sort of wrap it up, you've been very positive on macy's. >> yes. >> and, by the way, it's been of all of the stocks in that area has been a good one. but all of these pressures beyond the weather, mall-based retailers and so much else can he withstand it or is this quarter sort of saying -- >> i think he can in the way that vf corp bounced back and pvh went, again, and reaffirmed it, i think macy's is a buy and not a sell on the weakness if you can get it at $51.

the greatest operators is, one-third of the stores were closed, okay, but when terry is conservative and say bad things, i can't say good things. terry says he's disappointed. am i going to call him and say you shouldn't be disappointed? i'm not in the apparel business. i don't sell perfume. >> you may not get a chance to buy at $51 the stock is barely down. >> homes the best on the operator there is and is a lot of stores were closed. i'm not going to tell you that terry lundgren is too negative. who am i? >> you're jim cramer. >> i'm nikolai tesla. >> that you are not. let's get to the key housing dating, the s&p/case-shiller report said it was down 11.3%. and here first is to break down the result s robert shiller, its

great to have you back, good morning. >> good morning. >> just looking through the report, the tone, wow, what a change from just a few months ago, a couple of quotes. the strockest part of the recovery and home values may be over. recent reports suggest a bleaker picture for housing. you've been warning us about a turn. is this finally it? >> i think that there's pitfalls ahead. i think, though, that at this point they're going up pretty fast. and my instinct is that this momentum will dissipate but not -- we won't see a reversal this year. i think it will still be up. >> how are you stripping out the weather effect from the fundamentals here? >> well, if i look at year to year, that's up quite a bit, but, yeah, the latest -- you know, it's not just weather it's seasonal which is the predictable component of weather and if you correct for the seasonality, already we don't

see a weak market it's up 0.8 a percent in the last month in the ten-city index, so it's not weakening that much yet. and i think prices will continue to go up for the first part of the year at a fairly good pace. but i think they may weaken. there's a lot of signs showing that the housing market is weakening. >> right. we should remind people these numbers are december figures. we're not really getting into january which as you probably know was the tenth coldest on record. i mean, all we see, whether it's starts, whether it's permits, whether it's existing, pending, new, you look at a chart and we are beginning to see some of the trajectories turn down, robert. when do you think -- >> yeah. >> go ahead. >> it looks a little bit like 2005. nobody was paying attention as much but everything started to turn down that or early 2006. now, that was the beginning of a disaster in the housing market, so i don't think it's anything

like that, but it is worrisome. this is a time if you are cautious you might be a little careful in the housing market. >> but we are 19% still below i believe where the index was in i'm of '06, correct? >> i don't have the exact number. if you correct for inflation we're still way down. homes are not expensive now and that's the silver lining in this. you know, if i were buying a home right now i would think, you know, if i want it, fine, because it's not expensive and mortgage rates are still low by historical standards it's not a horrible time to buy a house not at all. >> isn't this exactly what ben bernanke wanted? he talked about trying to get housing pricing to cool. it's been the big part of inflation. isn't this a bernanke win? >> it would be nice to think, conclude his career as fed chairman with a triumphant win at this point. i don't think bernanke is really in control of the housing market. you know, these people probably

don't even fully understand it. so, i think the market has a life of its own. and, you know, the big factor in the housing market recently has been it bernanke. but it was in 2012 when mortgage rates hit record lows and we saw a burst in housing enthusiasm. and that carried over for a while but it might be fading now. that's the way i see it, the most important fed factor to think about. interest rates have gone up about a percent since 2012. >> yeah. professor, while we got you here. given your history in terms of looking at overvaluation or valuation of assets and particularly stocks, i'm just curious to get your take on the whatsapp deal in light of sort of the new valuation metrics that we seem to be revisiting, so i guess i can't call them quite new but revisiting a lot of things we did see in the late '90s. are those comparisons apt in your opinion? >> yeah, we do have kind of a

little bit of a bubble thinking. i'm thinking also of bitcoin, that one has burst in a way. >> right. >> but people are very impressed by high tech. probably too impressed. and so it does call to mind a bit of the late 1990s with the dot-com bubble. >> huh, okay. i'd ask you to expand on it, we're talking about. companies that have compared to a pets.com some level of earnings power whether or not they want to pocket it or not, right? >> well, i'm a big believer in looking at earnings but i like to look at long-term earnings. i have this ratio that looks at a ten-year average of earnings. you can't do that with whatsapp. that's a whole different market. it's for adventurers. and i'm more of a stable investor who look as the long history and wants to invest for the long term. so, maybe ask someone else about these upstart companies. >> i don't know, i think we'll

keep asking the nobel laurette from time to time. >> i got 25-year-olds tell me i'm dead wrong. >> robert, it's always good to see you. >> my pleasure. when we come back a ceo's perspective on the housing market, we'll talk to richard smith from realogy. also ahead, hear what blackberry ceo told cnbc at the mobile world congress in barcelona. jon fortt's got some details on that. and wup more look at futures after a bruising night in shanghai. relatively stable here. we'll get more on that in just a moment.

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♪ jpmorgan chase confirming plans for deeper cuts to its mortgage operations. the bank may reduce up to 6,000 jobs in the unit this year, and last year they set a goal of 12,000 job cuts and 24,000 job cuts since 2014 in mortgage and consumer. >> we all think the mortgage consumer business is a great business. when you get off the desk with

the bankers, they'll tell you it's a commodity business. it's not a business they really want to be in. there's been a lot of trades in servicing but they want commercial lending, okay? that's where the margins are and they want to be able to buy, good, short-term paper with your deposits. so, i don't want to overdo this. i think these mortgage departments got very bloated. i feel terrible for saying it for the people that got laid off, but this is what you want along with the 3% ten-year and jpmorgan earning more than now. >> the cfo of the company also saying they added 7,000 people, 7,000, in risk management and control functions. while they have been -- yes, 7,000. >> sheez. did you hear that on the elevator? >> i did not hear that on the elevator, that's courtesy of the meeting. that's, again, head count did come down 10,000 last year, so it just puts it in some perspective. >> it tells me that they're able

to make a lot of money in pretty much every environment. the thing that is daunting to me is that you have got to see more yield curve inflection. now, everyone always laughs when you say you need interest rates higher. no, for this company you do. you need to see some curve. that's how they're going to make big net interest rate margins, that's all we care about not the mortgage business. mortgage business, enough. another big story john chen spoke to cnbc earlier this morning from the mobile world conference in barcelona. he spoke to bbm's 85 million users versus that recently acquired messaging service whatsapp 450 mill plus. take a listen. >> i work with a shareholder, you know, standard answer, you know. >> very good. >> if someone comes to me for $19 billion, i would recommend to the board to take it, but it all depends on what it is. >> got to love that. >> they're in talks.

let's take it the next stage, they're in talks! >> it's good to know the guy is breathing air, $19 billion sold to you. >> when i heard from dan conan and honeywell, listen, if google will buy nest for billion, you can have the whole thing for honeywell. you got to be careful. they still have people who love it and i think this is a correct issue. daniel loeb why is in the stock? >> you, listen, there's this undercurrent of bullishness if you will in this stock. you can see it is up. people like chen. they look at the sybase turn around and believe in the intellectual property but there is especially among the hedge fund names sort of a bullish theme going on and you got a few of them buying in including third point. >> subscriber business is a great business and it hasn't tailed off as much. >> and even the privacy implications of it, it's harder

for the nsa to tap into it. >> really? >> a little bit. >> maybe switch back. >> the prez still has a blackberry. the president still has a blackberry. >> really? >> yeah. >> wow. okay. well, that's interesting. he doesn't want to be hacked. i don't blame him. we're going to have the military the same size -- that untrue. we were the 18th largest army, 15th? was romania, the force reductions are nowhere, i cannot believe "the washington post," everyone bought into that, "the journal," "the new york times," those stories are false. >> i do want to get your take on some of these cuts. >> that's a false story. it's embarrassing that they would make the comparisons to 1939. >> the r&d element. >> but there is a manpower and an r&d element to it and cyberwarfare now. >> yes. >> reagan had a 600-ship navy, what good did that do? honestly, those stories -- i don't want to be too political. >> what about the joint strike fighter? >> go back to 1939. go actually do some home work,

people. romania, larger army than us. believe me, romania's is not is -- when we count down to the opening bell, cramer's "mad dash," a lot more "squawk on the street" on the show straight ahead. ♪ [ male announcer ] these days, a small business can save by sharing.

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from td ameritrade. we got four minutes to the opening bell, watching cnbc's "squawk on the street" we are live from the financial capital of the world as i said and now it's time for a "mad dash." i think we're going to stay seated today. >> yeah. >> ahead of that market open. >> i want you to start understanding the greatness of zulilly, you get used to hearing the company incubated by people with starbucks out of seattle, it is a technology company and when you read the research and when you go through the conference call, this is a company that before every morning at k a.m. launches 4,500 new products. who are they taking on directly? this is the first company that i said we can beat amazon and i

believe them. zu. i think they can beat amazon, why? because they are a technology company in the woman's apparel business. it's a revolutionary company. i encourage everyone to look at zu and the reason it's up is because it deserves to be up. this is the first legitimate competitor to am zonle i've seen. >> amazon owns zappos, a company that was doing extraordinarily good job with something people said would be virtually impossible to do selling shoes and then they bought them and they continue to have great success. why can't amazon replicate what zulily is doing? >> they have no inventory, we love that, zappos, no inventory. i think it's because these guys understand women's apparel better than anyone, again, this is a tough call. you quot to interview people you don't normally think but you go through the conference call and you recognize they understand,

retail's technology now and this at 46% mobile, i mean, this is what you are looking at, facebook going 50% to 60%. you have a mobile technology company and, remember, starbucks is going that same way. go back to what howard schultz said. mall-based shopping it is in a secular based decline. need to be mobile based play. >> starbucks, amazon, zulily all based in -- >> washington. >> -- it's the hub for mobile-based retailers. >> they get it. maveron, they understand. zulily you'll be hearing from this company. i am not overdoing zu. >> company? >> compare this to the container store, bricks and mortar, well, run, no. zulily adding to the technology team this stock is going higher.

>> it went up four points. >> all right. the area of the country is also home to costco which is fairly bricks and mortar and then there's this other company not far away that is still trying to figure out mobile. >> nokia? >> yes. nokia. >> nokia. i know, microsoft. >> did you see nokia came out with a number of android phones at the -- in barcelona? >> yeah. >> that can't have been a good thing because the deal is yet to close so nokia has to continue to move ahead assuming that you never know. >> right. and now they are talking about another company that are destined to hear. eog is the old enron oil and gas and i bring it up because don't you remember who they were? they are not that team and they are talking about mammoth growth and our economy will be energy self-sufficient, go over the release, much more 3 billion barrel reserve. this is the great american oil company you've been looking for and i like continental, i like

noble, eog. >> you've been pretty consistent on that on "mad." >> thank you. at one point maybe things had gotten overheated. i think this stock is not overheated and will go higher. >> there's the opening bell. and a look at the s&p at the top of your screen. down here at the big board advisory shares and new fleet asset management highlighting the adviser share new fleet multisector income etf. over at the nasdaq comada. we'll keep an eye on home depot. 73 cents did beat by a couple pennies. comps up 44, u.s. up 49 which in retail is pretty darn good. >> it increases the dividend and buying back stock, it's a great capital allocator. they are not doing a big overseas thing they are only

open in one store which is right in north dakota where the balkan. but i think that frank blake is the best operator right now and they had the right merchandise. they do need warmer weather. i'll reiterate, they need warmer weather but my charitable trust has been buying this stock and i like it. >> i wanted to mention a stock that is shattering heights today, intramune is the name of it, itm is the symbol. it does appear to be up 150% according to a dow jones wire story. the company had -- saying it met the primary end point phase three trial for a treatment of idiopathic pulmonary fibrosis, and the study showed significant reduction in the lung disease's progression, data demonstrated that the drug is significantly reducing the lung function and

significant increase proportion of patients who had no decline in lung function which is an important advance in the field according to one of the co-chairs of the protocol study's steering committee. but you can see the stock is up 161%. that's not a bad morning. >> no, adam fearstein said it's positive results. we've seen this pattern, i find a little worrisome because -- but it is phase three data. it is a real study. >> and apparently the drug already is approved for use in the european union and canada. >> improved lung function, necessary. terrific. >> retail making a nice showing. macy's second best component and followed by home depot followed by tractor supply. >> tractor supply, they've are saying good things about buyback. tractor supply has been one of those company -- >> still the key to this market? >> no. i told you that -- will you please keep up with the keys? >> i do.

