good morning, everybody. welcome to "squawk box" here on cnbc, i'm becky quick along with joe kernen and andrew ross sorkin. we have a big guest lineup for you this morning, including barry sternlicht. we'll be talking to the ceo of panera bread, ron shaick. at 8:15 a.m. eastern, we have an exclusive interview with treasury secretary jack lew. steve liesman will be here with that. we'll be covering everything from economic growth to slapping sanctions on russia. we start this morning about a look at the markets and a focus on what's been happening with the fed. the federal reserve will be releasing the minutes of its last meeting on march 18th and 19th. that is expected at 2:00 p.m. eastern time. market will be looking for hawkish comments luing anything related to the discussion on changes in forward guidance.

that will be happening at 2:00 p.m. eastern time today. if you take a look at where the markets stand right now, the futures are indicated higher. dow futures up by 33 points, s&p futures indicated up by 2 points and the nasdaq up by 9 points. the major u.s. average managed to snap a three-session losing streak yesterday. although it wasn't much to write home about. the dow added about ten points. the s&p 500 added six points while the nasdaq after one of its worst three-day gains. it closes at 4,112. as for the ten-year, we've been watching it so close. the yield has been under pressure. the yield still under 2.7% at 2.699%. i'll send it over to andrew. he has more of the top corporate stories. let's talk cars and recalls. toyota now recalling nearly 6.4 million vehicles globally for

faults affecting various parts ranging from steering to seats. the world's biggest automaker says it was not aware of crashes or injuries caused by the glitches found in 27 toyota models. toyota did not say now how much the recall was going to cost and it's not clear yet if the faults stem from toyota suppliers or manufacturing process. 2009 and 2010 toyota was forced to recall more than 9 million vehicles to address sticky accelerators linked to accidents. in the same vein, general motors is being fined $7,000 a day for missing an april 3rd deadline to provide information about the recall of the 2.6 million cars for defective ignition switches. they will be fined until they answer all 107 questions. gm says it has fully cooperated with the agency delivering

nearly 21,000 documents covering more than 271,000 pages related to the safety recalls. but mary barra saying she wants to be open and forth right. if you're getting charge a couple thousand a day and the agency saying you're not paying, i don't know who to believe. >> do you have jerry baker's e-mail? this is a big story in the journal on medicare. >> this is an amazing story. >> $21 million. that's a good living for that guy. >> that is an amazing story. >> let's read it. medicare costs and payments are grabbing the national headlines today. new federal data has been released on how individual medical providers treat america's seniors and can rack up large payouts in the process. a small group of doctors and other medical providers accounted for a huge chunk of the 2012 costs for medicare. the top 1% of 825,000 individual

medical providers accounted for 14% of the 77 billion. 14% of 77 billion and divide it. that's a really good -- >> ophthalmologists. >> one in ten are radiation oncologists. >> the radiation, i can understand. the ophthalmology. >> that's a good rack zblet people's vision starts going. there's things you can do, glaucoma, cataracts and stuff like that. >> i don't want to suggest being an ophthalmologist is not as valuable as other -- >> you have someone in the family. >> i don't believe we have ophthalmologists in the sorkin household. >> he's about to say they're not as smart as other doctors. >> were you. >> no. i could see places where i want

that money to go. eyes matter a lot, obviously. >> the best racket is dermatolo dermatology, because you never cure anyone. >> you put creams on people. jerry seinfeld was dating -- he was dating her a dermatologist. he said, what do you do, pop zits all day long? she said, no, i'm saving lives. radiologist, good living. >> absolutely. >> that was one in ten they say. >> one in ten would be -- >> you're not there, life and death, making sure you don't hit an artery or something. >> right. >> nearly 350 physicians and other health providers made more than 3 million each from medicare in 2012 and the 1,000 highest paid medicare doctors received just over 3 billion in payments. the top earners,

ophthalmologists and one in ten are radiation oncologists and one florida ophthalmologist was paid $21 million by medicare. these are the kind of things -- when i say the word medicare, for some reason these are the things that come to mind with me, because i just get the feeling that the private sector where whethings like this -- ths one of the good things about having a profit incentive. you can't sign checks where there's no accountability. medicare fraud, how much do you think of the total is probably waste and fraud? when we're all -- if you were to go to a total system, single payor. >> 20%? >> wouldn't you say at least 20% is absolute fraud. >> i would say it's a large number. >> i would say it's higher than 20.

>> i'd say 10 to 20. >> i would say 10%. i don't know about 20%. >> we don't know. >> the doctors are furious about this, the ama -- >> if i made $20 million, i would, too. >> the release of the billing data has sparked an outcry among doctors because they say the information lacks context. american medical association notes that doctors couldn't review the billing totals before the u.s. released the data. >> the ama sold their soul to the obama administration. wait a second. i thought we had a deal. we signed on here. >> was the $21 million doctor outed? >> apparently. >> i haven't read the whole piece yet. >> it's amazing. you know, vision -- >> is important. >> yes, you can't discount that. >> you're talking about becky. >> fine. >> okay.

i'm still reading the story. >> you need your vision so you can see the beauty -- >> and i was looking at you. >> it was interesting pieces in it. while the data may be misleading on some points if you can identify the doctors who are earning $21 million, something like that, it does seem like a valuable exercise. let's talk about the eight biggest u.s. banks. they have to boost capital levels by a total of $68 billion under new federal rules. federal regulators are taking steps to ensure that the largest banks have enough capital to weather another financial crisis. this rule would apply to jpmorgan, citigroup, bank of america, wells fargo, goldman sachs, morgan stanley, bank of new york, melon and state street. andrew? >> you know about this? >> no. you going to ask me how to say this? >> laquinta. >> great golf course.

this is a lodging chain. >> they had their ipo priced below company expectations. the company had projected it would sell 37.2 million shares between $18 and $21 apiece. blackstone which acquired the limited services hotel chain for $2.3 billion and debt, that was in 2006, isn't selling any shares in the ipo. some people thought they would be selling into this ipo, therefore -- >> that looks like a nice -- >> that is laquinta. >> that's not one of the -- >> that's what we're talking about. >> the other laquinta -- >> i was going to say in your travels, i know you've passed through there. >> is that palm springs? >> yes, palm desert. east of palm desert. great place. great place.

>> there's a meridian that's good in new orleans. >> stars live around there. i'm sure they have nice houses. how many times have you taken that tour? in the bob hope -- now it's the clinton humana golf tournament. yes. he paired up with -- i think when they were doing it, you're kidding, right? one of the courses used to be -- there's a private course called laquinta. there's no ocean. that's why i can't sell it as a place -- it's hard to get there from here. >> for your family to go. >> yes. >> no ocean. >> what's the deal with sand? >> it's really nice. >> i hate it. it's sticky and that gross ocean. anyway, do you play volleyball? >> badly. >> we have a guy who lives on an

island waiting for us. ross westgate is standing by in london. >> good morning, andrew, becky and joe. we are a little firmer here today for european equity markets as you can see, 8-1, nearly 8-2, advancers outpacing decliners. the ftse was down 32 points yesterday. we've been helped of course by the better tone in u.s. equities towards the end of the session. today, up around 0.75%. we had a trade day throughout the morning for the uk. it suggests we're still not closing the gaps between exports and imports. as we know, the imf says the uk economy is the best growing economy in the g7 this year. the dax, the cac, gain of 0.5% this morning. renzi getting approval for his budget as well.

we are getting news we believe that greece will anons a new long-term bond. they might announce it as early as today. what we could be looking at here is a bond of a five-year issue. they might want to raise around 2.5 billion euros from this as well. the coupon, reuters are saying anything below 5.3% would be fairly advantageous. morgan stanley says greek yields at the moment, 6%. pretty close to where portuguese and irish yields were. analysts saying the market has priced in a greek return to the bond market. this is where portugal is yielding. irish debt on the ten-year, 2.95%. since they returned to the market, there's been one-way traffic. it's one of the reasons why i believe the euro is stronger than many would think it is because of this flow of funds into peripheral debt in the eurozone. picking up yield has been a dig

play over the last 12 years. it is keeping them at high levels despite the fact that the new prime minister mr. valls has come in and suggests the ecb isn't doing its job because the euro is too high. that's where we stand right now. back to you. >> ross, thank you very much. you know who was on the show yesterday? >> i don't. >> you don't remember? >> i remember some people. >> graeme mcdowell. >> yes, yes, the emerald isles. he's cool. and i mean cool in a lot of ways. a cool customer. >> where's your money, joe? where's your money? >> as i said to graeme yesterday, the field is wide open. it would have been wide open anyway because he's notes adominant as he used to be. you know who is another cool irishman, rory is so cool.

and you know, he's got more mature and some irish journalists asked him a question like why is it that you can't seem to be comfortable being a superstar? is it something with you or something with the irish? and then rory goes, you know, i don't know about you, brian, about your problem with being a loser but i don't have a -- it was funny the way he deflected it and talked about it. he hastwo majors now. if he's on, he's someone to watch, obviously. >> justin rose. >> he could do it. >> who do you like, ross? i have a feeling we might get a first-time winner. >> jason day says he wants to be the second aussie to win. he plays great at the masters. i was thinking about graeme.

