this is nice. i'm jim canner to. they've positioned me outside here. you can see the effects of climate change. it's april in new jersey right now. we want to thank jim paulson for spending the morning with us. and make sure you join us tomorrow, "squawk on the street" is next. ♪ >> good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. looking for some stability after that roller coaster ride in the markets yesterday, that 145-point bounce in the dow in the last 45 minutes. futures are mild here as we get earnings from coke, j&j and others. ten-year right around 2.65. cpi was in line this morning. empire manufacturing weak again. europe is mixed but check out gold, down $35 today. at the lows of the session.

this is the worst day for gold so far since the day of the taper last year. in our road map, sales of coca-cola beat expectations driven by strong numbers out of china. cnbc's exes cluesive with the ceo of coke on earnings, activism and diet soda. >> johnson & johnson moved the stock higher, j&j ups its forecast for 2014. profit rises as drug sales soar. >> end of the 20-year ceo, the journal's say jeff immelt may end his tenure early and a message for ge's next executive. >> starting now for one day only google glass goes on sale supplies are limited but will we actually see any demand. the price tag $1500. >> first up, stocks on track to open higher following yesterday's rally saw the dow close with the 146-point gain and the nasdaq up 23 for the day. the session did not end without some drama. stocks lost a big chunk of their gains in the final hour and that did send the nasdaq into

negative territory for a short period before heading back into rally mode. it is a tuesday, jim, market's been up 12 of 14 tuesdays. if you took out tuesdays from this year, we'd be down 8% on the s&p. >> are you kidding? >> yeah. >> great stat. >> wow. >> it really is turn around people when people call it -- tuesday when people call it that. >> not sure what it means. >> i like the fact that gold is down. ukraine always front and center in the newspaper so you feel like whenever you see the headlines that europe will sell off they didn't. that was positive. i'm looking at j&j which we know is a company i revere. coca-cola a company i didn't expect this fantastic number. it was fantastic. so if earnings matter, coke, and j&j, say the futures should be higher. >> talking again, talking to people who were making investment decisions every day, tough to put capital to work because things are moving all over the map and you don't have great deal of confidence. >> yes. i mean yesterday, i thought there was a program. like when you see -- i say a

program people at home get confused. there are people who have a motivated sell program, meaning they have to get out. and when the market was up, they started drilling the market as we got closer to 3:30 they excel ray rated their service. led by biotech. btk broke down. 3:30 the program is finished. finished. the market lifts. it's almost as if it weren't for a program you would have had a really big day. people have to keep track of the fact that's forced selling with short sellers knowing the program, running ahead, high frequency traders knowing the program, running ahead, causing a disconcerting decline which then makes people feel i don't want to play in this rigged game. this was a michael lewis day. i thought it was rigged yesterday. >> we have the larger backdrop of the last few weeks as well which add to trepidation on the part of somebody looking to put capital to work given the losses. again, at least amongst a small

sampling of people. >> feel like a sucker, go in buy these biotechs up like now. every time that's happened, maybe today is different but every time you buy gilead up a buck, a guy that comes in and slams gilead or btk at the close and you look like a moron and you ought to stop doing that. maybe today it's up a dollar and listen it's up three, but i think it hasn't worked. since this market rolled over has been a true sin and dumber than wood. >> it's hard to be dumber than wood. >> it is hard to be dumber than wood. orion stran board -- >> lumber liquidators have a dumb wood section. >> they have the dumbest wood there is frankly. >> good point. >> thank you. >> ul ta salon is the -- today someone reiterates -- high growth companies the analysts won't stop. used to be hh greg. i don't know if you saw their numbers today. consumer hardware company. i'm trying to figure out how

they could be worse but i don't think they can be, down 22%. >> let's move from the markets to coca-cola. jim mentioned it. give you more. it reported first quarter operating earnings. 44 cents a share in line with wall street estimates. global unit exceeded forecasts. coke's ceo muhtar kent spoke about his company's results earlier on "squawk box." >> we're beginning to begin -- get our momentum back here in the beginning of 2014 so we've grown our volume 2% in this past quarter. it's the smallest quarter of the year. but we're very pleased that we have been able to gain 2% on volume, also 2% on currency neutral structurally adjusted revenues and operating income growth of 7%. those numbers on a currency neutral basis. >> 2% volume growth. momentum i would assume is one of the more important things you heard him say. momentum. >> one of the things that people have to understand this is a