i do. i know. >> but, look, i think that people are giving everything a pass. now, this is the same thing they gave a pass to employment. they are saying, listen, the january month didn't happen. look at realogy, look at toll brothers. people are saying, listen, the weather really did play a role. >> look at macy's. >> the gross margins. they are taking it. if you are in the apparel business macy's calls you and says we are paying whatever everybody else is paying you, we are paying you 25% less, and the margin are extraordinary. and terry lundgren calls himself disciplined. it does matter. >> once the warm weather arrives, if it ever does, they do expect consumers to go back to normalized shopping patterns. >> think about, you see gross margins going up at home depot which are really impressive and gross margins at macy's, where are the gross margins at target

and canada and some have it licked. it's a gross margin business. anyone around retail expect gross margins to fall. but these guys are rising. important metric. >> toll you mentioned. 25 cents did beat by 7 cents. net income year over year up n ten-fold. we talked to schiller, how do you see housing shaping up during the course of the year? >> i think interest rates have calmed down. i like the fact that toll has moved up higher. colony on previously on "squawk" talking about household formation and continued shortage of housing. toll brothers does have the lots, but do you know what, then again, i look at -- you need a spring that really brings in some traffic and you are not getting traffic right now for the home buyers. >> do we want to talk tesla here? >> i think we do. >> because the stock is up sharply, over 7%. that's got to be a new high. >> an all-time high. >> it's got to be. approaching a $30 billion market

value is tesla. the morgan stanley note we referenced it at the top of the show. it's not just about cars it also moves into the idea that they can disrupt essentially storage of energy if you will with the revolutionary battery that they are perhaps going to start to mass produce or make a lot more of to help get more cars on the road but what it could mean for storage and for putting in these things all over the country. >> look, you know, this company is called tesla for a reason, okay? because tesla system was superior to edison system and it lost. this is tesla's revenge. i like the revenge. i don't like the price target. i wish morgan stanley hadn't done the price target. why not say, look, we've taken the price target up. but when i look at the history of this writer's stuff, february 25 and the previous piece december 3rd he's talking about the idea you can't call the bottom and the stock had been down very badly was then asking where are the fires lately?

no fires. is it disruptive to the technology of the entire electric grid? well, our electric grid is only, what, about 100 years old? it's certainly possible. >> yeah, yeah, yeah. >> one would hope you could disrupt it. >> efficiency improvement. >> no doubt. getting into autonomous vehicles and what it could mean. >> the giga factory, david, the giga factories. >> some of the viewers on twitter ask and i think they mean it sincerely, how long can you stay short tesla even if you are eventually right? it makes it more difficult. >> we got to get buffett on the phone. who has that kind of money? gates. >> bill acme can do it. he can stay short. >> oh, well, herbalife is no tesla. if the battery comes out and it is revolutionary and you should be buying solar city if that's the case, the stock shouldn't be down. there's something big here. steve jobs talked about the idea of a car running on water.

you could have a car that goes in, you know, like the everready, you know, the bunny there? >> yeah. >> well, i mean, we're all going to be driving it and if you are cone con ed, you got to be listening. >> the operating system of that car could be important, too, i don't know if tesla is going to do it or apple or google. >> my hats off to the morgan stanley guy recognizing the disruptive nature. the solar city conference call was a preearning call, and a lot of people thought they should have done more developing. i don't think they wanted to get ahead of the giga factory, in thechimera. >> your thoughts on food. dpz beat by a penny. and a lot of talk about mcdonald's extending breast fast hours and yum. >> and the stock is up since you reported a disappointing numbers. dpz, don't forget their app enabled you to no longer -- if

you ordered a pizza it's your own darn fault. patti doyle. 7% international. net income up 18.9% this may be one of the great cash flow generators of our time. remember, they are able to get fewer employees. >> right. >> oh, absolutely. >> and who uses the app besides me? right? >> ditealt guilty. >> when you say no cheese, it comes back and says are you sure you want no cheese? >> david said, we live in new york, why are you ordering domino's? >> thank you. >> 17 deep to get a domino's sloo and i had to give up and go to the starbucks line that was only 12 deep. >> okay. i got a pizza place on this side of me and a pizza place on that side of me, last time i looked, they are pretty good. not taking anything away from domino's. >> you can use your credit card, you don't have to worry about cash, and it has the great app. >> and shows you where it is in the supply chain. unbelievable. i tell you who knows pizza

bob pisani, he joins us on the floor. >> i hope so. being born in the bronx and hanging out in brooklyn. mixed markets. it up the s&p 500 the important thing was a lousy close. a lot of sale at the close, verizon didn't go particularly well and the s&p didn't close at a new high. we're not there right now, but bottom line is momentum names still are strong and the tesla and the linkedins and groupons are up. take a look at the sectors. the laggards are doing well. consumer discretionary hasn't done much, it's up. consumer staples are up. materials were up. industrials were up just at the open. and now can see things falling back a little bit, but those were the leaders early on. the macy's numbers were really great and the key story i think you mentioned this, jim, 244 stores were closed at some point in january due to the weather. 840 they've got. and a 30% of the store base was closed at some point in the month of january. they still did okay.

the guidance looks okay. they are talking about comparable store growth of 2.5 to 3% in 2014. earnings of 440 to 450. warm spring weather they said should bring out the buyers. i thought it was a pretty good report overall. perry ellis, not much you can say. cut the outlook for the fourth quarter and wholesale is a big part of their whole business and they said replenishing orders were turned off for the retailers in their effort to manage overall store inventory. that's not a good story. but home depot, move on to that, beat on the bottom line. it was a great story overall. they raised the dividend 21%. we are talking 47 cents a share i think that's, what, 2.4%, 2.5% it's a nice dividend yield and it was a great year for the company. you got to say that, comparable store sales 4.4% and those are good numbers and the whole background story of home improvement is remaining positive here. by the way, management's talked

about 4% to 5% revenue growth in 2014 even if they don't take market share from other companies, again, a very positive story overall. toll brothers numbers out, they beat expectations. you know, they talked about the spring season very optimistically right now. here's the important thing and this came from bob toll himself. but up the full screen, although the weather will result in some delays and some additional but not major costs, it should not result in lost sales or deliveries. that's something everybody's been talking about. now bob toll himself has weighed in on the whole idea. right now the dow jones industrial average down 20 points. guys, back to you. >> thanks very much, bob pisani, apparently is hanging out in the brooklyn these days. >> visiting my mexican restaurant. >> exactly. cramer hangs out a lot there, too. let's talk t-mobile and potential consolidation in the works and the topic we discussed with the chairman and ceo of verizon lowell mcadam who

indicated i don't know if that's something that, "a," is going to happen or, "b," he would necessarily want to happen. price competition is also, of course, something happening brought to you primarily by the fourth competitor t-mobile, you are looking at it here. you can see the stock is down a bit. most analysts and also a couple of money managers i spoke to this morning responding more or less positively to the 2014 guidance on net additions of subscribers. because they would note for the last few quarters t-mobile had been somewhat conservative on that and then beat it as we all know. but they actually put a pretty decent number out there in terms of 2014 implying to some that they're very confident they can continue to win business from -- well, from who? is it at&t? is it sprint? is it verizon? we shall see. but there's a look at t-mobile. by the way, almost, that price

is kind of where the old at&t deal was. >> wow. >> maybe a bit above it. >> you do wonder what will happen. of course, we continue to hear out of washington whether it be the fcc or the doj a lot of sentiments saying no way, sprint, are we going to let you get together with t-mo and i've pointed out that soft bank could control sprint is nothing if not an extraordinarily aggressive fellow. they are going to continue to argue as to why you need a much stronger third competitor to really compete with what is -- it's the two of them at the top there at&t and verizon. the latest iteration, by the way, what i'm hearing at least is what might happen, if deutsche telecom were to want to play ball or give it a try, maybe you get something like a merger of equals that does not actually have a break fee that john legere runs the combined company because they've done so

well. i know you are tight with management to a certain extent. dan hessy is coming on soon. >> he'll be on tomorrow and we'll talk about all the tough issues including whether whatsapp threatens telecom with low-cost calls. >> what i wonder is what is the -- how closely do they view the current management at sprint key to the vision or are they willing to say -- >> what are you saying? >> if they were to do a merger of equals, maybe they would have legere run the company. >> that's shocking. >> why? >> because i think hessy has done a remarkable job. >> don't you think legere has done a remarkable john? >> i am stunned. >> you are speechless. >> i know. >> it happens very rarely. >> that's a nice piece in the "journal" today sort of drawing parallels between t-mobile and 7up, meaning a player with minimal market share and in the "journal's" view not a strong ability to change the market

overall. one of the first to sort of pour cold water on the myth of legere. >> he's a revolutionary insurgent. he mays a guerrilla warrior and he's literally one of these people saying, look, we're the pink-shirted guy? right? we're not the button-down guy, dan hessy is a button-down guy, but in terms of operations, look what he's done, turn around the ridiculous nextel, maybe the worst deal, we have to talk about aol, don't we, time warner? and he's revitalized it. the footprint is still not the whole country. there is a drop call problem and we'll discuss it tomorrow. >> there's still the larger question whether either one can compete with the likes of at&t and verizon. let's move to the bond pits and rick santelli at the cme group. >> hi, david. we're seeing a little bit of action to the upside in buying on the face of it and to the downside on yields. of course, i'm talking treasuries.

look at a one-day and a two-day especially the two-day. very simple. we're starting to intratrade below yesterday's lows. here's the key as you look at a year to date ten-year note yields which settled at the end of last year at 303. this will be the 11th day if we say in this range that the ten-year note yield was settled between 271 and 276. and pretty much yesterday and last week it was about the upper band. now it seems to be about the lower band and it's happened rather quickly. that's -- that's a dazzling statistic when you think about the upward bias in stocks and how little of that is filtered into actual selling in treasuries whereas if you look at the breadth of the january decline in stocks, the treasuries were all too willing and accomplished to move lower in yields as stock prices and anxiety on equities and emerging markets moved lower. talking about emerging markets and the like, the most prevalent chart i've been e-mailed in the

last 24 hours is without a doubt been the yuan. here's a chart of the dollar versus the chinese currency and as everybody's paying attention we are currently at these levels about at the, you know, an extreme we haven't seen since october after there's been a general appreciation of that chinese currency against most of the majors, so we want to pay attention to this. why? because a lot of the action in january was at the epicenter of emerging markets and china's shadow banking system. carl, back to you. >> all right, thank you very much, rick santelli. the man behind the satirical twitter account that allegedly reveals crude comments overheard during the rides at elevators at goldman sachs has been revealed. turns out he never worked at the bank. andrew ross sorkin joins us with some details after his fabulous piece in "the times" this morning. good to see you. >> thank you, carl. it was one of the stories many of us had been following this twitter account and many people at goldman sachs and wall street

had thought that the man behind it worked at goldman sachs. in fact, in many interviews online he'd told people that he worked at goldman sachs but, in fact, of course, we now find out he did not. he's 34 years old. lives in texas. was a banker. worked at citigroup and in truth and, in fact, had an opportunity to work at goldman sachs in 2010. there's a picture of him on the screen that he sent me last night. i didn't -- i was about to joke, i didn't know if he was threatening me. but i don't -- we didn't know the context of this picture of john, but 34-year-old guy. he is a book deal now and now that he's been revealed we'll see whether the interest will continue. i did catch up with goldman sachs to ask them what they all thought of this. they had run internal investigations inside the firm for the past three years thinking this person was, in fact, there. i think we can get the statement on the screen. but it was rather hilarious. we are pleased to report that

the official ban on talking in elevators will be lifted effectively immediately. at least they had a little sense of humor about all of this. >> that sort of sounds like them. i especially like the detail, andrew, that the choice of goldman almost was sort of an accident. he was looking for a name with basically broad recognition, right? >> absolutely. he's an interesting guy because he chose the name because he thought it was commercial, that was his phrase, likes wall street. this is a parody and a satire, but it isn't something that he says is -- or at least when he started was used to poke fun directly at wall street. he doesn't necessarily sympathize with occupy wall street but decided at some point that movement was in line with what he was doing and a lot more people started to follow him as a result. he talked at one point pandering to that group and pandering to different groups. when i asked him whether he would still recommend that people do work on wall street, he said absolutely. he said he enjoyed his time. it wasn't that he had a grand epiphany in all of this.

