>> good morning and welcome to "squawk box." i'm andrew ross sorkin along with joe kernan. becky quick is off this week. here's what's going on this week, several reports have been pushed to thursday since the markets are closed on friday for good friday. today we're getting citigroup around 8:00 a.m. eastern time. tomorrow, here's what is on the list, coca-cola, johnson & johnson, intel and yahoo! then on wednesday, bank of america, american express and ibm. on thursday, it's a huge day because blackstone, dupont, ge, morgan stanley, pepsico and many more on the calendar. i can't say it in one breath. here are the numbers for citigroup, the giant is expected to report a profit of $1.14 a share on revenue of $19.3 billion. we'll have the analysis and

people are looking for any comments on what is going on with the criminal probe in mexico. also, one piece of data on economic data today. the retail sales report from march is due out at 8:30 a.m. eastern time. and economists expect the rise of .8% following 8.3% advance in february. that's the corporate news. i think our good friend michelle caruso-cabrera, even though she's here we have more on the international news. >> a deadline for pro-russian militants have come and gone four hours ago. as a result, ukraine is threatening a full-scale anti-terrorist operation if the protesters refuse to leave. they also offered amnesty to protesters to lay down their arms, but anyone who supported violence would be punished. and this hour there are reports of another police station being seized by pro-russian forces in another part of eastern ukraine.

ukrainian security forces launch ed a plea and the group was reportedly involved in a firefight. this raises concern that is russia would use this as an excuse to invade eastern ukraine. so far the markets in russia are growing nervous with the mugs market falling again today another 2%, down now 3% as we continue to see capital flight out of that country. cnbc europe, julia child, we did an interview with the russian finance minister who said, there's been a lot of capital flight from the emerging market, so this is not anything special. worse than last year because of other things up related to this. check out the price of gold this morning higher by $5.50. and the energy sector we saw rise in the price of oil as well on this, particularly in brent, which has been up $3, back to $108, but it is 107.36 right now. >> the journal says that they

are well-equipped gunmen seizing these places and they appear to be russian special forces, but they are not in russian uniforms. they are in unmarked uniforms, but moscow denies they have anything. >> this morning they denied it. >> would they do that -- >> they don't that in crimea. >> would putin do that, send in special forces and look straight in the camera and at the same time says, don't mess with these guys because it could cause me to protect my people. >> i was at the imf meetings this weekend, and it is wildly believed what is happening is russian special forces against some kind of western european or u.s. special forces, but we basically have a proxy guerilla war fair going on in eastern cow yaip right now. there was a point where the special -- >> we have special force there is? >> somebody has special forces there, that somehow when the

russians were ousted, when the people who claim not to be russians were ousted at one point over the weekend, do you think it was the ukraine yians did that? >> i thought we had gone beyond this in 2014 of these types of moves and lying and not trusting -- this is like a cold war. that seems like really a underhanded sort of a way to do things. he's taking ukraine. >> eastern ukraine, yeah. >> there are bad people still in the world. >> yes. >> there are a lot of them. look what happened over the weekend. >> we don't seem to -- that's not a bad country, that's one person. >> you're saying there are entire bad countries in the world? >> i'm saying there are people in charge of bad countries, yeah. we need to be aware and still lead in the world instead of appeasing. that's my point. what's that got to do -- what are you talking about? >> you were saying there are bad people in the world and there

was a bad guy over the weekend with the shooting. you were talking bad people. >> i know. >> we are on sanctions watch, i think. the german spokesperson came out to say the foreign ministers are going to talk about whether or not we have reached the next threshhold of sanctions against russia. >> this next story may cost some angst with people but not me. the markets here at home have been under pressure. the futures at this hour are indicated lower with another sharp sell-off on friday. the dow fell 143 points. the s&p dropped nearly 1%. down 17 points to 18.50. so we are quite a bit below the close on december 31st. and the nasdaq is now back below 4000 dropping another 54 points. down more than 3% last week. we'll check the yield on the ten-year which has been going down. 2.62%. but the reason i'm not worried is because the lead story in the journal is money managers and

economists say that looking at things it doesn't suggest any problems. >> have you seen the cover of "beerends"? >> yeah. >> i thought i would check. >> the market and the overall economy don't suggest a bear is looming, but you know what? that's so consensus right now. they will know her or smell her. >> yes. >> that's why i am saying, don't you think that might be -- do you feel better? >> no. it's just that we never know what we don't know. >> there are weird things, too. the emerging markets rallied last week with spreads in the credit market tightening. it's been weird stuff. >> i tell you what, i go back and forth, but the ten-year falls in yield. the fed is going to except qe, although they are going to stay low. if you believe that any of the increase in the stockbroker over

the last three years has been because of qe and get out of qe and the economy does not improve as we expect it to. then you would assume if that was 10% to 20% of the depreciation due to the fed, assuming that they could juice the economy, if the economy doesn't cooperate, then why wouldn't you give back the 15% when ending que? >> i agree. >> and what my other point is if we are at 2.4% low up nation growth, and we don't ratchet it up to three, evaluations still aren't that control given how profitable shoes are. i'm not sure we need the community to cooperate. >> you would think the high growth momentum stocks may come down, but i think gm is up and running around trahe track.

some of the big solid nationals are coming down -- >> but nothing like that. >> have you seen the cover of "beerends"? we told you so. >> i'm more embarrassed for "the new york times." they put out the executive compensation. is it every quarter? but the very first paragraph, adding to the income disparity. then at the same time, you saw the 1% now pay how much in federal taxes in the top 20% as of 90. >> you recognize that's indicative of what the problem

is, right? >> if i follow your logic, the lower to middle class individuals should be paying more taxes, right? because if the top 20% pay 90% of all taxes, it is indicative of income disparity, then the counter to that would be that we want to see the bottom rise and paid for. >> he doesn't want the quality of taxes. >> we have a very progressive texas. >> arguably, i mean, there's a new study out. everybody is talking about it. >> the 20% is paying the 90%. that's not good enough or high enough or progressive enough? >> i don't know what the weather was in terms of what it will be. this represents a problem. your argument is if they paid the taxes it would change the system. >> no, i'm trying to get to the core you said if 20% are paying 90% of the problem with victim

disparity, then the counterpoint is if they are back, you will see lower and lower. >> it would be nice if you could get the bottom to come up. you would think they would have more taxes. we know it's the government's role to decide who makes what. we have to get more of that. time for the global market report with ross westgate standing by. i don't know whether we'll talk golf. did you get to watch it, ross? >> i did. when you have someone to hit drives like that, he's got a great short game, too. but i don't know how you beat bubba. he had a gap wedge and a number 13. and i think he hit that drive 360 or 370 yards. and that's's people take it for granted that he can do that, but when you swing with that much clubhead speed, if you're off like a tenth of a degree, your clubface can go so far right

here. >> he's like traveno, he's swinging the slices and the hooks. on 16, he was aiming out over the water and drew it back into the pin. >> you know what? he can't -- the thing with the drives, though, he fades his drive and is uncomfortable and that didn't shake out the way he wanted, but he could hook a three up there. he can draw a sandwich to win in 2012, but when someone wants that dominant, i am not looking for the best books. for a 20-year-old kid -- >> that was awesome to watch. >> and digging down deep. he kept pulling out great shots. that kid is fearless. >> he looks relaxed. >> and fearless to be on the stage lightning that. >> i was really impressed with

the chatting. outstand outstandi outstandinging, he was mad that didn't go in from like 40 yards to the right because he was still a gamer trying to win. anyway, i hope that without tiger, the ratings, i would like to see the ratings because there was no tiger or mickelson. but once again, where was ian? i don't know what happened to ian. graham went home, i think, didn't he? >> yeah, graham didn't make the cut. ian was 1 over or something, and rory -- he shot 69 or something. he had a great -- >> same as bubba. >> yeah, same as bubba. bubba had 74 on a day where he

hit every par 5 and re-putts head to on saturday just because he was lacking them. but you cannot fault hthey are all par 5s then. >> he had no problem with -- not even hitting irons in some of them, so i don't know what we need to do. we need to buy some land down near augusta and, i don't know, lengthen some holes. anyway, what's going on, ross? >> well, you can see there's a lot of red on the market. >> i thought we did a lot of green over the weekend. not so much this monday morning. you can see on the screen 8-1 with decline currently being outpaced by advances on the market a week or so ago. the ftse 100 was down with a

slight loss. this morning down .60%. we were down nearly a percent around 20 to 30 minutes ago. in russia, ukraine is down 1.5% this morning. break that down to sectors, this is how it plays out. plenty of red on the screen. basic resources up a quarter of a percent. food and beverages and household goods, resources is being help ed to sell their stock in peru. for a pretty hefty meeting of $6 billion, they agreed to sell its interest in the month prior to the merger because it was previously owned by glencore as well. a lot of comments out this weekend as well from ecb morgan. the head of the bank and france.

don't need a strong er inflatio rate. the euro/dollar is at $1.38. that's where we stand right now. let's go to yeukraine this morning with ayman. >> reporter: until 6:00 a.m. local time, they have time to prolibt their buildings. actually, they have run out of time. this attack was 45 minutes away. the protesters have been moved

in but very heavily open forced men are taking over government positions with their weapons, openfully brandishing them and ultimately barricading themselves in the building and taking control of the area surrounding it and the towns. now the ukrainian government says this is not an organic protest movement. but apparently rob says some forces on the ground are russian forces, but nevertheless, they take control of the building and to break away from the ukraine. the government in ukraine will regain controls of the territories it has lost. no indication of such an operation is gone. there was unfolding on the scene. it was a tension situation unfolding here. >> are people pro-russian? when you talk to the average person, give us a sense of what percentage of the people would like to be a part of russia and

part of ukraine? okay, we have lost ayman's mike. we have some of the top ceos after the break. and we'll have much more on the markets. check out the futures hold. it is six points higher with the nasdaq off as well. back in a moment.