poulter, someone should tell ian this is the ryder cup, just try to sort of mislead him about where he is and he'd probably win. i don't know. >> the probable between match play and stroke play, in match play you don't have to worry about the one back so much. >> kutcher played well there. >> i figure we'd change the subject. ross, great to see you. >> basketball's over. >> we'll talk about something else, not sports. we'll talk about something else we are keeping close records on, first quarter earnings, we have a preview right now. we'll find out why standard & poors has lowered its growth expectations for the quarter. mike thompson joins us on set. mike, how come? >> well, basically this will be

a lackluster quarter. >> is it weather? >> i think part of it is weather. it's hard. weather is kind of a funky little thing that nobody can really define. it was february. we got three months in there. i think there's a couple things you have to worry about. five sectors, expected to be negative, versus five positive. the ones that are positive, for example, telecommunications and utilities, they're not usually the big drivers. the thing that's important, consumer discretionary, grow at 8%. that's half of what was expected in the beginning of january. so the proxy against the consumer, i'm not sure what that says. i think it reflects this modest recovery we have. what i would say is this, this is interesting, right? i think this is what jumped out at me. revenues. revenues are growing. leave knews are growing split strong, 4%. earnings are flat. >> does that mean companies are actually starting to invest again? >> maybe not as good news as that. they're sacrificing profit

margin to drive the top line. and so that -- if you regress that back, what is that telling you about the economy? demand is soft. there's a lot of people out there providing, you know, goods and services and they have to compete on price. >> for a couple years people have been saying i'm worried about the stock market. profit margins are as good as they're going to get. it hasn't weakened. we had good earnings a year ago. right? >> they were okay. >> corporations did. >> yes. >> to match that, isn't that okay, even if it doesn't go up because we're matching good earnings? >> if you look at a fundamental point of view, you expect to get annualized at 7%. now it's back-end loaded. but -- and you know earnings won't be flat where they are right now. they'll come up. from a valuation standpoint we're trading about 16 under times next year's earnings which is not inconsistent with the long-term average.

the real issue is investor preference. it goes back to the basic fed model mentality when you have yields so low, basically, the market looks like it's reasonably priced, particularly as you compare it to what you can get in the fixed income markets. the yields and the risk, you're okay doing this at this level. if you get 7% growth, you know, i think if you have a slowdown or further declines in the next quarter doesn't come in at 8%, almost 9%, where expectations are now, that can be troublesome. >> you believe the expectations at this point which you mentioned were back-end loaded. >> here's the deal. we're looking at 0.3 on the s&p. it will come in 2.5%, 3%. we've seen a lot of revisions. what's scary, though, this is not statistically significant, for the handful of companies that report, so far, the s&p, a lot of guys missed.

that's disconcerting. i'm getting tired of that. let's sweep it down, underpromise, overdeliver. we have to spend some time looking at that trend right there. i don't know whether we'll get the back end as strong as analysts think it might come in. it's a hard call. i think you have a lot of bet on the economy there. >> mike, want to thank you very much for joining us today. >> thanks, becky. >> good talking to you. >> i was sent something useful about the masters today, doug cass. this is actually pretty useful, among the other stuff. adam scott and rory mcilroy, 9-1, phil, 12-1, jason day -- matt kuchar, sergio, stenson has been playing well. mcilroy won both his majors by eight strokes, i think. he almost won the masters. he was ahead but messed up on

number 10. jordan speith, he's like amazing. people have been mentioning him. there's a lot of big names on there that we didn't think about. angel cabrera. don't forget phil, obviously. >> yes, he's 12-1. >> suited to his game a lot. coming up, the next big thing from a company that keeps everything connected in mobile from smartphones to home automation, the ceo of sky work solutions joins us in the next half hour. first, though, there is blood in the water. you know awhat that means. kevin o'leary is circling and ready to strike. the "shark tank" will come to the set, next. ...work with equity experts... ♪ ...who work with regional experts... ♪ ...who work with portfolio management experts,

that's when expertise happens. mfs. because there is no expertise without collaboration.

senator john mccain classed with secretary john kerry after mccain said the obama administration failed over its handling of certain items. they were both talking about teddy roosevelt. >> on the issue of ukraine, my hero, teddy roosevelt used to say talk softly but carry a big stick. what you're doing is talking strongly and carrying a twig. >> your friend teddy roosevelt

said the credit belongs to the people in the arena who are trying to get things done. we're trying to get something done. that's a teddy roosevelt maxism. >> now, i heard that watching it and i looked up the transcript on nbc. >> i heard it last night. >> they put -- nbc changed it to max im. >> they changed it. >> that's a teddy roosevelt maxism. >> you know, if that were bush or sarah palin -- in the transcript when i read it, it was back to maxim. i looked it up and marksism came up. when you may say something that karl marx said, that could be a maxism. >> don't you have a son named max. >> it's a maxism. >> john kerry ran for president. they made him out to be so much

smarter. >> this is a dan quayle moment? >> his a lot of them. they made him out to be mr. phi beta cappa. then his biggest decision, you remember what it was? do you know who would be president right now? >> did he have to vote? >> two terms of john kerry. then the vice president. john edwards. he brought us john edwards as a vice president. john edwards -- >> you like hair. >> he had good hair. he had a mistress and a baby. >> we've had those before. >> i feel bad for all of these guys who have to talk -- >> what about us? i've got a plan. >> i feel empathy. >> of climate change is the biggest threat to world security on my wind surfing. >> make sure there's no ambiguity. >> great politicians understand, they are 50% entertainers.

if they lose that, they don't engage with the constituency anymore. reagan taught us that. great ones that exist today understand, they get up there. >> do not mention reagan in the same breath as -- do not misunderestimate john kerry. >> strategiry. >> that was not strategiry. that was w. >> you would tune in to find out what he would do with the english language. there is nothing more criminal than a boring politician. that's a huge crime. >> maxism. use it. >> anytime. >> henryism with your other son. >> i heard it last night. >> i heard it and i went -- i missed it. >> that's a teddy roosevelt maxism.

that's a teddy roosevelt maxism. >> nobody else drudged. i didn't see it anywhere else. >> maybe it will pop up now. >> potato. >> given my mispronunciation. >> i think it's mispronunciation. >> am i introducing this gentlemen here? >> oh, it is? i didn't know you were waiting for me. i can do intros. joining us is kevin o'leary, creator of "shark tank," author of "news, women and money." >> if you're an author, you have to keep your book if present time. you helped me. >> 50 common money mistakes and how to fix them. kevin was also chairman of the o'leary funds. you had other stuff you wanted

to talk about today. >> i've been noticing of late people have been pounding down bondses is a bad investment. they have. they've been talking about the end of the bond mull market for 20 years. you don't want to have a full allocation of fixed income and they made it a boring topic. the truth is, as we get into interesting volatility and discussion regarding earnings and gdp growth, bonds turn out to be a wonderful place to be but not government debt. actually short your -- corporate. if you're willing to buy a stock of a company, everybody seems to forget, senior to every equity is the debt. >> even subordinated. >> of course. single b is not investment grade debt. i'd rather own the equity. you're getting paid first in the debt. you're always getting paid first. there's a couple of debt asset classes that i think institutions have made pretty wise use of that now individuals can use.

floating rate loans, you know, when buffett bought heinz, he spent over $20 billion. the way to finance it was he issued traditional corporate debt, six-year duration and something no one looked at was a floating rate loan, 99 cents to the dollar, traded to 1.01 and has sat there at 1.01 since the deal started over a year ago. this is an asset class i've fallen in love with. it's senior to everything on the balance sheet. nobody talks about it but you had a fantastic asset class because its duration is 0 days. >> what percentage of your portfolio. >> i now have 22%. neiman marcus recently was a private equity deal with a pension plan. they financed it with floating rate loan. i'm senior to the cash going back to the private equity firm. i'm at the top of the balance sheet. pay me first before anybody

else. i get paid first before buffett in the heinz bond. senior to everybody, bad news is you'll never make more than 5%. 5% these days, pretty interesting. >> on the way back to 4% ten-year, we've taken a detour, again, below 2.7. >> do i not own any ten-year bonds. i think that's toxic waste. greek debt, italian debt, why take the political risk of mismanaged countries when you can get well managed corporate debt. you have to think of sovereign as a mismanaged asset. that's what they've been. you're buying government debt thinking it's safer. i don't think it's safe at all. >> you don't think u.s. debt is safe. >> you think holding a ten-year -- >> you didn't say that. you're talking about credit risk or whether the rairt rates go u.

if rates go back up to the 40-year average you'll lose about 15% to 20% of your portfolio earning a portfolio of ten-year government debt. to me that's riskier than buying the debt of a corporation. >> we have to assume the economy is going to recover. >> you're a real pessimist if i don't you think rates will stay slow for the rest of your life. >> we were at 3 3rers now we're back to 2.6%. >> that's what i'm saying. >> that's pessimistic. i'm more hopeful than you are. >> you're not mepessimistic rig now? don't turn this into canada. >> you can pick switzerland or sweden or anybody else. i say now people are starting to look at the policies. i'm agnostic to party. they're starting to say this

isn't working. >> that's what i mean. we'll have to change. we'll be more pro private sector and pro business. >> that will become an issue. >> now you're connecting a lot of dots. i'm saying where we are right now, we deserve this. >> i think what will happen is when we get to the midterm elections you'll start to see this as a major issue. >> you might. >> that's not that far away. i don't care which party you're in. you better start creating jobs or you won't be a politician for much longer. >> maxwell smart on "get smart" had a lot of mixisms. sky work solutions been on a nice run over the last year. the ceo will answer the "squawk" call next. if you're having trouble getting your kids to do anything productive around the house, there's now an app to change all of that. we'll meet the brains on chore monster when we return. gunderman group is a go.