he's not greg smith but, you know, it's an interesting -- it was an interesting reveal and my e-mail at least from goldman sachs this morning has been clogging up. >> i can only imagine, andrew. great piece. >> thank you. appreciate it. >> stop trading with jim is after the break. one direction: up so we're up early. up late. thinking up game-changing ideas, like this: dozens of tax free zones across new york state. move here. expand here. or start a new business here... and pay no taxes for 10 years. with new jobs, new opportunities and a new tax free plan. there's only one way for your business to go. up. find out if your business can qualify at start-upny.com

♪ time now for cramer and "stop trading" jim, take it away. >> intermune, i would typically not favor a stock going up this much. this is talking about a major decline in death, okay? this is a terrible disease and you literally, idiopathic pulmonary fibrosis is a killer and they are saying there's a decline of 10% or more of death and an increase of patients who did not get threatened by this terrible disease, it's a home run and the fda will approve it at my prediction. let's go to the other side, you have some of this linkedin,

okay, we all knew that linkedin was going to do a chinese version. they've been saying that over and over again. linkedin goes up really big on this, is that right? we've seen this time and again with certain internet stocks they say they're going to do something and then they do it and we fall in love with it. i happen to like linked in long term, but intermune i think is right and linkedin, i'm saying i think it's wrong. >> they say their goals in china are aligned with the governments. we know what happens when you run afoul of those, though, in that market. >> that's smart and we know that google is not there one of the reasons that google has done well when china is off 4% is that google doesn't have china. i think linkedin is terrific, i think the announcement in china is terrific, i think the market is saying it's more terrific than even i think. i'm just concerned about it. intermune you are taking the shorts apart, linkedin when it fell below 200 i hate to be technical about it but we got to go anywhere and people were pushing the stock down and the company responded with something

very interesting. let's not go crazy to the upside. this is not saving lives. intermune is. >> you can say that again. you mentioned dpz on "mad." >> this patti doyle, comes in at $11, $12 on the thing and look what he's done plus a special dividend, i really like what he's up to. >> and phil fernandez as well. >> hot stock, software is a service and this is an area of the market and workday and salesforce reports later this week. and let's find out if they love them tonight. >> yesterday's action was good all day long until yesterday afternoon, did the bulls plant enough of a stake in the ground? >> i hate monday up openings. i like today's skepticism. we need a little pullback and remember retail has been terrible. if retail leads us back. all i'm saying stay skeptical you don't want linkedn up nine because of something we all expected. we don't want a situation where

we see this one part of the market divorced from everything there, i'm talking about the tesla, that giga factory better deliver or we're going to see a stock where it shouldn't be where it is. >> talk about a stock that's moved up 4% from where we last spoke about it and up 12% is tesla as carl alluded to earlier, once a heavily shorted stock, you got to wonder on a research report. i mean, an interesting read. >> disruptive technology which takes care of our grid which is old and bad. solar city down badly last night on the numbers. give me a break, if there is a disruptive technology solar city goes higher. i just want to point out a lot of thing have to go right. >> the effect on retail of natural gas, con ed says the average home, the monthly heating bill this month, $388 is up 17% from a year ago. and we talk about the effect of low gas prices but you can't ignore how much it costs to heat your house.

>> it makes me angry because there's not enough pipelines in the northeast. >> good hour, jim. >> thank you. >> we'll see you tonight "mad money." and also ahead a live interview with one of the co-founders of netflix as the stock hits new all-time highs. don't go away. you guys are good. lemme just get this out of here. unlike some places, we don't just change your oil. our oil offer comes with a four-tire rotation and a 27-point inspection. and everything looked great. actually, could you leave those in? sure. want me to run him through the car wash for you, too? no, no, i can't. and right now get acdelco professional durastop brake pads installed for only $99.95 or less per axle. chevy certified service.

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the x1 entertainment operating system, only from xfinity. welcome back to "squawk on the street," rick santelli here live on the floor of the cme group. and we're awaiting february data on confidence and manufacturing out of richmond. consumer confidence from the conference board drops unexpectedly 78.1. we're expecting a number kind of lateral with the number 80, our last look at 80.7 remains. the last time we were at 78.1 in terms of the weakness factor actually wasn't that long ago, we're at 77.5 in december, the high watermark recently was in june at 82.1. all right, richmond, fed manufacturing obviously weather affected down six. we were expecting up five. last look, remains at 12.

down six. well, the last time we had a number that would compete with that would be down ten in january of 2013. a little over a year ago. so, weather continues to be a big issue. i would say in richmond, but consumer confidence probably also affected from that vantage point. the issue is how much are they all affected because it's affecting the markets. carl, back to you. >> thank you so much, rick, rick santelli. as consumer confidence and case-shiller results clue us in on where the u.s. economy stands the president hopes to fuel the engine announcing the creation of two manufacturing hubs one in the president's hometown of chicago and the other outside detroit. talking first to cnbc this morning is gene sperling the director of the national economic council in his final days in that job. gene, it's good to have you back. good morning. >> well, good morning. >> we've been hearing for a long time about these manufacturing hubs about a year ago the president made this pledge to create them. what are they going to do and what will they do for the economy? >> well, what they do is they

take important areas of manufacturing technology where we know it's cutting e inting e. we know it's important for the competitiveness, but we also know that no one company has the incentive to do it alone, so what happens is we put out a competition that brings together universities, big companies, small businesses, and they come together in kind of create an ecosystem, a hub, where they work on the advanced manufacturing technologies together. and what's particularly beautiful about it is when you create these kind of hubs rather than creating a situation where people decide they want to leave and outsource, more people want to be part of that network. they want to be part of the supply chain, so in terms of the president's goal on advanced manufacturing, encouraging innovation and making the united states a place where people want to locate for jobs and r&d, this works in a positive direction for all of those goals. >> gene, it's really coming down

at the white house in terms of the snow. when you're talking about manufacturing -- >> we're doing way better than sochi and this is almost a christmas card or hanukkah card back there. >> take a spring break in sochi, gene, but the weather seriously is creating a soft patch in the economy. do you attribute the recent signals not just in manufacturing but really across the board? we just saw it in consumer confidence even to the weather or is there something else going on that worries you? >> i don't think we at the white house are different than most of the people you are talking to. you've had generally positive momentum in the economy. you look at manufacturing jobs. we're up 622,000 over the last four years. that's the best patch of job creation and manufacturing we've had since the 1990s. we're seeing still more large manufacturing companies wanting to locate here. you've seen a general view across the board that the recovery is gaining momentum and

yet you have all this uncertainty to the weather and, of course, everybody wants to know is it just the weather or is there something else there. i guess i put myself in the camp of guardedly optimistic that we when we get by the weather numbers we'll still see that there is momentum in the recovery, though, still not as much as this president would like. that's why we're still out there pushing for things like this manufacturing, innovation hubs for a big infrastructure investment, the type of things that could help accelerate growth right now and get more people to work and get the unemployment rate even lower. >> mr. sperling, you'll be aware that "the washington post" is reporting that house republicans have a bigger idea on how they can get the economy moving and that tomorrow after three years of work they're going to propose that there's a major cut in simplification in marginal tax rates with the top rated tax coming down from 39.6% to 25% and then a surtax to make up the revenue of about 10% on those

that earn $450,000. in other words, bring down the marginal rate of taxation and give people a one-off cost in order to compensate that. does that excite you? because they are talking about big leaps in gdp and big leaps in job growth as a result. >> so, i can't comment on chairman camp's plan because we haven't seen it. if people put forth a serious proposal, we'll give it a serious look whether we agree or disagree with it. but what i would say is that one of the things the president put out last july, reiterated in the state of the union is what he's referred to at times on a grand bargain on jobs which is that we could lower our business and corporate tax rate as low as 28% or 25% for manufacturing, have it be revenue neutral in the long term, but take some of the transition fees, the accelerated revenue and commit that to modernizing infrastructure. that would be very pro-growth, very pro-jobs, it would give more momentum in the rivecovery.

and that's one thing that the president has put out. but i can't comment on a proposal i haven't even seen yet. >> but importantly you don't include personal rates of taxation in that. why is that? because, i mean, a lower marginal rate of taxation for an individual surely would spur economic growth. is it because you simply can't give an inch to those -- to the high earners? >> well, i think that the question the president's going to look at is whether a plan is pro growth, whether it's fiscally responsible, whether it keeps our system as progressive as possible and we'll take a look at that test. i think right now we have -- you have a president who has pushed middle-class tax relief. he's had payroll tax cuts. he has looked to cut small business taxes, but we have sought to restore the rates on the very most fortunate americans to where it was in the '90s when we had robust economic growth.

i think we right now think that that's a progressive system, but, again, we're willing to take a serious look at a serious proposal, but we will be looking to see is it good for growth and does it make our tax code more fair or less fair and those are some of the things we think other people should be looking at when we review chairman camp's proposal. >> gene, you may have to shovel your way back to the west wing. please come back before march 5th, okay? >> happy to do so. >> gene sperling joining us from washington, gene, thanks. the latest s&p/case-shiller reports u.s. house pricing losing momentum despite gaining 3% over last year. earlier we heard from bob schiller himself the co-founder of the case-shiller index. >> i think prices will continue to go up for the first part of the year at a fairly good pace. but i think they may weaken. there's a lot of signs showing that the housing market is

weakening. >> let's get more insight now on where we are with housing in the cnbc first richard smith joins us chairman and ceo and president of realogy whose brands, of course, include cold well bankering, century 21 and soth eb sotheby's international. and what are you seeing in the housing market at the moment? >> well, at the moment we have very low inventory levels and robert shiller's point that is driving an increase in price as you know peak to trough pricing was down about 34% on a national basis. we've got about another 20% to go before we're at i think market value. and the prices continuing to react to demand, outstripping supply. so, i think he's correct. that's going to continue sometime into the year and i think that's probably a fairly good forecast for price. >> diana? >> one thing on your conference

call this morning, you said prices will have a positive effect on home sales going forward. i imagine you mean because it brings more people up from under water. but the realtors themselves blame the bad numbers this month on weakened affordability, that is prices rising too high, do you disagree with that? >> no, affordability is on a relative basis still very attractive, dropped from 173 to 168 and it's still very high and it's dropping from an extraordinary high more than 200% which means the average family had about 100% of what's necessary to qualify for the typical loan, so i am encouraged that affordability remains high. we think pricing is going to pull more people back into the market but, again, you cannot predict inventory levels or the year based on the first quarter of the year, it's just getting the seasonality of the business and it's just not the right time of the year to forecast the business. >> if i could just follow on that, when we talk about

affordability we also need to talk about credit and the fact that credit is still relatively tight. you also mentioned on the call this morning to investors that you were glad to see wells fargo was lowering fico scores for some loans, lowering their minimum, is that what we really need now is to see the lower fico scores coming in when we're just beginning to recover and see people back on their feet? >> most people view the current underwriting being far too extreme. it's not even close to being normalized underwriting. so, we think wells fargo is doing two things. one, they're trying to -- >> mr. smith, forgive me, sir, we have to just break -- >> other lenders will follow -- >> we have to break off for one moment, we have breaking news with steve liesman. >> simon, hi, dan tarullo conference the federal reserve governor making a speech saying that low rates can inflate a speculative bubble and they find

some evidence of increased risk in the system, but the risks appear to be relatively well maintained. evaluations for broad categories of assets such as real estate and corporate equities he says are within normal bounds but some categories such as leverage loans and high yield corporate debt, they're showing some signs of i guess fraud is the best way to put it. regulators are working with firms he says to withstand interest rate risk and banking firms he says are capitalized to withstand a spike in rates. but supervisory process may not be adequate. this is the key here, to deal with this kind of issue. and so he says monetary policy cannot be taken off the table. here's a big key, among the keys what he's saying here, there's a big debate. the fed has promised to remain low for long. does that promise maintain in place if the fed believes there are financial bubbles out there? and tarullo does an exhaustive discussion of ways the fed can reduce risk in the system.

