cnbc. i'm becky quick along with andrew ross sorkin and brian sullivan. joe is off this morning. our top story today, australia is now sending aircraft to an area of the southern indian ocean after satellites discovered two objects that could be part of a possible debris field of missing malaysian airlines flight 370. matt taylor joins us right now from sydney. matt. >> becky, thanks very much. the latest information that we're getting out of australia, authorities here on the east coast of australia is that one royal australian air force jet has been unable to locate any debris associated with these two satellite images that were released a little earlier on today by the australian government and australian officials. they say that two satellite images showing two objects which may or may not be pieces of da prefrom that missing malaysian airlines flight 370 have been discovered just south of the

corridor that australian authorities have been searching. one is 24 meters or about 75 feet in size. the other is around about five meters in length or around about 15 feet in size. now, the officials say that the objects are indistinct, but they say that they are credible sightings and they have been what they call awash in the indian ocean. this is located in a very remote place of australia where about 2,500 kilometers or about 1500 miles off of the coast of australia. it's very hard for aircraft to get to that particular part of the ocean. four hours flying time and officials say that the aircraft has about two hours worth of fuel out there before they had to turn around and head back to the mainland before they can recommence their searching. authorities also saying that a

cloud and rain is making visibility tough in that part of the ocean at this time. we also heard an update from a malaysian transport authority who was speaking in the last 30 minutes, cautioning against people getting their hopes up that these objects may, in fact, be debris from the aircraft because we know in the past there has been what has been deemed possible cisightings of pieces of this aircraft and it was not. back to you. >> let's turn now to the fed as expected. the central bank left interest rates unchanged. nobody expected them to move on that. it also, though, continued on a take placer with another $10 billion cutting off the bond buying program which could end by the fall. nowhere is the market getting excited. during janet yellen's first news conference as the chair, she defined a key, quote, considerable period of time that it would take for interest rates

to rise. here is the exact exchange. >> if we continued to reduce the pace of our asset management purposes, it measured steps next fall. >> in this coming fall, you mean, not the fall of next year? >> this coming fall, yes. >> i just wanted to be clear. once you do wind down the bond buying program, could you tell us how long of a gap we might expect before the rate hikes do begin? >> so the language that we use in this statement is considerable period. so i -- you know, this is the kind of term it's hard to define but, you know, probably settles on around the area of about six months.

>> those two words, six months, rattled the markets and sent stocks tumbling right as she said them. the dow fell as much as 200 points before closing off the lows of the day. as for treasuries, check out bond yields right now. you can see the ten-year treasury note, 99.7.8 here. the yield, 2.775%. that spiked higher with the dollar when that occurred. so how are things looking this morning? first day of spring, becky, thank god, by the way. >> first day of spring on the calendar. >> the ice on my car said something differently this morning. you can see them implied down. futures indicating a drop of about 3. nasdaq about 5 and the dow, down about 26, becky. let's talk more about the fed strategy and if the markets are getting us right. joining us now to talk more about it on set, we have drew mattes on the economy, senior u.s. economist at ubs. guys, those two words, six months. there's been a lot of criticism

from outside. do you think it was a mistake by yellen to go ahead and announce them in those terms? >> i think it was a little bit of a gaffe. it's her first real formal announcement as -- in her new job. and, you know, this really was nothing to react to. she says she's going to be targeting very broad things in the economy, inflation, blood measures over unemployment. you know, who is going to be on the "tonight show" a few weeks from now. she has all kinds of means to move, it's just kind of a nonevent. i mean, she's given herself plant of on ways for her to change her mind. i'm not too concerned about the economy getting that strong that quickly.

there's just too many fundamental problems underlying the economy, but i don't see inflationary pressures, i don't see pressure toes raise rates. >> you're talking about the market stumbling, but you're talking about a decline for the dow. >> it will shake it off. i think if you look back a little more than a year ago, there was no threshold for unemployment and the fed was saying they were going to keep rates on hold until mid 2015. janet yellen said yes keeping rates on hold until 2015. you're in mid 2015. people who do math for a living in financial markets should be able to add six months to december and figure out that that is not a pulling forward and -- >> i think people got it because they thought this was something new. they thought the taper was going to end much more quickly. the problem is, everyone seems to think fed meetings are once a month. they're once every six to eight weeks, which creates that two to six-month differential. finally, people are looking for

the 6.5% threshold to change and for no new information to be provided. i don't think any information was provided, but you know, people are searching for anything at this point because quite frankly, they're both a little boring. every data point is impacted by whether -- it seems like there's a big issue in the ukrainian russia. and, you know, everything is just kind of there, but no one can trust anything they're hearing. >> was she direct in how she spoke? >> i think she's much more plain spoken than any of the others. >> i appreciate that. >> she was very cool about some bearish things in the economy. and -- but it was just a little of room for interpretation in there as to what she's actually going to do. and the middle of next year is a long ways off. you know, and i think the market just reacted based on what everyone in the market thinks other people are going to do. it's a classic keynesian

reaction. there wasn't that much in that statement. >> so i feel like the relationships there would be right. you said parsing the language we always do, go back to being a star chamber, sit in a dark room. >> they're halfway there. >> did this give us a preview of what higher rates must -- whatever it is might do? are higher interest rates necessarily a bad thing for stocks given that higher interest rates should also tell a story of a strengthening economy? >> well, sure, but if you look at what really has been carrying this economy has been, you know, world wash and liquidity. you know, we've got a world like flood of capital, labor, and capacity. and there's really, you know, a lot of fundamental problems with under water homes and consumers not having access to credit.

you know, in an economy we're more than two-thirds of our gross domestic product. >> the private sector, we have seen some growth. the public sector has been down and the private sector we have seen some decent growth. >> that's true. but i mean, i -- if you look at it, higher rates are good for the economy at this point. so why is it good? >> well, when rates go to zero, everyone tries to get their cash back and keep et very short in terms of maturity. and equities, the way that that happens is you start paying to give them more buybacks and dif depositeds. it makes it more attractive to people. if you start raising rates, then you're going to have to -- equities are going to get rewarded for growth instead of for shortening duration and buybacks. that means you're going to want to start investing if you're a ceo. conversely, a higher rate will -- >> i think it's good for both equities and the economy. whenever you have people responding to the potential for growth as opposed to some fear

of something else happening -- >> do you think that's a virtual cycle instead of the vicious cycle we've been in? >> we're talking about 2005. we're pointing to air or may of 2000. >> that was 50 pounds ago. >> may, air or may of 2015 versus october at the point we're at? a thousand things could happen between now and then. caught out on one side of the yield curve, everybody is so piled into serp yields that if we start to see this move higher on the ten year like we did, we could see this big shift in the bond market.

and as we rachet up interest rates on the longer end, it's going to make equities, specifically the big caps, i.e. the dividend payers less attractive. could this be more of a mechanical shift rather than just a fed call? >> there is an interest in playing the yield curve. so there are a lot of people waiting for the move to actually start because history has shown that you can wait for the move to start and gain some momentum and still get in and still make money. >> was yesterday the beginning of that move? >> i don't know if it was the beginning of the move. >> the dollar, too. >> we have talked about those little dots, right? and the fed's forecast shifted materially in 2016. they actually added a rate hike in 2016. so when you're thinking about how the fed is thinking about these things, they're going from -- we're going to get slow and it's going to take us forever to get from normalized to potentially we're going to go and when we go, it's going to look like more of a tightening cycle which was not priced into

the market. if there's anything that justifies a response we saw yesterday, it's that shift of more rate hikes earlier because that makes it closer to a normal fed rate hike, like there's something more in line with the announcement rather than this kind of we're going to wait forever and go with half speed. >> do you think there's anything, speculation or it's just a gaffe? >> if you ask me about conserve time, i would say six months. that's fed speak. >> although we haven't done that in a very, very young time. >> it tells us how young traders are. when we come back, should we start to worry about the strength of the housing market? we're going to get a reality. and convicted felon bernie madoff is speaking out from behind bars. he says it would be easy for another ponzi scheme like his to happen again. we've got that story when we return. return.

welcome back to "squawk box" on this first day of spring. futures are indicated weaker. they've dropped, doubling the losses from just a few minutes ago. right now, the s&p 500 are off by 5.5 points. the ten-year note is yielding 2.775%. it has finally moved above

2.75%. earlier in the week, we were looking at 2.6% and change. the dollar is made big moves based on what janet yellen said yesterday that rates will rise at some point in the actual future, sometime between a year and a year and a half from now. we knew that was coming, but when it' about $14. $1,327.50 an ounce. we often talk on the show, and i don't know how often, about 3d printing. and the question this morning, is hd going 3d? hewlett packard is expected to outline plan toes enter the commercial 3d markets in june. chief executive meg whitman telling shareholders on tuesday that the company will make a very big technology announcement regarding how it will approach a market that has excited the imagination of investors and consumers. i'm excited for that.

>> i think it's a while before it has a huge implication for manufacturing. there's not too many things that you'll be able to order that you can go to the printer and do instead of off of amazon or something like that. >> yeah. but five or ten years from now, there will be serious -- >> potentially. >> we know somebody who bought a pair of glasses that was made. >> i fired a gun that was made from a 3d printer. >> you did? >> i watched the guy make the clip and the hammer. >> wow. >> and came out of the milk, which is basically a white chemical where the laser heats it up. it takes a long time, but this was an old gun the guy was using. it was part of a documentary. and the gun worked. >> scary. >> it's not that everybody is going to have a printer at home and that you can make anything in your printer. because you need the kwif lend of the ink, right? >> you're making model cars,

you're making blocks. it's the idea that everyone is going to make jewelry at home or this or that, it's not clear that -- >> yeah, but i agree with you, it's going to trend -- manufacture i manufacturing is going to face an even greater xalg challenge than it has in the past 20 years. >> are manufacturers going to have a problem in terms of creating? >> absolutely. let's talk about starbucks. it is making a new chai tea in collaboration with oprah winfrey. that was the big announcement out of starbuck's annual meeting yesterday. oprah has never put her name on something like this before. it's not technically an endorsement. all proceeds that oprah makes will be donated to youth education charity pes.it is

worth noting that the tea itself is a $90 billion global market. and we were talking about this at teavana, if you've been in there, it's pretty pricey. you can spend $30 and up for a pound of tea. i've walked out of there and spent $1 00 before. >> really. >> yeah. you don't even realize it. >> you can buy just a cup of tea, too. >> you can buy a cup of tea. it's not that much. they give away free samples just to get you to like it. the big bucks for them is if you buy a pound of it and half a pound of their special sugar that they use. that's how they make their money. >> i'm not enough of a teamaker. but you've ditched the coffee for the -- >> well, i drink coffee, but i start with tea in the morning. >> i'm feeling much better, thank you. remember we had a guy in with this highly caffeinated tea? that's what i want. no, we had a guy who makes special leaves that they find in -- i don't remember where they --