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welcome back to "squawk box," the internet of things will make many of the familiar devices and objects in our lives from door locks to refrigerators suddenly internet connected. smartphones accessible and response. joining us now is one of the companies that's enabling all that connectivitconnectivity. president and ceo of skyworks solutions. i was trying to understand how your chips interface with the qualcomm chips of the world. your chip is the chip that does the blue tooth component, the wi-fi component. that doesn't sit on the qualcomm-like chip. >> whether it was wi-fi connectivity or cellular, 3, 4g,

we'd do the processor and transmit and receive and it would sit on the mother board side by side. >> why are the other chipmakers not trying to be in your business? i imagine they must be. >> no. the distinction is between the digital processing which an intel would do, for example, or a t.i. or analogue processing in the rf. that's what we do. >> tell us what the future looks like in the internet of things. what kind of orders can you tell bus in terms of what kind of chips you'll be making two or three years from now. >> sure, sure. we cut our teeth in the smartphone business. we sell to saple, samsung, every smartphone. the connectivity chips. with billions of devices installed, it's created powerful mini hubs. devices have become cheaper, consumers have become more comfortable with the technology.

we're en routers, thermostats, we sell to general electric, white goods, appliances. >> are you in the fit bit did he vice. >> yes. and the scale. >> i own one of those scales. >> terrific. >> a couple years from now, what do you think all these devices -- is it just everyone will be connected more or will we have totally different devices attached to us? >> the beauty in our business is we like customization and complexity. with all the various standards that have to compete, they want to interfere with one another, blue tooth, gps, there's frequencies sitting on top of each other. you can envision driving home, smartphone tracking your location via gps. you get a certain distance. it's now been programmed to turn the heat up, turn the lights on, turn security off, might brew you a cup of coffee. all of these devices and appliances because the price

points are affordable and consumers are becoming quite used to the technology, are enabled in this way. >> i'll sound like the idiot at the table. consumers are getting more used to this stuff, getting more comfortable with it. there will be a relatively high threshold in terms of a barrier, in terms of wide adoption, correct? >> i think it will take -- for example, you mentioned fitbit. in the whole fitness area. 2013 there were about 40 plus million devices sold. so they're of that type of product, of a fitness product. the threshold is getting lower and lower as device manufacturers make them more intuitive. they've got to be simple. they're getting simpler. consumers are getting comfortable with the touch screen technology and the price points are more affordable. those three things converge to allow it to penetrate new markets. >> one of the negating factors from a consumer standpoint for all of these products is the battery, the battery life.

this is a great device. i have to turn off my bluetooth on this or it sucks the battery life like nothing else. how does that get fixed? does that get fixed on your end because you figure out how to transmit the data using less battery life? >> it will be done by a device that will consume far less power. battery technology moves at a snail's pace relative to semiconductor technology. we've been shipping into billions of devices. it's about band width, performance and performance as defined by battery life. i think it's overwhelmingly at the chip level. >> how small are these chips? fingernail, what are we talking about? >> you could fit 5,000 of them on your fingernails, some of the devices. >> like one of them can do all the wi-fi on the gps?

>> one of them could do a component -- a function within wi-fi. if you can imagine a receiver being a function, a transmitter being a function, antenna tutor being a function. it's often times integrated at a chip level or multichips at a multichip module. >> thank you for coming in. you guys are killing it. appreciate it. >> thanks for having me. when we return, a monster app that could have your kids doing more chores. i know, it sounds too good to be true. starting at the top of the hour, barry sternlicht will be our guest host. then the ceo of panera bread on his technology push to sell more sandwiches. at 8:15 a.m., an exclusive interview with treasury secretary jack lew, covering everything from economic growth to slapping sanctions on russia. "squawk box" will be right back.

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welcome back to "squawk box," everyone. we've been watching the u.s. equity futures this morning. they have been indicated higher. dow futures up by 27 points above fair value, s&p up about 1 point. okay. going back out here. we're going back out here.

coming up, it seems like there is an app for everything, including one to get your kids to do more chores around the house. the founder and ceo of the cincinnati-based startup, chore monster. chris bergman will tell us how it works and how the company plans to make money. more "squawk" right after this. yeah, i'm married. does it matter? you'd do that for me? really? yeah, i'd like that. who are you talking to? uh, it's jake from state farm. sounds like a really good deal. jake from state farm at three in the morning. who is this? it's jake from state farm.

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it's a day full of promise. and often, that day arrives by train. big day today? even bigger one tomorrow. when csx trains move forward, so does the rest of the economy. csx. how tomorrow moves. what if your kids beg to do

chores? a cincinnati-based startup is creating a world where mundane chores are stress-free and fun. a version 2.0 was launched last week. launched a version 2.0, it's free of charge. joining us is chris bergman, a founder from choremonster 2.0, i went wrong, with my kids, i do chores, don't even try. we do them. i've tried, it's at this point i just do them. >> sure. >> what can i do? can i change that? >> yeah, absolutely. choremonster is a platform for the family. so kid, it sort of works in an interesting way, it's actually two apps in one, one for the parent, one for the child, the child creates a list of rewards, kids log in, have their own ui experience, pick which chores they want to complete.

based on what they're worth. >> that type of thing. >> it's worth the payoff. you are not paying me. >> yeah. they get to be empowered by that opportunity to choose. >> and they get to do it, you know, with electronics? >> right, exactly. so it's been really interesting. there is a lot of people that would say, there is not a lot of kid that have their own hardware and devices and i tend to disagree. yeah, there is an entire generation of hardware that gets into kid's hand when parents get the new iphone or ipad. the old ones. >> they haven't paid for any of this hardware with money they've earned doing chores. i can tell you that has not been the way they were able to afford these things. >> yeah. >> have you? >> we got the ipads. >> do they do anything there other than? >> they cleared their dish, put them away in the dishwasher. >> that's good. >> getting good with that. we're a little lacking on laundry in terms of putting stuff away.

i'm not asking anybody to do the lawnedry. >> surely, i don't, i used to say,let, you know, it's time to take the gar back out, it's sunday night, how about you? >> my little guy is real. >> they actually. >> comes back with maxism. >> he is good with putting stuff into the garbage, into the dishwasher. >> that's pretty good. >> that's good. >> what could we expect eventually, the best case scenario from substituting this? >> well, you know, our tag line is your kids will beg to do chores. that's not something we came up with. that's something we heard from our users. so what tends to happen is parents implement it in the home, within weeks, kids are waking them up in the morning, becking them to have things to accomplish. >> are these virtual things, i got to use my own money to back this up? >> both, it's what you want as a parent. our too many is to create parents to parents, how they want to parent. it kind of works in two layers, there is a layer you as a parent

can give reward to your child our best box, waking up early to watch cnbc. there is also a layer of a game element. so there is a monster carnivale, every tour they complete, they have the opportunity to win one of about 200 interactive monsters or get a consolation prize, dirty underwear, stinky socks. >> that's good. you really said that? >> yes, i do. we are proud of our jar of hearts. >> i thought i did hear that. >> is it too late to start, like if they're 12? >> no, that's perfect, a 12-year-old boy, yeah, absolutely. >> i was going to say, can you earn your allowance, the allowance comes whether you earn it or not. it's hard to sell. >> pitch it, exactly. it really creates an interesting transactional relationship between a parent and child where

you add value to the things that are happening in the home. both from the chore side as well as the reward side. now the kids see they're valuable in completing those chores. they find value in that. they see themselves as independent. they see themselves contributeing to the home in a way you are not attacking them, tracking them down and we're big on positive reenforce:s. >> you do have kids, chris? >> i do, a two-and-a-half-year-old and one on the way, they're a little younger. >> the two-and-a-half-year-old is picking up on the iphone? >> absolutely. he uses choremonster already. we reward him. >> clean out the gutters? >> a little bit. cutting the lawn. yeah. >> what could you said you are already rewarding him? >> yeah, absolutely. so how we reward him is if he tries something new to eat, for example, or vegetables especially are a way to reward him. >> you can do that, too? >> absolutely. it rewards behavior, whatever

the behavior is in the home you reenforce. >> set up a pushup? >> an hour a day, that type of thing. >> i see it's free, what itself the model? >> yes so we make money in a couple different ways, one we have brand integration. we work with brand to help them create content that interacts with parents in a unique way. a great example of that, they will sponsor a specific chore, like brushing your teeft. we create content, typically an educational cartoon, our monitors doing that particular chore. they help kids to brush their teeth. it starts using a toilet brush, for example. that's not right. >> is there any age limit on the upside? >> no. >> hold on, rob, how old are you? how old is greco? >> i'm thinking. >> you are 42. what if we were to write a good intro? everything is perfect, get the

right person? they're thinking about, this is, you know what, i got kids here that are a little wayward. >> absolutely. >> they're yelling at me right now, chris, thank you. you are a dixie chilly guy. >> not a skyline. >> absolutely. >> a choremonster. >> dusty is gone. >> anyway, over the rhine is hot? >>ly the threw you out. >> when we come back, we will talk deal making, global real estate, energy, you name it. barry stern is -- sternlicht is with us. he is our guest host right after this. this. mfs. because there is no expertise without collaboration.

. a "squawk" exclusive, barry sternlicht with capital, he's wheeling and dealing, find out what he's adding to his empire. ron shake's high-tech sales. all that plus platinum portfolio stock picks. ""squawk box"" begins right now. >> good morning. welcome back to "squawk box" on cnbc. i'm joe kernan. the futures are something we want to watch closely today. we have been in a bit of a mini little correction here some people think it's finally, i know we thought that before.

up today the s&p. >> they've come down. they're up 35 points earlier. now the dow looks like 22. >> it was down 1845, 1846. it did close back above 1850. 1849 is where it closed out last year. we are basically flat so far only a year after moving all around. then the ten year got as low as 268. it's back above 270. that's why a lot of people are watching, if it were to break certain support levs, if it would have a target down in the 2.5 area. nobody can understand with the tapering and gdp expected. talk about a more hawkish fed. why is it the tenure? maybe it's europe. maybe because they're deflateing -- fighting deflation in europe. many people. yeah. here are your morning headlines. the federal reserve will release the minutes on the last meeting

march 18th and 19th. that's expected at 2:00 p.m. we keep saying this, the markets will be looking for hawkish statements. i'm interesting to see whether they aren't as hot. everybody thinks, you know the economy has been overheating, the fed has to get out more quickly. what if it doesn't? we'll see. we will see anything on that discussion about forward guidance for when we move off of that zero target for fed funds and toyota is recalling nearly 6.4 million vehicles globally for faults affecting various parts ranging from storying to seats. imagine if you had to recall 6.4 million cars. >> that could be tricky. >> why? >> let's say you are tesla. >> how do you recall tesla and get it fixed? >> you are going to fix it yourself. >> tesla still has facilities all over the country. it's not that they don't. >> just not dealerships. >> you think they can serve a