using supervisory tools but he said at the end of the day that may not be enough, simeen? >> all right, steve, thank you very much. let's return to richard smith the president and ceo of realogy who we were speaking to earlier. are you still with us? can you hear me? >> i am still with you, simon. >> good. i know you want to talk about the business. i mean, you know, even since the ipo you've had to send your cfo out to argue as to why it's still a good, solid business despite the heavy debt load. how do you feel about where you are at the moment? >> we're in a great position. we've substantially reduced our debt leverage. our goal is to get to three times trailing adjusted ebita. we're down pre-ipo our leverage was as high as 11 or 12 times. so, we've made remarkable progress. we generate a significant amount of free cash flow and we are going to meet or exceed the expectation that we'll get to three times leverage and then decide how to start returning capital to shareholders. so, we're in a fantastic

position right now. >> so, with $3.9 billion of debt you don't worry more than other ceos about the poor weather hitting your volumes or the fact that there may be low inventory? >> well, remember, we've reduced our interest -- annual interest expense from about $650 million pre-ipo to the current run rate of about $240 million and that's going to continue to trend down. so, we're in a very good position to satisfy the interest payment obligation on our debt and substantially with free cash flow reduce debt to our own cash flow generation, so, listen, i worry about debt like every other ceo but we're in a terrific position to continue doing exactly what we said we were going to do and that's delever the company. >> mr. smith, it's good to see you, thank you very much for joining us. richard smith there the president and ceo and president of realogy, thank you. well, if you haven't noticed already, shares of blackberry are up more than 60% over the last three months.

blackberry ceo jon chen speaking exclusively to cnbc commenting on that run as a reflection of his turnaround plan. our own jon fortt is live at the mobile world congress in barcelona where all the action is happening with more on that conversation. hey, jon. >> reporter: hey, sara, yeah, jon chen said stock price rises, it falls, mainly this seems to be a reflection on the fact that investors recognize that there is a plan. he was mainly focused on a new strategy around blackberry enterprise ser enterprise server. take a listen. >> reset the stock price and make it very competitive to the market. it also is our commitment that we're going to, you know, be able to bridge back to the old and that was also part of the discussion this week. and also building new features on it and integrating bbm tool. so, all these things are very important. >> reporter: he said that blackberry's phone for indonesia is a key one to watch here.

also speaking of emerging markets, facebook's head of growth is someone i caught up with here, he's a very important part of mark zuckerberg's inner circle, identify was asking him about facebook's big pitch to emerging markets carriers here to offer facebook and some other services for free which would be very good for facebook but also change out the picture in emerging markets. listen to what he had to say about the pitch to carriers -- >> let's together find the model that enables you to offer certain services for free to get people that are not currently connected to get the opportunity to be connected and then from there as their lives improve be able to afford other services and we need to do it in a way that is profitable and economically feasible for them so they can keep investing in the infrastructure. >> reporter: this is a guy you hardly ever see on tv. he is charged with making sure facebook and now whatsapp

continue to grow. very important topic here because as we recognize smartphone sales have largely topped out growthwise in developed markets, emerging markets are an important spot for growth not only for hardware but services like facebook. guys, back to you. >> all right, jon, nice stuff from barcelona, once again today, our jon fortt. when we're back macy's disappointing the street with fourth quarter sales. is it yet another victim of winter water? we'll find out what it means for retail as a whole. and one of the largest exchanges for bitcoin just gone as bitcoin's future and longevity is gong. what will you tell your grandkids about bitcoin? tweet us @squawkstreet and we'll get some of your answers a little bit later on. without the thinking that makes it real? what's a vision without the expertise to execute it...

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get your best rest ever from sleep train. superior service, best selection, lowest price, guaranteed. ♪ sleep train ♪ your ticket to a better night's sleep ♪ welcome back to "squawk on the street," netflix shares have been on fire although taking a breather right now. every type it goes up, it hits a record high this off its streaming deal with comcast over the weekend. the stock is up some 21% this year alone. a programming note, we'll talk live with the co-founder of netflix mitch lowe in the next hour of the show. sara, over to you. >> all right, thanks very much for that flash. macy's one of the retailers reporting results this morning, posting a higher quarterly profit. the shares are back in the green after we saw them dip in the

premarket. and let's bring in stern a.g. analyst and they like macy's and has a buy rating on the stock. stocks were solid but january sales were disappointing. can you write this off as an investor and analyst when you are trying to evaluate this company as a blip because of the weather? >> yeah, there's one month of the year that you want to see retail be weak if you are a company it's probably the month of january and we estimate that january's probably down close to 15% on top of the tough number a year ago and obviously the weather wreaked havoc, not only for macy's but we're seeing it across almost every single retailer and misery has company right now. i think what we have to do is look at the november/december period for macy's and they are up close to 3.6% and the online business remains robust. we're looking past it and clearly with shares up today i think most of the street is as well. >> this continues, the theme, macy's has been a leader in the retail pack, what is it doing right or better than some of the others? >> first of all, macy's is

structurally at an advantage, and we think they target a more affluent demographic which puts them in a better position, but they're also playing offense relative to their peers particularly jcpenney which is playing defense right now, they've got a big localization strategy that's been in place since 2008-2009 and they are going after the millennial shopper and they are playing offense and we also think they are structurally better positions than most if not all of their department store peers. >> dillard's yesterday talked about markdowns and the kind of environment we've been seeing with sales, cutting into margins and profitability. who else is that going to hit particularly hard this season? >> we'll find out over the next week with jcpenney reporting after the close and kohl's reporting on thursday morning, dillard's to your point, you know, gross margins were down i believe about 180 basis points and i believe that was another bright spot here in the macy's quarter, their gross margins were up only two basis points but they were actually up which is impressive given how

competitive it's been out there. i think that's one of the things we like about macy's, along with the fact the inventory levels this quarter were up 4.5%, a little higher in sales but not atrocious. we think inventory levels are good and current heading into the spring season. >> hey, chuck, for all the cynics who think that water is being used as an excuse, what do you make of arguments that say, look, cold weather in the south was also an aberration that actually drove some demand? is that not true? >> i think that's a good point. i think for macy's in particular and certain parts of november and december, being cold that time of the year is actually a good thing. but i think when you look at all of retail, i mean, we gov vitamin shoppe and i think there's certain companies that can speak to weather being an excuse. unfortunately it's supposed to stay cold throughout most of the

country over the next two weeks and i guess we'll see how trends bounce back towards the end of march and early into april. we think there's probably going to be a massive release of pent-up demand. people have been stuck in their houses for six weeks. we think they get out and we think retail sales for the first quarter probably finish better than they started which we think the market probably starts to discount over the next week. >> we'll see and we'll get other retailers later in the week including jcpenney, great to talk to you. it's a big night tonight on cnbc after "shark tank" the second season premieres of "the profits" with marcus lemonis and on tonight's edition he talks to a luxury car dealer about the need to take a loss. >> when cars come in, we're going to have a strict 60-day aging policy. >> can you point out to me the cars that are over 60 days old? >> this one. >> what do we own it for? >> 46.

>> oh. >> great, come on, guys. i'm going to clear the cash. >> i know, but you are taking a big hit. >> how much is this car worth? >> 32. >> 28,500. >> next car. >> you can't buy it at 28,500. >> this lexus. >> dollar 33 and change. >> how come you don't know these numbers? >> let him answer you. >> how much is the car worth? >> 48. >> what do we own it for? >> about $45,000. >> what's it worth? >> low 40s. >> 38,500. >> you are discounting easy things i can't go buy at the price that you're saying. >> i'm not going to go round and roundabout whether the cars stay. when they are past 60 days, we'll get liquidated. if we take a loss, we learn our lesson. tony, the cars should be gone at the end of the week. you are the general manager and i expect it to be done. >> marcus is here and tough love there. >> tough love, but you got to

trim your cash. >> didn't you change the name of the business without letting him know? >> i did change the name. >> crikey. >> i did change it. i don't want to have a business named after one individual. the business is bigger than one person and as we try to scale it across the country, his name doesn't mean anything. it didn't mean anything in that town either. >> you are excited about tonight's series. just to the conversation we were having earlier about the weather effect through the first quarter, i mean, you're plugged into so many different sorts of businesses. what can you tell us? >> i have to remind everybody it's winter. i don't buy when my managers tell me that they can't make a profit this time of year. same-store sales are down, there's no question about it. but what i expect is sg & a and advertising expense and personnel expense to be in line. the reason that retailers like macy's are making money because they have great inventory management and they are not discounting their way through the process. they can hold on to margin and their expenses. the pent-up demand's going to come and if you look at 120-day trend of sales, 120-day trend

isn't bad. the 30-day window is bad. >> is it tough to stock on that fluctuation? >> my season is march through the fall. i have to. but i think you have to be prepared. and that's why having a variable cost model as opposed to a fixed cost model works. >> i can't get over that piece of tape where you slash the price. can they fight back? can they say, no, we're not changing that price, we're keeping it what i wanted to keep it as? >> they can say it, but it's not going to matter. at the end of the day this guy had 20 cars on the lot and he's losing a million eight a year. we're not in to listening to his logic. his logic is flawed. >> what was the lesson, though, you are trying to teach there and what is the principle of business, if you will, that you can share with us that you saw in action? >> in any auto business, at autonation or any store, you employ an aging policy that are turning and your best loss is your first loss and they are sitting there static. whether it's an auto business or

a boat business, thanks, simon, i appreciate that. >> not at all. >> auto business or boat business you want to turn your inventory and keeping it fresh. >> the boss has pulled out all the stops. >> "shark tank" to the left. >> you are the kevin space sif business news. >> that's not a bad lead-in. >> the best lead-in. >> looks thinner in person. >> don't miss nbc's air of "the profit" after "shark tank" at 10:00 eastern. the nbc top 200 has been narrowed down. rate until you hear what re/code walt mossberg thinks of samsung's new tablet. walt will join us with his review in a few minutes. i always say be the man with the plan but with less energy, moodiness, and a low sex drive,

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the x1 entertainment operating system lets your watch live tv anywhere. can i watch it in butterfly valley? sure. can i watch it in glimmering lake? yep. here, too. what about the dark castle? you call that defense?! come on! [ female announcer ] watch live tv anywhere. the x1 entertainment operating system, only from xfinity. the number of contenders for cnbc's 25 people who have had the greatest influence on business in the last quarter century has been narrowed down to 100. who did not make the cut?