company where they've been telling you if we get the right marketing effort, remember they've been saying that, it works. listen to this, on the performance highlights, we saw china plus 12, brazil up 4, both accelerating due to should have been because of, due to strong marketing campaign centering around holiday programming and world cup. you put money behind it, the g dogs drink it. always been this idea and we talk about it off camera, i don't drink it anymore. >> no. a big piece in "usa today" about i don't know if you've seen these new vending machines calling them freestyle but it's one that sort of serves 150 different kinds of soda, trying to get some buzz back into the soda business these days. there's a look at the story. the money section. europe volume down 4, soda there down 5. >> emerging, you know, the more developed the market the more they know that soda is not great for you is what i think that is. our friend jim stewart comes on friday, he wrote a piece saying

that as the american market goes these emerging marketses will ultimately. i think there is a sense, they tried to talk to muhtar kent on squawk in the morning saying listen, people don't trust asper tame and he has a thousand studies saying it's fine. they talked about steve ya and whether it's the way to go, the natural sweetener but there's an overall sense in our country these things lead whether you like it or not, component that leads to disease. it's not healthy and natural and i thought that the code for the whole piece, we grew worldwide still at 8% for the quarter. they can make very little money on that but they have juices, juice drinks. i would like to see a breakdown. don't know if you caught a breakdown yet of their orange juice versus pepco. but nelson felt they're running rings around pepsico, when it comes to minute maid. >> pretty good surprising stats. u.s. flat but pricing up 2. what's behind that?

>> it's still water and sugar doing pretty well. i was surprised. good number. good number. >> yeah. >> and the pressure is going to be on pepsi to match it. >> i think it is when they report thursday. i know pepsico has been doing better lately, stock up from 80 to 83. a lot feel that is because peltz will throw down the gauntlet if they don't deliver a good number. this raises the bar for pepsico. >> you believe it does so? >> i do. i was surprised i had been saying i don't think they could reaccelerate growth if they spend more money but looks like they did. north america accelerated median investment, sochi, winter olympics and super bowl. >> always the 4 x head wind. talking strong dollar, one reason earnings were down 7%. >> i think that makes sense. j&j had a similar problem. >> yep. i guess speaking on j&j. >> the medical conglomerate did report 154, beat forecasts, dow getting a boost from strong

sales of new prescription drugs. raising their full year guidance, increasing the range by about a nickel. and pharma sales up 11, despite the negative currency. >> double digit growth of 10.8 they reported because of currency. one of the reasons i think this is important because alex gorske had lowered the bar, and people when he reported last -- looks like now he's under promised, clearly over delivered and people are liking the stock. a key downgrade a firm said they thought it was going to be disappointi disappointing. a short based developed in the name when the market was up and scrambling to cover. >> you don't mind when companies set a low bar, they can beat down the road. how do we square that between an earnings season that is weak, guidance is weak for a reason? >> i think you've got to look at the revenue growth here and if you get revenue growth that's double digit then i think that people get excited anyway. you're right. one of the things that i think that we're all -- look, tell you, take citi. citi the bar was set low by wall

street. and it blew the bar away. jpmorgan, i felt the bar was set high by jpmorgan. and that stock is almost down 10%. >> although to be fair they did take fick down. >> didn't tell us about credit cards, mortgages. >> and ended up being worse. >> they made me feel very sanguine going into the quarter about the nonfixed income and now i feel like i've got mcmuffin on my face. that stock sliced through 100. >> yeah. it's funny we talk about all these stocks. dividend yield has been important. coke at 3.15, pepsi about 2.72 and so is j&j, yield of 2.72%. >> mcdonald's 3.3. no one is questioning that yield. >> all above the ten year. >> goldman throws in the towel and says they like this, you know, the personal care stocks. they've been -- they still hate kimberly which has been an unbelievable performer. sort of loved kimberly. but they -- at the end of the day they like estee lauder. i don't know.

goldman used to be the ax on these names and clearly not anymore. >> bernstein does take it to an outperform, price target to 57 from 52. >> i love that. >> increased confidence on basically remedying the stress tests, the results with the fed, increased return capital over the rest of the course of the year, although they say patience will be required. >> right. because i think that's really patience on the fed's -- you have to -- the authorities wheels turn slowly. corbett did deliver a good number. the long growth plus seven -- hey, listen i've been critical. >> i like when you personalize an entire company around one person. corbett and gorske did it all. muhtar kent. i like that. these are organizations with hundreds of thousands of employees but one guy. >> pete carroll and richard sherman delivered. >> pete carroll delivered. >> you're right. i'm making them into nfl coaches and there are teams and the really great -- don't come on and say i did this and that.