6.4 million car? >> if they did, they would have an infrastructure. >> you want to plunge head-long into the future with no dealers anymore, i don't know, we'll see. >> i think the distinction with that issue is the issue. >> you can't do it in new jersey, i'm sorry, my friend. no non-dealerships for you. >> i'm okay with. the auto maker said it was not aware of crashes or injuries caused by glitches found in 27 different toyota models, you know they had 27 different models. did you? did you minivan that? >> it is the sienna. >> did you recall? >> i don't think so. i haven't gotten a call on that. i did take my commander in last week for the recall. so, lots of recalls out there. it seems like every day you turn around, there is another one. here's one that will get a little attention. general motors is now being fined $7,000 a day for not

reaching theful for 6 million cars for ignition switches. they say the auto maker would be subject to daily fines until it answers all of the 107 questions the agency asked in its questions. nay are probeing why they waited until february to order a recall despite learning of the effect den years ago. gm says it has fully cooperated, delivering 21,000 documents covering more than 271,000 pages related to the safety recalls. it's that question of 107 questions put forth an whether or not they have been answered. our guest host this morning is one of the biggest deal makers in the private phase, barry sternlicht. it is great to have you here today. >> it's great to be back. >> we will talk about the ten year in a moment. io enif you have an answer for joe, why we could be looking at the ten year, any thoughts? >> it's the economy. the economy is not that strong.

it's not going to meet the growth targets, but the fed has. we'll talk with treasury secretary lew later. i don't think the bond market is sort of the purveyor of truth. you look at, i have been watching the ten year in spain and italy, it's like a referendum, they will get through the euro, the risk is done. they're convergeing, they shouldn't have been apart all those yields on those currencys in the different countries, it's the same risk. the euro is breaking apart. so now you have the spanish and ten 84 trading where the u.s. ten years are getting close. i think it is a funny year. i mean, you had christmas roll around. we're very active in the housing market t. housing market has been boy yavenlt it's the most -- been buoyant. everybody should have spent a lot of money at christmas, they didn't. >> why? >> i have been asking myself the

enormous pockets of strength. you clearly see the 1% doing better, the others have disposable income lower than 1.7. they didn't foe whether their health care would be cancelled or what. they didn't understand the aoption, people played cautious. with the weather we saw the first half living in the east, the first couple months of the year, those were a stouf tart to the 84. i think people were nervous the taper rates would shoot up. obviously, they didn't. they went the other way. i think people were set up on the wrong side of the trade. they expected it to go three-and-a-half, people thought we were subsidizeing the rates with the fed. so i think it actually is an issue. i think the economy, it's okay. it's ully not a bad economy. >> it was a slow growing economy. >> people think it's supposed to be three, do you think we'll get three? >> no, we won't get three. >> two-and-a-half. >> a lot of the issues you said, the weather we can put behind

us. >> the weather changes things. i always watch fork city hotel rates and, you know, occupancys in new york. my career in hotel, i noticed new york city kind of led the economy up and down. it started to recover and went over the hill before the economy went over the hill. right now, new york city is soft. it kind of bothered me. we look at brazil and china, there is not a lot of things pulling the market forward right now, brazil still struggles. we have investments down there. i like it struggleing. the capital is not flowing in. you can find better investment opportunities. i think we'll be fine. i just think this isn't exactly the robust recovery you talk all about morning you might have hoped. >> like i like taking things to extremes. tv, cable. today we're seeing, we're watching the fed for any hawkish comments. do you think that it could eventually get to the point where we are watching the fed

for dovish comments? because they realize that, you know, that they don't want to, this is all on their shoulders. >> the faster the fed gets out of the market the better off we'll be. >> do they foe that? >> i think the baby has to stand on its own legs. we've seen everyone worried when they've tapered. i didn't find it probably isn't going to tick off. i don't think so. >> just so worry muddleing along like we have been. >> construction jobs are coming back. that was a big component of the employment trade that had not recovered. whether it's housing or commercial construction, i was down looking, in the city, obviously, last night. i slept in the city. there is a lot of construction in manhattan. we have a big home builder on the west point, tripoint. their business is solid across the states, they're buying weyerhaeuser markets, their business is good. it's actually, i read of the

death of the home building market. it's a lot of jobs. so it's pretty good. >> so the fed is able to exit and, you know, and there is not a disaster. but discuss the stockmarket hold up or was it -- >> you just can't, i think the one thing, i think it's buffet, i'm not sure, but the total equity value of the stockmarket is 115% gdp, something like that. it can't, ever time it gets here, it stalls. it heads south. it will grow now, you can't take 115 to 132% of gdp. >> you feed economic. >> you will have a 3% growth. this could be, i would think, zero to 10% year in the equity markets. there's pockets of opportunities. the stockmarket is not overheated. >> did you buy anthonys? >> yeah, up 32%. >> right now, what are you doing? given what's happening? >> oh, watching a lot. repositioning names. i don't trade a lot.

i invest, i don't really trade. >> repositioning names, meaning selling the winners? >> yeah, things that have gone a long way. >> are these winners you are selling? >> i have owned los angeles sands forever. i'm watching china. things like american airlines. >> you mean american airlines, that stock is not going to obviously hold up? >> they find it at 30 something six. it's not a hell of a run. small companies like multi-media games and companies. >> you never heard of it? are you taking that money and repositioning it into what? >> i like, i have a lot of real estate stories. i look at direct things. i have done some internet things and hotels tonight, which is an interesting app. if you seen that company, it's pretty interesting. i have done other stuff. i have been doing other stuff looking at the tech field, it's interesting for me in my business to understand what's

going on in these new areas. >> from looking at that one, it's fascinating b & b. it's the i question lent of a 7,000 room built and full in manhattan. that's 3% of the room nights. having said that, there is no question, you will get upset. they're not in these house, the condos and co-ops will get pissed off, they are not getting the occupancy taxes. >> that's the biggest thing. >> so it's a big, it's $10 billion valuation. so start with marriott, they're 15, 16 billion. >> i can't see how both sides are worried about bedbugs. >> i will invest. >> they will have a hole, too. >> i rented my office, how many guys have used this? one of the guys says i've used it like a dozen times. i'm shocked. i love it. i think it will be big in europe. >> it's big in places where you don't have other rooms. >> you are not worried about climates anywhere?

>> no, there aren't proliferation of chains, hotel chains in europe. everyone is a bed and breakfast. i think they're used to like branding out. i think, that's what you missed in priceline if you didn't pay attention, they're a big business. >> the owner? >> i don't know. i haven't done it. maybe we'll do it is there that's not a question? who cleans the toilet? >> i don't get it. i wouldn't want to live in someone else's house. >> the last time they said they'll send you a picture of what they want to look like. you can't smell a picture. can you? >> the statistics on it are pretty good, repeat customers. 65% of the stays aren't empty houses, it's not like someone is there to groat you. >> it's weird. it's weird. they had an orgy on. yes. >> it was a large full figured people orgy. >> that part. you investigated. not that there is anything wrong with. not that there is anything wrong

with with orgys. >> alibaba. >> you can't sit on his house. >> you brought it up. >> this is pg or g? >> pg-13. >> we need a sponsor. or an editor. >> barry is with us the rest of the show. we have a lot more to talk about this morning. >> when we return, pa innera, the restaurant chain is betting big on tech. big plan, sidewalk box will return in a moment. turn in a mo. .

. >> panera bread laid out its plans for the future. it's called panera plan 2.0. joining us to talk about what the plan entails is ron sheik. >> it's not the plan we are laying out. >> how can you help me today? i want to eat everything you have there, i want to eat now. >> i want to.

i'm not going to. >> is that a bear claw? i want that, too. >> this is going to get you good. >> we will share all. manly yogurt. >> we have the yogurt for you, becky. there you go. >> andrew eats something like that, don't you? >> i am looking at this stuff. >> tell me, this is the cinnamon maple scone. >> oh, that sounds good, too. >> panera 1.0 was pretty dam good, why did you need the panera 2.0? i think the potential the past two years for the do things for guests differentiated to when they come in the store. smab has to get it over to somewhere else. you have to go over to the more than pit to pick up your food,

you play a game, i call find your food, sandwich is here, coffee is there, it's a non-integrated experience, we're allowing you to place that order before you come into the cafe, you walk into the to go customer, you walk to a specific area reserved to you. there is an app. you can order off the web, off a gasoline kiosk and cafe. you can still use the register. then you walk over to an area researched for you. there are benches that are there. you can walk over. there is a monitor screen that tells you when your food is being prepared, when it's ready. >> is it all three meals? until you do the carb thing, this will make me fatter from what i can tell, is it easier for me to do this? >> i don't know if it will get you fatter. it will get you in and out quicker. >> how much is faster? >> it's significantly faster, but here's the thing, if you are a to go customer, you go through the same as everybody.

in the new world we've created, you will have a different experience to go and a different experience for eating in. >> if i go 15 minutes in advance, i can grab my stuff, walk right out. >> it's ready for you. >> we pay by credit card. >> you can pay. >> so it's the whole thing. many of the, in our industry, the food industry, the mobile apps or the auto payment system, everybody is talking about it. the reality is everybody has a single purpose app or a piece of technology. this is different. what this is, is an integrated guest experience, a change in that guest experience enabled by the technology, ultimately powered by something else, which is operational execution and capability. >> it's sounds fantastic from the perspective of getting you in and out faster, in terms of customer loyalty. if you break down your morning routine, you can do this quickly, i can see people using it more frequently. we also talk a lot on this

program about minimum wage. if it's raised, if that means fewer jobs for people, mcdonald's and others said they have been playing with this technology as well, is a part of this from that? >> not at all. we are taking the labor we are saving. we are running as he as 30% digital today. today it will be as high as 50%. we are taking that labor, putting it into production, into building much greater accuracy and much greater execution. we are also using it to do what we call deliver to the table. so again, i want to keep saying this. this isn't technology, everybody wants the pitching home and technology. it's a different traded guest experience. >> how does that work? >> i have never seen it. >> about 20% of our stores are dry clean. >> so can you order the drive-throughs? >> in fact, what this is, is a walk through for people that don't use drive through. so, literally, today, do you want a to go order? you got to come into that store.

you got to wait in that line, it's different. >> even rich, it's 30 bucks in '09, you can't tell on these charts. what happened? did something what it was on the last earnings release? what did you say, it went from 180 to 160 quickly? >> we share this vision. >> that caused the stock -- it's expensive. >> no, what we've said is, if you look at panera, i've run this as a public company now for the better part of two decades, i've got 100 quarterly earnings under my best. i'm like cal ripkin, i'm still standing. >> it will cost a lot of money. >> you go back to the history of panera, every five to seven years, we made significant adjustments that reflect massive growth. this is a massive initiative. we have 42 million. there is a major step up.