tyler mathisen with details on that. >> it's more art than science, folks, we started with 200 nominees and cut the list now down to 100. we also solicited votes from you the viewers on cnbc.com where you can still go and vote and so we added actually seven new contenders to that list of 100. let me tell you a little bit about who's out and who is in. david stern out, howard stern in. reid hoffman of linkedin, out. reid hastings of netflix in. here are the viewer suggestions that we added to the list to round up on the top 100, tim berners-lee, wayne huizenga, howard stern and lynn tilton and bob wright. let me focus on some of those, tim berners-lee was the developer of the world wide web were and without him we'd not be doing the commerce that we had today, of course, berners-lee

one of the fathers of the worldwide web. aliko dangote a little known in this country, but he built a fortune on soft commodities like flour and sugar but has moved as well into the cement business and more recently into broadband telecom. and howard stern, we added him because we felt like he changed the face of radio. or maybe the voice of radio and legitimized sirius xm satellite radio when he signed that five-year contract. other media figures on the list include oprah winfrey but then you ask why did some folks fall out, why did herb kelleher not make it and richard branson did? maybe branson touched more different businesses. why does a guy like sam walton genius businessman or boone pickens similarly genius businessman, why did they fall out? well, in those cases we felt basically a lot of their sort of

seminal work and business building took place before our 1989 start date because obviously this list is trying to sync up with the history of cnbc from 1989 forward. so, we're looking at the first 25. you can still go back, carl, and vote for your faves on our list. and give your comments as we narrow the list down to an april reveal, late april, of the top 25 most influential game changers in business over the past quarter century, folks? >> that's a painful process. leaving out david stern, that's crazy. >> and magic johnson we kept on the list because of his sort of globalization of the game of basketball, his moves into real estate development and also now and a co-ener on of the l.a. dodgers. we know we're going to make friends here and we know we'll make some enemies, but that's the fun of the game. >> you got that right. as ty said, make sure to vote online for who you think should

make the final 25, go to cnbc.com/25. to cast your vote. dow's down about 23. let's get a quick market flash. >> hey, carl, check out intermune up triple digits on 20 times its normal volume. it shows positive data in a late stage trial taking the treatment close to fda approval, the stock currently up 131%. big move there. carl? >> oh, my gosh. that is a huge move, thank you very much. red arrows across the board, though, for major averages this morning. the month of february, though, has brought in nice gains overall. what's ahead for this market? let's welcome back brian balsky the chief investment strategy with bmo market strategies. the brilliance is standing out to me. why are investors seemingly dismissing softer economic reports? i get the water, but also steep losses overnight from china and also some concerns about

corporate earnings. >> well, we just returned from a week in asia, kayla, and the u.s. strength in terms of its stability fundamentals compared to the rest of the world remains a pretty attractive asset to investors outside the u.s. frank li, you know, we believe that many of our institutional investors around the world were very surprised on the january pullback and we do think people in general from a longer-term point of view, 6 to 12 months, 12 to 18 months in terms of time frame, are becoming increasingly comfortable with the notion that equities are the preferred asset class and we are once again becoming comfortable with this quote-unquote buy the dip mentality. so, we're still we think enthralled in a longer-term 15 to 20-year equity bull market. we do think 2014 could bring a little bit more volatility than many investors are expecting. we've already seen a bit of that so far this year so don't be surprised if we continue to see that type of back-and-forth

trading. >> want to bring in jonathan gollab managing director with rbc capital markets on specifically where to go in these markets, because, john, your note surprised me a little bit. overweight u.s. companies with high foreign exposure. isn't emerging markets and the foreign exposure the problem right now? >> first of all, because you've had a problem with something doesn't mean it's a place to run away from. as a matter of fact, if the economy improves the way that most economists and we at rbc believe, which is the gdp of close to 3% this year and people haven't really changed that general trend view, then you're going to do better in companies that have more aggressive footprints, whether they are in cyclical companies in the u.s. or whether they are in companies that are exposed to emerging markets broadly. >> but fundamentally, jonathan, you think people are misreading the diagnosis of what happened in the emerging markets and the threat or the benefit that they pose? >> yeah. i think that we have to, you

know, separate out the headlines that we're reading which are quite concerning and then the human element of that and look to emerging markets broadly where we've had really much greater weakness than you would expect. a lot of that has been i believe because u.s. import growth, you know, the things that are made abroad, has been quite weak and we expect that to rebound which should be -- should be very positive story. >> brian, let me come back to something that you said that really ought to stand out for a lot of viewers, that you believe in a 15- to 20-year bull market. so, what are you saying here? this 10 to 15 years upside on this stock market? >> yeah. we've been i think pretty clear and consistent on this, simon, we think for the last five years has been in a bull market. but that doesn't mean bull markets can't take a bit of a respite, that's why our 1900 target on the s&p 500 we think is a little bit lower than most

of our compatriots out there given the fact that, again, we were early adamaopters of this l market but we need to see a bit of a respite and transition year as investors start to transition away from this incessant need of monetary policy driving stocks. we think we're transitioning more towards a fundamentally based stock pickers, bottoms-up market away from the macro and more towards intrinsic fundamental as and that's very positive for equities longer term. >> i don't know. we heard that before. people are waiting for the stock pickers' market, great to get your thoughts from both of you, brian and jonathan. to the latest on the situation in ukraine. with victor yanukovych on the run crowds are flocking to get a glimpse of his empty and surprisingly extravagant palace in kiev. our chief international correspondent michelle caruso cabrera took a tour of the palace and is live in kiev with more. hi, michelle. >> reporter: it's a huge estate, carl. it would take hours to walk the

whole thing, a zoo, a spa, et cetera. take a look at it from the outside. you would almost describe the style as a baroque kind of swiss chalet. it's got a beautiful view the way it's situated right on the main river running through ukraine. take a look at the great room. it's huge. more than 20-foot ceilings. it's got a white baby grand piano that's a steinway. huge chandeliers throughout. and the bedroom, enormous. big sitting area as you can expect. a fireplace as well. the shower, the bathroom is huge and the shower itself has inlaid mosaic tile. there's a coat closet on the ground floor. it's the largest coat closet i've ever seen. there are still some coats hanging in there, cashmere coats with brand names we've all heard of. look at the staircase, the place is being guarded by a bunch of young militiamen who are preventing looters from going in there but there are thousands of ukrainians flocking to it, they

just can't believe a man lived so opulently in a country where the gdp per capita is only $3,500, in the backroom with the guest room that are larger than many people's homes, there are people poring over documents, that he tried to dump in the river, he did, in fact, and they retrieved them, drying them out and taking photographs of them and posting it on a new website yanukovychleakings.org where they think they have found evidence of money laundering and bribery payments and secret accounts all allegedly, of course, but they are poring through it. it's been an extraordinary find journalistically but also for the people of ukraine to see this. they really had no idea how victor yanukovych lived. simon, back to you. >> and in many senses is a game changer for many. michelle, thank you. closer to home jpmorgan is announcing plansing to close

thousands of jobs here. kayla is live from that investor day with more, kayla, good morning. >> reporter: good morning, simon. two hours into this annual event we started with jpmorgan's cfo maryann lake followed by some executives from the consumer bank and then later on today we'll hear from executives in the commercial and investment bank as well. but the headline, you mentioned it, simon, the broad layoffs that will be happening across the bank. it's been a focus for the bank since at least last year. it's changing its business line-up now that the economic environment is changing, and as a result it expects to see head count fall by net 5,000 jobs this year alone. that includes 8,000 jobs being cut in the consumer bank due in part to both mortgage production falling as well as fewer people going into the bank branches. they don't need as many tellers. last year they cut 10,000 net jobs, but, guys, they added 7,000 jobs in risk management and control. that's how strenuous some of

these new regulatory controls and some of these litigation issues have been for big banks like jpmorgan. on the capital front marianne lake said the regulatelations a regulations are getting better. jpmorgan has $900 billion in safe assets as a capital buffer to their riskier assets. she did say that that is going to be dragging on the margins. but they should see a light at the end of the tunnel, 2013 was an inflection point and she expects that will go up from here. and he expects to buy back more stock, she said the stock is 20% undervalued and even at higher levels buying pack stock would still be accretive for jpmorgan shareholders. the big cost is litigation that added $10 billion in after-tax costs for jpmorgan last year. there's no data on that in the presentation but you can bet when jamie dimon gets up later

this afternoon for "q" and "a" that will be the number one question that he gets asked. we'll bring that to you when we get it, but for now, guys, we'll send it back to you. >> kayla, thank you. up next on the program, mt. docks one of the largest exchanges for bitcoin has disappeared. yes, it's just disappeared. is this the end of the digital currency? more on that when "squawk on the street" comes back. you'll experience reliable uptime for the network and services you depend on. multi-layered security solutions keep your information safe, and secure. and responsive dedicated support meets your needs, and eases your mind. centurylink. your link to what's next. tdtdd# 1-888-628-2419 n take you in many directions.t spark your curiosity d# 1-888-628-2419 you read this. watch that. tdd# 1-888-628-2419 you look for what's next. tdd# 1-888-628-2419 at schwab, we can help turn inspiration into action tdd# 1-888-628-2419 boost your trading iq with the help of

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tokyo based mt. gox once one of the largest bitcoin exchanges has disappeared taking a whole lot of bitcoin with it and gox commenting saying it's only made the decision to close all transactions for the time being and that its closely monitoring the situation and will react accordingly. our mary thompson joins us this morning with more. >> obviously it hasn't

disappeared yet but that was certainly the feeling earlier today. a number of people tried to logon and they couldn't get on. the statement from mt. gox telling its customers that the decision was taken to close the transactions for the time being just hitting the wires now. this comes after weeks of a temporary shutdown at mt. gox. the first and best known bitcoin exchange has been plagued for months by technical issues. many client accounts have been frozen and according to two bit idiot a well-known voice in the bitcoin community when mt. gox went offline overnight he was questioning what happened to over 744,000 bitcoins the number cnbc has not been able to confirm that are held at mt. gox but it's a significant number because it's just under 6% of the 12.4 million bitcoins in circulation. now, predictably the bitcoin's price has been under pressure this morning though interesting enough there have been some problems with some of the pricing index. there it is on the wink desk, it is down today following, of

course, extending a 54% decline since its peak in december. bitcoin, of course, is the brainchild of an unknown japanese programmer -- or the crypto currency taking off last april as the residents sought a safe haven for their funds and it's climbed steadily since then as a disruptive force in finance with faster, cheaper peer-to-peer payments and a public register that they say is faster. but its own disruptions including the one at mt. gox could slow. cyberthefts are frequent including silk road ii and one by a malware called pony. but advocates are moving ahead with plans to push into the mainstream. secondary markets plan to launch a u.s.-based bitcoin exchange which many hope will bring price stability to the currency. he'll be the guest on "closing bell." until then a number of people

will be waiting to see what mt. gox has to say, hopefully we'll hear from them in more detail later today. back to you. >> and do you know what, mary, stay with us on that note because joining us on the cnbc news line is benjamin losky the superintendent of new york state's department of financial services he's done a lot of work on bitcoin and he's a good friend of the show. thanks for being with us from basel, do you think a closure of mt. gox going offline actually does anything to alter the trajectory of bitcoin and the legitimacy of the virtual currency? >> good to be with you. thanks for having me. i think the question is, is this, you know, a continuing of the shaking out of a fledgling industry. and my gut is that's part of what you're seeing here. it's a new industry. it's obviously not regulated in any significant way yet. and thus to the extent there are those who were not doing what they're supposed to be doing or

that might get involved in the industry for the wrong reasons, i think as the industry grows and becomes more ubiquitous and i think as regulators get more involved, you will see the -- those who want to right, thrivi, and those who don't falling away. i think you may be seeing that. i don't think it's a -- it may be a significant bump in the road for the significance of bitcoin and currency but i don't think it means they're going away or it's any kind of death now. i think underlying bitcoin is an interesting, powerful new technology that we don't know what it will look like a year from now, five years ago. i think that powerful technology is going likely going to survive and have significant implications for our entire system. >> talk specifically about what the regulators like yourself can do to prevent this sort of thing because mt. gox was one of the major exchanges of bitcoin. as a consumer or if you're looking sat getting into this you might be thinking how on

earth would i know that my money is safe in bitcoin? >> two thoughts on that. first of all, mt. gox is obviously offshore. and not regulated really by anyone. and i think it underscores the fact that if we have, for example, exchanges that were onshore and that had some regulatory oversight and scrutiny, you would have, i think, potentially a lot more consumer confidence over the long haul and people would feel a lot better about the fact that their money couldn't just disappear potentially overnight. and i think at the heart of what we do as regulators is ensure the safety and soundness of the institutions we regulate. and doing what that for an exchange that's onshore, especially as the virtual currency market continues to grow, i think we'll be essential and we will potentially not be a bad thing for bitcoin and

virtual curre virtual currency. it will be a good thing because it will create consumer confidence. >> this is mary thompson. what would you tell an investor right now? the price is down. one of the major exchanges is off line. why not issue a warning like a state regulator in alabama did, a consumer alert saying, you know what, you better watch us because your funds could be at risk. >> well, again, two thoughts on that. one is, you know, i think we're still trying to get our hands around exactly what's happening at mt.gox and what happened at mt.gox. it again underscores the problems with an offshore unregulated exchange. normally when we regulate institution, it has problems, we can go. we can look at their books and look at their records and figure out the situation and alert people to that. so i think that -- >> i'm sorry. but why not alert people now? you can look at the price. you can see that it's fallen

significantly. why not tell them, you know, while we're looking at this, this is still a very early stage technology shs currency, whatever you want to call it, and you should be careful about investing in it. >> look. it came up in our hearings about two weeks ago that obviously there is huge price volatility right now with bitcoin and i think it's really only sophisticated investors who know that they're buying into that very significant price volatility that are involved with bitcoin in any major way. and it's certainly something that for your typical investor you have to really, if you're going to invest in bitcoin, in a significant way, you have to have a real appetite for the price volatility that you're going to see in a currency -- in technology that's still very young, that's still -- things are still shaking out for, that regulatory are still being worked out for us.