like to personalize it. it's more to me like a ceo's incredibly important. general electric, for instance, the ceo is important. >> and we're going to talk about that. >> we are. >> we are? >> big piece in the journal, speculation immelt's tenure as ge's ceo may end sooner than expected. we'll get to that after the break. exclusive with hayman capital kyle bass defending gm despite fallout from the company's recall crisis. take one more look at futures this morning as we said, up 12 of 14 tuesdays. we'll see if it happens again today. more "squawk on the street" from post nine in a moment. ine in a . predicting the future is a pretty difficult thing to do. but, manufacturing in the united states means advanced technology. we learned that technology allows us to be craft oriented. no one's losing their job. there's no beer robot that has suddenly chased them out. the technology is actually creating new jobs. siemens designed and built the right tools and resources

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♪ "wall street journal" saying general electric ceo jeff immelt may give up leadership of the company sooner than his 20-year ten sure. board conversations about shortening the tenure for the next executive between 10 and 15 years. according to the report while immelt maintains strong support on the board directors expect that he will step down before reaching the 20-year mark in 2021. among the leading candidates identified to succeed him are lorenzo simon nelly who took over ge's oil and gas unit last

year and steve bolze leads power and water. ge issued a statement saying we don't comment on speculation. the ceo board routinely discusses succession planning a key part of its responsibilities. in house you will hear the premise of the story is wrong, citing conversations that have not happened and that he maintains full board support. >> they don't -- stories tend not to come out of whole cloth from "the wall street journal". there's very well sourced. i find that it's very rare that they come out and have like the great former ceo saying about the late dan dorfman that man doesn't have a clue. i think they have a clue. i felt the salient comment was over mr. immelt's tenure. tenure, the stock prices lag behind the s&p -- lag behind them more than 65% gain for the s&p 500, down 37% below where he took over. i don't think that can be said about a lot of companies. >> the stock was trading at about a 45 p/e right before 9/11

when he took over. he's done a lot of different things. by the way, what's this 20-year thing? that's news to me. >> yeah. >> what board suddenly says you got the job for 20 years. >> welch after 20 years. >> i thought the board should be reviewing your performance every year and nobody has a given tenure. >> i was surprised. we think the turn is for real. the financial remove the financial business is going to be very good. the two divisions that we mentioned from the -- by the way, until today i didn't know there were successors. i didn't know anybody was on the run here. >> to your point that this story, however they want to characterize it, has wound up in the newspaper for some reason. >> right. >> by joanne lubelin who has been covering executive management for a long time. >> if she tomorrow comes down and says -- >> i don't think so -- >> do you think they'll come out tomorrow and say that strong was wrong and we regret our error. >> this paves the way for this board to choose to do something if it wants to, at least and have it -- the idea out there. >> if the stock is up today --

>> i can't believe the average tenure for the s&p ceo is seven years. he's almost doubled that already. >> like the nfl. >> yeah. >> not for long. i think if the stock is up big today then the board says, hey, you know what, maybe lubelin knows what she's talking about and we ought to be in a meeting. we know from their comments lubelin made this up out of thin air. >> you're being sarcastic. >> it is. it's still "the wall street journal" and i respect them. i think they would have fact checked this story nine ways to sunday. >> point out we are going on the story, i have not done reporting this morning on it. or been able to speak to anybody who might be in a position to know. so we have ge's statement, we've shared that. >> right. >> they discredit it. there it is. it is interesting. especially given the tenure that has been marked by a difficult time for the stock prices. >> the idea that they mentioned two people already, i mean, this is not mcnerneny versus nardelli

for a bakeoff or is it. did you know? did you get the memo these guys are vying for the sgloob jon rice would probably succeed him immediately if something happened to him. >> can we see, you know, how the company does after it does the split. why my trust buys it. he's got a plan. >> he's got a plan. >> plan seems to be yields three and change. i don't know. >> also bought a lot of shares. in fact -- >> yeah. >> put his own bonus into the stock. >> he's getting it right and this article suddenly appears. kind of mystified me frankly. mystified. raised eyebrows. >> raised an eyebrow right there. >> as a result of plastic surgery. >> i have never ever, i would never go there. >> you wouldn't. >> or hair club for men, none of that. you're -- faber's hair, i'm cramer's shirt. >> you are what you are my friend. >> thank you, poppy.

>> if you went to hair club it's time to get your money back. >> thank you. >> cramer's mad dash after the commercial break. today is tax day. second worse session for the s&p last year was on tax day. >> it wasn't a tuesday, was it? >> world's colliding. >> more "squawk on the street" in a minute. street" in .