>> is it an arms race? is everyone going to do it? >> i think there is a bit of an arm's race occuring. you got to hear me loud and clear. this isn't about technology, most of what people are doing will fall by the wayside, i was in a competitor's operation a year ago. i placed an online order. i walked in the cafe. i waited in the same line i always should have waited in. i said, i'm here to pick up my online order. they said, fire your fries now. i thought to myself, why did i need to do this? >> a large pool with a big taco sauce pool going? you got competition. >> there is always. >> you have lunch. >> fairy tale. >> a much bicker lunch. >> here's the reality. right now, everybody goes through one system. in the new world, people will go through different processes for how they use the cafe. here's where it ultimately leads, three to five years from now, you will sit in your living room and say, hey, siri, i want

a bacon sandwich from panera. we will enter a world where there will be personalize menus, if you have digital capabilities. i know becky is many much better shape than you are. >> i want one, bring it to me. >> how is the consumer, is this a 3% world gdp in the united states right now? >> yeah, i think it's a slugfest, no question. >> economy is better, consamer is better right now? >> the economy is a bit better. the consumer has gotten a bit better. we have a better consumer, we tend to benefit. >> is your average ticket price going up or down on flat? >> it's going up modestly with inflation. >> are you opening bigger stores? >> bigger stores. >> that's real estate. i want to know that. that was key. >> i like the vision. >> i want to know about -- >> it's for real. >> you can uplift your cards a little to the cloud. >> no, people say to me, all the

time -- >> thank you. we'll talk karshs during the commercial. coming up, more on our exclusive conversation with our host barry sternlicht and an exclusive interview with jack lew. we will get all that at day 15 eastern time. eastern time. financial noise .

still to come this morning, warren buffet has been warning ability the risk attention posed to the economy. after the break, we'll talk to the director for the state of florida. ""squawk"" will be back right after this. after this. . [ grunting ]

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thanks. [ male announcer ] troubleshoot, manage appointments, and bill pay from your phone. introducing the xfinity my account app. . >> welcome back to "squawk box" on cnbc, first in business world wide, i'm becky quick. let's start out with toyota recalling 6 million vehicles world wide. they span nearly 30 models. no injuries were reported related to the recalls. 2 million are in the u.s., others in japan and europe. google is looking to disrupt

hotel rooms online google is streaking a licensing deal, it's a startup by expedia, they are adding morphotos so they increasingly resemble those of other travel search sites. >> barry, thoughts? >> they are user friendly travel agents are expensive. >> this is good for your business, not bad? >> they are down 40 cents. also, president obama is headed to texas to mourn the death of the soldiers there. >> let's talk about public pension funds. >> that i are trying to get back on track. our next guest runs the fourth largest pension fund for the state of florida. it's been called the poster

child for the industry our guest host is here as well. we were talking during the break about how a hedge fund is going to make even more than zero at the end of this year. who are you going to make more than zero at the end of this year? >> we are working hard, we are seeing evidence that oil hanging fruits in the markets is gone. we have been able to take advantage since the great financial crisis. we have more than doubled our fund. the trailing five 84 term is north of 50%. we have been able to add a lot of value. >> it hit on an annual basis? >> the number we look for is a 5% real return. if we look back over long periods of time, we have been able to beat that number. the statutestory number is

7.75%. all of us agree is a bit aggressive. >> what do you need to fund the pension properly? >> if we can hit a long term real return for good, we have done that. >> what's the statutory s. there a risk? >> 770. >> why do they have a statutory? >> that's a statutory number used for discounting purposes. >> that's a nominal rate. that's not real. >> we were talking to barry earlier for the where he was moving his money. you recently moved from the class the target by 6%. you moved into a lot of real estate, correct? >> we made adjustments in the course of calendar 13. we took the view central banks running the printing process the implications for inflation, interest rates and currencys were not great and, therefore,

not good for fixed income. we took our fixed income target down from 24% to 18. we took that 600 basis points and allocated 3% to real estate, 1% each to global equity and strategic investments. that's a bucket in which we have opportunistic strategies. >> so real estate, you said, you talked about what i'm doing outside real estate. i think would you agree that it has a free column inflation more or less? >> yes. >> are you doing okay if it doesn't show up, inflation, if it does, you are probably going to do largely better than other assets? >> that's right. i think it's true if you have the overwapth for stabilized core real estate and gateway markets. if the assets you own have pricing power, homes for

example, priced nicely, what can be better than that? then you are in very good shape. >> how much more going into private equity long term? is that private equity? do you see this continuing as a trend or happy where you are? >> i don't see any other huge adjustments on our horizon for the time being. allocations for a fund our size are not things that can be implemented quickly or without costs. so it's not something you want to do hastily with long-term investors in that regard. >> our business today, we've just closed, invested without raising something else, i'm probably not supposed to say that. but the sovereign world funds, the exotics, akic investment core safe sovereign, they're entering the mark, focusing on real estate, they're coming in a big way, how do you see that? do you see any turn in that or is it go him to be a tidal wave?

>> you are meeting with them. you see the canadian funds, they bought 1370 broadway, a building in new york city, how do you think about how you have to react or how pricing is going to be over the next five years given what we are sighing is that most of these foreign investors are underweighted to real estate. if they have, if they reaffirm the taxes act firpta, i think you will see a tidal waves of these. they are already in europe. you have norway, the largest fund in the world. what do you think is going to happen? you think if interest rates pick up, do cap rates yield stay where they are? you have core, large buildings unleveraged or moderately leveraged? in there the theme certainly is global investors are seeing global real estate for fixed income if not cash investments. >> that, in turn, has property away money and washed over most

of the major asset markets. >> you don't see it turning, do you? >> that creates a challenge for people like us. you are competing for a wall of money with a lower return for investment tan we do. the key to people like us is to maintain our discipline and not exceed the reality or expectations for returns. >> what do you think of canadian pension funds who are now trying to get effectively into barry's business, they are dock it, themselves? >> the key to that is to be able retain, recruit and retain the right professional talent. >> that will not happen in the united states. because there is simply to the a willing ins to compensate government financial professionals that privatefuls are compensated. i'm not saying that's a bad thing. i'm saying it's reality. in canada, for example, if you look, i'm thinking one of their

large provincial pension funds, their top five people all make seven-physical incomes. you are not going to see that in the united states ever. >> some of the funds are relatively new to the class. they don't have a staff. others decided like audio is 128 real estate. you are seeing both. they partner with us. in the opportunity business, with i is our core business, we can move faster. we have better access to the markets. we know the markets really well t. speed is a long-term thing. we have been doing it 24 hour years. >> i think jim stewart wrote it. a guy in your state the pension funds for the tampa police and fire, did you see this? run by one guy, one guy, he's been doing 130rs for like 30 years, no fee, no consultants. he doesn't send to private equities. it was an amazing thing. >> where did you see if article?

>> i think jim stewart wrote the piece in the new york times, it was fascinating. >> equities? >> i think mostly equities. he was like, a wannabe warren buffet. >> a loanshark? >> what is your non-core? is there anything you can do that is totally non-correlated. don't you get something that goes the opposite with everything else? what do you use? >> there is no one thing, diversification is our friend. when we look back at the past six years, with see different asset classes that add in different years. real estate has 28 been our top forming asset class in the past. >> it's good to have that. i wonder what the most non-correlated thing will be? >> it will move around. >> people are more correlated across the board. >> they got alternate investment type things. a lot are ill liquid.

>> that stuff is correlated. it's about the market. 75 years of history doesn't capture. >> what do you do? you got anything uncorrelated? >> i this i to stay wealthy, keep from blowing up, you diversify. >> everyone has cashed in today. tell me if you could for a sending, ask your opinion of investing offshore? where do you think u.s. pension funds will go? people talk to me today about africa? about uncorrelated. who knows? is that, do you think? is that something that's going to happen? is that something you are considering? what do you think investing in china for your fund? i have my opinion. what's your opinion? >> i think globalization is a reality that's here and has been here a long time. we first took the equity portfolio to the florida state board international in 1993? >> it's early. >> we have ever since and

frontier markets. >> what percentage of your balance sheet is off shore? >> to really look at that, you'd have to look at the s&p 500 too, as far as 50% of your earnings there are actually off shore. so on that basis, if you look at the real earnings flow, it's probably half. you mentioned china. china we think has a number of issues that limit its appeal to direct investment, if not rule it out completely. so the way we tend to approach most off shore situations is through external partners. where we do things wage as primarily and core real estate here in the u.s., we do that effectively ourselves, then we partner with other funds to gain diversification, to get specific exposure and capture their expertise in areas where we don't have it. >> thank you this morning. we appreciate it. >> thank you. >> coming up, another addition to the "squawk" platinum portfolio, from value into

momentum stocks. the large value fund is up 31% in one year. find out if he's shifting his strategy at this point. later, the interview of the morning, our platinum portfolio. >> yeah. >> i get most excited about that. >> we also have treasure secretary lack lew and steve leisman from washington. we'll be right back. we'll be ri? i tell people it's for the climate. .ns in

. >> welcome back, eb, our roster is filling up. today we are adding david katz, chief investment officer at matrix advisers. his mantra is boy on weak inside and don't chase the rallies with new money. he has a billion dollars in asset manage:. the average length 18 to 36 months. he joins us right now. david, it is good to see you this morning, thanks for being here. >> it's nice to be here. >> tell us about your mantras, don't case rallies, what would you be doing now?