>> i'm all decaf, so -- >> it seems like at some point the pot industry and the tea industry are going to merge. is working from home more productive? the "new york times" recently ran a story about this saying, quote, those who work at home tend to put in longer hours and are often more productive.. the ceo of gallop took issue with that statement and he wrote a story about it from linkedin. he says research shows people who work remotely for less than 20% of the time are the most likely to be engaged of all employees. disengagement rises when employees spend more time out of the office working. agree or disagree, andrew? you're a guy who spends multiple places for work. >> i'm most productive on an airplane. >> no distractions. >> no. i actually want to be on an airplane with the internet, but

there's no other human beings to talk to me which is a good thing when you're trying to do work. if i was never -- for long periods of time, that that would be hard. >> i do think there's something to go to your office at least partially to check -- this is worth some higher piece at yahoo!. there were productive people at yahoo! but part of the problem was that they never talk to each other. there is something you said about going to an office and talking to each other and having some kind of integration a little bit, no? >> i would agree. now, i would like to see in that poll how many of the workers from home have dogs. i have two dogs who bark at everything. so if you're trying work from home, you're on a conference call, whose dogs are -- >> i mean, i -- i have a little kid. it's a lot harder to get things done. it used to be easier. >> i think it fends on who you are and what you do. if i'm not doing this fine program, street signs in the morning, i'll get up early, go through the news, do the conference call here in the

morning, send out -- just one drink -- and go through and put together some show notes. if you can get quiet, you can do it. but it depends on the job you have, too. >> i used to know a guy who worked at ibm for probably 20 years. and he worked for ibm at home for 20 years. and i could never figure out how productive -- there was no office to go to. >> it depends on your job, though. if you have a project and you're assigned that project and you can sit down and do it, that would be democratic. i think it would be tougher to do something where you have to work with other people. >> when i wrote my book, i wrote it at home. it was probably the most productive thing i've ever done in my life. . >> there's the asterisk, no kids at that time. big difference, right? >> we should tell you about a couple things this morning. we have a special guest for today's edition of executive edge. mj lease, finance reporter from politico who interviewed bernie madoff behind bars last week.

she joins us now. it is a cnbc exclusive. good morning to you, m.j. >> good morning. >> first of all, how did the interview come about? how did it happen? >> i just wrote him a letter a couple of weeks ago t. he agreed to talk. he called me a week later and said -- >> did he call you collect? >> he did, actually, and apparently my cell phone didn't have money on it, and so i had to, you know, get him back some other way. but we ended up connecting on the phone instead of e-mailing and set up the interview. >> give us a little bit of the sense of what he thinks life is like in prison. i was struck in particular by a line when he said that the prison was -- he thought was beautiful like a college campus. >> right. he seems to be doing very well. i was struck when i first saw him. i thought that he would look more sick, i thought that he would look a little more weak. he seems to be doing fine.

adjusting to life in prison, considering the kind of lifestyle that he had before getting to prison. i was a little struck by that, as well. the description of the prison being more like a college campus. the inmates are nice for him. i think his biggest problem is boredom and passing time. he watches a lot of things on television. >> i thought most controversial was this idea that he felt no remorse, it sounded like very little remorse for what he had done. what was that about? >> sure. i think that it's not true that he doesn't feel remorse. i actually do think that he feels a tremendous amount of guilt and remorse, especially when it comes to the pain that he's inflicted on his family. but you're right, there are certain lines in the story and certain lines that stuck out for me at the time, too, and i knew

he shouldn't be saying that and i thought he would no better than to say something like that. his depends are something that people talk about a lot. the fact that you jewish individuals and groups and charities, that they're very vulnerable because he himself was a member of those communities and the fact that he said, you know, i didn't heard the -- mojews more than i hurt e catholics. >> in terms of how he's come to that view? >> i was struck by how on defense mode he was during the entire sprue. i spoke to him for about three hours. he was very open about his family, you know, he kept coming back to justifying himself, justifying details of how this

has been covered, how the media has not been covering him fairley, how it's distorted. >> did he apologize to anybody? i mean, did he apologize to his victims? his son committed suicide. >> no, i think his family is definitely the thing that he feels worst about. he's been willing to talk about it. he talked blths bit about his wife. he's been married for over 50 years. so he feels a tremendous amount of remorse. i think when it comes to discussing his victims and his former clients, it's a little more complicated because he thinks that the fact surrounding this scheme has been so resorted. >> he asked you when you were leaving to send him a copy of your story.

have you sent him a copy? and have you heard back from him now? >> i have not done that yet. i will be doing it soon, though, and i'll let you know if i hear from him. >> i didn't understand that one piece of it, actually. i thought he liked that book. my understanding was he kept in touch with that reporter after the book came out. no? >> no. i think it may be right that he may still be in touch with her. i'm not sure. i asked her what her reaction was to his general disappointment with her book, especially the title. he seemed pretty hung up on that. but they may be in touch, i'm not sure. but i think it goes along the theme that his satisfaction with what's happening has, you know, covered in general. >> does he keep up with the markets? >> i don't think he does, actually. i was asking him for investment advice, you know, how would you invest money if you had it now. he was amused and he said, the only piece of advice i have is that i would avoid the stock markets, that he was never a fan

of investing in the stock market. >> he had his own market. m.j., thank you. >> he marked his own market. >> thank you for joining us. great story this morning. all right. when we return, we tack that topic and strength of the housing markets. as we head to break, let's take a quick look at yesterday's winners and losers. about business internet? ok, how about thirty seconds? at comcast business our internet is fast.

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good morning and welcome back to "squawk box" here on cnbc. i'm andrew ross sorkin along with becky quick. brian sullivan is here today. joe has the week off. australia now sending aircraft to an area in the southern indian ocean after satellites discovered two absence that could be part of a possible debris field of that missing malaysian air flight 370. one of the objects is almost 8 0 feet long. the search area now nearly 2500 miles from australia's southwestern coast, a four-hour flight. australian officials are calling them the best lead they have

right now, but caution it could still be along a shipping route. we're going to have a live report from sydney at 7:00 a.m. eastern time. in the meantime, let's take a look at futures this morning. the futures are weaker even after dipping yesterday. dow futures look like they would be indicated to open down by about 45 points below fair value. s&p futures are down by about 5 1/2 points below fair value. you'll see at least in some of the earlier trading, the german dax is off by about 1% and the cac is down in france, as well. overnight in asia, weakness. the dow was down by just over a hundred points here. the nikkei closed down by about 1.6%. the hang seng was down by 1.8%. oil price rs are indicated lowe. right now, down about 39 cents.

below $100 for wti. $99.98 a barrel. the ten-year note is trading back at 2.784%. the dollar is stronger on this idea that higher rates maybe sooner rather than later. janet yellen talking about maybe six months after a winding down of qe. the euro this morning is at 1.3782. the dollar/yen is trading at 102.48. and gold prices have been coming down, too. they're down by just over $13, $1,327.70 an ounce. so how is this for a combination inspect business ethics and housing this morning. the world's most ethical companies, and among the winners is realogy. congratulations. >> thank you. good morning. >> there are many out there who you meet that say that corporate

america is by default unethical, that the last ten years have proven that. how does realogy, how do you .your employees define ethics today? >> first of all, it's a great honor to be recognized for the third consecutive year as one of the world's most ethical companies. it didn't happen easily. it takes an incredible tone at the top. you have to set the stage for every employee, every plier, every vendor, every customer. and it is not just a policy or a program for the company. it's cultural. we believe this. we live by it. we conduct our business by it. we hold people to very high standards. we try to attract the most ethical people. we spend a lot of time researching backgrounds, as an example. we want to ensure that what you've done historically has some reflection on what you intend to do in the future, .that as a guide tends

to make it easier for us to attract the best talent. even if you are known for being ethical, you will by that nature attract ethical people. >> is there an interview question that you ask? is there something that you say to try to find as an indicator of how people will respond? >> well, when you're hiring employees, you're held to certain standards, as you well know. we always believe your background and your track record is important. your track record will tell us what you intend to do in the future. if you have a blemished background, you're probably not going to be a good candidate for employment in our company. >> does that mean you look for complaints against people? i know a real estate agent who once i was in contract with them and they found a better bid and they dropped us and went somewhere else. i thought that was unethical, but this is a person i see getting high ratings. >> employee res held to one standard. independent contractors, a different standard. that doesn't mean ethics are

difference between the two classes. it means that you go about the background check differently than you would otherwise. that agent would probably tell you that was a judgment call. you ted her to a high standard from an ethical standard. >> am i wrong? >> it depends on the circumstances and the issues. but we could have a discussion about whether it was a judgmental or on ethical decision. literally, agents are held to a very high standard through their licensing and through their state licensing. they are obligated to exceed those standards. that's what we held them to. and we would like to think they all do, but from time to time they're not. employees will not always abide by the high standards of your company. so it's not only the tone we set at the top. it's how you react. and the instances where people are not ethical. >> and so what do you do? how public are you with your firing or whatever type of

modification you -- what do you do? >> i'll tell you what's interesting about that. of our surveyed employees, about 11,000 employees, 260,000 agents, our employees will tell you that 99% of them believe that they have an obligation to meet those ethical standards and they actually hold our ethical goals to the same standard as our business goals. so they see them being one and the same, which is a remarkable change. i don't think that would have existed four or five years ago. when we find someone who does not have the same goals, a thorough investigation is due, but then we take swift action. it's how you consistently -- be it an employee, vendor, supplier, franchisee, a customer buying a home or selling a home one might be consistent in the application of your belief that ethics are important to your reputation, the reputational

risk is not worth any to the up side, and then you take corrective action which may include termination of employment. >> let's talk about the housing market while you're here. there have been a lot of concerns. i know wlb has slowed things down. but do you think next month in terms of sales? >> we have a low inventory problem right now. that's just about in every market of the united states. inventory has been impacted in the northeast and the midwest now. i for one prefer not to be a business that complains about the weather. but truly, it is difficult to take a home and inventory, given the conditions we've had. so i think the northeast and the midwest will improve our inventory over the next month or so. that is the -- the jury is out as to whether that's going to occur. the good news is the last inventory report was up 10%. so we're starting to see an increase in inventory. we think the market reacts very well to that. >> i'm glad to hear you say that. every time there's a housing number that comes out that isn't

as strong as people thought, the nay sayers say, oh, i told you. if you don't have a home to sell, what are sellers, then, waiting for? why aren't they putting their homes on the market? >> specific to those two broad markets, the northeast and the midwest, it's hard to list your home. if you get it under contract, an inspector can't accept the roots and the foundation because of the snow. and the vast short of the plaintiff's exhibit, i believe the people waiting for higher prices. it's a far better endcation as to the health of housing than the reverse of that. i would prefer not to see flat to pricing trending down. that would be a bad fact. if you couple that with low inventory, then you're looking at a much different year. >> on are appraisals still a

problem? i know everybody wants to believe their home is worth more than it currently is. >> my tax collector does, too. let's call him a friend and try to refinance his home in central new jersey. a couple of years ago, the appraiser came in at far less than this person would have thought even conservatively. >> the other way, much tougher. >> and that's by design. no one has any interest in going back to that. mortgage lending, underwriting, so the appraiser res being very diligent and very tough. and lenders are being even tougher. so i would not worry about a housing bubble. and your friend will eventually get his price and he's -- >> one other selfish question

for a friend. if your agent is doing a lousy job, you signed them up for six months to sell your home but you know within a month or if you feel you're not doing what they're supposed to be doing, what do you do about that? >> you can go back to the company and ask for a change in agents. if the personality is not there and i don't have the chemistry, don't wait. that's a mistake. when you know the chemistry is not there, go for the change. they accommodate that easily. >> you can't greet the -- >> that never happens at any of our brands. i just want to, for the record, state that. that's keeping with our high ethical standards. thanks so much. let's take a quick look at the futures again. they are under pressure this morning even after the sell-off yesterday. at this point, dow futures are 61 points below fair value. it looks like they would be opening down. s&p futures off just over 7.5

points. when we come back, we're going to be talking about much more. in fact, at the top of the hour, keeping the fed and janet yellen's perspective. as we take a break, the we see declines of more than 1% for the ftse and the dax. "squawk box" will be right back. . (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online