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what are we talking, mad dash? >> bank of america upgrades morgan stanley neutral to buy. under current throughout this period of the last year is how well james gorman is doing. okay. this stock had a nice move up and it's kind of gently come down. i think this upgrade -- how much can they buy back. you have a book value, the government still in charge, but this is a very interesting call because i think the citigroup number has emboldened analysts to get a little more bullish about the industry. i think this call works, david. i think morgan stanley can go back to where it was. >> company reporting earnings i believe it's thursday morning. >> very big call ahead. >> obviously very important for them. >> yes. >> and remember they -- >> smith barney business. i think is working for them. i think gorman is correctly integrated the companies. i remember work day a stock people don't like, was brought in to really make this amalgamation. it's good. they have a real book value.

it's a strong story that has sold off. >> not that they aren't doing advisory work. they advised yesterday, advised today zebra on the motorola deal. let's move on. >> hh greg, might not care about it because it's a smaller retail, but here's what's important. they have comparable store sales down 9.9%. electronic category expected to decrease, preannouncement, 18.9%. computing and wireless category minus 22.6. so remember there's been this great conversation about how personal computers have been doing better. how wireless might be improving. now again, this is not a big national sample but that's pretty awful. >> down 22.6, computer and wireless. nine overall. but are they just losing it to amazon? >> and to best buy. this is a show room situation. but you know what, when you see this decline you say to yourself is the pc really done and turning around? is the handset turning around? i know amazon can destroy whole

companies. but at the same time, i respect greg enough to say, wow, that's still far worse. i expect best buy to be under pressure. >> you do because of this? >> i do. best buy i think is going to go down. >> we'll be watching best buy and, of course, what's left of hh gregg this morning. a lot more coming here on "squawk on the street." the opening bell, of course, about five minutes away. we're back right after this. ♪

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that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade. you're watching cnbc "squawk on the street." live from the financial capital of the world. the opening bell set to ring in about three minutes or so. busy day after a crazy session yesterday. >> yes. >> tax day, of course, which will -- did you realize the chances of getting audited if you make more than $10 million, 25%. robert frank had amazing stats this morning. >> well, i'm audited every -- >> you told us this before. >> i'm surprised to see there weren't more audited. >> high-class problem. go where the money is. >> like my great, great grand

uncle said, if i'm unhappy it's my own fault. >> that's while he was killing millions of people. >> not nearly that -- >> thank you. >> you do not do that. >> i think when i see those numbers i say that makes sense. >> yeah. >> why would you go after people who don't have a lot of money. >> yeah. >> i'm surprised they don't audit everybody who makes a lot of money. >> we worked our way through some of the earnings today. coke and j&j. you mentioned the upgrade of citi. you mentioned morgan stanley and the b of a upgrade. downgrade for ibm out of citi. >> let's talk about that. i thought they were saying all the good is reflected. my travel trust owns ibm. after a series of discussions with stephanie link, my co -- saying enough is enough. this company is going to have a better 2015 than '14. warren buffet has endorsed it. take a look at what they can do. 60% software. cloud based. 2015 is the story, though. not this year. >> security also. people forget. they've got a much bigger

security business than fireeye. >> right. >> fireeye -- >> fireeye not even notice it. >> i see you fireeye and raise you splunk. ibm has this going for it. they are motivated because they screwed up. sometimes motivated people like muhtar kent, they can come back. >> shares have outperformed since december. >> it's been a great value play. they had 2% revenue decline. talk about a company you see revenue advance. >> all right. with that the opening bell. look at the s&p at the top of your screen, down at the big board, voxelijet. >> 3d printing stock at 70. >> vjet and then, of course, the opening bell at the nasdaq. >> vjet is a tale of a three-day printer company unlike dvd which has fallen on hard times, strats you', stock at 70, fell to 13, priced 3 million shares at 15 last week, it's at 14.42. cautionary tale as they are

right here and i apologize for bringing up the empirical data. >> we're going to get earnings tonight. yahoo! gets an upgrade out of mcquarry today. >> i thought that was -- >> based on zero improvement in the core business they see valuation on the ali baba ipo, 160 to $180 billion. >> david first brought this up when people at ali baba was worth 25 to 50, that there's tax issues which make it so that you may think that ali baba, you subtract it like vm -- >> 24%, 22% fully diluted may sell as much as 12% in the ipo. that's the reason for the ipo. there are or at least there's a belief that there's going to be an ability to do tax efish shent sales after the ipo. what is sold in the ipo by yahoo!. but let's not forget this also gives us an eye into alibaba because it is not yet a public company. this will be the last quarter we get a look at alibaba through yahoo!. it lags. the fourth quarter for alibaba