what you're saying is true. i think most people know that and i think people are pretty well aware of the mt.gox problems. they've been extensively covered by you all and other out lites. you make a fair point. it's not something yet that's ready for your average consumer to plunk -- your average investor to plunk down a lot of money into. if things shape out and if regulators are thoughtful and careful and take a balanced approach that isn't too heavy-handed, that it drives the fledgling industry away or into the ground but is smart enough that creates consumer confidence, ultimately in the long run it can be a more positive development. >> ben, until that day, right? until regulators make their 3406 move, for either the sophisticated or average investor, can you say

unequivocally that bitcoin is a stable investment today? >> look, i don't give investment advice. it's not my profession. but i can say that it's very clear that the price of bitcoin based on where the industry is now, is very, very volatile. and that anyone who wants to invest in it needs to certainly take that into account. again, i'm not an investment specialist. >> superintendent, it seems to be an important point here that you believe that whatever platform it is traded on you can increase the technology and supervision to ensure that it is safe. people watching now would question if something that is mind at a very local level and stored at a local level can be systematically infected by what's going on. that seems to be the central divide in the argument. you are solely on one side of it, it would seem to be. >> well, look, i think that's a very good and complicated question you're asking. i think it's why we're spending so much time focused on how we do -- how we do effective regulations when it comes to digital currency.

and, look, we're not the only regulator on the block here, either. ultimately because digital currencies can be all over the world, i think a lot of regulators need to think about this and how to do it in a smart way. i think in new york, we're hoping to set a good example going forward but we also don't want to rush it and get it wrong. then you point out that this is a complicated and sophisticated form of regulating that we have to do. those questions are ones we're going to have to face. >> thank you for joining us with the perspective making the case there. ben lawsky is new york state's financial regulators. i have to say i've been talking to him for a long time over the past few years or so as he's b looked into bitcoin and i have t not heard him so strongly defending the idea behind it. and the fact that the virtual currency has a future as he is now, even with questions over mt.gox. >> okay. let's get over to the cme and the santelli exchange. rick, it's yours.

>> thanks, simon. back in the '80s and '90s when i was a trader i used to do a lot of business with some of the european banks. some of the old style european banks at that point in time were privatizing from postal banks into the private sector. and yesterday i bumped into a bunch of the cfos and ceos of some of those banks. they're now retired. the reason i'm telling you this story is i wanted to see what their thoughts were regarding europe, eurozone and the countries because you've heard me, many times on the santelli exchange, you know, on this friday, the 28th, we're going to see eurozone unemployment. so i hit these gentleman with the notion that we're still looking at a 12 manned. we had a 12 handle unemployment rate for all of 20134. and their answer was, that doesn't matter. you know, that the eurozone number they just had to put a number, it's always been high. it's not the issue. i said, what is the issue? here's what they said. they said the issue is to look at the current account balances. look at t the trends.

that will give you a better idea assessing the health in future of investing in europe. so quickly, remember, we just finished 2013, so the date i'm looking at covers '09, '10, '11, '12. in plaqblack, it's a surplus, n deficit. germany has been pretty much 6% all along. 7%, my sges 13%. it will even be higher. what's fascinating the countries i worry about, okay, minus 4.8 is a function. it's a deficit. look how much smaller spain is getting. look at portugal. also going from minus 11 to minus two. that's a dot there. minus two. look at ireland. a complete reversareversal. up 4.4 positive. a surplus. italy, also getting very close to zero at 0. 4. and greece, even though the numbers aren't terrific, look at the way the numbers started out. the one fly in the ointment is

france. france does happen to be the second largest economy in the eurozone. they seem to be going the wrong way. but when we get the world bank to update and that's where these numbers came from from 2013. we're going to pay close attention and balance that on what we learn friday on the eurozoning a ge ing a graggrega unemployment rate. let's get to squawk on the tweet. mt.gox, one of the biggest exchanges for bitcoin has disappeared so as bitcoin's future and longevity a no? we're asking you, what will you tell your grandkids about bitcoin? bob writes, bitcoin is where we hid our money in the early 21st century before we realized we hid it so well we never found it again. i will tell the grandkids that i sold bitcoin and bought netflix. tom writes, bitcoin, tulip market 2.5. also stk writes, bit the dust. and certainly this gives ammunition to all the critics and cynics out there.

>> i'm going to tell my grandkids that all my colleagues here on "squawk on the street" were wrong, were totally wrong. >> look at me now. >> i haven't made up my mind yet, by the way. don't put me in there. >> seriously -- >> david is still working on what zu lilly is. tesla is up a lot. >> david, we'll see you later on. simon in a few minutes. if you're just joining us this morning, what a morning. here's what you missed. welcome to "squawk on the street." here's what's happened so far. >> i really think the economy is gaining traction. it's a obviously tough to know what to make of the latest data because of the weather issues. but i think we're going to start to grow much more rapidly this year than we have the last several years. it's going to be a good your when all is said and done. >> all of our habits are changing. everybody is recycling. everybody is retrenching. same thing in media. the netflix comcast news is g gigantic. it's the future. everyone wants what they want when they want it. >> you can't have two stock

markets at once. it doesn't work. you can't have a stock market that's value point eyeballs and we value things on eyeballs and another stock market that's valued on minus two, minus three, minus nine comps and we say it's okay. >> i think that there's pitfalls ahead. i think at this point they're going up pretty fast and my instinct is that this momentum will dissipate but not -- we won't see a reversal this year. i think it will still be up. >> there's the opening bell. >> i guess i put myself in the camp of guardedly optimistic that when we get by the weather numbers we will still see that there is momentum in the recovery. >> i'm encouraged that afordibility remains high. pricing is going to pull more people back in the market. again, you cannot predict inventory level tors year based

on the first quarter of the year. >> good tuesday morning. live at post 9 at the new york stock exchange. it is 11:00 a.m. on the east coast. 8:00 a.m. out west. we have an amazing lineup of tech names this hour. first up, mitch lowe will join us to talk about netflix paying for the faster streaming and the big run-up in the company stock. he will be joined by reddit go ko-founder alexis ohanian. and big news on bitcoin. and walt mossberg says this tablet has one of the worst screens he has ever used outdoors. walt will tell us exactly what he's looking at in just a few minutes. first up, less start with netflix. the online streaming giant has cut a deal with our parent come past to boost the speed of streaming by paying the company to ensure original programming faves like "house of cards," will stream smoothly. mitch lowe is the cofounder and

former coo and president of red box. he joins us this morning from los angeles. mitch, it's great to have you. good morning. >> good morning, carl. thanks. >> obviously this is huge news in our business and all sorts of businesses. terms of this deal were not disclosed. i wonder, do you have any idea hoyt might have been structured and whether or not it's going to insulate them from many down the road? >> this is the perfect time to do this deal. probably getting the cheapest price just by setting the precedent. and it was inevitable. you know, you can't continue to run. i think they were using something like 30% of the pipes at some point. so i think this was inevitable. >> you do, mitch? i can't help but wonder whether this puts netflix on a slippery slope now that they're in this structure where they have to pay a fee. i mean, who knows then if the fees could go up, if they're going to have to pay everyone. you don't think that's an issue? >> oh, i think it is an issue.

my hunch is is that this is just the beginning. this is probably a short-term agreement just to get it steertd see where the market lies just how much elasticity there is in charging for these kind of flows of the content. >> do you think they're going to be able to make this up, the fees that they're going to have to pay and more subscriber growth tied to better streaming capabilities? >> you know, a lot of it depends on how many times they can follow up on great content like "house of cards" and "orange is the new black." if they keep putting out great content, yeah, i think there's a lot of demand. you know, this is where -- we're right in the midst of two huge trends. and one of them is deeper and more complex story telling. and, you know, an hour and a half or a two-hour movie is no longer enough to build these interesting characters. so i think they're on the

beginning of a great trend. >> unbelievable some of the figures we've seen of not just the premier of season two of "house of cards" but the whole thing in the first weekend. are you a big a fan as seemingly the rest of america and is this -- are we sort of getting drunk on binging and is there a lifespan to that kind of media consumption? >> right, you know, i see it as a fantastic pr stunt. but long-term i don't think this is the right way to build audience and even from an artistic point of view, the cliff-hanger is so great. but when you can immediately see what happens next, you kind of lose that long-term build-up that the weekly episodes built. and you can't even talk about it at work. you get to work, you don't know if someone has seen the whole thing or is on part three. so you don't build up the

enthusiasm or bring in new viewers because no one's talking about it. it's kind of like in this cone of silence. so i don't think long term the binge watching or releasing the whole season is the right way either financially or artistically. >> i'm surprised to hear you say that mitch, because for me it seems like this has served netflix very well. they're considered pioneers really in this format, releasing everything. and it's not like their business model is tied to advertising like the rest of television. so go into that a little bit further. >> well, i think it is a great pr stunt. it adds great value. a lot of people wait until an entire season is over and then they'll go on to, you know, they'll record it on their dvr. they used to go in to walmart and buy the whole box set and binge watch it. thing is just a -- kind of a new way to do something that people

have been doing for years. i think everybody is talking about it. so it's deaf t it inially raised the awareness of netflix. i just don't think -- it's kind of like you watch it and it's done. okay. now what? you know, so, you know, as opposed to the way they release "breaking bad" on amc where each week you go in to work, you would see your work and go out to dinner and you talk about the most recent episode. oh, what's going to happen next. you know, you talk about it. people would hear you and they would build the audience. so i think it's -- from the producer's side, i don't think this is the best way to optimize the largest audience. and, therefore, financially. >> mitch, competitively, who do you see the threat is, is the threat to netflix? is it an amazon? we've seen others like intel essentially throw in the towel after really not trying that hard for that long. who do they have to worry about?

>> you know, it's tough. one of these other big trends that are going on is this fragment ta fragmentation of sources and devices. right now netflix is in the driver's seat spending huge amounts on content. i think their biggest competitors are the cable companies. that's why i think this is so inevitable that their primary competitor who is carrying their content is going to find ways to kind of ratchet down the competition. >> all right. competitor that also pays our paycheck, by the way. mitch, don't go too far. we're going to come back to you later this hour and talk about your new company with the co-founder of reddit. that's coming up, mitch. thanks. all right, first, we have a news alert for you here. former treasury secretary tim geithner is making news.

steve liesman has the details. hey, steve. >> hey, sarah. yeah, we have the name and the cover actually of tim geithner's fourth coming book called "stress test." it is official. it is a bit of a handbook on financial crises, a bit of a memoir, and a bit of an explanation for what he did and why he did it during the financial crisis. he released a statement, by the way, this book is scheduled to come out in may 2014, may 13th. geithner released a statement along with the announcement of the book and i want to tell you what he said. quote, we made mistakes. it was messy, and the damage was devastating and long lasting. and yet, at the moments of the most extreme peril, the united states was able to design and execute a remarkably effective strategy. that, of course, is his view on the crisis response. another thing he said, quote, we saved the economy from a failing financial system, though we lost the country doing it. geithner talking about effectively the political fallout from the crisis. one other comment that i think

is poignant here from a long statement that geithner put out. quote, i also hope this book can add to the historical record, help correct some misperceptions that have been entered into that record, and give a sense of what it was like in the fire. that's a sense of what's going to be in this fourth coming book. it will add to his series of books from hank paulson among others who have written about the crisis, alan greenspan wrote a bit about it and, of course, ben bernanke is currently writing a book but we don't -- i understand that a treatment of bernanke's book is going to be circulating relatively soon. >> steve, it is widely anticipated. thanks for giving us a sneak peek on tim geithner's book. with its whatsapp purchase facebook is doubling down on its bet on growth in emerging markets. our jon fortt is speaking exclusively to the man at facebook charged with ensures that that bet pays off. jon, what did he tell you? >> sarah, yeah, his name is

javier. i caught up with here at mobile world congress. kind of thinking about m so of what we talked about in the context of twitter which, as we know, is struggling with growth. facebook clearly has an opportunity here because carriers in emerging markets have a problem with some of their s and s revenues going away. data, they've got to sell and their kusz hers don't necessarily know that they need it. listen to what javier had to say about the importance of data and messaging in particular. take a listen. >> if you think about the services that people demand the most on phones and if you think of yourself, texting is a thing that you do daily. and facebook has those same patterns. so that's what we've seen, that mess senging service include facebook messenger, we have 150 million active people using the service and we see tremendous growth. one of the fastest growing applications. i think it is because it's that application on mobile.

it's this reach one to one, small group communication that people really want. >> he told me that facebook had to pit it which enthat saw how this was developing in emerging markets. people were trying to sign on without e-mail t accounts directly from phones, never logging in to pcs. and they really wanted to do primarily messaging. now, back to twitter. they're kind of in a bind because they don't have a direct messaging product. one of my favorite telecom analysts was telling me he thinks twitter can p get back into this game if they come out with something, but remember, facebook is trying to offer itself and what's in emerging marketing market. if they do that, twitter may get shut out. >> engineers and programmers are all working on that really quickly. jon, thanks a lot. jon fortt in barcelona. when we come back, which tablet ross mossberg has, quote, one of the worst screens i've ever used outdoors.

but first, rick santelli is looking at housing today and a lot of new data to look at. rick? >> absolutely. and some of my questions are predicated on that wonderful interview you had with robert chiller, carl, because he made me a bit nervous. we're going to talk about his comments, things he said about ben bernanke, demand, supply, financing, and weather all with my housing guy, mark hanson. r oil offer comes with a four-tire rotation and a 27-point inspection. and everything looked great. actually, could you leave those in? sure. want me to run him through the car wash for you, too? no, no, i can't. get a dexos 1, synthetic-blend oil change, tire rotation, and inspection for just $39.95 or less. chevy certified service. anbe a name and not a number?tor scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office.