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welcome back to "squawk box." time to check this morning's squawk planner. on the economic front this morning, the jobless claims report release add 8:30 a.m. eastern time. the markets get a read on real estate with existing home sales reports at 10:00 a.m. eastern. after the bell, check this out because nike is going to check

into earnings central with its quarterly results. that's your squawk planner for this thursday, the first day of spring, we should snow. joining us now is the co-founder of the internet powerhouse blogher. does i pronounce that right? >> yes. >> we've been going back and forth about it. a big time influence on social media. the question this morning, how many unique visitors do you have every month? >> we reach 100 million people every month across 13 blogs and different social profiles. >> amazing. we're going to have a lot more with her in just a moment and the business end of blogging right after this short break. squawk coming right back. . life with crohn's disease or ulcerative colitis

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for all our viewers out there who think that blogging is for the birds, our next guest shows there's a lot of money in it. our next guest has paid out $36,000. joining us now is elisa. we've gone back and forth on this. she's the co-founder of internet powerhouse blogher. it's one of the top 100 webb properties in the u.s. the company is featured in the new book, opportunity knocking.

written by our own "squawk box" senior talent producer lori ann larocco. thanks for joining us this morning. >> thanks for having me. >> is it one site or is it a network of sites? >> we're a network of 3,000 blogs in over 12,000 social profiles across twitter, pintrest, this is all advertis driven? >> it's advertising. it's content. it's promotion. it's a variety of ways that we help people pay for works. >> right. >> so when you involve pinterest, for example, how does that work? >> well, you know, with each tool, they have their own terms of service and some of these folks are changing their terms of service pretty frequently. for pinterest, for example, we can have influencers who can have a tremendous following on pinterest create boards around a brand, for the brand. they can write about the various things they're finding on pinterest and link to them. we're not paying them to pin,

because that would violate the terms of service. >> there is a controversy about editorial content and advertising, and how it's disclosed about what's really going on. because these days, you could be paid for a tweet or not, or you could be paid on the back end in some way or related to it. >> not according to the ftc. according to the ftc, you need to disclose when you're doing something that's sponsored. our editorial guidelines are in place for all of these thousands of influencers. everything that is paid promotion is disclosed and it always has been for us. >> among all these different new social media sites, whether it's twitter or facebook or pinterest, what do you think right now -- it's sort of maybe an unfair question, but the most effective? >> that is so dependent on what you're trying to get your message out about. if you're talking about food or beauty or something extremely visual, then pinterest is one of the strongest. if you're talking about something that you want to have a substantive review of a product experience, it's still about the blog.

and i think for increasingly the younger generation, instagram is a huge -- that's what my nieces and nephews use. >> when you say it's about the blog, is it any blog? is it on tumblr? >> we're agnostic and we work with bloggers across every platform. typer and word pad is one of the strongest ones in our network. >> is there anything you would say is overrated? we were talking during the commercial break -- >> facebook. >> we were talking about facebook but also twitter. oh, you're saying facebook is overrated. is there one or two that you say, you know, may have gone past the sell by date? >> here's what i think is happening with facebook. is that we're looking for a way to carve time and space out away from the constant flood of information and emotion that's on the internet, and a lot of what i see happening that's really interesting on facebook is in private groups. so it's going to make it harder for companies and brands to participate and find their customers. facebook is increasingly wanting

companies to pay as opposed to organically. >> i'm glad you said that. you read my mind, or perhaps my show notes. there's a story, sam bidle, story yesterday, that facebook is going to end its organic reach program. basically this means if you want to be in somebody's news feed as a company, a blogger, or nike, whatever it is, you're going to have to pay up. that now that everybody's on the platform, now they've got to start making more revenue. to me, when this kind of stuff starts happening, you start to see user engagement go like this. i'm just speculating. >> yes, because it's not only happening to brands, it's happening to people. so you like someone, you follow them. these are individuals. facebook's algorithms are deciding which of the news feed updates you get to see. and it's a small percentage of what your friends are saying. so people feel like why are you making the decisions for me. >> we have to go, but i do have a great idea how to solve these problems. have a once a month group with

your friends, maybe look each other in the face, hug, share a drink, and talk over stories and ideas. >> i would never discount the power of online relationships. >> thank you for joining us. when we come back, a possible break in the break by the missing malaysian airlines jet. we will have an update on this developing story. "squawk" will be wipe. clb 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.

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a possible break in the search for malaysia flight 370. australian satellite picks up images that could be debris from the missing airline. we have more details on this developing story. fed chair janet yellen rattles the markets.

>> it will be a considerable period after the asset purchase program ends before it will be appropriate to begin to raise rates. >> but are the markets getting it right? we will break down the fed decision. and will cabin fever turn into spring fever? why the change in season is critical for retailers this year. "squawk box" begins right now. good morning, everybody. welcome back to "squawk box" here on cbs. joe is off today. we've been watching the futures, and even though we did see a down day yesterday, you're not seeing a rebound this morning, at least not now. those dow futures are indicated lower. s&p futures are down by about six and a half points. the ten-year note pushing a little bit higher. this morning trading at 2.781%.

we'll have more on what fed chair janet yellen said that rattled the markets in just a few moments. our top story this morning, australia is now sending aircraft to an area of the southern indian ocean after satellites discovered two objects that could be part of a possible debris field of missing malaysian airline flight 370. matt taylor of cnbc australia joins us now from sydney. he's got a lot more on the story. good morning to you. >> reporter: good morning, andrew. what i can tell you is that one of those royal australian air force planes that has been sent to that area where those two objects were discovered on satellite has been unable to locate any debris and the reports coming back from the aircraft suggest that the rain and visibility in that part of the indian ocean is essentially not cooperating with the search efforts at this point in time, as darkness does now approach that corridor of the indian ocean. some 1,500 miles or about 2,500

kilometers off the southwest coast of australia, it's a fairly inaccessible area to get to the aircraft. takes four hours in flight to get there. they only have about two hours of search time before they have to return to the mainland to refuel. it has now been a number of hours since the australian prime minister confirmed that these two objects had been discovered by satellite. said that they were new and credible in the search for this missing malaysia jetliner. the authorities speaking a short time after that statement from the australian prime minister saying those objects are indistinct. but they are definitely worth sending out resources to take a closer look at. one of them 24 meters or about 75 feet in length. the other object about five meters, or 15 feet in length. they have been seen awash in the ocean essentially, according to those satellite images, awash,

bobbing around. a number of reporters asked the various officials in a news conference earlier on today here in australia if they could see any other debris, like seats or life jackets or any oil slicks as well on the satellite images, but authorities say they were unable to. several thousand meters deep is the water as well, so they've certainly got their work cut out for them surveying that very sizable stretch of ocean. back to you. >> all right, matt. appreciate it. thank you very much. let's get now to the other big story of the day, which really began yesterday. janet yellen's market-moving press conference and the fed statement. steve leachman back from washington, d.c. he was in the room when the comment was made that was now heard round the world. >> round markets in the world. >> yeah. >> it lingers today. >> what did she mean by six months? does six months really mean six

months? are we taking this whole language thing to a ridiculous level? or is there something to this? >> yes, it's ridiculous. what i've been doing for 12 years is ridiculous, which is to parch fed comments and turn them into numbers. that's what we do. they had that 6.5%, got rid of that, went back to language. that's what you have to do. that's what moves the market. here's the questions that linger today in my opinion. was it a gaffe by yellen, and if it was a gaffe, then once you get done with the chuckle, you have to get down to the serious business of what's really policy? new fed chair janet yellen, she rattled markets by asking the question about when the fed would hike rates. we'll play you more of the whole byte. take a listen. >> so the language that we used in this statement is a considerable period. so, you know, this is the kind of term, it's hard to define. but, you know, probably means something on the order of around

six months, or that type of thing. but, you know, it depends -- what the statement is saying is it depends what conditions are like. >> she goes on to say what the conditions are like, what labor markets are like, and that we're near full employment. i think it's a gaffe in the following sense. i'm pretty sure if she can have it back, she would have liked to have said at least six months, or six to nine months. i think it's also a gaffe in that it doesn't seem like she was prepared for what we reported all week. that the real question for the market had nothing to do with qe. it had to do with guidance from the fed on when rate hikes will come. we'll show you what the fed survey says now, which is that people are kind of in the six months from the end. depends on when they end it. they end qe in october. if they end qe in december, which would still be the fall because the fall meeting -- you know, that's where you get really ridiculous. bottom line is 40% of the market is the second half -- what is that, 23% is in the first half. three months either way. once you get over the idea the

language wasn't precise, where are you? what did yellen really mean? i'm fairly certain no intention by yellen to accelerate the market sense of when the fed would hike rates for the first time. the fed is comfortable with what the market thought going into the meeting and there was no reason for yellen to move that up. the fed said explicitly its new language was not designed to change the market's outlook. take them at their word on that. and there was a highly devilish comment that was completely overshadowed with the fed saying they would keep rates at normal, even when two hawks sign on to this. the intention was to convey a more dovish message. you get a gaffe. i don't think it's ridiculous, but it makes some sense. >> i know that i will die. i will die someday. >> right. >> it's hard to accept, but it's true. and so i start planning now for that day. >> but you don't want somebody telling you it's next spring. >> you hope it's a considerable

period. >> we know fed rates will go up. they can't go down unless we go negative and start paying people to borrow money. why are we so obsessed with the timeframe six or nine months? shouldn't investors drive into work right now on the radio, think the fed rate will go up at some point, let's start shifting? >> it's not about mom and pop. >> no, it's not. >> it's not. >> i didn't say it moved because of mom and pop, but mom and pop care. >> but yesterday -- >> let me answer the question. these markets trade very precisely. they trade on the day, on the hour, on the month. if you tell me that there's a three-month difference, these guys are going to pull forward 50 basis points or 25 basis points either way. it's one of the amazing things about the american market. if you're talking about a market in a third world country, they would not be trading this way. they would not be so hung up on a single word. >> makes you wonder who's

actually third world, right? if a computer is going to do this and that. i'm always more concerned about mom and pop and what higher rates are going to do to them. >> that's the way we trade. we trade very precisely. these guys are wired into everything she says and that's how they trade. so it makes a difference to them. i think they're just making a mistake in thinking it's sooner than they thought otherwise. >> all right, steve. thank you very much. joining us now for perspective on the market's reaction to yellen's news conference is michael farr, he is president of farr, miller and washington. we also have eric marshall, portfolio manager of hodges funds in dallas. did you hear anything that changed your mind about when the fed would be raising rates yesterday and did you do anything different with your portfolio as a result? >> i tended to agree with steve. i thought he was pretty much right on. the thing that got me was the shift to the qualitative language. if you looked at his numbers for the predictions of when rates might hike, there was only about 20%, 23% for the first half of