even though this is the first quarter for yahoo! being reported. the concern about alibaba, slowing sequential growth rate which it showed from the second to the third quarter but this fourth quarter includes the singles day they invented where they sold more stuff in one day than ever sold if the history of the planet. >> i thought that -- yeah. >> maybe reaccelerates the sequential growth rate. a lot of investors will be looking into that tonight not just to understand the value of yahoo! because it's so much tied to the value of ali baba, but also because thinking what am i going to see in the s 1 from alibaba when it comes. >> plus again, we have these thing with the internet plays and biotechs open strong and give up the ghost. this is giving up the ghost in an early period or two minutes into the session. the stocks were up. i think yahoo! has -- is a stock that gets bit up in the morning and tends to get hammered. >> and when they come back to yahoo! they talk about throw in the actual business and say, you know, you have a lot of cash, have a lot more and all the

stakes, japan and alibaba and we do think that it will be about $1.36 billion in 2014, that's worth something. >> it certainly is. >> >> i think the stock is cheap, ali baba is going to take off and people are going to regret they sold yahoo! >> you do? >> i do. >> i also don't think core yahoo! is worth nothing. i think there have been changes. it's not why anyone want to own the stock. they want it for alibaba. >> michael wolf with another tough column on the heels of david carr's column how they all want to be in show business and it's a tough racket. >> the disney marker. >> oh, my gosh. relativity giving them a run for their money. >> who has more money? relatively or bob iger. i did that rather than disney to antagonize you. disney does. i don't know if they're going to come out and pay. >> mastercard above the 200 day, upgrade out of janney, earlier in the week, beard, impact crest

upgraded them. >> these stocks have fallen off a cliff. mastercard did not report a good quart but visa did. visa dow stock. i think mastercard not unlike coca-cola, i think they're going to report a very good quarter and people are selling the stock because they've written it off. i think these companies have a great secular trend behind them, the paper to plastic, it's not done. people still use paper all over the globe. >> yeah. >> against that the -- >> paper as in money. >> as in checks. >> not writing -- or writing checks. >> money and checks. i use a credit card. i don't know about you guys. >> all the time. >> csx in the red going to report tonight. the journal quit with a curtain razor saying plants are below trend giving csx pricing power and margins are good? >> michael last spoke on "mad money" and he said look, this is a -- could be a breakout quarter because of exactly what you said. the coal inventories the stock has stalled, union pacific is

well ahead of it now, norfolk southern which has big coal, well ahead of it, i think csx is a buy, not a sell. buy half before the quarter and half after. i think michael ward is good. >> you've been a fan. >> i have been. >> been in that job quite some time. >> 20 years has he been in. >> that long? >> i'm kidding. >> time to go. >> i don't know. time goes by fast. i can remember years ago his fight with activist back before we knew what activist were. >> the children's fund. >> children's fund. >> they played like children in the end. >> yeah, they -- >> how about google up three quarters of a percent on the titan aerospace deal taking away the drone maker we thought facebook was going to buy. >> my travel trust owns it i saw an upgrade. jeffreys. i think it was jefferys. you don't want an upgrade ahead of the quarter. that raises the bar. you want what happened with j&j where a guy says it's not going to do well. google, i don't know.

i want them to buy yelp and open table. >> drone wars with facebook. >> like do you want -- why don't they buy the cia division cutting back on the drones. don't laugh. musk puts up rockets for nasa. >> yes. >> google here take over and don't spy on regular people, spy on big guys. >> drone company, the drones are powered by the sun so they can stay in the air for years at the a time. >> not to mention project balloon. >> this would help with wi-fi in remote areas and mapping services. >> it would have a dual purpose. >> i was hoping it might do more ad selling so the numbers are good. >> if you can bring wi-fi to every part of the planet more will go on sghoog good for everybody else, all the other internet players, all the others are tacking along in the google. >> one of their key strategies, bringing fiber to people in very smaller parts of the country. >> right. >> owe berlin park and austin,

texas. >> have you been to google headquarters in new york. >> in new york, yes. >> as cool as they say. >> it's very interesting. food is great. >> everybody there was younger than me. >> well that's not saying something. >> well i mean -- >> cramer -- >> i would love you to come with me so i would at least be one of the -- somebody older. >> i have to tell you i read the immelt story, come on he's only 58. i guess the guys who are under that say how can he still be the ceo, 58. shocking. >> guys in my class are retiring left and right. >> balmer got tired. i'm still a little vigor. >> you still got it. you still got it. when you go i go so don't go. >> really? >> maybe. >> all right. >> finally whirl pool, 20% div hike and half a billion share buyback. wonder if that's a sign of things to come. >> i think whirlpool always had a good yield. the brazilian division that kept them back. the u.s. division is good. a lot of people dump in this