"the new york times" releasing their 100 list over the weekend to look at the ceo pay. the largest companies by revenue. the list of the highest ceos regardless of company size will be published later this year. here with a look at the big pay and u.s.'s biggest firm is mary thompson. >> thank you, andrew. familiar names at the top of the list. legendary names in the world of media and technology, but we're going to start with number five on the list. that would be emerson electrics david farth with the biggest pay increase among 23 ceos. he has an impressive $260%le. follow i following the company, his firm

racked up a 47% shareholder return in 2013. a perennial on the highest paid list 21st century rupert fox. along with the third highest paid ceo, his salary of $8.1 million is among the largest in the top 100. disney's bob eiger is checking in at number two with $26.1 million. as the medium giant's return rose 21%. and topping the list, oracle ceo and founder, who saw voters pay no for two years in a row, they say last year they rose to $13.9 million with average revenue coming in unchanged at $14.6 million. one unnamed person is larry

page, co-founder and ceo of google. he was paid among the least at the companies with stocks and a dollar summary of $1.08. >> we need to talk a little bit on this. >> i just have a quick comment for mary. these numbers are for the largest revenue publicly traded revenue companies, but they don't also include things like private equity, so if you're you do that thing with 600 million in dividends he got. can we do a little more than $300 a day. obviously, your temper. mark zukenberg this year was up billions. >> well, not sour anyway, but a lot of money can be made in this

country. >> you can make a lot of money in the stock market, which is a great deal of the ceo's pay and among those in the top 1% agreeing to their love is strong. her movie, sandra bullock, $70 million on "gravity." if you are a lefty and can make the bottom fall out of -- if you have good stuff in terms of, you know, of heat and then you can also throw some off-speed stuff, you're probably worth $30 or $40 million a year. not to say that a guy with 300,000 employees and lots of shareholders is as important as a lefty. >> let me ask you a question, are these guys who operate --

>> hold on. didn't the founder versus -- >> dan, as an investor. david schwartz, they are all operators to some degree, but answer the question. >> the argument with ceos is they did not start the company and don't deserve a huge paycheck, but if you have a company that had a market cap of $5 million and become ceo and ten years later the market cap is $50le be, you didn't fund the company but added a lot of money for the shareholder value. >> i don't think the issue is when they perform well. >> i think there's a certain strain in the united states right now where even if they did perform well, it acts with just too much money. >> there will always be that element, i would suggest. i would say, though, they tend to come under fire when their

company does not perform well. >> and it also has to deal with companies are free to court, you know, great executives from other companies and it takes money to do that. >> and there's an argument with a limited pool of people talented enough to run these companies and therefore they take a cut in pay. >> but then there's over in europe where you feel like there's kind of the government backstop for myself. if you do well, you take a percentage of the company -- >> that's too week to penalize. what is it in france now? there's a cap and we have the guy on in davos who says, of course they should only make a million dollar. what is that? forget sock tan. he was talking to me and said i was the ugliest american he's

seen. >> you knew that. i didn't pick you to tell me that. you must be delicate to the french. thank you. >> you can wear those pants like they over there. >> i don't smoke cigarettes. >> you would like those comments, wouldn't you? >> if i was thin? yes. i would. >> you wouldn't want to hear that every morning? >> yes! >> so what more do you need? >> you're gorgeous and thing and beautiful, yes. coming up, the economic expectations for the euro zone. and what would the film be at the special auto show? we have a special guest on our way. heading to break, a look at chivalry. ♪

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becky quick is off and we have michelle caruso-cabrera here with us. >> we just had a conversation about economic equality in the markets. >> the ten-year, we'll check that out, 2.628. have not broken under 2.6. if you look at the chart on the right side, you can see that's a -- >> is the death cross still in place? >> i guess it's still in place, but it's managed to hold above those lows. and if you went back to october/november, you are down -- this looks significant. >> do you remember how great that was? you can draw right on there. >> i stopped using it. >> i loved the telestrator. >> you should go into weather. they do at lo of that. >> what about a little white board? >> you could draw right on the screen. circle this and look at this

part of the chart. it was helpful. >> you can do that with an ipad. >> if ipads can do it, why can't we do it on television? holly hunter in my ear says we can. >> not right now, though. let's keep going. citigroup checking in to earnings central. is it really a place called earning central, rob? what is that? jonathan wall still lives. earning central keeping america great. >> it was jeremy, wasn't it? >> anyway, this morning, the banking giant, the you're thinking of earnings central, do we have an earnings team or task force on this? >> a s.w.a.t. team. >> the giant is expected to report a profit of -- wait a minute. they have a s.w.a.t. team. they have an earnings central. this is the place to get earnings information because they have a place called earnings central. $1.14 a share with revenue of $19.3 billion. the number and instant analysis is coming up when it hits for citigroup.

a lot was written over the weekend on main street to be the place for banking. you know, wells fargo, in fact, i saw one person say that you could not have made a larger difference between wells fargo and jp more michig prks mopmorg played out. anyway, when we return, phil lebeau just flew in from the windy city. wow. when you put that in a teleprompter -- go back, let me read that better again. >> he just blew in. >> he just blew in from the windy city. anyway, he's in town for the auto show. next, the biggest issue facing the industry from gm's recall to tesla's industry battle. we'll return in just a minute. life with crohn's disease or ulcerative colitis

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the imac and the world bank held their annual spring meeting over the weekend. joining us is albert alberto alvarez from bank of america. alberto, we ran into each other over the weekend at meetings. >> good to see you, michelle, how are you? >> i'm good. what was the information on the big sell-off based on what you heard on the ground there? >> well, i think a couple of things surprised me regarding the views of emerging market investors at the meetings.

one was how positive they are about emerging markets, and particularly about money continuing to flow into the emerging markets this year. we had about 200 investors attending one of our conferences, and the majority thinks flows will continue to go back into fix income and equities. this is surprising given what we have seen not last week but over the past three to four months with weak investors coming out of e merging markets. the second thing surprising was how little concern they placed on geopolitical risks. those came out at the bottom of their concerns. that may be that they are concerned -- >> can we translate that to you cape? >> exactly. they don't believe ukraine is responsible for the rest of the emerging markets, and we need to see how bad the situation gets there. >> do you think it's wishful

thinking with money still flowing into the emerging markets? last week china was up by more than 3%. india up 1%. brazil was positive, too. we are looking at the big sell-off in u.s. equities, but at some point if u.s. interest rates ever start to rise, and now it feels like a big if, we don't we expect to see an outflow of capital? >> if you look his or the you cannily at what has happened with capital flows into the emerging markets and the period of fed tightening, what you find is no impact on direct investment. so no impact on the true long-term investment that goes into firms and machinery and equipment. and depending on how aggressive the fed is, you may see a border or two of portfolio outflows, but typically the level is moderate. as we all anticipate, the fed moves gradually, and over that period the european central bank and the boj are not tightening.

i would expect some moderation of flows but not outflows. >> alberto, good to see you this morning. thank you for joining us. >> you're very welcome. it is time now to get behind the wheel with phil lebeau onset with the biggest stories facing the industry right now. and one of them came last week. so should we view the ceo -- >> i'm messing up your papers. >> you are. let me just get these exactly like this. and i guess i need to put them over here. >> on top of mine? >> do we view mary berras's testimony after some of the disclosure that came out last week? >> i don't know if we view it differently. most of the people i talked to within the auto industry look to her testimony as one, miscalculated the level of venom as well as detailed questions coming, particularly on the

senate side. if you saw the testimony on wednesday, i mean, that was -- she looked like she was at the -- holed up behind the wall at the ranch with everyone giving shots to her, and she has no answers. and the answers she did provide, everyone knows she wants to wait for the internal review to be done, but you can't go to capitol hill to say that without getting slaughtered. >> in 2011, what did the documents say? >> the documents that came out released by the house energy and commerce committee, the one that got a lot of attention was that there was a memo regarding steering issues for the -- >> steering issues, not necessarily ignition, huh? >> not ignition but had to deal with the components turned off and the electrical components turned off, so they sent a memo to her and said this was not included in the cobalt case. we will be discussing and briefed later. there's no response from mary

barra and no report that says, quote, so there's no way to read into this other than a memo sent to her about the saturn ion later recalled that had steering issues. so that's why people are saying, seriously, you have no knowledge at all? at this point there's no proof she does have knowledge at all, but the documents did raise questions? >> and a few types i've said, so opening and basically installing ceos and mandating cafe center is when the government was basically in charge. there's no way this made its way up to anyone in the government. >> i don't think it would. i don't think it would. here's why. i think on a broad scale they were looking at the balance sheet and how to fix the problem. they were not looking at the major recall issues. there's no indication that he

did know or that mary barra knew. >> there's no responsibility for the government to say, what are our reliabilities here? >> that's a different question. >> then why wouldn't they have had that on? >> and richard blumenthal brought it up to say you cannot give these guys a shield. if you give them a shield, who knows how many millions of these vehicles are out on the road. what if this happens down the road? he brought that up and basically was shut down with other senators who brought it up because the idea was to push it threw, clean up the balance sheet. we don't need the bankruptcy barrier. >> i pushed back a little bit because i cover the whole situation. some individuals thought very granular during the whole process. >> not on the vehicles themselves, right? >> no, i why mean, they were talking about different scann s

scanners -- >> not only did they ditch that yesterday but there was a lot of -- >> there was a lot of granularitary in certain regards, not when it comes to the liabilities out there in terms of potential suits, which is why we said they will give them a shield. this will clean up the balance sheet, and there were a few people out there who were saying, lord only knows what is coming back to bite us years from now, and that's what we are seeing with this case. >> so regulators are tougher all of a sudden. it happened after toyota. >> stipl added up all the recal recalls.

you know stiffler's mom. >> would you like me to discuss the pool table? >> how about pie? >> it was not all gm, but i was saying for the industry. $9.4 million with 60% of the recalls in the first quarter for from general motors. >> how many cars do you buy in america in a quart her? >> if you are looking at $16 million and divide that by 4, 4 million. >> you are recalling more cars than what we sold. >> sure, but you're going back well over a dozen years. >> you did that fast. you're lucky. >> what? >> that was good. >> 16 and 4, because it goes into it evenly. >> and if you go to the 10 million months, then it is way more than -- >> absolutely. >> the chicago came out there, absolutely. >> a deep dish pizza, i want to bring it right here. >> what about an apple pie? >> right here.