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right now in an otherwise flattish session this morning. see seema has more on that. >> definitely a good day for consumer staples stocks led by lorillard. said last week it was considering putting itself up for sale among the leaders in the sector. now, rounding out the top five, costco, wall green, and altria. carl, over to you. >> thank you, seema. when it comes to tablets options are limitless. but a product that has the per fek combination of portability and usability, walt mossberg says goes to the ipad mini. samsung's new galaxy tab pro 8.4 the taking on apple's device and here is ross mossberg, nbc news group as a minority stake in re/code. good morning, walt. how are you? >> immigrate. how are you?

>> i'm not bad. enjoy reading your review. seems like there are some things to like but a lot of other things not to like. >> samsung is great at hardware. and i think the galaxy tab pro 8.4 which is just one of four new tablets that they're announce i announcing shows the hardware expertise. they managed to take an 8.4 inch screen. talking about these middle size screens between the 7s and the 10s. took an 8.4-inch screen and squeezed it into a body that is lighter and narrower than the ipad mini's 7.9-inch screen. that's quite an achievement. >> you know, jk ship and barcelona said, quote, our consumers don't want eye-popping technology or the most complex technology. >> right. >> are they pivoting to sort of, i think "the washington post" calls it the every man alternative to apple now?

>> well, i look at it a little differently. two things are going on with regard to their soft care and their software has been their weak point. one is they've gone way beyond a until trying to just throw everything at the wall in terms of software and load it on to their phones and tablets. they, you know, eight different ways to slar photos instead of one or two. you would open the box on a new samsung phone or tablet and you would find the google version of video player and the samsung version. the google version and music player and samsung version. the google app store and samsung app store and so on and so forth. so they had some decluttering to do. when i read that statement i was thinking, yeah, they've gotten feedback from consumers and reviewers like me that there's just too much on there. the second thing very quickly is

that we at re/code reported that although company has not announced or confirmed this as part of some recent meetings they had about patents and things they also -- google really leaned on them to not substitute samsung software for google software and to kind of clean that up and make sure that the doingle apps were presented, you know, prominently on the device. and they are on this new tab bletd. >> you know, blond the product reviews just curious about samsung's position here in the market. clearly it's out with these new tablets, new phones and new wearables. it's coming off the slowest earnings growth since 2011. how bad by li does it need to make inroads and get people turning in their old samsungs or new samsungs and where is the position on these products? >> i never go into things like earnings because there are of this of her factor other than the product. but as a product guy, i think

they have done well i think they're continuing to do well. i took a look at the tablet figures when i was doing this revi review. they're behind apple which is the opposite of the phone situation. growing faster than apple actually had a falling share in the tablet market last year although they grew numbers. samsung grew numbers faster and had a rising share. they're doing okay. of course, they're strong in phones. obviously though the market dynamics are changing quickly. i think samsung and even apple is seeing that people want a lower priced phone. a lot of lower price phone alternatives. samsung was already doing that. apple doesn't do that. and both of them are just scrambling to try to keep up. but the margins are really the best, of course, in the premium

phone categories like this new galaxy s phone and the top of the line iphone. >> yeah. my question this morning was, one has a 5s, is other has an s5. >> i was thinking about that. >> confusinconfusing. >> when we t got to 5, all of a sudden, and apple picked "s," it got really confusing. >> the mathematics of marketing. walt, great review as always. see you soon. >> take care. >> ross mossberg in madison. bill nye the science guy and reddit. they signed up to work with one brand new company. alexis and mitch. plus, an ominous day for bitcoin. mt.gox one of the engine changes has literally disa appeared. as the future is unknown, we want to know, what will you tell your grandkids about bitcoin?

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food. consumers like to have their favorite goods delivered to their doorstep. quarterly is a subscription service that allows users to subscribe to boxes cu ees cure y guys. bill nye the science guy and alexis ohanian is here from reddit. alexis, why are you a curator on quarterly and how are you trying to tap into this trend of subscription services through the mail? >> well, you know, for me, it was chance to build something, to curate something specifically for my fans. my last quarterly package was a

taste of all the things i've been reading and eating and discovering on the road. it's a way for people to connect on another level not just looking at instagram photos. but actually, you know, tasting the same foods that i'm seating or reading the same books that i'm reading. it really kind of takes it to another level. it's off line but that's pretty cool, too. >> mitch, where did this idea come from? your background obviously netflix and other subskrings services. how did you get involved in celebrity taste making and how did you figure out that the consumers really wanted this? >> well, i was introduced to the company by the founder and what really struck me when he told me about what he was doing is how many fascinating people that he was presenting at quarterly that honestly i had never heard of. so as i started to look at what they were doing i got really excited because, you know, when you think about it, twitter and linkedin and even facebook are

this, you know, method for people to build a brand about themselves. and it's no longer just celebrities and big stars and athlete athletes. millions and millions of people are trying to build a brand ability themselves. >> yes, i meerngs it's great for them but, mitch, a question here from the consumer's.of view what makes them keep coming back and renewing their subscription beyond make the first shipment novelty of it. >> yeah, they get an insight into the mand that is translated into physical objects of the person that they admire. for example, with alexis' last package, in fact, i tried to bring the box here but those brownies filled with caffeine ended up being my staple for this morning. but you really, you know, you can read the tweets. >> i don't blame you. >> you can read their blogs. you can read their backs. but to get a -- get this other

facet of who they are you get this box of things that are meaningful and special to them. so that's, you know, you continue to get new items and new things that are important to that person. >> you should see how many followers sarah has on twitter. it's ridiculous. >> alexis, one question on bitcoin because it is in the news today and blackout of mt. gox. we talked to the new york financial superintendent, seems to think long term this is part of the shaking out of the wild west. but what's wrong with the argument that this is something that bitcoin cannot overcome? >> well, you know, where i stand, i'm an investor in companies like coin base and butter coin. i'm bullish on crypto currency. i think this is long overdue. i think mt.gox is short for magic the gathering online exchan exchange. it was clearly something that out grown its capabilities. i'm excited to see new entrants come in and filling in the void.

i'm betting that innovation will keep up. it's still evolving. still risky. >> vry time i do a report on bitcoin on tv i get attacked on reddit. there are so many people out there part of this community. i wonder how that factors into the growth here and what they'll do once this kind of crypto currency, as you say, bursts into the mainstream. >> well, it's exciting to see more and more retailers. taking it on. i wonder until they start taking it. >> mitch, do you have any insight into that one? >> you know, i'm excited about all of those different formats because someone has got to grak the monopoly of visa and mastercard. >> i hope you have monitors where you can see what's going out on the air. there's an employee spinoff -- sorry, employee video out of netflix. it was a spoof, basicallysh

about their rivals at amazon in which employees pretended to deliver netflix content by drone. take a quick listen to this. >> now we're getting back to our creative roots with ground breaking, same day home delivery subscription service, drone 2 home. >> apparently netflix acknowledged this was there and they did this for their annual meeting. i guess this does speak to the rivalry that's developing in media distribution. >> well, you know, it's a fantastic idea if you can just figure out how to open that mailbox or the slot on the door. but, you know, the culture at netflix was one of the most amazing experiences i've ever had. and i think this just demonstrates how much fun it is so work at such a great company. >> one more question to you, alexis. obviously an entrepreneurial spirit alive and well.

you had it. you started red did. what do you think when you see a $19 billion transaction from facebook to buy one of these start-ups whatsapp? >> well, for me, it drives home the spirit of the book, the spirit of this tour, the spirit of the time right now, right? the potential for someone to create something of tremendous value and create tremendous wealth can happen from a laptop. those founders, what i love about them in particular, is they didn't spend time going to parties, they didn't spend time doing a lot of lavish things. they built a great company and a great product. it just goes to show, please, start learning how to code, start building because that's the way to really win in this new economy. >> thanks very much for joining us. mitch, thank you to you as well with your thoughts on netflix and your new venture "quarterly." we want to bring in simon hobbs in the uk and across continental europe. how does it look? >> i think it's important to mission that the european

commission raised the growth estimate for the year. overall the economy, the european economy grew by 1.2% because they're upgrading spain from 1%. though italy will be lack at 0.6%. overall europe not really going anywhere. i mean, there is a concern about china. don't forget that overnight shanghai fell by 4%. there's a knee-jerk knock on europe today to the miners as you can see, though. that said, they are off their lows. still the height of the earning season in europe. the world's largest dialysis operator warning the operator here in the united states will have lower reimbursement rates under medicare an uncertainties over iv supply will affect it. and the possibility according to reuters that might be about to bid for medical nutrition unit which might be why they're marked over. trouble over in the french telecom sector. not giving much clarity on

returning cash to shareholders because of this guy, illiad that came in and disrupted it and they're all suffering on their margins as a result. buys, back to you. the latest s&p shiller says it's losing momentum. earlier today robert weighed in on the fed and the housing market. take a look. >> i don't think bernanke is really in control of the housing market. you know, these people probably don't even fully understand it. so i think the market has its life of its on. >> for more on housing let's go to somebody who has a life of his own, rick santelli in chicago. >> i love that sound bite. i'm going to play it on my alarm clock every morning. the market has a life of its own. imagine that. i like to welcome our housing guest, mark hanson. thanks for taking the time today. are there you, mark?