country. i think whirlpool has been cognizant of that. another nice turnaround story and i like management at whirlpool after stumbling for a while. they're very good. the maytag acquisition did work. >> with all of that to bp on bob pisani on the floor and what's moving. >> health care strong in the early open. consumer staples strong. materials weak because of what happened in china overnight. a lot of the talk down here is about the ipo market. rather the reprising of the ipo market. i'm standing here paycom opened quickly but paycom was postponed from last week in a rather surprise there, didn't price in the price range of 18 to 20, priced at 15. 15. opened rather well at 17.90. that's still well below the price talk. this is by my count the fifth company that has priced below the range here. put up a full screen here. paycom, priced below. citi, just behind me, waiting for citi office read to open,

that price at 1250, 1460 the discussion read. la quinta all priced below the expected range and what's going on here is the underlying cause is the stock market itself. when the stock market wobbles the ipo market wobbles and you get reprising. as simple as that right now. what happens the rest of the week? can i ask what genius priced the ipo calendar this week. we have passover, we have spring break, and we have easter and we have 12 ipos that are supposed to price and nobody's around. i call these desks and it's thin out there. not to complain but did we need to price them in a week where everybody was away. that may be an issue for everything. let me move on with my rant and move to china. china weak overnight. there was data out of china indicating that the money supply grew at a slow pace, weakest in 12 years. that's an issue. gdp data tonight. expecting 7.3% growth in the gdp

and that's moving things here in the united states. on a side bar, gold is weak today because the world gold council noted that physical demand for gold appears to be down in china and to the surprise of a lot of people, a lot of finance -- companies are using gold to finance deals. remember the flap about using copper to backstop deals a couple months ago. that also is being done with gold and so there's question about whether this is a lot of collateral putting up for gold and rather than actual physical demand for gold. gold is weak and all the other precious metals are weak. when you get data on china weak you get weakness in the base metal stocks so you take a look at rio tinto, vale, bhp, all are on the weak side. some of the earnings you were talking about coke here, worldwide still beverage growth up 8%. wasn't much else i thought was encouraging in that report. j&j, johnson & johnson, beat on the top and bottom line and did raise their 2014 eps.

a modest raise in their guidance for 2014. comerica another regional bank in the south, based in dallas, decent numbers, active in california and the southwest, good numbers following on yesterday some of the regional banks. schwab beat, revenues in line but i thought the numbers were pretty darn good. i know the -- a lot of issues with the discount brokers. schwab's numbers and how they reported. asset management up 11%. trading revenue up 11%. net interest revenues up 18%. these are very, very good numbers. so if you're wondering whether or not there's any trading activity going on, there is at least amongst the discount brokers. schwab has been weak because of concerns on what's been going on with payment for order flow and that is a revenue stream. some issue about whether or not that will continue. nonetheless, the overall metrics good. right now the dow up 60 points. guys, back to you. >> thank you very much, bob pisani. did want to get to a deal this

morning, interesting deal for a couple of companies both of which are publicly traded. motorola solutions selling its enterprise unit to zebra technology for about $3.45 billion. deal interesting on a number of fronts. let's start on the zebra side, of course. these two companies, the enterprise business for motorola and zebra's bar coding business as well, they kind of compete in duel channels that are then put together often times by the recipient. if you're amazon and have fulfillment centers probably buying all these different kinds of units. it's a rugged unit from motorola that can withstand warehouse work when they're checking all the boxes and everything else and making sure they know where everything is. rfid and all the things that come into play there. it does make sense certainly from the standpoint of you're going to have one integrated product portfolio from zebra offering to the likes of amazon, also big in the health care industry, couple other

industries as well. interestingly, they're going to use $3.25 billion in new debt to fund the deal. going to be five times levered, debt is going to represent about five years worth of its current ebda. they expect the deal to be completed by the end of 2014. they're going to hit the market with this in leverage finance market with new issue. bet it's going to be well received, that's a story we haven't been discussing that much. the basic story they're going to borrow cheaply and going to help, of course, about 100 million in synergy, paying about 11 times current ebit da, take or include synergies paying about eight times they don't think that's too bad obviously at zebra. for motorola that side of the story is interesting at this point. because it's down to its public safety business. it's not an insignificant business by any means. talking over 6 billion in

revenue. more than 100 countries in terms of its presence. core public safety, commercial system, devices and then systems integration, managed services smart public safety. it will be interesting to see what they choose to do from here. does it sell this remaining business, sell itself, what's left of itself? next year you've got incentive options conducted by the fcc, the proceeds will go towards public safety and public safety spending. interesting to see if they get competition from some places that doesn't currently -- that doesn't currently come from. jeff, value act ceo, very active here for many, many years, icahn came into the stock and left the stock, valueact has been there throughout. by far the largest holder and they certainly have been behind some of these deals.