>> you know what happened at band camp. so -- okay, that went too far. band camp, you know what happened at band camp. >> last summer at band camp? >> come on. that's so wrong. anyway, coming up, a world that wants to go paperless. how does a company with 150 years experience keep moving forward? the ceo of p.h. will tell us. and we've had a mixed picture all morning. back in a moment. weekdays are for rising to the challenge.

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beautiful shot of the capitol right there. i was there this weekend. the paper company is celebrating its 150th anniversary. they make the paper in k-cup coffee filters, books, stamps, as well as straight up paper. we will talk about it. now how to thrive in an increasingly paperless world, the ceo. congratulations on 150 years in the paper business. >> thank you. >> as we move out of the paper world, or go paperless, what percentage of your business now. sort of talking about the transformation, is straight up this kind of paper that i'm

holding compared to -- what do we call it? >> fiber engined materials. >> fiber based engineered materials. >> books, envelopes, business forms, greeting cards, playing cards, postage stamps. the last 10 years we have trip heed the size of the company over acquisition to our fiber engineered based materials business. it is the largest producer of filter paper for tea bags, single serve coffee, absorbent core materials into feminine products, swiffer mop. >> when do you say, object, this paper business not so hot. we have to transform ourselves.

>> this is my 17th year with the company. i was fortunate enough to be able to participate in formulating the strategy and develop a strategy that could evolve over time and not drag too much risk into our balance sheets. about 15 years ago we started. >> you are a 150-year-old company. i assume in the beginning people cooperate have been too happy about it. >> i think change for most people is scary. and there's no guarantee your strategy is going to work. we're fortunate that our people are resilient, committed, dedicated and very capable. >> you did mostly acquisitions, right? it is building it or paoeug it. buying it. >> our business is pretty capital intensive. for the investment of a greenfield facility, we felt the risk wasn't appropriate.

we would rather customer relationships and some brands we could leverage and build. >> and the markets that you were buying into. how decentralized was there. was it a good time to be doing a rollup? >> yes. the markets are small, nichy, tend to be regional. we were able to bring scale economy. >> you didn't end up having to displace a competitor? in most cases you were buying the business. if you're doing k-cups, who did you buy? >> the guy from the rolling stones has been on. he owns a tree farm. people stop printing, then my trees aren't profitable.

i regrow trees. if it's not profitable, i sell land and put up houses and we have fewer trees. >> i think there are two elements you have to think about. one, you have to accept reality. technology challenges, things evolve. but our industry is responsible. >> tell me about the swiffer. is it something that's put on the swiffer. >> we produce the raw material that proctor & gamble would use. >> what do they put on it? >> they have a proprietary technology they use. >> there is something put on the paper? there's a chemical on the paper? same with the absorb ept feminine hygiene things. >> the fluff pulp, the chemicals, and the technology to come up with something that meets -- >> does it have a bunch of

surface area to be absorbent. >> if you think about what it is being asked to do, it has to be able to collect particles on the floor, not scratch the floor. these are things we build into our raw material. >> how competitive is your business? do you have long-term contracts with p&g? >> all business is competitive. the nature of competition in your fiber based engineered materials is different because of the technical hurdles. but you have to have a compelling value propgz, you have to innovate. >> all your stuff is recyclable? >> the ability to recycle and reuse is important. not every single component. if you think in the united states our industry, 2012 reclaimed 65% of all that is

used. >> you're drinking tee right now. this paper is never going on to the internet. >> right. >> you need tea. >> you can't 3d print it. >> actually, we have a portfolio of technology where you can print on tea and coffee filter papers. some you can see a logo. others that the message or logo appears. >> there's a future for paper. >> there's always a future for paper. >> congratulations again. >> coming up, big questions for the fed as the market sits in rough waters. we'll break it down with your guest host drew mattis, strategists at rbc. i think an rbc golf tournament this week on "squawk box". eek os that are powered by the moon. ♪

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are the bulls in for another tough week. the market prepares for a wave of earnings from s&p 500 companies. >> adding more stress to an already nervous market. >> where to find safety during market turbulence. three stock picks from five star fund managers. "squawk box" begins right now. good morning and welcome to "squawk box" on cnbc. i'm joe kernen along with andrew ross sorkin. >> are you going to get a third name? >> no.

>> i'm going to change my name in personal life but keep the same one on air. >> people don't understand what's going on right now. >> i think they can figure it out. >> becky quick did not change her name. >> michelle caruso-cabrera. let's check out the futures. a little bit of a bounce after a rough week in not a great friday. if you were in the bond, the 10-year, i think you're up 15% this year or something. even though you were supposed to be -- it's the most hot materto material. i don't know how you take the other side of the trade. do you save it for the next five years? >> i started cnbc 15 years ago. the one consistent piece of advice has been whatever you do

don't buy the long end of the curve. why would you want to get paid only 6%, 5%. >> we're going to talk to these guys, our guest host, about what was happening. some people think the stock market gets sold first. people go into the bond. >> let's talk about earnings. we have a very big week coming up with earnings. more than 50 s&p companies expected to report the next four days. several reports have been pushed to thursday we should note because the market will be closed on good friday. we won't be here. today we get citi 8:00 a.m. tomorrow, coca-cola, johnson & johnson, yahoo!. bank of america, american express and ibm. and then on thursday, it is a huge, crazy morning. blackstone, dupont, ge, goldman sachs, morgan stanley, pepsico all on the calendar. for citi, the number to beat,

expected to earn $1.14 on $19.3 billion. we'll have the numbers on instant analysis and looking at comments related to a number of those probes involving citi group's mexico unit. >> so, andrew, tia creff, chief executive roger ferguson. >> what happened to him? >> remember him? buying na srnuveen. tiaa-cref. >> it used to be exclusively the teachers pension. now they do management for all kinds of pensions as well. >> so it's a little bit interesting that -- >> madison dearborn a clear exit from a seven-year-old investment. >> they need that, by the way. they have struggled.

>> yeah. nuveen had revenue from 2009. 6.25 billion from a billion dollar revenue company. largest ever by tiaa-cref. >> we will watch the other asset managers to see if they get a markup as well. it would have been nice to be in deal book before it happened. another missed opportunity. thanks, joe. i don't know. when are we going to get something before it comes on the wire. >> i think we had john donhue before the ebay guy. don't you remember? we brought you the scoop first right here on cnbc? >> 800 billion in management. >> ebay settlement with icahn. >> it's big. >> yeah. it's a lot. that adds up, a billion, after a

while. what's going on in ukraine? >> more unrest. armed militants to leave oupld buildings in eastern series of donetsk. ukraine threatened a full scare anti-terrorist occupation if protesters refuse to leave. and reports of another police station seized by forces. a dozen cities there have been buildings seized by pro-russia forces. russia denies having anything to do with the protests including they are well armed and not your typical kind of, you know, occupy wall street folks. they launched an operation to clear separatists from police headquarters in slovansk. they warped kiev against using any force. this raises concerns they would use this as an skhraous to invade ukraine.

markets growing nervous. 3% today. still down 3%. you can see if you look at what happened in late february, early march, the market has gotten hammered. putin's actions, crimea in particular, escalated. the price of gold has risen. a gain of $4. the energy sector, it wasn't above 108. now it's 107.53. >> joe, before we get to the next guest. apologies. you know who should have called us. >> ferguson. >> abdal. that's where he went. >> you're right. >> i was trying to remember who went. someone left and did go to nuveen. bob dahl. just a man. >> for the first nine months in

2013, customers pulled out $13.5 billion. that brought down their total. 71.8. so it's a company that has had a bit of a rocky road. maybe the idea is if we put it under the larger umbrella they will be better. >> okay. privatize -- yeah. because i remember there was a time when it traded. >> tiaa-cref? >> no, nuveen did. but it hasn't since -- scary -- since 2007. seven years. i was over here like -- you said it was important for madison dearborn. >> this is very important. >> that's why you said that? >> yes. >> is seven years -- >> that's a long time i would think. >> they will tell you they have long term. they would have pressed it much earlier. >> it worked. everything works given enough

time. given enough time, it works. >> time heals finances and broken hearts. >> seven years, they have owned it for seven years, does that mean they bought it at the top? >> 2007? pretty close. managing director on the ubs, jonathan gallub. and chief u.s. strategist and managing director, good morning. drew, i'll start with you. why has the 10-year rallied so much. >> i don't think it's responding to anything in the economy. you were just talking earlier about what's driving what. in this particular case. >> it seemed like the 10-year went first and equity market pulled after. >> it can always seem that way. i would look at it from what do you have going on in the world? really nothing good. you went through a whole list of things not all that great in the world. what's that going to do. a, affect the market.