2015, which means 75% or more think that it's going to be second half or later or even into 2016. i don't think that changed. this shift to a qualitative kind of squishy confused number of what they're going to mean by an employment target, i think added a whole lot of dovish room. it gave them room to say, we're not really worried about the empirical precision here. we've got this general sort of thing we're going to go for, and it lets them ease. so we didn't change yesterday, but i'm still looking for opportunities to buy. and i think that -- you know, like the weather report, you look at the window to see if it actually snowed when the weather man said it was going to snow. i've hired three people so far this year. our business is doing pretty well. my neighbor's businesses seem to be doing not great, but better. i think overall, the trend is positive here and i think you stay invested. >> let me ask you think. you say you're looking for

opportunities to buy. are you looking for a bigger selloff? >> i wasn't quite nimble enough to hit that yesterday in the afternoon in the last hour of trading. i would love a bigger selloff if we could find one. i was hoping that -- i think like everyone else that that first 6% sort of dip at the beginning of the year would turn into something a little bit larger, becky, because it's been hard to buy stocks. i don't think they're cheap. i do have my list. i stay invested. but i'd love to see some lower prices. >> eric, is the fed calling the shots on this in terms of where the market goes or do you think that this is the economy that will eventually take over for what the fed's been doing to stimulate things at this point? >> i think that's the important part here, is the fed is talking about the potential of raising interest rates as a result of a stronger economy. not because inflation is getting away from us here. and the important thing is as that economy improves, earnings of companies improve, and that's the most important factor at

predicting long-term stock prices is what is the future earnings and what are we willing to pay for those today. as a mutual fund portfolio manager, i mean, i don't think our individual investment thesis is going to change on any stock because the fed may raise interest rates in the first part of 2015 versus the second part of 2015. i think as long as it's measured and it's in the face of an improving economy, that should generally be good for equities. we would look for volatility around this as an opportunity to go in and buy things that we think still make sense from a valuation perspective. >> brian's right in that rates are going to go up. it's a question of timing on this. but what do you tell people who are looking around, trying to figure out if they still ride this bull market for a while, or do you think they need to change where they've been allocating money based on the idea that rates are going to rise? >> i think it's pretty hard to find anyone who thought interest rates were going to stay low

forever and ever. and we don't spend a lot of time focusing on trying to predict interest rates. but instead, i would recommend the people to really focus on looking at what's going on in the individual businesses that you're investing in, and are they dependent on having low interest rates in the future, or are they relying on good business decisions by their management teams. are they well-run. do they have the ability to do well with or without an artificial stimulus from the fed. >> michael, how about you? what do you like right now? >> you know, i continue to like health care. i think that that's still a story that's unfolding. we haven't gotten out of the shadow of obamacare and we have the powerful demographic and there's still places there. i continue to like technology stocks. i'm not comfortable with the banks. i own a couple. some of the new kind of emerging

trend stocks. i think the tend towards natural foods and organic foods, those companies are adding margins and i think that those trends are here to stay. so different areas, but still no need to swing for the fences in a market like this. stocks aren't cheap. i don't think they're egregio egregiously overexpensive, but there's risk here and we haven't had a pullback in over two years. that's just too weird for an old hand like me. >> all right. so we'll wait for that pullback. michael, eric, thank you both for joining us. >> thanks. >> i watched the first season and i stopped. >> yellen should come out to the podium, look at the audience and say "winter is coming" and then walk off. because that's where we are in my mind. coming up, the amanda behind the gs elevator twitter account that andrew ross sorkin found out he is. as we head to break, let's check out the price of oil. chevron executive saying $100

oil, which is exactly where we are right now, is the new $20 oil. >> what? this is the low they think? >> ratcheting up the drama here on "squawk box." we're back after this.

welcome back. spring, by the way, coming in about five and a half hours officially. let's check the futures right now. they're not looking quite as rosy as the yellen drop that we

got yesterday. maybe continuing this morning. the dow indicating a drop of about 50 points at the open to nasdaq and the s&p also indicated lower. >> we've got a little bit of news this morning because the man behind the twitter handle gs elevator is getting a new book deal. we'll talk about that in a second. because grove atlantic is now giving john lefevre a reported six-figure deal to publish "straight to hell: true tales of deviance and excess in the world of banking." he had a deal with simon and shuster before we revealed his identity. we didn't know that they were going to kill the book. a lot of people got very upset with simon shuster, because they said why would you publish this guy's book if he really didn't work at goldman. >> there's the argument that parity -- >> a lot of people thought it was a parity account, too. i did not expect, by the way,

them to kill the deal. and then, of course, these guys picked him up saying there's so much attention on this anyway. >> is he getting another six-figure deal? >> it's another six-figure deal. >> as a best-selling author yourself. i don't know the book industry at all. if you look at how greg smith, the former goldman sachs guy, who wrote that article, if his book didn't sell well, wouldn't simon and shuster be looking for a way out? did they have second thoughts? >> they picked up this book after the greg smith book. the greg smith book was a fact yu -- failure. that is true. >> is that fair to say? >> given how much it sold, you put it in the failure category. it did still sell some copies. coming up, health care and business ethics. the ceo of health care improvement company premier going to take us inside that industry when we return.

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cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances. welcome back. we're talking health care and business ethics this morning. ethosphere institute releasing its annual -- joining me, the president and ceo of premier. good morning to you, susan.

it's great to be awarded, that you have this ethics award. what do you think it is that you do that makes you more ethical than the others, especially in the health care arena? >> you know, andrew, it's interesting. i think you can do all the process work to hire the best people, do the background checks and get them in the door. but the real challenge is how you deal with employees and with customers in a complex health care world after they get here. and so we have implemented a lot of processes that allow people the ability to identify and discuss and report and work through what might be ethical issues. and so i think we're recognized because of all the things that we do to ensure the compliance with our code of conduct and our ethics rules. >> do you think that the health care industry is more ethical than others, not so much? broadly speaking. not about your company now. >> i think the health care

industry is maybe more ethical because patients are trusting physicians and hospitals with their care, with their very lives, and so i think by its nature, they want to trust that system. i don't think that means that the system doesn't need processes and structures to make sure that that trust is maintained. >> when you're talking about processes, what do you mean? what kind of processes? specific examples. >> the things that we do, we have an anonymous hotline. so employees can report in anything that they're worried about. we have a regular survey process. >> how often do you get called -- i know a lot of companies that have these hotlines. i always wonder, how often does the company get that call? what happens to that call, and how does it move through the chain of command, if you will? >> we have a separate compliance and ethics group in our company. the hotline calls go into the ethics leader. that ethics leader immediately contacts or reaches back to the

on mou oni onimous reader. they have a direct line to the board of directors. we monitor and report the number of calls that come in, the resolution of the calls and there's a process to make sure everything gets handled appropriately. >> any specific interview questions, for example, when you're going to hire somebody, whether in school or later on in their career to try to identify with people you think of more ethical or not in others? >> maybe i should start by explaining our business a little bit. we have 1,100 suppliers of devices and drugs and everything that hospitals use. we have 2,900 hospitals that are doing the buying. so we are bringing together buyers and sellers on the supply chain side of our business. and then we're handling big data, all kinds. millions and millions of patient records on the data side of our

business. that means when we interview people, we have to make sure privacy is going to be protected. we have to make sure they're going to be comfortable with encrypted computers. we have to be sure that they don't own equity in the potential companies that will be negotiating contracts with. so there are a variety of questions with that, and there are scenario-type questions around gray areas, and we'll do a little bit of role-playing with employees just to make sure that we think that they have the right thought process as it relates to code of conduct. we also do training so that we continue to build it. >> we've got to leave the conversation there. congratulations. >> thank you. >> and thanks for joining us this morning. >> thank you so much. when we return, the trading block turns its attention to treasuries and currencies. and spring is here. so will the consumer get out and spend? can retailers turn cabin fever into spring fever? we'll turn more about that.

more after this. >> get a leg up on the trading day with the morning "squawk" news letter. go to our show page and sign up now. morning squawk is a snapshot of the day's top stories. guests and some fun watercooler stories that we'll be squawking about all morning long. sign up and get morning squawk delivered in your inbox every weekday. "squawk box" on cnbc. profit from it. at's not much, yk except it's 2 percent every year. go to e*trade and find out how much our advice and guidance costs. spoiler alert. it's low. it's guidance on your terms not ours. e*trade. less for us, more for you.

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welcome back to "squawk box" here on cnbc, first in business worldwide. let's get a look at some of the stories we're following this morning. two objects of size have been spotted by satellite in the southern indian ocean, that provides a lead for search for the missing malaysian jetliner. australian authorities are sending aircraft to the area to try to identify the objects. we'll keep you updated. ukraine is preparing to pull its remaining military personnel and their families from the breakaway region of crimea, effectively conceding defeat after russia says it would annex

the peninsula. president obama has threatened additional sanctions. the announcement in kiev of possible evacuation in crimea comes after pro-russian forces early yesterday took over ukraine's naval headquarters. that navy chief who was detained has since been released. the russians have demanded that the ukrainian troops either switch allegiance or abandon their post, but many have refused, counting down until 8:30 a.m. eastern. that's when we'll find out how many people filed for unemployment claims for the first time. about 25,000 new claims were filed up from 315,000 the week before. we have three economic reports out at 10:00 a.m. eastern time. existing home sales for february are expected to be flat compared to the month before. weather is expected to be a factor once again. the philadelphia fed's manufacturing survey for march is expected to bounce back a bit from the contraction that we saw back in february. and finally, the conference board's index of leading economic indicators for

february, that number expected to come in flat for the month before. >> how are you feeling, by the way? >> okay. >> you are a trooper. >> i'm okay. i'm feeling better. thank you. >> okay, feeling good. you are tough. anybody that says you're not tough, then come talk to me. >> she's playing injured. >> what's that? >> she's like jack lambert with the broken leg with the steelers. not feeling good, but she's here. >> you guys are taking it easy on me, thank you. >> that read didn't take it easy on you. janet yellen rattling the market during press conference yesterday as fed chair. listen. >> the federal open market committee concluded a two-day meeting earlier today. as you already know from our statement, the committee decided to make another modest reduction in the pace of its purchases of longer term securities. the committee also updated its guidance regarding the likely future path of the short-term interest rates. >> it was that interest rate outlook that rattled the markets. here now to talk currencies is

the managing director, also a cnbc contributor, and on fixed income, michael gregory, senior economist. michael, i want to begin with you, because -- and there's a twitter debate i'm having with a couple people going on. there's people like you that are deeply into the markets trading on timeline and discounted cash flow and everything else. and then there's my parents. there's mom and pop that have a 401k that are curious about how the federal reserve may have b. she tried to pacify that by saying when they do rise, it will be very gradual. the m point will be low. but she also indicated i think that while they reserve the right not to tighten as the unemployment rate falls, they also reserve the right potentially to tighten even if inflation doesn't return back right away to its 2% target. so a lot of uncertainty there. the uncertainty creates some volatility. so both the rate expectations and the sense that there's more volatile times ahead for the bond market. that caused yields to rise. >> and the bond market has been