>> we think the market will be doing 9 to 11%. after you've had a run 3 or 5% on the upside, we would slow down with new money. we do like stocks. we don't expect to have the type of year you had in 2013. >> let's talk about the stocks you like, whole logic. you like it because of activist investors. >> a lot of things have happened, carl icon took a significant stake. got two board seats. there are other activist investors, it is owned by 20 to 30% activists. the new ceo is doing a terrific job. he bought about 235,000 shares. here's a value stock with good business momentum. we think the stock is worth 29 to 30. >> it's at 29 to 52. you think it's 29 per share? >> we do over the next nine

months. >> eaton corporation, what itself the key to that? >> buy good stocks with good momentum. eaton is doing well. we are expecting. they're good. exciting business outlook at a reasonable price. >> you have been looking at the financials. i know capital one is one of the stocks. >> we like the financials in the last 24 hour months they made a number of acquisitions. they have been diluted. we are expecting that to get better. we also have american express.

xun is a better lace for new money. >> where do you see that stock trading over the. >> david let's talk about two things. you oversee two portfolios at matrix. one is the high dividend fund. another is large cap. i know large cap has done better recently, do you find more bargains in one area right now? >> we are finding an equal amount of bargains. each portfolio will bring something to investors. the dividend is a low risk way to play the stockmarket right now as long as you are very diversified with dividend stocks. we are not expecting stellar returns this year. a dividend growing at 10% a year is a good place to be. it's a lot more attractive. we think large cap value is due for another good period, probably another good 12 to 24 hour months. again, not shooting the lights out, but having nice low double

digit returns. >> david, thank you for joining us today. >> thanks a lot. still to come, treasury jack lew, from minimum wage, we will cover all the topics affecting our monetary system. "squawk box" will be right back. . .

welcome back. the federal reserve will release the meetings of the minutes from the last meetings on march 18th and 19th. that's expected at 2:00 p.m. eastern time. they will look for hawkish comments, that discussion on changing forward guidance again, that will be released at 2:00 p.m. eastern time. checking the markets the futures have been not too bad. a little rebound as we're building what looks like from recent weakness, the average did manage to snap a three session losing streak yesterday the dow added ten points, the s&p is back up for the year 18 and frapth and change on december 31st. the nasdaq is back above 2.3r7s.

now it's below 2.7. barry said it might indicate we've gotten a little ahead of ourselves in looking for an uptick in the economy. >> yeah, that's correct. it doesn't feel like it should be here, 3% is sort of the right number. i think the economy we'll see what happens. nationally, it's affected the south. it's not just the east. we own a ski resort on the west coast. they have no snow. >> which one? >> math moth. east or west in california. >> everybody else has snow in the year. >> down rub it in. >> but it's snowing now so we're going to ski until august. >> can you guarantee me, you

know interest rates. we'll go to 3.5 on the tenure before we go to 2. >> i don't want to go there. >> you can't say that? >> i think systemically, we have residential. >> some day rates are going up, aren't hay? >> 2015? so the curve is very steep. three-and-a-half i think in five years. i don't think it gets there. i think the nation goes broke. you can't pay 4% on 17 trillion in debt. so i think the global, this is relatively the whole world has to keep rates low. 250% gdp. europe is in slow growth. the demographics of western europe, japan and soon china just mean that you have to, it's very hard to grow.

>> it's not consensus. >> i want to be a constrarian on this. >> do real estate guys see the world a little differently? >> i think we are divided. probably consense sutsky, clearly inflation. you have to be spending. we protect ourselves against that. i don't see a lot of global domestic consumption. the nation isn't rich right now. it's not doing well under this economy. we are not creating good quality jobs. >> we will raids the minimums on the crappy jobs we are creating. >> one of the things we talked about briefly, the idea of single family homes, what was happening with that market. blackstone basically stopped buying this stuff. he made the argument he felt they wouldn't have to continue to operate them. long term. >> we have single family homes, we think it's an interesting business. i think that's what's makes it a ball game, that everybody played

in. it was a dual play, right? you got current yield with current real estate. you probably had more upside potential than downside risks. you avoided markets too par, too fast. i think the thing some of these guys did, they went in so hard, so happy. they moved markets beyond their natural point. they were bidding themselves at auctions. >> you can't have a public company for a long time set up on something like this. >> they got one. have you the technology background, our internet guys. it's got a cool delivery system. we have 550 people in the field. it's like a grub hub. it's a totally different play. if you get pockets of scale, it will be fun, it's interesting. it will be a new asset class. >> i can do this today. i want to talk to you about the politics there i want to show you some stuff with dell in europe and a little bit of the hotels we are building in the

u.s., it's kind of fun is there when we come back, we will talk housing, venture capitalism. then our exclusive interview with treasury secretary jack lew, "squawk box" comes back with all of that? just a moment. just a moment. why relocating manufacturingpany to upstate new york? .

. >> a cnbc exclusive. treasury secretary jack lew joins us to talk monetary policy, minimum wage, china and russia. it's an interview you can't afford to miss. it's the rise of the "squawk" platinum. . we add another stock pecking pro to our list and find out why he thinks facebook has more potential. >> what happens when you swipe a credit card? a closer look at who gets that information and what they are doing with it as the final hour of "squawk box" begins right no now. ♪. >> welcome back to "squawk box" her on cnbc first in business world wide, i'm joe kerr fan with becky quick, barry

sternlicht, a big line-up this morning. treasury secretary jack lew with an exclusive interview about 15 minutes away. it says here, you cannot afford to miss it. you will lose money if you don't see this interview, it says. you got to connect the dots. we can explain it to you. we will find out the strong dollar still. >> steve leisman will be here with that. new rules from u.s. regulators, forcing eight of the biggest banks, the move prompting industry complaints it will give overseas competitors an advantage the banks are city, j.p. morgan chase, wells fargo, morgan stanley, bank of new york mellon and state street. regulators say the new rules would limit bank's reliance on debt. by 2018, they have to rely on funding sources, like

shareholder equity instead of borrowing the money. the offering of la quinta holdings was priced at $17 a share last night. >> that values the hotel chain at about $2.1 billion. la quinnta raised $268 million after it was priced below an expect r5i7bdge of $18.21 per share. toyota recalling more than 6 million vehicles world wide for a variety of problems that span nearly 30 models. no injuries or crashes are reported related to the recalls, but there have been two fires related to the engine starters. 2 million of those are here in the united states. others in japan and europe. >> i will do this fast, barry sternlicht, chairman, ceo, you will be able to talk about whatever you want, exactly. you might want to relax cough. put this on.

listen to me you will talk about what you want to talk about in a second. this jeb bush thing, number one, it is hard to create jobs, there are head winds. a lot of businessmen are waiting for this some day to be gone, anything good happen if the senate goes, you still have one branch of government you can't do anything with? >> i mean, what part of the republican party is going to dominate the republican party? >> you need to know that answer. >> the senate can get that done the right side the right and left, far right and far left. >> the next thing, i'm wondering, given what you are talking about the skism in the republican party. i don't think he would take it back. if you don't like it. >> he wrote a book. >> you don't like it. he says, it can be an act. people know, if you can't

provide for your family, immediately, ted cruz said, well, what do you mean it's not a felony? we have a rule of law, boehner says it's a rule. the journal comes out, he was slain because of this, the journal says you lost five out after the last six pop loar votes now you pillary the i go, which side is going to win in the republican party? >> immigration reform is something they should do this year. it will help the economy. it can add to gdp growth. they won't be hiding. the money will second quarter late better. i don't understand it. >> i thought the journal was slamming. i assumed that the journal was slamming jeb this morning.

>> the headline, i thought it was her ret cal. >> they're being sarcastic. >> yeah. >> i don't know if we seen the personer, her man kaip for a while was leading the republican position. he's the number one candidate back in the last election. >> i don't know if we seen the guy. >> the cheer theater would be great, bush and clinton. i am a big fan of jeb bush. i think he's a his pan spatic life, nobody ever lost minorities the way. >> he did good things. >> you would love jeb bush to run? >> not the moment. he is easy to like. he's a thoughtful person

education is the number one issue you know our nation is tilting not in a great direction i was talking about this. they expected the nation to be educated when they invented democracy. democracies will fall apart if the people are not voting for the right thing. it's a dangerous comment we need people in our electorate. >> that itself how the nation will make progress. they will give up on unemployment benefits. we can't afford to do what we are doing. it's a part of the economy. >> i find chris christie one of the best speakers i've ever seen. he is very charismatic. chris is enormous.

>> i don't know we'll see what happens i don't think so. this guy, he's like good. you see that guy speak? everyone can relate to him. he's the guy, he seems like the anti-politician politician. if he stays honest, pure, speaks the truth the way he knows it, i think that would be refreshing for the country. >> we'll see. >> do i get to speak about this other stuff or not? >> this guy is like going to the dentist, having a cavity drilled for you. >> normally you like this stuff. >> i am tired of politics. >> you are. you know, i kind of don't know what to think about the supreme court decision about letting everyone, it's going to exacerbate some bad behavior. i thought they should give each candidate $500 million. no fund raising. spends it. it's like running the federal government. you build your team, effectively communicate your strategy, you can spend all front, spend it later, the pedia, tv, internet.

let them run their campaign like we run the country with a budget and don't spend time fund raising. i hate this, you know how many phone calls and e-mails i get? >> i think they should have been. the three exemptions. >> let's talk about the three viewers like people are doing today. >> is this a way you can talk your book? can we help you somehow? >> we are launching two military brands. we have three opening and an ecobrand. you have some pictures. >> we are opening in new york in september we will open in brooklyn next year in the fall. the toll brothers, 50-50 with

toll. we are launching bacharat hotels. that's who i think will be the nicest hotel, i'm biassed. >> what's the rate? >> for angie, the corporate discount of $2. 1ri689 to $1,000 bucks a night. >> the 12ri69 anniversary of baccarat. i don't want to open until november. >> what is that over and above the peninsula and four seasons? >> comparable, but higher, comparable. >> new york city. >> is that a free whichfy or no? >> of course. >> you will not charge extra? >> no, i hate that.