b, it will get everyone who is risk averse. >> the first time you thought they would taper and they didn't because they were so afraid of what happened in the 10-year. it ran up from one-sixth or whatever. they got totally nervous. the 10-year was going to be a problem. the second time when they did taper, you said they weren't. at that point you were worried. now we are 50 basis points from where we were. that means nothing. that's why. >> it has nothing to do with the fed. >> when the fed said they were going to taper, rates shot up and they almost didn't do it. >> i blew the first call just like everyone else. i would readily admit it. i would say i didn't blow the call. the fed blew the move. the second time around, tpaopb. >> why do you say it means nothing now when it means so much then. >> at these level of rates of moving other directions isn't going to stimulate or hurt the economy. >> it doesn't indicate the economy isn't going to do 3%. we're still going to do 3% this

year. >> you're going to accelerate the second half of the year. it will be very healthy. second quarter, maybe you get a little hit. great wall street journal article about tax receipts. get the people nervous about spending they will pull back. worry about the second quarter a little bit. even though we're optimistic on that. the second half of the year or you're getting close enough to rate hikes. ceos are saying should i make the investment now or wait. understand that the clock is running. they're going to begin to invest. >> really? >> yes. >> we have had five years of 2%. at best. >> yeah. >> zero rates have helped keep the economy low. >> things are positive enough it's going to uptick from 2 to 3. >> we can see the hike coming. when your rate is at zero, everyone wants to get their cash

back as quickly as pobl. so dividends and buybacks are the key for getting the wealthy if you're a ceo paid in stock. now you will have rate hikes. so there's going to be competition. so people have to look for growth. they have to figure out ways to grow their businesses. >> it reminded me of oil prices to some extent. people worry when oil prices go down. that in itself should be stim active to an economy. i would say the same thing about rates. once it is at 2.6 you don't worry about housing anymore. you don't worry about slowing the economy. it should be good for the economy. >> if you told me we end at 2.6, it was disappointing year for the economy and the stock market. michelle started off the conversation, everyone believes that we are going to see a drift higher in yields. if it's not, that means something went wrong. >> then we're in the middle of something going wrong. >> i think drew alluded to it.

there's either a flight to safety. the 10-year didn't fall because of this rotation from tech. it fell when there were merging market concerns. it never recovered from that. so if it's a flight to safety, there's nothing wrong -- >> you disagree. you're being nice about it. you're agreeing with what he is saying. >> this to me as an equity guy is an important signal. for the last five years, the back half of the year, everyone said it was foggy to be better. it never materialized. my guess is everyone is expecting 3. it's not a disaster. you get 2.6, 2.7, 2.8. but it's a little bit softer. >> even 2.5, which is as profitable as corporations are. i don't think it's a slam dunk. >> if you told me 2.5. >> you would be out. >> that means absolutely no inflation. >> right. >> companies do not have enough confidence to do all the cap drew is spending.

profit margins are great because they continue to hold back. and you get a surprising earnings numbers. >> is that the selloff we saw last week, and is it over? >> i think the selloff is probably over. if you look at the economically sensitive stuff in the market, it's not really selling off. it's tech. it's biotech. how much -- if you actually count up how much of the market that is, 10%. the other 85% to 90% in s in perfectly fine shape. by the way, if you look at the growth rates on a lot of these stocks, especially in biotech, they are really attractive. guys will gobble some of this stuff up. >> the thing that makes ubs different, we see higher volatility is good for the economy and higher rates is good for the economy. >> if they ever come. >> the threat of them out there is different than the last couple of years. the fed is going to be on hold all next year as well. there's no incentive for anyone to do anything.

you remove the time value of money. >> just in terms of murphy's law and the way the world works, the feds should finally realize all that stuff we did, here we are at 2.25. it didn't really work. we're out. we have no more bullets. we were unable to do it. they're in effective. >> the panel decision this week is more important than jabbie owens. >> if you look at what the fed did to stop the bleeding, i think that we're all effective how the fed was to put a floor under the market in 2009. since then, all this money printing, probably a big zero. >> wow. all right. >> they're not going anywhere. >> there you go. you don't know you have a golf tournament? >> they the didn't invite me to play. >> rbc, hilton head. rbc spends a lot of money sponsoring the tournament. you should talk it up.

>> much more on the markets, including a deeper look at gold. and china's growth and other concerns of the market. a preview of very important numbers about to come out of bay skwrepbg in the coming days. cars are driven by people. they're why we innovate. they're who we protect. they're why we make life less complicated. it's about people. we are volvo of sweden.

welcome back to "squawk box". checking the futures right now, we have had a mixed picture earlier. we have green arrows. dow opening 32 points higher.

s&p up 3.5 points. nasdaq a little over 6 points. michelle. >> china's first quarter gdp released tomorrow. they are out with their own report ahead of that to forecast the future. leland miller, president of china beige book international. what happened on the first quarter of china? >> they are all saying bad things are happening in the economy because there is a slowdown. only transportation. didn't show an acceleration. >> there is all this above the actual gdp number. based on what you have seen forecast for a year they are running at a pace of what percentage gdp for the year? they are trying to target 7.5%. are they hitting it? >> the entire 7.5% debate is this bizarre side show.

i think the chinese government is putting themselves in a box by doing, if they are announcing 7.5%, they are announcing 7.2% unemployment, how do you not report 0.2 or 0.3 decline in the gdp when all of these things are happening. >> if you want to have any credibility. >> yeah. where is the credibility? >> i read about all kinds of stuff failing. trust products. they are letting a lot of things fail. how does that play out? we know we need to let things start to happen. they don't want to be too chinese to fail is the phrase. but that's coming at a cost. >> the cost is they are going to try to thread a needle, pick certain companies they will allowed to fail. others will bail out. they will talk about injecting risk in the system. they are not going to allow all out default. people will get parts of their

interest back. they will play it so they are not over -- >> can they manage that without being incredibly messy? >> is it in the as easy to run or second consequences. you end up with a slowdown. economies fall. >> we will see a slowdown. you can look at the gdp number and not believe it. we have seen it over a year now. we will continue to see it going forward. the important thing to look at is whether they are doing the restructuring and rebalancing. are you seeing geographic al rebalancing. >> are they? >> we are seeing very positive things as far as the way certain industries over time have been rebalancing. but as far as continuing to rely on stimulus. they are still doing that. >> that's the other headline. don't expect stimulus. every single leadership issue

has come out and said the best way is to reform. do you think they will detective desperate enough? >> a few weeks ago this wasn't the consensus. a few weeks ago they were writing articles about how it means more requirement. more stimulus is on the way. this is the way people have been trained to think. this is not what we are seeing on our data. they are accurate. they know they have to change on this. we have shown there is not a response to increase monetary stimulus. >> the international markets are the most exposure based on everything you have told us? >> any emerging market. you have south america, southeast asia. >> because of the connection to commodities? >> the commodities angle is going to be huge. >> good to see you. >> thank you. >> thank you. coming up, we'll talk about the big new auto show in new york. it kicks off this week. what will be the major themes and how much will the g.m. recall crisis dominate the headlines. and the markets are waiting on

citigroup. we'll have the numbers and instant reaction. more squawk coming up after this. this. ♪ [ banker ] sydney needed some financial guidance so she could take her dream to the next level. so we talked about her options. her valuable assets were staying. and selling her car wouldn't fly.

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she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪ amazon may be about to jump into the smartphone wars. the company has been

demonstrating versions of this phone to developers in its hometown seattle and san francisco. amazon could announce by july and begin shipping by the end of september. it will come with a screen capable of displaying seemingly 3d images, although you won't need any special glasses apparently. >> you can look right at it. if the screen is small enough, they have developed technology that has that 3d effect. but in tv it was a massive failure. >> but you have to wear the glasses. >> it was a spacial thing that upsets your stomach. >> why would you want 3d on a little tiny -- >> you might not. >> i interviewed james cameron once. he's really into it. he was talking about how if you are using word and you want six to eight pages backed up. for software technology on your

phone -- >> you are moving things around. >> he gets mixed up between his movies like avatar and the real world. he's kind of -- >> yeah? >> yeah. >> not a lot of science info from j.c. >> facebook want to be more than a social network. they want to provide financial services in the form of electronic money. it is weeks away from obtaining regulatory approval in ireland for a service that would allow them to store on facebook. the authorization comes from ireland central bank to become an e money institution to allow facebook to issue units of stored monetary value that represent a claim against the company. the e money would be valued throughout europe as a process known as passporting.

>> why wouldn't it work in the united states? >> because this is passporting money in europe. i don't know if the license allows you to effectively move dollars. >> you're saying it could come from europe to the united states. >> yeah. >> i will tell you when we return, we'll have a trading bug. we'll talk gold. and currencies after the latest tumble in yields. elds.

welcome back to "squawk box". citigroup set to report earnings in 30 minutes. expecting to come in at $1.14. $19.4 billion but be down 5% year after year. an hour away from market moving data. march retail sales will be released to economists they are expected to be up 0.8%.

in a battle of sequels, captain american, the winter soldier holding on to the top spot. captain america has $159 million. fox's rio 2 took in $39 million in its opening weekend. joe? >> i'm trying to figure out his super power. >> he doesn't have a super power. it is america. >> put him up against ban and he see what happens. >> you mean bane capital? tiaa-cref buying $6.25 nuveen investments.

the largest acquisition ever. >> ever. >> the transaction will create a firm with nearly $800 billion under management. moving tiaa-cref up the ranks of one of the biggest asset managers. >> it will do a little bit better than break even. >> all right. we have another monday morning mining deal to tell you about now. glencore xstrata sells las bambas. ♪ that's not la bamba. it is las bambas.