almost looking or begging for volatility, as the contacts that i've been talking to have been saying because everybody huddled into one corner of the yield curve. that's for guys like you, the deep market participants. from a more macro perspective, say to your clients out there that have real jobs that are not necessarily market timers every day. they're at work and tune in and out of the markets. what are you advising them to do? >> obviously the trend toward higher interest rates seems intact. yields are not going to rise in an awful hurry. you don't have to rush out and buy a house right away fearing that rates are going to be 100 or 200 basis points higher. the fed may be preemptive here, but rates will remain historically low. maybe not as low as they've been. so you don't have to rush out and buy that house and you can think about your investment portfolio here as not really being affected too much by sharply higher interest rates. >> all right. so kathy, now let's go to the

dollar. the u.s. dollar got stronger yesterday. do you expect that to continue? >> i do. actually believe that yellen provided more clarity than ambiguity. if you take a look at the price action, currencies, treasuries and equities, there's quite a bit of consistency. that tells us that everyone took away the same message from the central bank, which is that yields are headed higher. as a result, the dollar is very big today. and i think that there is scope for further gains. because we could see yields at 3%, which would be pretty positive for the greenback. overall, i think it's time to reload those long dollar trades a lot of people have put to the side over the past couple months. i think chasing yields seems to be the right trade these days. >> every time people said okay, finally the dollar is going to strengthen up, especially against the euro -- unfortunately we've been hearing that for the better part of, say, five years. is this time for real? >> seeing quite a bit of monetary policy divergences around the world. as this widens, it's going to create better tradeoff treaties. for example, you're seeing the

canadian dollar trade at a four-year low. some central banks like canada, who's talking about -- maybe we have to cut interest rates again. you have the u.s. who's normalizing monetary policy. today we have a huge slide in the euro, and part of that is because inflation is down. the ecb could consider additional stimulus, or at least keeping monetary policy low. so people are looking at the story of monetary policies around the world, and realizing the gaps are widening. that is why you're seeing better opportunities. because as before, we weren't sure exactly when the federal reserve was going to tighten. i think yellen provided a very clear timeline for investors to target, which is six months after qe ends. that puts us in summer of 2015. >> there are times when i feel more silly than other times. it is hard to say higher rates and 2.7 % in the ten-year in the same sentence. we're still so historically -- we're still still so historically low. look out a year if you can.

where do you see us going? >> i think as the economic data improves as we shake off the shackles of this lousy winter we've had, that data will likely push yields a little bit higher. we'll take a run at 3%. once we start getting above 3%, we start hitting multi-year highs. i think that thing gets people interested. oh, you know, 3% is still not bad considering where we've been. you get a little buyers there. we'll get some flare-ups in geopolitical issues and the data is never one-sided. so i suspect we'll have more of a ratcheting kind of rise. i suspect we're around 3.5% by the end of the year. >> 3.5% by the end of this year. so you see another 75 basis points on the ten-year in the next nine months? >> absolutely. because i think part of that is going to be the end of qe, and once that happens, the expectations begin to build about rates rising. but more important than that, i think the economy is going to start to really begin to perform. a wealth effect coming through.

a lot of pent up demand coming through. and all of a sudden you get 3% growth and the talk begins to turn when is the fed going to raise interest rates? >> and kathy, parity with the euro for the u.s. dollar by year end? >> not at all. >> i'm kidding. >> 3% is consistent. so we could get there. >> kathy and michael, good morning, thank you very much for joining us. michael, i know a lot of home buyers are hoping that, with all due respect, you're wrong about where interest rates are headed by the end of the year. i need to correct something i said. as a los angeles kid, i'm really ashamed about this. i referenced jack youngblood with the steelers. he was with the rams playing the steelers when he played with a broken leg. a couple of eagle-eared and eagle-eyed viewers pointed that out. as an l.a. guy, i surrender. >> if we're doing corrections, i have one, too. when we talked about madoff, i talked about butner.

it's really butner. >> i figured if we're in correction mode. >> i thought you were talking about the jonathan franzen novel. if we were talking about the corrections. >> we're doing that, too. coming up, when we come back, we're going to drink beer and then we'll need a lot of corrections. and talk "game of thrones" with the ceo of new york specialist. it's almagang. walmart bringing up black friday to spring. courtney reagan's got more on that. >> that's right, andrew. walmart, one of the retailers that's come down with spring fever. rolling out what it calls black friday-like prices starting tomorrow. i've got the details coming up on "squawk box." (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online

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through all of the features then. why don't weeeeeeeeeeee go out to the car. ok, i'll just be outside... ok, yeah. his dad is my boss. yeah. vin scanning to add a car. just a tap away on the geico app. take a look at the futures right now. see how the market is setting itself up after a pretty crazy day yesterday. dow looks like it's going to open down, about 38 points down. nasdaq would open down as well, about 7.5 points down. the s&p 500 opening down, or looking like it will, close to five points off. check out shares of home builder lennar this morning.

beating estimates by seven cents. revenue also above analysts' expectations, as lennar sold more homes at higher prices. the company did say it was too soon to tell where the spring selling season will go. coming up, we're going to take a closer look at the home builder and whether or not you should be buying these stocks. retailers across the country are hoping that cabin fever the past few weeks will translate into a big bump in sales this spring, and the world's largest retailer walmart is going a step further trying to boost sales. courtney reagan has that story for us, reporting from a walmart nearby in new jersey. courtney, what's walmart doing? >> hi, good morning to you, becky. believe it or not, spring starts officially today at 12:57 p.m. that's what our friends at the weather channel tell us. retailers and consumers are really ready to put the coldest winter we've had in 13 years behind us, so spring sales and events aren't totally unusual, but this year they could be more important than ever for

retailers hoping to recapture some lost sales and drive traffic after shoppers just stayed at home because of that harsh winter. so tomorrow, walmart is rolling out what it calls black friday-like prices for its spring savings event, featuring what the world's largest retailer is really looking forward to on 60 outdoor essential products. cfo charles holly says recently that since weather has improved, walmart has also seen sales pick up. target is advertising promotions featuring home goods. others hoping to benefit from consumer spring fever. home depot's spring black friday event kicks off april 3rd, and every year spring is the true holiday season for retails that sell home improvement goods. this year could be especially strong, as consumers need to make up for what the winter has done to the outside of their

home. it could be good, but evan gold said that's a double-edged sword. the more money consumers have to spend on things like siding and roofing, the less potentially they have to spend on flowers and spring dresses. but the weather channel paul walsh said 60 is the new 80 and any warm weather we begin to see is going to have an outsize effect on consumer behavior. you know retailers are hoping that's the case. >> do you get the sense that retailers are nervous at this point, that they're really anxious to try to make sure the shoppers come back? >> yeah, i think it kind of depends, and it depends on what you're selling and how much you're able to offer those discounts. we all know the holiday season was very, very promotional and that's what folks are going to continue to expect to see. so if you're a retailer that can continue to offer 40% off, i think it's going to help. if you can't, you're going to be a little bit more nervous about recapturing those sales. >> okay, so this is really interesting. black friday, when walmart came out and offered a bunch of deep discounts that other retailers

weren't expecting, it really rippled through the entire retail chain as everybody else slashed prices to try and keep up. they all got their profit margins slashed in the process. do you think there's a replay of that that's likely to happen now? >> i do. i do think so. and you know that the size of walmart always has an outsize effect on anyone else. so all the competitors are going to watch very carefully and not everyone can absorb those promotions as well as a company like walmart that has large economies of scale can do. so i think everyone's watching each other very carefully. they're all fighting for those same consumer dollars. we know heating bills are higher. so there could be less disposable income, which makes it even more aggressive this time of year. >> okay. courtney, thank you very much. we'll hear more from you later today. >> thanks. coming up, what to make of yesterday's market move and how you should be setting up your portfolio for the next of the week. amalgang is going to join us

to talk about their latest cooperation with hbo's "game of thrones" and the craft brew business, when "squawk box" returns.

welcome back. hewlett-packard, we've just gotten word that it is raising its dividend to 16 cents per

share. there you have it. we'll see what that does to the stock performance today. it's a little bit. a turnaround in the free market, but we will see where it all goes. >> hard to analyze hewlett-packa hewlett-packard, too. it's outperforming the dow this year. but so much of that is maybe either asset sales, buybacks. it's a tough stock to analyze fundamentally. here's a foodie alert. and it's never too early to talk about beer. new york-based beer maker amalgam is announcing its lineup for the third annual hop chef beer and food competition. here to talk about that competition, simon thorpe. ceo. simon, welcome. i'm a big fan of your brand three philosophers. >> it's a quadruple.

>> we'll call that have one and done. you're partnering up with hbo's just mind blowingly huge hit series "game of thrones." is george r.r. martin, like, hanging out a your brewery? how did this come about? >> it came about very simply. >> because he lives up there near cooperstown. >> it's very simply, the hbo team, particularly the licensing team have been fantastic. they're friends of the brewery. the brewery's been obsessed with the series, so it was a natural fit. >> how do you expect it to help you? obviously you'll sell more beer. but what does this do for you otherwise? >> we're a tiny little brewery. i mean, our brewery is in upstate new york. it sits at the top of the quality pyramid. there are probably only four or five breweries in the country that can do what we can do. when you get a hook-up like this, it transform what is you can do. we can't afford big tv budgets, so this is giving something about 200 million social media impressions. that's transforming. >> so how does this work with

hbo? can you talk about what the licensing arrangement is? >> details -- i mean, no, because there's a contract. but the way it works is very simple. hbo got this fabulous reputation. you hear actors and directors talk about how wonderful they are to work with. the same is true for beer as well. they've given us great creative license. they come up with concepts around the story line that they particularly want to talk about. >> but they came to you? you went to them? how did this happen? >> originally, they came to us. >> because they said they love the beer. >> and we were selected from -- i mean, any of the great craft breweries you could have found. >> was there a competition for this? >> i mean, literally they were fans of the brewery already and we were fans of the series, and it was a great mix. >> you may not want to answer this question. i'm going to move away from brewing, to you said 200 million social media impressions. huge debate lately, especially on street signs, 2:00 eastern

time, about how effective a drink -- now we have alcohol. how effective those impressions are. as a small business owner, do you find that -- because somebody likes something that they're going to buy something? >> yeah. there's a direct correlation for us. i think very simply, if you put normal point of sale and stuff out in bars, think of it, about a million impressions. if you run a poster campaign in manhattan, then you might get five million impressions. but to get this kind of level of transforming awareness for your brand across the country, and it's -- people get really enthusiastic and they will travel from california. >> have you found pieces of the social media world are more effective? are the folks on facebook more inclined to buy? are the folks on pinterest more inclined to buy? is there any way to measure that? >> we haven't seen any particular channel that says this is it.

but it's across the board. you find that people move between one and the other exactly as you've described it. >> here's my problem. my last name is sullivan. my mother is belgian by heritage. and i don't have a beer. i know it's only 7:50 in the morning. becky, you want a beer? knock that cold right out. >> i'll be your designated drinker. >> i've got a lot of anchoring left to do today. so tell us about the new fire and red. what is that? is that your version of a black and tan? >> fire and blood, it's a beautiful red rye ail. and it's spiced with -- >> bitter? >> no, it's very soft. try this one. >> you notice i'm fishing. i keep asking questions. >> he wants a glass. hey, hoda kotb can do it, 10:00. i can do it now. >> it's spiced with unseeded ancho chilies. the brewers took about seven weeks to deseed all these beautiful chilies. >> which on the surface wouldn't sound particularly refreshing.