today not seeing any great pop in msi as it continues to slim down after having been split originally from the handset business which got sold to google which now is on it ways to lenovo. >> right. maybe it shouldn't go up. remember, motorola bought simple technology in 2006 for $3.45 billion. bill moody turned that company around. >> part of this business. >> sell it for 3.9. >> sell for 3.45. >> that's not so hot. >> no. >> i liked simple tech, is bar code. they had a mobile bar code. >> what zebra is too. >> right. >> i say buy zebra. we don't know the details but zebra is now going to own that market. >> yes. >> i think that that's very impressive. zebra is probably a buy here. >> they talk about having the same channel partners and now being offered the same solutions to the partners at zebra. >> very positive. >> very positive. >> so as the party buying, you don't have to put them together

anymore. it will be one offering. you like zebra? >> i do. >> not so much motorola. >> i like zebra as a combination. they've owned this business. i think bar code, everyone sees this bar code, this is a pretty good business. some people say that bar codes have been passe because of other methods of operation but i still see bar codes everywhere. >> let's move from equities to bonds. head to the cme group where rick santelli joins us in chicago. rick? >> good morning. once again, we have more curve flattening. it's all little itty-bitty helpings but adds up. if you look at a two-day chart of fives up a couple basis points. look at a single chart, single day in a two-day chart of tens see we're unchanged i was to throw up a 30-year bond it played down towards the 3.48 level and settled yesterday, whisker below 353.50 -- 3.50. open the chart up to the significant day, we've used it on many technical retracement exercises. february 3rd, ten-year truery

closed at 158. what you'll see is that the pattern really is very hard to argue for higher rates. this is not an aggressive pattern. and quickly, switch to a february 3rd start of the dollar/yen. usually put them on the same axis. it's the same chart. it continues to be a highly, highly correlating start. you know what, let's also take a look at another currency. that augers some study because of what's going on. geopolitically the dollar versus the rubl and see we're not on the highs, but it certainly is making a bit of a resurgence. the next chart after this morning, 8:30 eastern when we made the high yield and we had a cool empire, hot cpi, and then a half hour after that we saw a lot of foreign sponsorship, big month for treasury international capital flows. the water cooler topic, belgium, belgium continues to be a buyer. the last chart, crb index back

18 months, it's at an 18-month high. deflation. 18-month high. back to you. >> rick santelli, we'll talk to you later on. thanks so much. still to come, the ceo of zebra technologies on his company's $3.4 billion deal to acquire motorola solutions enterprise business. we'll find out what it means for the bar code printer maker that jim and david were referencing. also gm still trading below that 2010 ipo price of $33 a share. hayman capital's kyle bass betting on the automaker. an exclusive interview with him when "squawk on the street" continues. continues. ♪ ♪

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around we will have a good rally here for, you know, for the unileaver. a lot of companies remember, unileaver has broken from the pact, but the goldman note about the personal care companies you will want to be in coal gait if you get emerging markets coming back. >> coming back as an economically coming back. >> no one thought that. >> pretty good this year. >> yeah. if you get consumer purchasing power in those companies, that china number for coca-cola, i come back to that, took my breath away. people drinking coke if you advertise. >> or at least something that they sell. if not coke itself. >> yes. i wanted to -- again i need the juice numbers. that's where you're going to get nelson saying, it's not only garr carr bow nated soda you aren't doing do that good in. >> i expect fireworks. >> boosting marketing $400 million they mentioned on the call. we'll get stock trading with jim. "squawk on the street" will be right back. right back.