>> i love you. you will have free everything, whatever you want. >> we're doing that. we bought three in the u.k. i think we have pictures of two bebought two banks. principal haley. the hotel is called the russell. that's the russell in london. we are going to gut it. renovate it. it's a full city block. go to the next slide. >> how much will you spend on that? that will cost you. >> probably $50 to 70. in glassgow and man chfter. >> is this a bet on things improving? >> we bought them early. in our business the focus of investors is europe. there is still the banks unloading lots of loans and things. we picked up 50 hotels. we will merge them and take them public. it's real interesting stuff. the u.k. is doing much better than anyone thought. it's the leader in europe in gdp

growth. we are looking at chechoslovakia. we just bought a retail company in sweden. so we have been quite busy. we did a deal at nama. you are seeing enormous investor interest in university. probably ahead of the fundamental also. but the stress guys, whether distressed credit, equity guys. everybody is looking at europe. that's where most people are comfortable. i think the bond market in europe is telling you, things will probably be okay. now we're going to the fringes. you go to poland and where you can get better yields. and the front tear companies are spain and italy. they have a new 39-year-old prime minister. they're ready are spain moving. actually, spain is reforming themselves. so it's amazing, with spain moving, italy is looking over leak this, saying we got to do something so this can be good for italy.

these are wealthy companies. >> i don't know how you could screw up italy is beyond me the greatest company on earth. >> we don't do much, we will do hotels. >> your former company is going crazy. >> travel is a big business. the number one growth market will be asia, the chinese travel, they can overwhelm you, everywher everywhere. >> we probably don't want to do that yet currency rule of law. equity capital, it's another ri risk. >> so you can have enorm us problems dubai is doing great. it's coming back. even residential prices are

higher than they were. so part in the middle east are doing well, i think the more interesting thing is the flight of capital out of the middle east. it's kind of interesting to see the pace at which money is being invested and moved into the united states. >> thank you for that. stay where you are. we got a lot more coming up, including right now after this break. our exclusive interview with treasury secretary jack lew, later stellar stock picks. the next installments back in just a moment with the treasury secretary right after this break. break. and i don't need to be online for it to work.

. >> welcome back to "squawk box," yesterday you sa you the markets pick up a bit. this morning take a look at the futures. the dow are up higher. s&p futures up by close to 3 points. nasdaq up by eight-and-a-half, when we come back, treasury secretary jack lew joins us, then what data leaks out of your card when you swipe it at the register, how is it being used? who has access to it? we have answers as well. "squawk box" will be right back. . ♪ that's why i'm type e ♪ ♪ that's why i'm tyyyyype eeeee, ♪

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. >> welcome back to "squawk box," let's go to steve leisman in washington. he has a very special guest. steve. >> andrew, thank you very much. i am here at the pressure treasury secretary's office. mr. lew, thank you for being with us. >> we meet ahead of the world bank meeting where in sydney you pledge to a very ambitious growth program what is the united states doing to deliver its part of the growth in the

world, particularly at a time when it's giflt to get anything at all out of congress? >> you know, steve if you look at the imf outlook released yesterday, it shows among the developed countries, the united states is leading the economic recovery. we are doing our part. we took tough decisions six years ago and we stuck with them. we have our economy growing. we formed our financial system. we have our fiscal house in a much better place. we have growth that is by world standards doing very well. as you know, by our standards, we have a long work to do. as long as there are millions of americans who want to work full time or find jobs that can't, we are not done with our work. the u.s. is a strong driver of growth. our children is there are many pockets in the world that can do better. one of the things we will talk about is how to drive that growth agenda. >> i want to talk about the

united states, we get stuck in the 2s, 23rs growth. where is the boom you might expect relative to the decline we had? >> if you look at being in the high 2s with a debate about whether or not we could cross the line to three. you have to remember, we've come a long way. we started out in a very bad place we've made a lot of progress. there are a lot of signs of health in a lot of sectors in our economy there are some behind in terms of recovery, for example, we seen housing vows return in a fairly decent way. we haven't seen as much progression in new starts and in

construction. that's a professional for another boost to the economy. so where we are now is before we have seen a full recovery in a part of the economy normally contributing to the recovery. i think there are many parts that kil still could do better. we have to pursue policys to make sure we boost the chances of that happening in terms of specific and broad policies. >> let's talk about where you started to go. which is what the rest of the world can doing. europe seems to have bottomed out what kind of policies would you like to see? >> we have been clear in our conversations with our european friends that we think particularly in surplus countries, there is a need to boost demand. there is a demand problem in the world and in europe. >> surplus countries, you mean,

specifically, germany? >> look, i have always been careful not to point the finger. germany is obviously one of the surplus countries in europe. i think there are, if you look at europe as a whole the growth rate stayed very modest. the risk of deflation is something that has a lot of people concerned. the answers lie in policy decisions that could be taken. that's actually the good news, there are solutions that could help. >> give us one you would like to see in surplus countries. >> look the policies we are talking about in the united states, things like investing, infrastructure. those are the types of things that stimulate demand. it's a good thing in germany in their new deposit they made a commitment to increase spending on infrastructure this is a question of not if you take action, how you turn the dial. we think the risk of low demand and risk of deflation is

something they need to be alert to and take a little more, not less. we have friendly situations, i think we need to look in the mirror. we have an agenda for what would stimulate growth in the united states i think it's a good agenda, things like skills training. >> you talk about infrom structure here. i want to get back to the global thing while you are bringing that up, ray la hood says he sees low prospect, it will run out of money in september, almost no chance of passage, how do we tell the rest of the world to do x when we can't do that? >> ray la hood, i'm more optimistic on infrastructure than that. if you go back we did quite a

lot in the recovery act and that's going to benefit not just our macroeconomic condition, but we have better roads and facilities around the country. i've worked in this business for over 30 years i do not believe the support for infrastructure is a republican or democratic issue. i think there is almost universal support for having better roads, better airports. the challenge is how to come toke to an agreement where you put a program together and a way to finance it. i personally believe there will be an agreement on what to do on the highway bill, because i don't believe it's an acceptable outcome for the highway bill to expire. we have a plan to jump start spending on infrastructure. it would be to combine infrastructure with business tax reform. which would be a great thing for the economy and our business conditions. i haven't given up on that. >> it's an election year. it seems almost no prospect that happens. >> everything gets done in the

next six to nine months. if you look at the ways an means, he recognized there is a linkage between business tax reform and infrastructure. this is a long process. i think that if you accept it as i believe that infrastructure is something we need in this country to be competitive in the future. it is something that has broad bipartisan support. you have as to work at it. >> let's keep weaving domestic. let's go back, recently, strong statements were made about china and their currency policies. are you concerned china is now in the process of devalueing competitively to give competitively against the united states? >> my first day in this role and before that we have been clear with china they need to determine an exchange rate, there needs to be progress on a steady basis.

we saw a period of time e period of progress, we recognized that. they took action to double the trading down, at the time i said that was something that was a positive move because it was potentially a step towards a more market determined interest rate. they had a concern r & b was only going up, it would become a magnet for the kerry trade because of the higher interest rates. they needed to demonstrate it could go down as well as up to recite to stability in their system. i think they demonstrated that quite clearly. it won't went down. they need to determine they are committed to a market extran rate. if they want the r & b to be a world currency some day, if they want it to be a reserve currency some day, they need to demonstrate that. from our perspective, it is something that is very important to preserveing a level playing field for trade in the world. so this is something i have raised many occasions with the

highest levels of china's leadership. i will continue to do so. and it's something that we need to see signs of progress. >> did you recently talk to them about this issue? this specific intervention they made? >> whenever i engage in my counterparts, people in the more senior leadership. i met with the president twice the vooit vice premier, the head of their central bank. i don't have a meeting where i don't raise this issue and show a deep understanding of where we are. one thing they could do that i think would help would be to be more transparents. it's not easy to see what they're doing. they can hide behind the fact that they say that they're not doing what it looks like they were doing so they could be more transparent. >> that would be an important step right away. >> how much concern do you have with the recent consumption tax there? down that could derail the games as a result of the stimulus? >> steve, i think you have to

take a step back and remember where japan has been for the last two decades, what the progress is made over the last year. they had, you know, 15-plus years of economic stagnation, deflation, we along with the rest of the world were saying, you into ed to do something about this. you cannot allow japan's economy to spiral down and stay there. you know, put in place the first two arrows rather quickly using monetary policy and pump primeing. so they have a growth rate that is positive. they have turned the tide on deflation. now, the question is, where are they going? they also had a fiscal problem. they needed to get their fiscal house in order. there is a balance. now the value added tax is

something that, obviously, had the potential to slow the economy. we have encouraged japan on many occasions to looking at offsetting policies that they could use to make sure that it doesn't turn the progress they've made arnold. they need to stay village lavent and respond. there is a third arrow i personally believe the ristory is going to be in how effective they are in putting in place the long firm reform in japan. that's something where the jury is still out. they have yet to take the actions. there has been a lot of discussion of it. that's something we all need to hope they make the right decision. >> back to do mostic concerns, there are several large hedge funds and lobbyists trying to get the u.s. government essentially to pay some of the dividends from fannie mae and

freddie mac. do you have a position on that and what is the prospect on them to get any value out of the shares they currently own? >> look, our position has been very clear, when the gacs went into conservatorship, it was at a time when there was enormous taxpayer exposure. the economic crisis the financial crisis caused by the practices in those companies. i think that we need to continue to work on gse reform. we need to continue to look to a future where there is a different kind of playing field for housing finance and i think that if you go to main stream america and ask people, i doubt a lot of people will feel they have been made whole. >> final question, back to the foreign, is there has there been an effect you could measure on the sanctions we levied against

russia? >> i think our sanctions program has been effective. it's continuing to be effective. the president made very clear that russia's violation of ukraine sovereignty an its borders is unacceptable. it took tough action against individuals who are central to the decision-making and close to the leadership. it's taken action against the bank that is the bank that many of those people have their assets in. i think the message that there will be consequences to these kind of actions is very clear. you know the president laid out options, if reason is not because we want to do that. we don't want to be sanctioning russia. we want russia to take decisions that will reverse what it's done and not make further incursions

into the ukraine i think the sanctions is clear. i think this implementing sanctions has been clear in many. >> more a u.s. decision. >> the executive order the president signed puts in place authorities that have not been acted on. is there is more we can do. what i'm saying, teev, is the best thing for russia and the world is for russia not to take the steps that caused further sanctions to be necessary. but there should be no illusion that we have done everything we can do. we put in place a blue print that makes clear there is quite a bit more we could do. >> thank you for juneing us, come to see, on behalf of joe, becky, everybody in our office. >> it's good to be with you, steve, welcome. i look forward to seeing you again. >> joe, back to you. >> that was kind of a non-answer of coming to new jersey, steve. work on that a bit. >> you want to press him? i can press him right now. >> simply saying you didn't

answer when i said coming to new jersey. >> i have been to new jersey. >> he said he has been to new jersey. he'll come again. >> i have been there once, i'm not coming out. it's across the bridge, it's nice, it's a garden state, thank you. bruce, bon jovi, coming up, it's one of the rarest elements in the earth's crust, "squawk box" is dicking deep to find it. we will add another platinum portfolio member and talk stock picks. you can't afford to miss that. >> as we head to break. take a look at u.s. equity futures. futures.