>> the ukraine. >> it's not ukraine anymore, guys. >> down markets are currencies and gold to the move. look at the euro. there's no reason for that. gold up 2.8. managing director on the pks and president and ceo at boston advisers. cathy, i kind of read your stuff and i don't know. i think you're right. the decline in u.s. yields making the dollar less attractive. and then investors are unimpressed by u.s. economic data. so the journey to 3% plus, we may hit a couple of, i don't know, detours. >> yeah. absolutely. as you said, every single piece of good u.s. data last week,

investors completely ignored. while we have high expectations for today's retail sales report, i'm not sure they are going to rally except we get nexus 1.5%. we just touched on the euro. i don't think it should be ignored. they tell us it is wearing thin. there is possible ecb easing took them back to the forefront. that's one of the reasons it is trading lower this morning. >> absolutely. $1.38 this morning. nobody is listening. >> welsh you know, i think there is this two-way pull that's happening between lower u.s. yield and a weaker euro. the key is, very little possibility we are going to get quantitative easing from the ecb. there's plenty other options at their disposal. they can narrow the rate. cut the refi rate.

and end s&p sterilization. they're not out of options. far from it. they continue to tell us $1.40 is where they don't want to see the euro. just a little bit of a dollar rally even if we have them stabilized at these levels. >> mike, on gold, horrible 2013. you figure that we're just sort of maybe in a resting state here until something gets bullish or more bearish. but you do point out you would be bullish if yellen blinked and was under pressure to taper the taper, right? >> yeah. gold is effectively an option on lousy central bank around the globe. central bank activity. whether it's qe in europe or china doing something surprising, i think people are using gold as a potential option. the real price in gold has

changed. particularly last year, joe. we had such a huge drawdown in etf holdings. think of all the etfs and folks that put gold in a vault. we're down over a third. just it's the first time since etfs for gold, physical asset holders of gold have actually had a significant drawdown. that was last year. we had a big retail trade and anywhere but u.s. equity kind of trade was a drawdown. and i think that's been through. we added to our gold in january. >> would it be the stock market continuing to sell off or would it be the bond market indicating that we weren't going to hit those -- that uptick in growth? >> i'll be a politician and say yes. >> certainly both of those things would add to that. i think the real issue would be -- there's all kinds of wild

cards, right. if europe becomes a little more entrenched with russia, you could see the economy slow down. the market would increase. if unemployment went the other direction. we start to weaken economically. political pressure would be strong, very, very high to stop the easing and to stop the taper rather to continue quantitative easing. >> we still have -- people think we finished already. a lot of money still going into. it's like guys in a row boat with a bunch of holes. 55 billion hasn't been enough. if that continues to go down, it's like we're trying to get the water out faster and faster. my fantasy is that she tapers the taper at some point which shows you we will play hotel california because you can check in but -- that would mean the fed is having trouble exiting. that would be a nightmare. they are committed to exit right now, right? >> that's exactly right.

people are worried about it. they have to get off the morphine. >> i don't see a real reason to taper the taper. this is exactly what they want to see. this is where it's working. as long as yields aren't reversing chorus, they will keep the current pace. >> it's indicating about -- that's where we have the discussion. what it is indicating when the 10-year has no business going down in yield right now. >> if qe is morphine, then maybe, you know, zero rate policy is methadone. so they can taper. in order for them to stop tapering, they need to really admit they screwed up. taking it to zero is pretty much a guarantee. the question is whether they get away from vero rate policy, which is probably the more relevant. >> i like the drug metaphor.

>> pot vending machines. awesome. in colorado. >> do they shoot it over the border? >> cathy, have you been on before? >> yeah, quite a few. not with you, though. >> thank you. >> talking about those machines. >> yeah, yeah, yeah. >> i was talking to people who went to a party in denver. nobody apparently drank. >> come on. >> they are 40, 50, 60-year-olds. nobody went to the bar. beforehand they -- >> people just sit on couches and look at each other or something? >> this is what was told to me. i don't know. >> the food bill was outlandish.

>> chips. >> brownies, guac. >> we have five star fund manager who thinks aflac can in sure your portfolio risk. and the new york auto show. trends, g.m. and tesla in just a bit. "squawk box" will be right back. . (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates. we did a 27-point inspection on your chevy,ce, you got new tires and our price match guarantee.

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welcome back. we have the top three picks. gannett, amgen, smead. >> it is technically not platinum but you are, bill. >> do they though know? how do they keep it straight? >> bill, welcome. why don't we go through the list. you can make the case.

where should we start? i'm a newspaper guy. tell me why this is a good deal. >> the first thing you're missing -- it's not the same newspaper company people thought of. 84 dailies are warren buffett's community newspapers that provide local sports, community news, community politics. as all the echo boomers, get married, have a family and need a car seat in the car will sell a lot of cars the next 40 years. 84 community newspapers are where auto dealers, retailers and other people will advertise to that group. >> does gannett stand alone or is it a takeover target? >> it's kind of funny. it's fun to speculate because we

are big fans of berkshire hathoway. with warren accepting a network affiliate television station in trade with graham holdings makes us feel good. he likes the tv station and community newspapers. what is there not to like about gannett? >> you made the case right there. let's talk about aflac. >> aflac. >> not ben affleck. ben of pledaffleck is a great a. >> and director. >> sorry. there was an uprising. >> aflac will be a huge beneficiary of the effort on the part of companies like ibm and walgreen's to go to employees and give them the money and send them to private exchanges.

as soon as people go to private exchanges they will raise the deductible level to get an acceptable monthly payment. as soon as deductibles move up, what happens is they will the go to supplemental health and pay them a certain amount per month to fill the holes in the deduct be will. if you go from $500 deductible to $1500 deductible to save money on health insurance, that voluntary choice on your human resources list of going to of black and supplementing that with $20, $30 a month to fill the hole in the deductibles is very attractive. >> give us your last pick a amgen. >> the recent correction which we think is healthy to get the froth out of the market. 83, 84 correction. they are throwing babies out with bath water. amgen trades at 14, 15 times earnings, spending 20% on r&d. raising dividends, buying back

stock. and they are treating them like some of the 60 times earnings stocks. >> the woogie? what is that. >> frothy, woogie, go-go stuff. >> got it. >> momentum plays. >> broadly speaking, you called it an 83, 84 correction. are you buying with both hands? >> well, we're always buying and we're always liking the companies that fit our criteria. in 83, 84, you have the largest population group, which was baby boomers. you were in the early stages of a long economic recovery period. it had a strong market in 82, 83. a 70% game led by small caps and conceptual tech named genentech and mci communications. the dow and the s&p corrected 8% to 10%. and laid the groundwork for

large cap outperformance over the following four years and, again, that was the culmination of nine years of outperformance from 74 to 83. >> back to aflac. they have a huge business in japan as well. do you care about that at all, if they finally get economics right and have some impact? would that also add to their business? >> the big negative is translating earnings back into dollars if the dollar strengthens dramatically. by the way, to go back to your prior conversation about the $1.38 euro, i've been to europe and asia a lot for our offshore fund the last couple of years. what you notice is i used the starbucks indicator not mcdonald's. i paid 5.1 euros for the drink that cost me $4.30 in the united states in both of those areas of the world. of course i'm paying 55% more for starbucks in europe and the

far east. the markets can stay irrational longer than you can stay solve ept. it makes our stocks even that much more attractive. >> thank you for joining us. >> thank you. >> we will see where all of these things line up. >> have you see jiggly, pearl harbor, armageddon. i hope he puts acting aside and runs for office. i think the country needs, i think the country needs -- >> yeah, i know. >> compared to zero dark 30 i thought it was a complete ulcer. >> how about goodwill hunting? >> that was when he was 16. >> daredevil. >> gigli.

armageddon. pearl harbor. how can you screw up a movie about pearl harbor, sorkin? daredevil. golden raspberry award. >> he needs to run for office. i think that's where -- >> you blame j-lo for his -- >> dragged him down. dragged him down. >> the biggest names in the auto industry. we will show the girl in this dress 10 times this morning. we will preview the new york auto show and the girl in the dress. dow opens roughly 38 points. s r. go! it's chaos out there. but the m-class sees in your blind spot... pulls you back into your lane...