as a good beer should be. it is good. it's not spicy at all. >> it should be warming, not hot. of course, from the series, this is all about the dragons and khalisi's dragons. we had take the black, which is all about the knights on the wall. sometimes up there we think we're on the wall in the frozen north. a blonde ale called iron throne. >> how many at this point? >> we've had three out now. >> and all of them are available still? >> third one has just come out. >> do you sell more when the series is active? >> truthfully, we bring out one when the series comes on, one in between, and one when the next season comes on and they've just grown and grown and grown. now it represents about 8% of our volume this year. which is tremendous. >> and do you see an effect to your other brows? >> yes. that's one of the reasons for

doing it. does it build awareness and does it get people to try your other beers. i mean, the brewery is up by 36% year on year. and traditionally, you hear a lot of stories about beer as a moribund category. craft beer as a movement is way up in the 20s. it's something about a group of breweries. this is more of a movement and a collective of a whole bunch of different breweries that are all doing fantastically well. and i mean, from alagash to russian river on the west coast and to bells to stonebring in california, there's a whole group of people who have got this passion and enthusiasm. and all combined, they can take on the bigger brewers. no one brewer in its own right can do that. >> did you have any worry when you made the partnership? did people in the craft brewing world, did they say you're selling out? >> great question. i mean, we thought about it a

lot. i think it really was just a momentum of passion in the brewery, because everyone loved it and it's kind of what we do when we're not brewing beer -- >> watching the show. >> so it was a no-brainer. but we did think about it. as i say, we're at the top of the quality period at ommegang. >> you have a very unusual upstate new york accent, too. >> you think? >> what's happening up there? are you north of the wall? >> just think of me as kind of born in england, trained in belgium, and settled in america. i'm a first generation. >> you're 2/3 positive. cheers. >> you go it. cheers to you. >> here's to belgium. the most boring country in the world, but they make good beer. >> you're in hot water today. >> this is what you need. >> this is true. >> simon, thank you for this. coming up, we're going to talk the fed, the markets. then the global council is in session.

we're back in a moment.

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welcome back to "squawk box." the selloff may continue at least in some way here, the dow looking like it would open about 34 points down. the s&p 500 looks like when the market opens it could be off by about a little over four points. the nasdaq looks like it would open down off as well. we're also less than 30 minutes away from jobless claims data. that data and market reaction just ahead and those numbers could swing based on those numbers when we get them. >> all right. welcome back. let's talk now about home building, because lennar coming out with some pretty strong numbers. yesterday we had kb holmes beating expectations. today it is lennar.

the average selling price or the contract price was up about 10% year over year. company making somewhat cautious comments about the spring selling season. but the stock is rising nonetheless. they're actually coming out and saying that they expect things to continue to improve through the rest of the year. another earnings report crossing the tape this morning comes from the food giant conagra. a profit of 62 cents. that topped the wall street consensus by two cents a share. c conagra dealing with operational challenges but seeing pockets of strength as the year progresses. some potentially good news for the auto maker tesla and it could use some. just days after new jersey banned tesla from selling directly to consumers, arizona lawmakers are considering a bill that will lift a similar ban in the state. it is only a handful of states that had such a ban in effect. a state senate panel approved the bill yesterday. it is, of course, facing opposition from traditional auto makers and dealers.

we'll have more on new jersey's tesla controversy in a couple of minutes. guys, remember, arizona is one of the states apparently in the running to get a multi-billion-dollar battery manufacturing plant. >> that's right. >> so it's in the states -- if i was a state lawmaker -- >> i was trying to figure out how the state would reverse its position on that. >> because we want that factory in our state. >> right. because the car dealers -- the car dealerships are massive lobbyists in just about every state. they're at the top of the list. that's why you've seen some of these laws put in place. >> i would never want to suggest that money and politics put it together. we know they're completely separate and distinct entities. >> if you just come up with the realities. >> i'm not too young to do anything at this point. >> let's talk a little bit about the big story we've been following now for more than a week and a half. two objects of size have been spotted by satellite in the southern indian ocean, providing a lead in the search for the missing malaysia jetliner. matt taylor has more from

australia. >> the latest from the australian authorities looking for those two objects discovered via satellite by the australian government earlier today say that one of the royal australian air force planes that was dispatched to that area has been unable to locate any debris. authorities also saying that cloud and rain is also hampering visibility as we proceed into the darkness hours here in australia. in terms of the search zone, it is a particularly remote part of the indian ocean, some two and a half thousand di lkilometers or 1,500 miles off the west coast of australia. when you look at the actual size of the zone that authorities are searching, it is also sizable as well. authorities saying that the objects that the satellite images reveal are indistinct. but the search for the missing

malaysia airlines flight continues. that's the latest from australia. back to you. >> again, that is matt taylor keeping track of what's been happening there for us. we're also watching the futures closely this morning after janet yellen rattled the markets yesterday. in her first news conference as fed chair. joining us right now is steven sachs. covering the economic angle, scott brown. scott, did you hear anything yesterday from yellen that changed your mind about when the fed might actually start raising interest rates? >> not at all. i think if you go to the transcript and look at the context of what she said, the correct answer is how long are you going to wait between ending qe-3 and starting to raise rates. the answer is it depends. it depends how the economy evolves, what's going on with the labor market, what's going on with inflation. if things proceed as anticipated, that might be about six months. the markets don't do nuance very well.

we saw this with bernanke's testimony a lot of times. and this is really wide open. so the markets are very often will take a line out of context and then run with it. i think that's what we saw yesterday. >> steve, did you hear anything that changed your mind, and is this a case where you thought wait a second, i have to reposition myself? >> no, nothing that changed my mind. but scott actually said it quite well there. in fact, you know, the nuance is really what matters. yesterday was a little bit of a new nuance, if you will. particularly given it was yellen's first press conference after a meeting. so ultimately, no. there isn't anything that changes my long-term outlook. you know, we may have shortened the window a little bit as to when the short end of the curve actually moves, but ultimately i think the market is going to digest this in fine fashion over the next couple of days and i think a week from now we probably won't be thinking about this. >> let me ask you this. do you think yellen's reacting to what the fed is seeing as maybe better economic growth,

the idea that hey, maybe the economy really is starting to turn a corner? >> i think so. i think at the end of the day, the softer data that we saw over the course of the fourth quarter and a little bit in january was just that. i think it was a soft patch in data. if you look at the global fundamental picture in the u.s. in particular, the fundamentals are good. valuations are quite good. we're not at extreme levels. revenue growth is more than sustainable at this point and at these levels. the fact of the matter is that gdp growth in the 3% to 3.5% range either domestically or globally is more than enough to support current asset levels and current flows into equity markets. so overall, nothing's changed from a fundamental perspective. >> scott, you think we're actually at the position where we could be looking at 3% to 3.5% gdp for this year? >> i think so. if you look at the broad range of economic reports we've gotten the last several weeks, there have been several themes. a clear effect of the weather.

but even beyond that, you're seeing downward revisions to a lot of numbers. even fourth quarter gdp. all those figures tend to show that there was probably less positive momentum ending 2013 and coming into 2014. that said, if you remember a year ago, we had an unusually mild winter and that pulled forward a lot of the seasonal spending. and this year, it's just the opposite. well, that weather is going to push some of that seasonal growth out into the spring. so we could see some very strong numbers for retail sales. >> scott, you don't think that those sales are just lost sales? you think we actually make up for them later? >> some of them are going to be lost sales. for example, people don't go out to restaurants. and they're not going to make up for that. but, you know, we should see a rebound. but then spring numbers may actually overstate some of the strength. so you take the first half as a whole. you're probably looking at around 3% gdp growth, which is

what we expect for the year as a whole. it does look like things are getting better. this is going to be a very gradual recovery. we expected that all along. the job market is getting better. you know, week by week, month by month. but it still has an incredibly long way to go before we see a full recovery in the job market. >> steve, you sound pretty optimistic on stocks given you think that the economy is turning. but this year is very likely not going to be the easy year we saw last year where the market was up by 30%. what do you do more specifically rather than just invest in an index fund at this point? >> well, i do think that ultimately, we are very constructive on not only u.s. equities, but globally. we do think it's a little tougher to be a global asset allocator this year than last. we don't think a 32% return on the s&p is likely this year. but that being said, domestic equities look very good. if you look at the out performance we've seen in small caps and mid caps versus large caps year to date, shows that there is still risk appetite out

there. i think ultimately for investors, there's really a couple of themes that are going to play out. on the equity side, it's going to be about being a better allocator to various sectors. and we continue to see correlations drop and return dispersion go up, which ultimately is a good thing. it means if you can find the right sectors being driven by economic growth, you can get rewarded from that. and the other theme really is in the credit markets from that perspective. that's really still about basically managing risk and hedging the fixed income risk, if you will. >> all right. steve, scott, thank you both for joining us today. >> thank you. coming up, cfos of payroll giant adp and at&t, they're going to join us. at the bottom of the hour, jobless claims data. is now the time to buy home builders? we're going to find out what's working and whether or not these names should be in your portfolio. check out the "squawk box" market indicator. [ indistinct shouting ]

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welcome back. jobs numbers and consumer sentiment are maybe the best indicators of where the economy

is heading. for a real gut check, we're going to turn to our exclusive cnbc global cfo counsel. joining us, jan siegmund, and stephen -- both members of the cfo council. let's get a quick economic snapshot. i want to dig into both of your businesses and talk some deal stuff with you. where do you see things going right flow? >> well, we obviously had a little bit of slower start regarding implement growth since the beginning of the year. slower job creation. i think a general consensus that the harsh weather in the first few months probably has dampened the growth. >> how much? >> maybe 40,000 jobs i would guess due to the harsh weather, and the long-term growth has been around 180,000 jobs created. so i think that's pretty steady. i wouldn't expect that to return. >> were you surprised by what janet yellen said yesterday? >> not necessarily. i think the market has a quick

reaction to what she said. but i think we've all expected that interest rates over time are going to go up from these historically low rates and it's just something to manage through. >> as the cfo of a big company, do you listen to janet yellen? is that something that's on your radar or something you need to pay attention to, or not really? >> oh, most definitely we pay attention. whether we watch it live or whether we read the notes that night and go home and study it, try to keep your finger on the pulse of everything that's going on in the market just so we can deal with our issues and plan going forward. >> were you surprised by anything she said going forward? >> i think it was more i was surprised by the significant reaction to it necessarily. i think everyone expected over time that the tapering would occur. and i think the reaction was harsh. if you step back from it, we're still at really low interest rates on a historic basis. we had the opportunity to refinance over $8 billion worth of debt last year and dropped

our interest rate cost by over 50 basis points. so it's still a good environment. there's money available. it's just the immediate reactions and giving the market time to digest those. >> given that you're probably the best indicator of what's really going on in the job market, do you think that she needs to change her benchmark in terms of the unemployment rate? does that make sense to you? >> i sense she is going back to the more traditional assessment of the central bank, including a number of factors giving more flexibility in the decision process. i was also surprised about the strength of the reaction, and for adp, we are the only company in the u.s. that looks forward to higher interest rates because we have such a large number of client fund balances on our balance sheet that earns us interest rates. >> but john, as the cfo of the company and the dow that pays the highest dividend, are you afraid of higher interest rates? >> no, i think we all want modest interest rates. what we really want is economic growth and real economic growth