. >> welcome back to "squawk box." this morning on cnbc. we got headlines for you. the eight biggest u.s. banks must boost capital levels by a total of $68 billion under new rules the federal regulators. they're taking steps to insure the largest banks have enough to weather the fmpblg crisis.

als, bailed out greece is set to end it's four-year exile from the bond markets with a five-year issue. greece, which has been blamed out twice now by the european union an ims since 2010 aims to raise up to $2.5 billion. >> i need to know. >> need to know what? >> what the expected yield will be. >> i will get you. what do you think it is, five year? what do you think? >> 5 or 6%? >> he wants more. to another place. greece. we will get you exact figures. also, we should note, general motors is fined $7,000 a day. this is more missing an april 3rd deadline for the recall of cars for ignition switches. a national highway safety traffic administration says the auto maker would be subject to

daily fines until it answers all 107 questions. they are probeing why they waited until february despite first learning of the defect more than ten years ago. we should note gm says it's provided hundreds of thousands of documents in pages. you covered this. >> i was down there last week. we saw mary barra. she ended up on "saturday night live" as her inability to answer the questions. >> give her a brake. she doesn't know anything about it. >> it's a scandal 101, when you have a scandal, start an internal investigation and refuse to answer questions. >> there were a few valid questions. the guys are still there. they asked her, why don't you call these those people into your office? i'd want to know before waiting the answer. >> has anybody been fired as a result of this? this has been going on for

years. >> the government can't talk about firing people. >> wow. >> it's a society-wide issue. people don't get fired for people. >> the government getting out. if they had no knowledge of any of this? >> if the government had a knowledge of this chevy co ballot scandal. >> it dates back to 2001. at the point in which the government owned gm, there was definitely knowledge pence of gm. the question is whether it was transmitted to the u.s. government and what they did about it. >> the conspiracy theory. have you the assumption. >> it's like a bridgedpaet. >> we have to line the scandals up. >> this one, really? >> this one involves people dying. >> you think the treasury knew? >> they're the company.

i think that's very requireing foresight. >> everybody knew. >> i think the company knew. >> you might by a tributeing too much confidence to the government. who are you? >> i just wandered onto the set. >> why don't we talk about why you are here. when you swipe a credit card, a lot of information is taken t. question is, what are the banks doing with it? eamon is here to talk about that. >> a lot of the issue in the wake of the target hacking schedule, where does your data go when you are interphase at the point of sale, we have a card reader here who have allowed us to borrow it. it will demonstrate the chip and pin technology, a lot of gobblety gook in this debate. how does that actually work? well, here is the new card

reader. this does chip and pin and chip and signature. so when you go to pay for purchase at point of sale, i'll demonstrate here. we got it set up. you hit payments. i done this once before, if i mess this up. we will do $999 because we want to do that? it's credit. this is a credit card that works basically like a credit card with chip and pin, insert the card. this is a demo card, nobody get the hd reader out to see whether or not my credit card number is on there. insert that, insert the pin, one, two, three, four. 1234. pinnock. fi pin okay. it's approved. >> why is that more secure, though? >> it's taking this computer chip which is on the card matching it up with the bank receiving the information and then also matching that up with the pen to make sure you are the

real person who owns this card. these magnetic strips can relatively easily be copied by criminals. these chips are a little harder to copy. what it does, it adds another layer of security. you have to enter a credit card. i think it depends on the number of devices you are buying, if you are i boing thousands of them. >> what kind of company is that? >> this is a main company that makes these card readers. you are looking at one extra step in the process by entering that pin number. >> that gives you one extra layer of security according to people who buy these machines. >> it's much more previous lent over there. >> there is a question of which will become dom nantd, chip and pin or signature. this can do both of those. >> that way the retailers can buy this.

>> no shower is standard? >> if you have them in your hotels over there, you have a shower door if your european hotels? >> i had that, i need to know the right answer. >> you will get one. >> one of the questions, where do the data go? what this machine gets when you issue this transaction, it gets your account number, expiration, pin number, time, date and lo location and amount of sale. it doesn't get details of what was pufred. it doesn't know if you bought a six pack of bore or a loaf of bread or your home address. >> that itself the information that transfers when you do this swipe. >> eamon, thank you very much. >> you bet. when we return, we are adding three more stock pecks to our "squawk" fund portfolio and we will talk about the right to pick the right stock in an

oneasy market. "squawk box" will be right back after this break. ter this break.

. >> add agnew name to our stock platinum portfolio. the four star sex growth fund. paul meeks calls him a tech concontrarian, let's look at his performance, up 22% in five years, his stock account for

over a 3rd of the company's $4 billion, so 22% each year for five years, paul? >> that's one of our key funds, the aymanna growth fund. >> how much stocks do you have for us? let's get them, fine out why you like them. >> sure first i like adobe systems. it's a 1990 software company. it's embracing cloud computing. selling software or sas. >> did you watch kevin lannis yesterday? >> i did not. i know he loves them as well. >> loves adobe, so, great minds, i think that was his third pick yesterday he really liked. i was paying attention yesterday. what else besides adobe? >> i like microchip. microchip is a semi conductor

company that focuses on analog chips, which are fast growing, margins are rising. the company generates a ton of cash, which is very rare for a semi conductor and a technology company. and the company pays a 3% dividend-year-o dividend-year-old. >> and what was the one in the middle? >> the last one i like is facebook. facebook i continue to think is going to grow at least 30% per anumm, top and bottom line makes it the fastest growing of the new era internet stocks. the company has a lot of potential and with google, these two companies control about 80%. not just of america's, but of the world's mobile ad revenues, with i is very powerful. >> 87%. it's given you a better buying point, i guess, not as good as after the ipo. some of your stocks have come back into a range you probably

like better. >> the nasdaq did pretty well yesterday. the pre-prior sessions before that, the nasdaq went down a th expensive, they've come down to reasonable prices, some analysts are getting angry and are cutting their targets. i actually think it's a buying opportunity. i think all three of these stocks have at least 10 to 20% upside to my target prices. >> you think the nasdaq is finished with its correction? >> you know, i don't think so. i think it's too early to tell and nobody would be able to say that with any confidence. >> all right. okay. paul, thank you. we'll -- >> thank you. >> we will keep track of these. you're kind of against landis but you got that same stuff and then you're up against all the other ones, all the other legends that are in this. >> bring them on. >> i'm keeping track of all of it. >> okay. >> i can't affords to miss one second of it. >> you heard him, bring them on. >> he's not afraid. >> when we come back, jim cramer is standing by at the new york stock exchange getting ready for the trading day ahead and will

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. let's get down to the new york stock exchange. jim cramer joins us now. i think you should have got a billion dollars if you picked

the lady huskies and regular huskies and no one would have done that either. how did that happen? >> daily double. i hope the president goes up there today. he ought to deviate his schedule and get up there. this is one of the great cinderella stories. it's a story everyone is talking about and i -- this is a great moment for this college. >> i wonder what -- i can't figure out how they -- i don't know. it's just very weird, to have lightning strike in the same place. it's not easy to get there. not even to get to the tournament, much less to win everything. >> not the women, the men. >> both! >> the women people would have thought would have won. >> they're undefeated. i guess so. you're right. it was hard for them. what else? >> barry is spell binding in the european call is so right, no one's making it but you're empirical, boots on the ground, and the brooklyn call, i've seen what you're doing there. i think that's going to be a home run. >> thank you. residential market in brooklyn is on fire. >> i've been buying property

there, barry, and it is -- >> the hottest neighborhood in the united states right now. >> i think it's an incredible market and there's 2 million -- more than 2 million people there, and only about three hotels, one whole foods. time to buy. >> couple tycoons talking shop, andrew. we are both buying property in brooklyn. have we been buying? we've been doing other stuff, right? we haven't been buying property in brooklyn, have we? >> queens. >> don't knock queens. >> coming too. >> you said that before. >> big. >> you said that before. >> an if you stay at the backrat, he's offered all of us a free continental breakfast. >> 50% off while we're closed. >> i thought that was a great thing, 250 years. glasgow, the manchester, this is an amazing call you're making. and i think so many people are gloomy. i thought this was a wake-up call, just a great job, barry. >> thank you. >> really fabulous. >> jim, we'll see you in 4:30 minutes. >> coming up in our last couple minutes, barry will sound off on

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undisciplined investing in the stock and bond market. >> i think in all asset classes investors are chasing performance and a lot of the hedge fund were 10,000 basis points behind the s&p. the biggest disparity in ages. i see a lot of people levering long. they're buying assets, levering because interest rates remain low everywhere and pricing is getting a little harder and harder. it's across the world people keep looking for their alpha, how they can -- and i see whether it's in the debt markets because we have a large mortgage company or the equity markets or the real estate markets people are stretching a little bit again. i worry the lessons of '07, '08 are not -- they look at a five-year history and don't see it. >> does that mean you've changed your behavior? >> we look for today as the probability of outcomes, right. i think what's the downside versus the upside. i think that curve if you were going to earn 20% returns is moving in. people are saying i like -- six

like you heard ash williams say, it's really a situation where investors are moving out of mortgages into anything and the chinese said to me we'd rather own -- we have enough of your paper. we would like to own your real assets. >> pleasure to be here. >> thank you. >> join us tomorrow. "squawk on the street" is next. ♪ good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. finally got that bounce in stocks yesterday and futures suggest it may hold, at least at the open. facebook is higher on some news, gm facing a big downgrade today. watch that ten-year. we'll get fed minutes this afternoon, mortgage apps and refis continue to get weaker and weaker. in europe, greece will return to the bond market tomorrow for the first time in four years.