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the new york international auto show kicks off this week. more than a million people are expected to hit the floor of the convention center. phil lebeau joins us now to tell us what to watch for. i would figure imitation draws a crowd. electric cars are going to be featured. they're not going to get the most attention. >> what is? >> two vehicles. one is the new camry. two years ago they came out the what they call the newest camry at the time. you know why it's important? >> no. >> best-selling car in the

country. they're under immense pressure from the luxury segment. if you're spending $31,000 on a car, would you rather a camry or 3 series? that doesn't mean people aren't buying camrys. you have to have more incentives. >> a ford is good looking. even a malibu. >> the grill in the front -- >> the fusion? >> yeah, the fusion. how much does that cost? >> i would have to go back and check. >> you told me a camry can go for 30,000. what's the bottom line mercedes? >> 29,000. but you're going into the 34, 35. >> i was not impressed with that car. you said you had two. >> the new alfa romeo. that's coming back to the u.s. what's interesting is they are not doing a big dog and pony show. you will start to be able to buy

this, the 4c later this year. it's interesting. it's a very unique approach they are taking, which is here it is. here's the alfa romeo. it hasn't been in the u.s. since the early '90s. >> as for most italian cars, do you need to buy two for one is in the -- >> i'm going to have sergio come on set. >> they make beautiful shoes that don't last. great suits. >> and they last. >> the cars, andrew. it's like the pope talking about -- >> he doesn't have a car. >> i'm impressed. it's cool looking too, the alfa romeo. >> absolutely. they need a luxury presence. you look at what fiat-chrysler has. luck schur is where you make your money in this industry. in the united states, thank god for jeep. it is leading the charge back

for them. they are picking up market share. hats off. a lot of people said they wouldn't be able to make it back. >> where is mary barra talking? >> conference. jd power has a conference. all the auto leaders. she will be talking tomorrow afternoon. >> do you expect anything to come from that. she speaks. a few questions. a scrum of reporters afterwards asking about questions. >> carl is not the moderator? >> no. >> what about tesla? do you have stuff to say about tesla? >> what do you think? should they be allowed to sell? >> yes. >> i agree. the agreement in ohio that is the blueprint we have seen used in new york. you will see it used in other states as well. where the dealers are saying we would lose if we went to court most likely. so let's contain it. let's limit them to a number of

dealerships for a number of years. >> strike a deal. >> yeah. >> did they pick texas yet? where will they build that plant? do we know that? >> still four stats. arizona, texas, nevada. >> and i want them to make it so they go further. they're close, though. >>er they are close. >> coming up -- thank you, phil. earnings on the shorter trading week. big names reporting and citi when we come back. when we come s for the climate. the conditions in new york state are great for business. new york is ranked #2 in the nation for new private sector job creation. and now it's even better because they've introduced startup new york - dozens of tax-free zones where businesses pay no taxes for ten years. you'll get a warm welcome in the new new york. see if your business qualifies at startupny.com

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if the by a third, they have a lot of tax carry forwards they were able to keep because they never declared bankruptcy. did they use 1.1 billion to let it flow? >> it actually says in the release, we deferred more than any other quarter since the crisis. >> is that good or is that even?

>> made the quarter. >> beat expectations. >> by sheltering. >> they got a good deal on it as it happened. >> right. >> because instead of if they have gone through normal bankruptcy you lose those, right? >> we should note michael says he is cognizant to see a return of capital. the fed says no dice on the dividends. the process of them -- of the fed determining what's going to happen. we're committed to bringing it to the highest possible standards. the fitting and institution of our global reach. i will dedicate whatever resources and make whatever change is necessary to achieve this critical goal. >> legal expenses $945 million. >> book value, $66.25. do we believe that? andrew, i guess it is what it is, right? it's calculated in a -- >> hard not to believe. >> way below book is where it

trades. >> the real question is what's happening with their lending activity, with their credit. commercial loans, mortgage businesses. that's way more important than whether they use a tax number. >> initially the stocks up on that. do you see any comments about fixed income trading or mortgage or any of that stuff? >> i don't see the revenue number yet. 20.1 billion. 19.366. this looks, unlike jpmorgan, they are at least above expectations. >> wouldn't we expect them to be less exposed because they do so much more commercial stuff? >> right. >> i don't know. >> around the world. >> not much of investment banking as jpmorgan. >> it will be a different situation. >> release of 673 million. fixed income, 3.85 million.

investment banking, 1.05 billion. >> that's good for, you know, the prospects of eventually. got a raw deal with not being able to move forward with their plans, right? >> i see nothing on mexico at the moment. a small amount of money. >> i know it's small but a large scale of fraud, right? when it comes to fraud, it's pretty huge. and you have to wonder about controls at that point when that kind of fraud can happen on such a large scale.

>> investors season kicks into high gear. senior fort folio specialist at the westwood funds. you maybe remember his boss, a member of the platinum portfolio year. and rbc capital markets chief u.s. strategist and managing director. good morning, everybody. we have had this debate on what happened in the stock market the last couple of weeks. was the selloff because the tech bubble had to run out and they had to lose some air and people rotated out of them? or we look at what's happening with the 10-year yield, does that tell us something is up with the economy and the selloff in the markets? >> we don't think anything is up with the economy. i think it is still growing as expected at a reasonable pace. what you are seeing is a reasonable reaction to the fed reduction of liquidity by

volatility in the market and by change of leadership out in the momentum stocks into higher quality stocks that can produce consistent earnings growth. you have seen value beat growth. it's hard to say there is something nefarious going on, sinister going on. we see it as a reaction fed's slow process of removing liquidity and the market reacting to that by focusing on companies that will perform better in that environment. >> you are assuming now the economy can handle things on its own after we see the fed take away the training wheels? >> we sure hope so. clearly the fed believes that. the economic indicators seem to believe that. it's been five years since the down turn in the economy and the market. we haven't seen it bounce back like we would have liked to have seen. clearly the fed has to remove stimulus at some point. they are seeing indications from the job market and the consumers

to take liquidity out. we're going to invest in companies that will do better and do well. companies with good fundamentals and visible earnings growth. >> we were just talking about citigroup. considering what we saw with jpmorgan and citigroup, do you like the financials? >> we do like the financials. we own some of the big names. nice the see wells fargo put up a big number last week. we like the smaller banks as well. they're the ones that don't have as much capital market. we are seeing good loan growth in some of the mid and small-sized banks. we also like the energy sector. you are going to have to see an increase in production four-fold to meet demand, particularly if there's a hot summer.

>> when interest rates go up, they are the single biggest beneficiary. everyone is concerned. let the banks get healthy. it will be good for the economy. >> if he's confident in the process and you bring up the short end of the kufpb, you're going to get relief from the banks on money funds that don't make any money at zero rate policy. so, you know, will she be able to truly reinflate the system overall? no. but does she make it better tore banks in particular, sure, it does. >> drew? >> we are saying you want cash heavy stocks. it dampens the volatility. they like health carement companies with a lot of cash on the balance sheet tend to do better.

>> david, what about technology. is there opportunity there or more of a selloff? >> we say there is opportunity in the higher quality companies. some of the high flyers that sold out that are trading at higher evaluations. what we want to see from the earnings season in particular is an indication of increasing cap x from corporations. i.t. spending. we do think -- >> that doesn't sound like facebook. >> it is not a company we would invest in all these levels. qualcomm is what we like. we think it will benefit for continued demand for wireless services. >> the number of companies with

a beg ratio, they are only expensive if you ignore the fact that the growth is going to be good. >> gentlemen, good to see you. thank you. thank you, david. drew and jonathan staying with us the rest of the show because they are guest hosts this morning. >> there's two drews. >> yeah. >> coming up, reaction. >> oh, you're right. >> i always wanted to be a drew. >> i'm just a nickname. >> with your permission, i will call you drew. >> he has more optionality in his name. we head to a break. check out the "squawk box" market indicator. we do have some green arrows. n . [ male announcer ] this is joe woods' first day of work.

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welcome back to "squawk box". dow opens higher by 71%. before citi's numbers, it would have been opened higher 38 points. so definitely a response to c i

citigroup, a dow component. >> joining us on break down the numbers is david hilder, banking analyst at drexler. good morning. >> good morning. the headline is citi's earnings are better than expected. consensus had been around $1.15. they reported $1.23. on an operating basis, $1.30. so i would say that's a clean beat. there was less revenue especially in fixed income trading, down 18% year over year. that was certainly expected and had been signaled. certainly to the capital level, citi -- sorry. this is perhaps too technical. on a leverage ratio, above 5% level they need. but the company is actually very fully capitalized and had a pretty good quarter.

>> is that going to help, hopefully, the fed, give them permission to get a dividend back on the table? >> well, my suspicion is that the fed probably had a pretty good idea what this quarter would look like. it was much more about the internal capital planning and models process. they want a more rigorous and detailed process. they made the same requirement frankly of jpmorgan and goldman a year ago. i would expect especially with gene mcquaid leading citi, they will do that. >> help us with one thing. joe had raised the issue. we reduced our deferred tax assets more than any other quarter since the crisis and held closer to break even. we were debating whether this means that's a good thing or bad thing. >> it is clearly a good thing. one of the problems citi has as a business right now is it is dragging around a certain amount of capital and assets that are

not terribly productive. not really producing earnings. the deferred tax asset being reduced is good. you reduce the deferred tax asset basically by having taxable income in the united states. that's what citi did in this quarter. they have cut the losses at citi holdings, which are the businesses targeted for sale or runoff down to $300 million in a quarter. a couple of years ago, citi was running a loss on a quarterly basis of a billion dollars a quarter. that's a real improvement. >> they were hoping there would be comments related to what's going on with the investigation. mexico unit. i don't see that. anything in there that i'm missing? >> well, you've probably had a chance to read more than i have. but i didn't see anything on that score either. frankly, i wouldn't really expect that. maybe there will be something on the conference call. but i think it's going to be a while before we get more details on that. it's obviously a very highly

legal process at this point. >> i know it's apples and oranges. but just looking at the banking sector broadly, given what happened with wells and now citi, how do they line up? we will hear from goldman and others later this week. >> wells had a strong quarter. i think citi is setting a more positive tone for the group by having a quarter that's above expectations. so i think a lot of negative sentiment on banks may turn around in the next few days. >> jpmorgan, is that a buy? >> jpmorgan is certainly a buy. i think analysts had just been a little too optimistic in terms of both trading and investment banking. those are clearly volatile businesses. they will bounce around quarter to quarter. jpmorgan is a very strong bank and i think the stock is undervalued today. >> and lastly, what does this

poretend for goldman when it comes to fixed income and trading? >> i think we are liking to see declines in fixed income revenues in the range of 15 to 20, maybe more than 20%. >> okay. david, thank you for helping us through these numbers. >> happy to do it. take care. >> city is not a dow component. it used to be. >> that's true. goldman is now dow component. >> my mistake. >> you didn't say it. >> i did. >> the dow could go higher based on citi. >> agreed. but i made the direct correlation that citi is in the dow. and it's not. >> do you know who? s? >> jpmorgan, goldman sachs. >> nike. >> yeah. gosh. >> that's a hard one to remember. >> they came in with goldman and visa. >> visa is another one. >> goldman. >> yeah. >> old habits.