>> i got you, rick. >> everybody started out with ben bernanke, mr. shiller, in your newsletter today you said fed induced dead manned is waning. i like this dynamic. okay. can you expand on it from your perspective? >> yeah, we're in a critical juncture in housing and it started when rates went up that small 1% back in june. we're going from an investor-led housing market to an end user-led housing market. that's creating a lot of problems. and -- >> let me interrupt you. you said something in your newsletter i've never seen before. you brought in bidding leverage. leverage on housing based on bid on investors, not people who necessarily want to live there. can you expand on that as well? >> tom barac was on this morning. love this guy. follow what he does, not necessarily what he does in my case. he was the first in the distressed housing market and also the first out early last year. but in these markets where institutional investors may have

bought 300,000 houses over the last couple of years and ma and pa investors, 250, 300,000. they have to bid on 10,000s to buy that one because they're all bidding against each other and on everything else. it's not the necessarily sale that makes the house price go up, rick, they're bidding over each other. that's where we end right now with the investors gone, who is the greater fool to continue the bidding how hier? it's certainly not first time home buyers. they're down 26% of total house sales. >> that's such a nervous issue. with a minute remaining, you know, whether it's supply or demand you definitely think it's demand. and i had the notion that you're hinting it might be bubblelicious which is the same feeling i had from mr. schilling this morning. give me your thoughts on are we looking at an '05-'06 land skip with the eventual softness around the bend? sglin vesters supplied by fed liquidity over the past two

years have acted much like ma and pa speculator from 2003 to 2007. they were able to thwart the laws on the governors of mortgage loans and basically buy with reckless abandon like tom barac alluded to this morning p as housing has to go back to end user fundamentals, we're going to have a tough time. unless rates come down now, back to 3 1/4% on a 30-year fixed you're going to see forward looking house indicators, not necessarily the kay shiller who is six and seven months behind negative by may. >> mark hanson, thank you for taking the time today. housing is a big part of the recovery story or lack therein. we'll keep handicapping it gong along. carl, back to you. meantime, here in the marks, dow is up 41. let's get a market flash. >> carl, look at tesla. it's at session highs. morgan stanley raising the price target on the electric carmaker to $320 a share, noting the

company would become a leader in commercializing battery packs. it's up 65% this year alone. you can see the stock up 17% just today. back over to you. >> tesla on a roll. thanks, seema. coming up, a new smartphone, smartwatch, and a lot more wearable technology unveiled by samsung at an event yesterday. you want to see all of samsung's new gadgets, you can wait until they hit store or keep it right here because we've got them onset and we'll show you exactly how they work. try it all out in just a moment. customizable charts, powerful screening tools, and guaranteed one-second trades. and at the center of it all is a surprisingly low price -- just $7.95. in fact, fidelity gives you lower trade commissions than schwab, td ameritrade, and e-trade. i'm monica santiago of fidelity investments, and low fees and commissions are another reason serious investors are choosing fidelity.

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coming up at the top of the hour, energy stocks leading the way higher. is it time to jump in or is it too late to join the party? we'll have all the big trades on the big names in that space and could trash talking actually be good for business and bad for the competition? some high-profile ceos or slinging mud and we'll find out if it's helping their bottom lines. consumer reports reveal top auto picks in the next hour. we're going to bring you the market moving headlines as soon as they're released. all straight ahead on the "half." carl, see you in 20. >> wish you were down here, scott, because, well, we're going to talk about samsung in a moment but first, courtney reagan has breaking news.

>> good morning. it looks like the house of representatives isn't exactly satisfied with the information that target had provided in a conference call on january 30th as it pertains to the massive data breach. representative issa wondering when they learned of the breach. they want more documentation about when they learned of the massive data breach. we've reached out to tar get for xle comment. we'll let you know when they have a response. >> thank you, court. as you know the mobile world congress is under way in barcelona and electronics giant samsung released a new phone and three wearable devices. samsung s5, the gear fit, the gear2, and the gear neo have been released. we have all of them onset this morning. >> we do. >> i'm gearing the gear fit which i'm demo first. this rainbow-colored wristwatch. i want to take a picture of

sarah click on the camera. you actually -- the camera faces forward so i'm going to -- >> how did you figure that out? >> boom. i just took your picture. obviously this communicates with the phone and then you send that picture later on. >> i got the phone here actually. the new s5 which people are excited about. you said down back to basics. the real upgrades come in the camera. good thing you pointed it out. they say it's water resistant. >> 30 feet of -- 30 minutes at a meter, i think. >> if that's true i'm going to get it because how many times do you drop your phone in the toilet? >> never. >> well, i have done it. i think that's pretty good. >> we just talked to walt mossberg about some of the displays which are large but he said not so great in the daylight, for one. >> he was talking about the screen here. what seems to be a good focus strategically about the new devices and including this one which is the answer to fit it,

orange. health monitoring. apparently you can sync it with the phone and you can touch the phone and it takes your heart rate and it will then display on your wrist. a lot of sort of convenience there in terms of going between different gadgets. >> authenticates not only your print for access but also for pay pal which is sort of where ear all heading getting that sort of bio technology, you know, with mobile payment. that's the goal. >> right. and you wonder how secure that is because that could be very appealing to customers. iphone obviously had the fingerprint sensor. takes it to the next level with e-commerce. it really raises the question, how well will this sell now that samsung has unveiled the galaxy s5 and will consumers want to buy it and rebuy it? gazelle says samsung phone trade is up 50% so far this year versus last year. israel is the co-founder, president, and ceo of gazelle joining us now from boston.

isra israel, why are samsung trade-ins becoming more valuable now? >> good morning. in a worst thing tremendous growth. but samsung specifically, so you mentioned they're up 50% year to date. if you look at the second half of last year, they were up 154% year over year whereas the iphones grew only quarter growth at 64%. so a lot of growth in samsung devices. we expect the growth to continue in 2014. the reason is very simple. samsung continues to release really good product. i think the one introduced yesterday was good, not revelation lugs their but good product. if you think about two years ago that's when the galaxy 3 came out. a lot of those customers got the galaxy 3 two years ago. they're up for a new contract. up for a subsidy. and when you can get close to $140 for your galaxy 3 and

upgrade it to the new device for $200, you know, that's a pretty good deal. subsidize 70% of your purchase price. >> interesting. israel, as a rule, apple/samsung, which retains their value for a longer period of time? >> so far it's been consistent. apple beats samsung historically. you can get much more for the iphone 5, 4s. with the new features, water resistance, interesting to see if that helps retain more on samsung over time. the phones are getting better and better. they're still plastic phone 'they don't feel as luxurious, i think, as iphones. we think that iphones as bmw of the space. and i don't think samsungs are nearly as luxurious as the iphones. not yet, at least. >> what do you see in terms of consumer patterns when it comes

to trading in and selling their phones to you at gazelle right ahead of a new product release? is that as feverish as it has been? >> well, it's very different when you compare on iphone to samsung release. when apple introduces a new iphone as they did back in the fall, the new product is available in the market a week and a half, two weeks later. so that creates a huge frenzy of upgrades just ahead of the release of the phone. with a samsung, they take a very different tact in the marketplace. this new phone is not going to be available in april so there's really very little our customers who really want to upgrade can do at this point. i think come late march, early april, we're going to see much more activity in the samsung trade-in arena. >> i just wonder how much of it is the brand recognition that leads to a i hehigher resale va. apple versus what's in the product and how long the product lasts and if there's some specific gadget or function

within the product that makes people want it on a resale value. >> i think you're right. a lot of it has to do with the demand side. who buys those used devices and as i've shared in the past, on this show, most of the buyers of the second-hand devices are consumers in emerging markets. china as an example. and in that market consumers want that with the brand and they do value the apple brand and having an iphone in their hands more so than having a samsung device. that's been the case for the last few years and we're not seeing a lot of change in that dynamic just not yet this year. >> well, it's always interesting to track re-commerce of some of these mobile devices. thank you for joining us again here on "squawk on the street," the ceo of gazelle. >> yes. a man who has leveraged that business nicely. when we come back, move over, auto dealers. one retailer seeing a huge surge in new car sales. it's not who you think. we'll tell you who it is in a

moment. plus, would you eat this for breakfast? >> nope. >> that is new breakfast taco at taco bell. the company hopes the answer is yes. we'll look at that and other new fast food options in just a moment. ameriprise asked people a simple question: in retirement, will you outlive your money? uhhh. no, that can't happen. that's the thing, you don't know how long it has to last. everyone has retirement questions. so ameriprise created the exclusive.. confident retirement approach. now you and your ameripise advisor can get the real answers you need. well, knowing gives you confidence. start building your confident retirement today.

as auto sales continue to grow car buyers are looking for dealers to deliver what they want quickly and without any haggling. that has made cost to, yes, cost to a leading retailer of new cars. interesting story. phil lebeau joins us live in calls b carlsbad, california, from a costco live. >> a lot of people might be surprised that costco is doing a thriving business in new car or trucks. this has become a popular way for many people to say i want a particular vehicle and i don't want to have to deal with going around to a bunch of dealerships. how quickly is it selling? look at the growth over the last seven years. last year 340,000 people bought through costco. it will be up close to 400,000 this year. really it comes down to saving time and not wanting to deal with the process of negotiating a final price. what happens is they go through costco, they pick out a particular vehicle, then they are put in touch with a dealer

who handles that particular brand in the area. there's a preset price. for many people that's when they close the deal. why do dealers subscribe to this and pay costco to be part of this program? often because the referrals coming from costco are for customers who have higher credit scores and they can close a deal within 48 hours. plus, dealers realize this is the way auto sales are moving in the future. >> the days of going to six or seven dealerships to shop for a car is over. it's not going to happen again. this is it. >> why? >> why? because consumers are more savvy. >> and that's the bottom line. we talked with one person who talked a volkswagen pissat through costco. she went through costco. put in touch with a dealer. bought her car below invoice, which is typically what happens. and she said it was a much better experience than in the

past where she went from dealership to dealership trying to see who had the best deal. increasingly, not just with costco but other third-party firms, we're going to see that in the future. >> that is a big story especially with what we know about inventories right now. phil, thanks so much. >> here's a question, can anything top the egg mcmuffin? the waffle taco from taco bell will try. jane wells is live in los angeles. i hope she's hungry. >> breakfast in america, guys. the usa said drought in california can impact dairy prices which means breakfast in the most important meal of the day. a meal worth as much as $50 billion according to technomic. get ready, egg mcmuffin and bacon sandwich from starbucks, taco bell next month will roll out nationally a breakfast menu that's been testing in a few hundred stores.

including the waffle taco filled with eggs and sausage. special crunch wrap which you can fold in one hand and eat while driving and coffee made fresh each cup from an unnamed private label. how is it? here's a review on youtube by a young man atta cobell's key demo who weighed in on the crunch wrap and cinnabon delights. >> pretty good. better than i expected. there's bacon in it and also cheese. there's a hash brown in it. a full hash brown. that's neat. wow that is really good. sweet, sugar in it. give that like a 4 1/2 out of 5. >> i think he's an expert. so can anything top the egg mcmuffin? mcdonald's has 25% of fast food breakfast sales according to jpmorgan. it's trying to figger out how to keep selling breakfast after 10:30 a.m. when the kitchen switches burgers. it's their space to do both.

they think taco bell can catch 15% of breakfast. $700 million. taco bell president admits to usa today that changing breakfast habits is hard burks hold on, hold on, he's working on the holy grail, portable pancakes. carl and sarah, in our lifetime. >> that's major. >> one day, jane, we can all dream. you're obviously going to have some of what's on the table in front of you, right? go ahead. >> i'm going to have all of it. >> right now. >> starting with the king. >> it certainly is -- jane, i heard that burger king was testing chick chen and waffles. >> really? >> it's a little cold right now, sorry. >> don't make her talk with food in her mouth. >> it wouldn't be p t. first time. we love it. thanks so much. >> go enjoy. perfect story for you. the battle for your breakfast. >> seriously, big story for you as well. tweet time, mt.gox, we've been

talking a it. it has disappeared. has bitcoin's future and longevity unknown. we want to know what will you tell your grandkids about bitcoin? tweet us. we'll read some of your answer osen the show when we come back. is earned with sweat, sacrifice, courage. which is why usaa is honored to help our members with everything from investing for retirement to saving for college. our commitment to current and former military members and their families is without equal. in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities

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exchanges for bitcoin has disappe disappeared. as bitcoin and its future is unknown, what are you going to tell your grandkids about bitco bitcoin? i won't be telling my grandchildren anything about bitcoin. after i've lost dl is no budget for children. i'd tell my grandkids that bitcoins were cheap. you can actually purchase one whole bitcoin. i'll tell my grandkids about the horrible bitcoin mining accident of 2014 where not one person was injured and we all survived. i mean, people have lost money and we have seen it. you shouldn't make light of the fact if you're going to play in this game it can hurt. >> the volatility, the fluctuations can be mind

boggling. two years ago it was worth less than $5. no matter what you way about bitcoin it elicits an emotion and response and reaction. and people have strong feeling about this.experts and regulato taking a look. >> that does it for us here. let's head over to wapner. a lot to cover this afternoon. >> markets, carl, search for direction. macy's, home depot. how about tesla? this stock is unbelievable today. >> and just building and building as the morning has gone on. i love this stat. . we just handed. up 650% in 14 months. >> unreal. we're talking about that. have a great one. welcome to the "half time" show. talking smack, more ceos have been doing it lately but is it good for the companies and the shareholders? special report is ahead. top rides. we are live and trading when consumer reports reveals its best autos of the year. boom