generated by private investment. i think as many of you are aware, our company, the business round table, are real proponents of tax reform. making it more friendly to invest and more profitable to invest in the united states to generate jobs, and those job growth will help all of us. it will help us all in the revenue line. that's what we're really looking for. real incentives for business to invest here in the united states, or quite frankly, an elimination of the disincentive that exists today with our tax structure. >> i have an at&t specific question, which is that we've been talking for the past several weeks about the comcast time warner table deal. where does at&t stand on that deal? are you going to support that deal or are you going to try to block it? there's a lot going on in washington right now. >> there is a lot going on in washington. we're going to have to see how the deal develops. from an immediate reaction viewpoint, comcast and time warner don't overlap in their distribution markets. so they're sitting there -- so

it seems like there may be a path for that to be accepted. the real question is how much that distribution rate they have. the real question is when you combine that with their content holdings and now you have very significant content holdings on one side and distribution of the other and does that provide a bottleneck that could impair the consumer. those are the questions that are going to have to be dealt with. >> when brian roberts says that he considers satellite competition, he considers cable competition and increasingly considers what at&t does both in terms of water line, but increasingly wireless. do you consider them -- do you put them in the same category? from a competitive landscape? >> certainly we compete with cable in the sense of broadband, whether ours be mobile or fixed wired, we definitely compete with them. we compete with them on our video products. so sure, there's a lot of competition out there. and many of the wired companies are expanding into the business markets. so it is a very competitive

environment, and it comes from new and different situations that it did historically. >> do you want to open up those markets? one of the other big issues is that different municipalities -- you've got in rights to run wires and easements over the years. and if google fiber or somebody says we want the same easements, and at&t or comcast says no, we paid for these polls, what are you doing? you can't do this. >> we are certainly not afraid of the competition. we love that. the issues come down to if you've made those investments, you want to get paid for those at a fair rate. we can do that. we'll carry a variety of providers' content and traffic. we just want to get a reasonable rate of return on what our people have invested in those assets. >> let me ask you about the job market overall. there are serious concerns about what we've seen. even though the unemployment rate is coming down, if you ask the fed or other people, they will tell you that people are dropping out of the job environment. they are taking part-time work not because they want to, but

because they have to. and the new jobs that they're getting are not good jobs. would you agree based on what you know about the jobs market? >> yeah, i think the general idea goes in the right direction. i agree with you. we've seen growth in part-time job faster than full-time jobs. we have seen slower growth in higher paying financial services jobs and so forth. if you think about overtime is increasing, so people working longer hours without more jobs being created. so it has been slower than everybody expects, but also pretty steady if you look beyond the two-month kind of variation that you see. so the trend of 180,000 jobs per month seems to be fairly steady, and so i'm kind of in the balance kind of moderately okay with the job growth. i don't think it's terrible, but of course, we wish it could be a little bit better.

>> do you think we're in a cyclical downturn? how big is this problem? is this problem we get out of? or are we faced with reality? >> it's a cyclical recovery at this point in time. and we still have room to grow in construction. that has slowed a little bit. we have room to grow in services, etc. so i think there are areas in the job market that can continue to improve. energy in the south and texas have carried a lot of the job growth. so i see us in the middle continuing the path steadily. probably not much better, but also not much worse. >> thank you for joining us this morning. >> appreciate it very much, really. up next, a engineer lawmaker firing back at governor christie for the ban of tesla sales. his comments are right after this. and as we head to break on this first day of spring, supposedly, a live shot of chicago, where it is snowing. "squawk box" will be right back. for retirement.

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for advice, retirement, and life insurance, connect with axa. running a small business is probably the hardest thing in this country to make a living. it's an emotion. it's a passion. it's a belief in yourself. it's a passion and belief that the risks you're going to take are important risks to take and they're worth taking. and so if you don't believe in taking risks, then you're not really an entrepreneur. and if that's missing, it won't work. welcome back to "squawk box" this morning. new jersey assemblyman lou grinwald issuing a statement regarding chris christie's comment at a town hall meeting about the state's ban that would

stop tesla from selling cars directly to customers. he said when it comes to tesla, governor christie needs to get his facts straight rather than take responsibility for his own administration's decision to shut down tesla. he chose to point fingers and evade accountability. these town hall antics wreak of hypocrisy. tesla said the decision was a back room deal between the governor and car dealer lobbyists. christie fired back on monday at that town hall saying he wouldn't have a problem allowing tesla to sell cars in new jersey if the company works with a legislator to change the law. i mean, i know who i think is right and wrong in this, which is to me tesla should be able to sell direct. i'm sure all the dealers in new jersey will no longer -- if they liked me before, they won't like me before, they still won't. >> the other side of that, it's eventually changing the business model. i can understand the dealers who have put money in over time with the existing things and have built up their franchises.

i get that. you want to protect that and make sure they don't get taken out necessarily. but you can't say that no other company is ever going to come in and have different distribution. >> you want to take the other side of that? >> my uncle owns car dealerships. i can understand both sides. i will say this. don't assume the manufacturers want the tesla model. i'll tell you why. even though they probably lose some profit by having to use a middle man, ie the dealer, the dealer will also buy 30, 50, 100 cars at a time. i mean, if you've got a bunch of cars sitting at the lordstown assembly plant in warren, ohio, you can drop 100 chevy cruzes to some massive dealer out there. >> dealers that have gotten frustrated that the big three in particular have been stuffing the channels and leaving more on their lots the last several months. >> and they assume the risk. the dealer assumes the risk. mike jackson would be a perfect guy to talk about this because they own dealerships as well. >> we have.

but the problem is -- i mean, you still are dealing with a situation where you have a new car company who wants to go direct to consumer. by making the laws stop it -- >> there's an easy solution to this. all these lawmakers are trying to -- they're fronting, right? whatever they're doing. just partner up with an existing car company, mercedes, ford, bmw, and sell the teslas through their existing dealers. kind of like a mini -- i know it's owned by bmw, but why not do that? and give them a little slice. but you're going to get enough foot traffic for people that may not be able to afford a tesla. i know we've got 30 seconds hard. i'm going to finish this in 15. you may not be able to afford a tesla, but you look at it. you say here's the new ford f s fusion or mustang. i did that. >> we're coming right back. i don't want to think about the alternative. i don't even know how to answer that. i mean, no one knows how long their money is going to last. i try not to worry, but you worry.

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welcome back to "squawk box," everyone. we are just seconds away from initial jobless claims. rick santeli is standing by. steve leishman is standing by with us. rick, go ahead and take it away. >> initial jobless claims moved up 5,000 from an unrevised 315.

that's 315,000. 320,000 this week. continuing claims hovering just a whisker under 2.9 million. and of course, the big news of the day is that short maturity notes like twos may be more specifically and aggressively three-year notes. five-year notes yesterday. they moved higher at a pace that far outpaced longer maturities. flattening. if you think back, we've seen that before. bear stearns, lehmanns. especially in an area where you're not going to see a real tightening until 2015. and the long maturities, they may be a little nervous about the stock market. we're going to go over that, but it is the talk of the watercooler community today. back to you. >> for more on the data, let's get to steve leishman, who's been doing a little number

crunching. thank you for that. >> it's another sort of evidence that some of the pops we saw earlier last month were kind of weather-related in the sense that you've now settled down. we'd still like to see it taken a leg lower to really confirm more strength in the job market under 300,000. at this level, it's consistent with that 150 to 200,000 of job growth. i really want to engage rick on this. i want to do some really deep tea leaf reading here about the fed statement. >> say it again and i'll do it. say it again faster this time. >> i'm not going back there, rick. >> okay. >> but here's the thing. the feds said in the statement when it went to that new language from the 6.5% threshold, that essentially that our intention here is not to change your view on our guidance here. so whatever yellen said yesterday about six months or not six months or around six months, it seemed like they were going out of their way saying they were comfortable with the

market's expectation for the first rate hike. could you just tell me what the buzz is down there on the floor after yesterday, they had a night to sleep on it or maybe drink on it, whatever they did out there last night. what's their thinking today about when the first rate hike happens? >> there is, of course, discussion on that, because they have referenced some of the great articles written pointing to things like euro/dollar futures, the short rate, not the currency or fed fund futures. but we look at things different here. the traders really saying that the influence of a flattening curve kind of pushes potentially inact watt signals back into the loop of short maturities. because there's arbitrage on the term structure, the yield curvee loop of short maturities. because there's arbitrage on the term structure, the yield curve. so they're not rushing to judgment, but they are paying more attention to the logistics of the market, positions in the market. and when it comes to the fed's statement and press conference is fascinated and they have to watch, as it is, they kind of

look at it -- i think one guy said it best on here, when you buy something for 70.99 that says it has a lifetime guarantee, that's about the way they look at it. >> folks are hoping for an argument. not going to get one today, because this is the discovery process where rick and i figure out what the heck is going on and then we argue about it later. rick, going into the meeting, the survey showed third quarter 2015, i think that was consistent with my read of what december 15 fed funds futures were. so when you look today -- and i know you've got problems looking through all those different moments on the curb -- >> listen, i'll engage you right there, steve, because i was so surprised "the wall street journal" in my opinion in their lead story had it wrong. they said six months after we're done with qe, but they made it seem as though that's sometimes mid year. if they do the math at ten billion per meeting, in december you still have 5 billion left. if you add six months, it's kind of -- i don't really see that anything changed. >> that's my opinion, because by

the way, if you want to get really, really, really technical about it, which we can do on the first day of spring, the first day of winter is the 21st. the last day of december is technically in the fall. so that is a very thin wire to hang your hat on. i don't think she meant to say around six months. >> i think she did a marvelous job. i have no problem with janet yellen. anybody who listens to her can hear that she's highly educated. she's succinct. she knows the subject matter. my issue is i'd rather have more of a steve jobs type in there slash half mr. fisher because i want to see some thinking outside the box. i don't think continuity and continuation at all is synonymous with thinking outside the box. >> but let's focus on what the trade is going to be here. in my opinion, i'm interested in yours on this. the fed is in a pretty good place. i know you disagree with the policy. but the guidance right now, the market and the fed are simpatico

on this issue here of what happens for '14. they go down ten billion in the meeting. with all things being equal. but it's 15 when the guidance and the rate hikes are where the fed needs to concentrate and that's what we're going to be listening for from yellen and all the speakers, is when this rate hike happens. how fast it goes up and how far. i said it yesterday. how soon, how fast, and how far are the three questions that government -- >> it's a little disingenuous, though. i'm not saying i buy into it. i'm using their stencil. completely data dependent with forward guidance that isn't tied to the unemployment rate. so, to say things like we're going to keep rates low for a significant period of time, or into 2015, i'm not saying i agree or disagree. but that's why i don't like spongy forward tailor rule. they can do anything they want and find a way to find ground cover to do it. >> i think you're right about that and i think that's the

downside of moving off of -- hey, here's a threshold. wait, that didn't work for us just like it didn't work in england. now we're off the threshold. into, as you describe it, spongy guidance. as more charitable people describe it, verbal guidance. so that leaves you with a whole mess of numbers and stuff. and that's why we're going to have to listen more intently than we did before and look at those labor slack numbers and those kind of things and what moves the fed here. it's one of those things, i hate to make the analogy, but you're just going to know it when you see it, right, rick? >> yeah. like a tyranasaurus rex. >> thank you. >> we do this all the time. >> not certain what the call is here. you talk to each other and we report, and then tomorrow, he's going to have a more firm opinion, i'll have a more firm opinion, we'll knock heads tomorrow. >> right now you're still -- >> we're reporting. that's what we do. >> what's that song.