>> axp still in there? >> who? >> american express. >> you do what you want. i like drew. drew is cool. you have andrew. you can call me ray, you can call me jay. you have ross. sorkin say much bigger name. people talk about him all the time. >> the brother. >> he's a huge deal. still to come, retail sales data. tensions in ukraine running high this morning. what's he do? what's worth having an eastern ukraine? >> manufacturing. they make tractors there. >> this guy takes what he wants. >> he doesn't ask permission. he doesn't even ask forgiveness. >> he just does it and pretends he doesn't. >> an update next on the situation. "squawk box" is coming right back. back.

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this morning at least 100 pro-russian separatists attacked the city of orlifka.

eamon? >> reporter: michelle, after that ultimatum was given by the government, separatists seem not to be heeding the warning from the government at all. separatists, as you mentioned, stormed another police station taking it under their control. now it's not yet clear who is behind these separatists, who is funding them, who is paying for them. but the u.s. and the ukrainian government are not holding back their punches. they are blaming russia. they say the way these attacks are happening across the eastern part of the country, they are too well coordinated, too well organized for them to be organically conducted on the ground. they believe russia is behind it. they are putting the blame squarely on moscow's shoulders. the government in ukraine has given the protesters and separatists an ultimatum. put down your weapons and leave these buildings. you will avoid being prosecuted and arrested. so far they have not addressed that physically. meaning the government has not

deployed any large scale military operations to try to regain some of the territories and buildings it has lost. meanwhile, russia says the order by the ukraine began government to launch a large scale operation is criminal. so there is a tense standoff unfolding and certainly one that has the ukrainian government in a bind. if they proceed with a crackdown to try and free these buildings with use of force, they run the risk of provoking russia to respond military. if they don't do anything, they will see more government buildings fall into the hands of pro-separatist militias. >> that's the corner i think they would want them to absolutely be in. tell us what's on the ground. does it feel like an area on the edge of civil war. are these isolated areas? when you walk around, what does it feel like on the ground? >> well, we have now been to several different cities where some of these incidents are happening. here in donetsk, a large city. much of the city behind me continues life as normal.

it is not necessarily tense. the main regional government building is still in the hands of the separatists who want a referendum and to break away from ukraine. we have traveled to smaller towns on the outskirts. in those areas it is a different scene. we have seen the separatists not only take control of a police station and government building but they have set up road blocks and check points going in and out of the towns to indicate they are now increasingly in control of not just a building or two but larger parts of the eastern part of the country. in addition to that, what we have seen, some men brandishing their weapons openly. many of them preparing molotov cocktails when they take over buildings. they are prepared to fight if they have to. so in those areas, the smaller towns, they remain very tense. many of them bracing for wider confrontation between the ukrainian government and the local militias in control in some areas. >> thank you, ayman. good to have you.

jonathan, how much are you paying attention to what's happening in ukraine and the portfolio? >> as a human being, a lot. from an investment perspective, this is a footnote over the course of the year. unless the u.s. or europe will seriously engage in this thing, which we are not going on. >> you mean militarily. >> even on the sanctions side, what impact will that have on the u.s. economy? nothing. so while this really matters on one level from a market perspective it's not an issue. >> it could end up boosting investment in the united states. we do have a lot of energy issues. there's been holdups in terms of boosting u.s. energy independence. if anything, this means if you're sitting at the top levels of the u.s. government you you have to think anything that encouragings u.s. independence is a good thing.

>> president owe bam? >> i would certainly think he does. >> i saw this at the imf. you don't think you're too complacent about the ripple effects of this gets larger? if they start to target financial, it is the fifth largest economy in the world. >> i think the u.s. is -- in particular, the u.s. tends to be much more insulated from the rest of the world than people would ever possibly imagine. one of the things we did at ubs is look at what we were most exposed to in our ability to export. china was fourth, right? it's actually -- >> even though it is first in our minds. >> it is first in your minds. latin america matters most to the united states. it is very much impacted by china. but we have these buffers before we enter the u.s. because it is such an ancillary economy. >> are we going to see more ukraines elsewhere in the world as a u.s. as a policy to pull back on the world stage.

if whether it's asia or the middle east, i think it's an issue. >> we have retail sales numbers. they would know how to make a molotov cocktail over there, right? you know what it is named for? a soviet foreign minister back in 1939, a derisive term. they said the bombs they were dropping were bread baskets. we. cars are driven by people. they're why we innovate. we. they're who we protect. they're why we make life less complicated. it's about people.

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welcome back to "squawk box". you're looking at march retail sales. up 1.1. that is the headline number. a bit better than expectations. let's go through all the internals. take out autos. drops a little bit to up 0.7. take out autos and gas. it remains 1%. they have something now called a control group. so if you want to squeeze it altogether in an easy box. we live in an easy box society, it would be up 0.8%. subtle revisions. autos and gas up to 0.4.

it's firm retail sales given expectations. since it is march, it absorbs some of the weather. if you were looking for some impact to help the numbers stabilize more than our last look from february, then it did occur. if you look at yields, they reflect that. we're up a couple of basis points from 263 to 265 in a 10-year. it pretty much remains in a lower end of a range. remember, the lowest yield close for the year was february 3rd at 258. we did get close to that level last week. we continued to look at positive openings in the equities. futures are trading positive. there's where your basis points are coming from. if we are down 60s i doubt it would have this impact. >> we were 2.53 as recently as

february. >> 2.58. >> it did have a 2.5 handle. so, rick, when you worry about fridays lead to go mondays, so far so good. if you're bullish, so far so good. this has been a good stand and retail sales helped to add a little bit of momentum. even equities. if you're worried about the 10-year going down, it helped there as well. maybe we will make a stand in the equity markets, do you think? >> i think it's possible. first of all, joe, i think we need to change all our qualifiers. it's not about worrying. it's about being realistic. i know consumers and people watching have this proity, america has a propensity to work for the upside of stocks. i get it. it makes perfect sense. you need to just acknowledge it is what arms you. neutralize your portfolio. go short. prices go up, be aggressive.

whether it's options, direct ownership. but right now it certainly seems to me you could make a very good argument looking at 2014 versus 2013 that it's not going to be a clean sailing ride for the secretaries. it hasn't been. i don't suspect it will be. and i think for all the blatherring and blithering, you can't retkpaeupb gses without having uncle sam on the hook. that's what the mark is grappling with. >> i wonder what the real number for how much the fed influenced equity prices. whether 10, 15, 20, 0. if they're on their way out, that removes whatever that boost was theoretically if the economy doesn't improve. we don't know. that's the problem.

>> we really don't know. joe, it's possible if the fed didn't have all these issues and it was much more certainty and kind of free market underpinnings to the economy, maybe things align just perfect to where they are now. i can't look you in the camera and say one way or the other. >> because we don't know. thanks, rick. we're joined by chris, isi vice chairman and head of global central bank strategy. also former executive vice president of the new york fed. our guest hosts continue, drew and jonathan gallub is here as well. do you have an answer for me? do you think it's a tangible number that the fed orchestrated equity prices being above where they would be otherwise? >> it's very, very hard to put a precise number on this. but look, there is no question that one of the ways in which the fed policy aimed to boost the economy was by lowering those long-term interest rates,

lowering the discount rate for stocks and pushing up the value of equities to create net worth and support consumption. that's been part of the fed's game all along. >> the only thing that worries me is that -- so they did all that. if we don't get a boost in consumption, we were doing that just to sort of run in place. we needed it to stay where we were. that's worrisome, isn't it? it seems structurally wrong we can't do it without training wheels. >> i don't disagree with you that the underlying strength has been pretty disappointing, including after we came out of the reception. look, in the last year or so, remember, we had a lot of fiscal drag. the fed's hope is as taxes aren't going up, the government is not cutting back on spending as it was yesterday. it is going to win through. growth will transition up to about 2.5, 3% this year. >> chris, is the market reacting

to the 55 million still part of qe, or has it been terminally priced and we assume we're on our way out, so the market is not being boosted by that anymore? >> i think the market has already adjusted to what looks like a pretty certain guide path for wrapping up qe. but i think the really important piece is what's happening to rates. with the 10-year still range bound. as you were saying a moment ago at very low levels. expectations on the short rates, rates are not going to go up until the second half of next year. when they do, they will go up gradually. that's the real game right now. as long as those rates stay low, equities will have considerable support. >> what do you think the game is for the ecb? mario draghi saying it's going to 1.38. will they stick with negative interest rates and when?

>> my sense of it is as follows. look, they are very close, in my view, to doing additional easing. in the first instance it would take the form of a negative deposit rate. interesting move. never tried before by a major central bank. tax bank reference. try to stimulate lending within the eurozone. the hurdle is still quite high. on the one hand, all policymakers has to be on the table. but to get there, they are going to need a significant downward revision to their estimate where inflation is going the next few years. on the other side, on a separate track, they are keen on trying to jump start a market. >> securities market. >> that's right. absolutely. >> which is what you have here but they have very little. >> yeah. it would be very helpful to them. the banks aren't lending enough. you can increase supply of credit to businesses.