♪ sunshine lollipops and rainbows ♪ >> i like your optimism. coming up, guys, a possible break in the search for the missing malaysia airlines jet. debris found by an australian satellite. could be a huge new development and we have got an update on this big developing story coming up next. on car insurance. yep, everybody knows that. well, did you know the ancient pyramids were actually a mistake? uh-oh. geico. fifteen minutes could save you fifteen percent or more on car insurance.

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welcome back. starbucks is making a new chai tea under its new teavonna line,

in collaboration with oprah winfrey. they're calling it teavonna oprah chai. this is an unusual move for both parties. oprah has never put her name on something like this before, but it's not technically an endorsement. all proceeds that oprah makes will be donated to youth education charities. worth noting that tea is a $90 billion global market. let's get down to the new york stock exchange with a man -- you took the red eye, jim cramer, is that possible? all the way from seattle to here? >> red eye out, red eye back. you've got to come to play. >> wow. >> how? >> devotion. this is what it is. this is it. jim, what did you make of the meeting yesterday? >> well, i think that howard has tried to kind of position it, and becky will know what i'm talking about, as a bit of a pilgrimage. you have 4,000 people coming out there. it's a bit of a show. start off with norman leer kind of telling some tales about what starbucks means, and then you go to howard.

got a group of trestreet singer. and then they hit you with oprah, which was very well hidden. the issue, is oprah to howard the way she was to uggs when she turned deckers around by basically not taking a partnership, but endorsing uggs. stock then quadrupled. how resonant is she worldwide? because the teavonna initiative is a worldwide initiative. it's a partnership, it's branding. teavonna had been a missing question. i kept waiting for something to come out about teavanna the last year. this could actually move the needle. >> i love the way they set you up and lure you in. i've bought things there myself. but the prices are really expensive. i just wonder if they can get people in when -- i just wonder about the price point. what do you think? >> the price point is hard, but

remember they have tazo, so we know they've already done some work with tea. the teavanna was the one i was used to where you say where's the tea and they try to sell you pot. i said no, i've got lipton. but what i like about it is there's buzz for teavanna, and for those of us who are starbucksologists, we've been waiting to see if this was some starbucks afterthought. i know howard had not thought about teaming up with oprah until she told him what a tea drinker she is. but this is important for india, it's important for china and obviously for the united states. i think that oprah still has that power. at least now i understand how teavanna could be more of a factor in earnings 2016-2017. >> the other thing i was excited about was taking a much broader number of stars and serving wine and dates and some appetizers to get people in, because

apparently the stores where they've tested that out, it really boosts the sales in that after-work hours. >> yes. how many day parks can starbucks have combined with how much through-put can they have? obviously too many lines at a starbucks. you've got to move them out. mobile payments. very focused on digital mobile payments. got to meet adam brockman, who's in charge of that. i think he's probably the single most important, maybe the biggest genius in mobile and digital and he works in starbucks, so you have the through-put issue. you have the date part issue. the geography. and the topology. all this adds up to something that says we're bigger than just the price of coffee in brazil. and i thought that was refreshing. >> with your takeaway, what is starbucks? it's not a coffee seller anymore really. >> it used to be a coffee retailer. >> is it a retailer? >> yes. howard's always talking about his roots of coffee. originally, it was starbucks coffee and tea. but i think you hit on

something. i think that if they spun off the mobile division, a la papal and e-bay. i'm just saying theoretically. if the company were to come public with the technology they have, google and facebook would probably pay 20 billion. they merge that and suddenly you've got a mastercard visa rival where you can take out the vig. and that's worth maybe more than the $50 billion company that it's buried into. so watch for something to happen. i know that howard said on air there are many companies who want to license our technology, would it be so odd to have whole foods do it, to have chipotle do it? even mcdonald's do it? no. nobody has starbucks's technology. that's what you should watch in terms of the valuation of the company. that's what will matter. >> jim, thank you for the report. for staying up all night. do you sleep on the plane? >> you know, you catch sleep here and there. here and there. >> thank you. we will see you in just a little

bit. up next, a development in the search for the missing malaysia jetliner. bob francis will join us. we will speak to him right after this break. tomorrow on "squawk box," co-founder of the carlisle group david rubenstein. private equity, and how he's trying to change the world through philanthropy. "squawk box" with david rubenstein, tomorrow starting at 6:00 a.m. eastern. profit from it. [ girl ] my mom, she makes underwater fans that are powered by the moon. ♪ she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪ my mom works at ge.

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australia now sending aircraft to the area of the southern indian ocean after satellites discovered two objects that might -- and that's key -- might be part of a possible debris field of missing malaysian airlines flight 370. joining us is former ntsb vice chairman bob francis. he is the senior policy adviser at zucker, scoot, and rassenburg. i know everybody's been trying to draw conclusions. you will probably push back against that. is there anything that we can glean at least from the satellite imagery? >> i think that, you know, you can glean that they saw two things down on the surface of the water.

but beyond that, i think it's very difficult. you know, one thing i haven't seen addressed -- and maybe it's just because i haven't been paying close enough attention, is this spotted in a part of the ocean where it would be practical for wreckage from this aircraft to have been able to gotten in the amount of time that we're talking about now. i assume that it is feasible, but i don't know. >> i heard an interview this morning with -- i believe it was an australian maritime official. either way, they said listen, the object is believed to be about 80 feet long. but they did -- >> who? >> i can't remember. it was about 4:00 in the morning. i was actually listening to european radio on the way in. and it was -- they said this could be a shipping container. things fall off ships a lot more frequently than you might imagine.

if it is the wreckage, does that lend credence to the theory that the plane had some sort of catastrophic mechanical issue and simply flew in a straight line until it ran out of fuel? >> i would think that would get you away from the terrorism hijacking and into more something went wrong and they lost control of the aircraft, and down it went. or it ran out of fuel and down it went. >> all right, bob, we're going to leave it there simply because there is so much information and speculation out there. let's hope the australian authorities can give us some more clarification later. bob, thank you for joining us on short notice. becky, you made an excellent point earlier. the area of where this debris is, it is so far out at sea, that with planes, you can only basically go out there for a short time, and you have to come back because you run out of fuel so quickly going out -- i think it's 2,000 miles off the coast

of perth. >> kilometers or something. it's quite a ways out. it may be some time before we have more information. >> how many planes do you send out? do you send them out on the two-hour mark? >> the ships will go there. i would imagine just bang the bottom of the seabed with sonar. just boom, boom, boom, boom, boom. a lot of people don't realize the currents even under water are strong. so just -- even if they know where -- because apparently the satellite images are a couple of days old and they've just been manually poring through them. anything under water will move. so you've got to get oceanographers to say where is the current going? >> we'll keep you apprised as we hear any additional details on this story. when we return, blackistone

group ceo steve schwartzman telling us yesterday that the housing market has lost its pop as an investment. >> later this morning, existing home sales will be out. we'll find out if homebuilders should be in your portfolio just in time for the spring real estate season. "squawk box" will be right back. get a leg up on the trading day with the morning squawk news letter. go to our show page, squawk.cnbc.com. morning squawk is a snapshot of the day's top stories, guests and some fun watercooler stories that we'll be squawking about all morning long. sign up and get morning "squawk" delivering in your inbox.

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blackstone ceo steven schwartzman joined us here on "squawk box" yesterday and he weighed in on the housing recovery. >> we think a lot of the big pop in housing has gone out, for example, in the markets where we purchased, houses went up over 20% in one year. we think that the returns are more likely to be somewhere between 5% and 10%.

closer to 5% probably and that's just great but it doesn't justify -- >> well, we are continuing our what's working series now with the focus on the housing stocks. joining us now from new york is jack meseque says quu hanusquehg group. you have to be happy with the numbers from kbr and lennar this morning. >> when you look at both stocks the companies both reported. look, deliveries were a little bit on the light side, but the margins, the profits they are making on these home sales is well exceeding expectations and both companies we saw positive year over year order growth still, there's concern about weather with a few other companies reporting, but kbnr putting up positive trends. >> the home builders and i heard, becky, you did an interview last week, with the new jersey base but now they are big into houston, are there any, jack, that are more geographically preferable to you? >> well, when you look at

geography, you look at the northeast as being the hardest hit with weather. that obviously affected the toll brothers numbers and kb homes doesn't build a lot in the northeast. they're more of a california, southwest, central texas kind of franchise. and then lennar as well. so, we're now seeing the non-northeast focused builders report and those trends are okay. so, it leads you back to think that maybe weather did have something to do with some of the disappointing numbers reported by some of the other builders earlier in the quarter. >> let's talk about pulte, you said they were more levered thn in the downturn. where does it stand now? >> early on, they have a big mortgage company and the gses have been going back against the banks and lenders since 2009 to get paid back for loans that went bad. we worked through the issue with pulte. we like them for two reasons, one they re-engineered their business and their margins will continue to improve regardless

if we continue to get home price appreciation. second, you know, you look at the consensus view right now and pulte has guided to down orders. and that expectation of orders and i keep going back there because the builders trade on orders there's an expectation to do positive order growth so that's cooked into the valuation here so there's only up side i think from that perspective if they -- if they put up, you know, a more flattish order comp. >> do you have a price target for pulte? >> we think pulte is worth about $25 per share. >> it's trading under $20 a share right now. let's talk about kb homes. that's your other top pick? why do you like kb? >> because they've been remixing their business and over the last year or so they've been moving from a lower price point builder to a higher price point builder. a year ago they had their community count, their stores. it had a low water mark and we look at, you know, where we're at here now a year later and say, okay, we're now working through that remix of the

business. and we have an easy comp on orders and for the next quarter or two we're going to put up, you know, we think positive order trends, in fact, we saw that yesterday. they put up a positive 6% order number on a community count to grow against. >> your one concern on kb is they don't have as much land in the pipeline as some of the other names you cover? >> they have a third less land than some of their peers, some of the more land heavy names we cover, toll brothers and taylor morrison, some of them have 10, 11 years of land at their current delivery pace. that's the key, the land, you want the good basis and in the right markets and in the right price. >> jack, thank you very much for joining us today. >> thank you. okay. guys, thank you. thank you, brian, for being here as well. we'll see you back here tomorrow. >> let's hope. make sure everyone else joins us tomorrow. "squawk on the street" joins us. ♪

>> we had to play the beasties after jim made the trek back. good morning, welcome to "squawk on the street." i'm scott wapner alongside jim cramer today live from the new york stock exchange. carl and david are off. let's take a look at the futures. that's how it's shaping up today, a day after that selloff on the fed day. here's the dow with an implied open down almost 50 points. the s&p and the nasdaq look like they'll be negative as well right off the open. let's look at yields because that was a big story and it remains that way today. look at that jump.