>> how much are you worried about whether or not the european banks are going to be affected by any kind of sanctions that we impose on russia financially speak something do you think the ecb is keeping an eye on that? >> no question in the front line or any intense fiction of the sanctions war with russia. obviously we focus mostly on the energy connections. it is true banks would need to cut back some of their ties. from the ecb, the principal question is if we really get deep into economic sanctions. because of our sanctions, energy supplies get caught off. >> so you think that the fed was successful in making the consumer feel a little bit better from the wealth effect or whatever? >> i do. >> so what's wrong with

corporate america if they are seeing the consumer demand more stuff, when do they start hiring and expanding and playing ball, or does that ever happen? >> look, there's no question that a lot of people still feel quite burned by what happened in recent years. not just in terms of the economy but also in terms of their access to bank credit or even capital market in some substances being cut off when they needed it the most. companies will be cautious for some years to come. with that said, i do expect to see a little bit more animal spirits come through. both as we see the underlying strength in the consumer. but also as we get less monkeying around on the fiscal side. >> what can we watch to see -- when we saw jpmorgan and some of the other banks, commercial loans aren't really going up. is there anything else we can watch to see if it's thawing a little bit? >> well, you're right to be looking at the loans, no

question. obviously looking at capital goods orders, the usual things, leading indicators of investment intentions. if you and i would agree about the uncertainty about tax policy, uncertainty whether it would pay its debts on time, if that was part of the problem, that's dropping away and we ought to expect in my view some modest acceleration in corporate hiring investment. >> do you think there's a structural down shift in the economy? >> look, i think we have to get used to a lower trend growth rate than we were used to. population, labor force isn't growing as fast as it was. productivity numbers will be bouncing around some. they haven't been as great as we were hoping when we came out of the recession. i'm expecting the trend growth in the u.s. is between 2 and 2.25. that doesn't mean we can't have a few years of growing closer to

3% as we catch up and use the spare capacity and put it back to work. >> you might become a market master here. >> here's hoping. >> we have an opening in the g. somebody has to die or leave. we may have an opening in the g for you. >> can't be in the platinum portfolio. >> the market masters is more important. we appreciate it. thanks, chris. >> thank you guys. take care. pay for performance. we've got new numbers on how the nation's top ceos stack up against the highest paid athletes. tiaa-cref to buy nuvveen for $6.25 billion. it would create a firm with 800 billion moving them up the ranks of the biggest money managers. s.

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welcome back to "squawk box". futures right now suggesting we would have a positive open. the dow would open higher by 96 points. a real boost when citigroup reported an adjusted $1.30. $20.1 billion versus an estimate of $19.4 billion. everyone though it's not a dow component, it seemed to give a lift to the overall market. >> financial times reporting that the company is readying

itself to perform in the form of electronic money. a service would allow users to store money on facebook and use it to pay and exchange money with others. ireland central bank to become an emoney institution. it would be valid throughout europe by a process known as passporting. we were talking earlier whether it would be valid in the u.s. and whether facebook is trying to become a pay pal. and you were saying you thought it was -- >> hong kong monetary authority. >> los angeles the dollars are real there, they're real everywhere. >> as long as there is a stored area where they have dollars you can issue against it. >> it is not a bitcoin, though? >> exactly. >> why not? >> because it's backed by the

dollar somewhere presumably. >> see, uncle sam backs our dollar. uncle mark, he can back things, can't he? $40 billion? >> it's all paper money stock. so is the fed. so there. >> i would take all that paper money. >> he's not 30, is he? >> i don't think he's 30 yet. >> i just hate him. >> okay. come on. >> coming up. jim cramer will join us from the new york stock exchange. preview of the week ahead. and pay for performance. which pay for performance stacks up to the world's best athletes. we will bring you the results in just a bit. tdd#: 1-800-345-2550 trading inspires your life. tdd#: 1-800-345-2550 life inspires your trading. tdd#: 1-800-345-2550 where others see fads... tdd#: 1-800-345-2550 ...you see opportunities. tdd#: 1-800-345-2550 at schwab, we're here to help tdd#: 1-800-345-2550 turn inspiration into action.

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jim cramer joins us now. friday and thursday were both scary. monday could have been scary. it looks okay, though. is this going to hold up and increase? do you think we're sort of through this short-term or intermediate term pullback? do you think we make a stand and go higher or sell off as the day

progresses? >> we need to see interest rates continue to go higher. we had such strong data. rates plummeted, which means there's think there is a lot ofe worried about you craven, i don't blame people. when european markets opened up, they opened up horribly. it's great to see our sales knew something we are trading off europe and the bonds, not our own economy which i never liked, it means the market is reflecting a level of fear, which i think is wrong. >> you got this guy, so he sends, theoreticallilet say, for example, he sends these special forces in, they're not in uniforms, they're in like dark, they got weapons, take over police stations. then he says, you better not do anything, he's asking them.

>> they're protesters. >> to try to push him out. then he has to protect these pro russian people. when you got a guy that sort of looks this cunning and calculating, do we care he's running one of the former superpowers? it seems a little scary, or does it? >> no, we have to care about it. i think the germans remember. i hate to invoke hitler. >> they remember. >> they remember chechoslovakia. >> they seem to be sort of, you know, they're afraid he's going to turn off the heat? >> yes. i think that's one of the reasons why ridiculously a lot of our natural gas prices went up. i think people think we can ship it over there. the guy behind the biggest shanear, no one will be shipping to europe before 2018, buying those stocks makes no sense,

ukraine is in control here. right now, ukraine had europe dropping badly, somehow, europe's come back and maybe our interest rates go higher in that, i know it sounds weird, that would move our market higher. >> which is not the way it always was. did you like the citigroup in your trust right now, do you own it? >> no, i was surprised to see how strong their earnings were, they're oodles of capital. i have to believe at a certain point they will be behind them. i really like the fact and the margin was up two basis points. na does matter. a lot of others aren't going to do as well. this was a clean quarter with revenues not that great. the earnings seem to be much better than i to the. lending up .7%. >> maybe they got the right guy. >> i think michael is trying. i think he got a bad hand. i think some of the international issues you talked about are going to dog them. city holdings, we can pull the balance sheet back on real soon.

city holdings is doing real well. i look at it and say maybe they were overly punished. it should go their way. i don't know when they can come back. i think that's something i can hear about in the fall. >> michelle. >> all right, coming up, both are paid millions to do their jobs. find out which athletes stack up to the highest paid corporate executives and whether or not they are worth the money. "squawk box" will be right back. . it works how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review. today is monday today, we greet you. treat you. care for you. today, you can come to cleveland clinic

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welcome back to "squawk box." earlier this morning, we showed you the largest companies by revenue. the new york times got the list over the week. mary thompson is now back to show us a ceo stacks up compared to the highest paid athletes. another conversation we have around this table often. >> yes, let's go over the highest athletes and the highest ceos. the highest paid athlete is tiger woods not playing because of his back surgery. he made $781 million. larry oracle topped him at $748 million the founder of the software company. here's where it gets interesting. there is a huge drop in eceo

pay. that's the difference between ellison and bob eiger from disney, only $3478 separates tennis champion roger federer from tiger. now, at the number 3 spot for the athletes, nba star kobe bryant making $62 million. that's $36 million more than the third highest paid ceo of the largest 100 company, runner murdock who made $26.1 million. murdock is making less thanning soar legend david beckham who makes about $47 million, mostly in endorsements. most of the athletes make their money in endorsements and pro basketball player derrick rose from the chicago bulls made more than $37 million, even though he didn't play one game in the 2012 and 2013 injuries. i think he played one last 84 due to injuries. so, a lot of people say, look at

this. i tend to think it's compareing apples to oranges. i do not think it's the same thing t.ceo tends to run a company made up of hundreds of thousands, maybe thousands of people. but the effort, ultimately is of all the people. whereas an athlete is a smaller group of people. they make money off their endorse:s. they are selling their own louisville brand for. thank you, mary. i'm with you. i go back to the same issue i calls u always talk about. i believe there is a competitive mark for athletes. it's defined, you can see it. i don't believe there is a competitive market with ceos and manage vpts that's visible. >> why not? >> traditionally, you can't see it. i think when you look at a board of director's hiring opresident or a ceo, the controversy is not what is the least amount of money i can offer this person to incentivize them to work hard, come here, stay here. that's not the conversation. that's how we hire employees.

frankly, that's even how a sports team might hire a athlete, it's not how we hire and compensate senior executives. >> i i think there is a lot of discussion in the board room. they have to pay these comps in front of them. well, so and so all got paid this much. but those -- those conversations go on the sports teams as well. athletes use that leverage as well when they're negotiateling tear contracts. the big difference in the ceo pay and athlete's pay are the endorsems they receive on top of whatever tear salary is. >> that's a part of it. what i'm arguing is, we all talk about a free market. i believe at the board level, you talk about coney capitalism. >> up to the point, i would say just because that's where we are. that's the status quo that that's enough of a market to show you that there's

competition elsewhere for a person's services because no one likes to pay more than they have to. it's not the world we live. >> that's when they try to grow them at home. >> look at the guys you have here. they've created wealth. >> absolutely. thank you, jonathan, thank you, drew. >> see everybody tomorrow. "squawk" in the street begins right now. [ music playing [ music playing ] >> good monday morning. i hope you had a great weekend. welcome to "squawk" in the street. i'm here with jim cramer, from the new york stock exchange. earnings season kicks into high gear. 50 s&p companies posting numbers. futures are up for a change after retail sales had their best print in 18 months. ten-year yields stop flirting for now. yellin gives a big speech on wednesday, a