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time for cramer and stop trading. >> okay. first gilead, i was saying that biotechs tend to have no game, disappoint during the day. there is wells fargo has a piece out saying they have increased comfort with sa valley their

help c they have a data point. it's not like hey buy on weakness. could change the luck. coors, kors, part of this rebound, herb greenberg, writes reality check for the street saying be careful, missed, lack of disclosure. i mean with some of these things people like growth again, but maybe a tug of war here in courskors. growth trying to stabilize. i'm nervous about kors going higher and i have liked the company. gilead does seem to have data points that says it's not a fool's iron to get long gilead. >> what's on mad tonight? >> eman john, no one likes to play favorites. i like them all. old friend mark cuban. cork rin, lisa. however, daymond john, i've known him years, he and he was the guy that got you out of apple at the time saying that samsung has more gain than

apple. he said people are switching to samsung. i heard no one else say that. i listen closely to what daymond johnson said. i'm going to talk about coca-cola. i'm going to talk about coca-cola and see if it's making a comeback. >> yeah. >> i love him. i have to admit he's frugal. i just love him. his insight is fantastic. >> see you tonight, "mad money" 6:00 p.m., of course. when we come back breaking news on home builder sentiment and that exclusive with hayman capital's kyle bass. talk about gm and a lot more keep it right here. take a closer look at your fidelity green line and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy

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welcome back to "squawk on the street." april read for national association of home builders, housing market index, 47. we're looking for a number 48, 49ish. our last look, originally released at 47, now stands at 46. so i guess we can say it improved 1.47. give you a little historical significance in august of this past summer it hit 58 which was the highest level since early '06. back to you, simon. >> 46. >> thank you very much. u.s. stocks continue to climb higher in the wake of what we just got from rick, given that

you have 150 points yesterday in the last 45 minutes of trade, that's, what, 240-point swing to the upside. larry joins us now, managing director and head of research at barclays. good morning. >> hi. >> what do you make of this? >> of the housing number? >> no. i'm actually thinking of the move in the stock market. >> oh. i think we're just bouncing around here. i mean you sort of sit back and look at what's happened here. we're only off in the s&p about 1% this year, after 30% up last year. and part of the problem i think just talked about the housing number is we've had, as you know, unusually bad weather here in the first quarter. a lot of storms. i think people are looking through that not sure how much of the weaker data is real and how much is weather. >> you see, for a lot of people this is an interesting chart here. for a lot of people this is an important moment in the market, because you're getting lower highs and lower lows. >> yep. >> there is a suggestion some people will be reassessing their appetite to risk within this and

therefore the ability of the market to drive higher. what would you say to those people who believe that the risk/reward is changing and that market could go down? >> i think it depends on their time. if you are more short term, i would be very cautious. i think that's one signal. again, we've had a stock market that's done nothing but go up for the last couple of years without a correction. people got a lot more optimistic because of that. and they got more optimistic on the u.s. economy. which means the bar for moving a lot higher has gotten higher. so it's going to be more difficult. i -- so i think things are more evenly balanced. remember last year we had bond sell-off, more than 100 basis points. they're now a better hedge. we're telling investors to do move toward more balance between stocks and bonds. we've been bullish on stocks for years and less bullish now. i think a correction now would be healthy. you move down 5 to 10%.

we would be buyers. but we're very cautious here. we think growth is probably not as strong as people think. you know, i saw earlier on your show talking about 3% growth. we think the trend is 2.5, which is better than it was, but maybe not as strong as people expected. we wouldn't be surprised once we get through all these weather distortions, to see growth a bit weaker than what people were thinking. >> a lot of people have focused on the vix whenever we get a sell-off in the market, especially recently. people are starting to say the vix is irrelevant. what you need to watch is the ten year and any volatility will cause the yield on the ten year to go lower. do you believe that? if so what's the level that you think we need to watch for to really believe that the market is in volatile territory? >> i don't know that the vix is all that. i think at the end of the day regardless of what the fed chairman says or the fed, what we found out last year with the whole taper tantrum is it's really the data that's going to count here. we're going to start to get

clean readings this month really, because march is the first month. and as you see the data come in, i think that's the key thing. we think people will be a bit disappointed. the other interesting thing, is i think this morning's cpi is a harbinger of things to come. no big deal, core cpi came in 0.2, instead of 0.1. extrapolate that's 2.5% for inflation. we have core inflation in the cpi 1.7% year over year moving up. we think that's bottom. and that's going to -- that could cause people to start moving forward expectations of fed tightening as they see that trend. that will take a while to emerge but another thing that could halt the stock market. we're just more cautious here. >> just to follow through, the logic of what you're saying, on the one hand the feds will need to normalize because inflation is going to normalize, so no super low interest rates, perhaps as long as people had expected, but more importantly if you're saying gross at the same time is going to disappoint

what people are expecting doesn't that -- isn't it just a question of logic therefore that your earnings expectations are for companies are likely to be disappointing as well because there isn't the underlying growth in the economy and therefore the valuations at the margin will look extended. >> right. i don't want to go overboard. longer term, mine longer term stocks are still the game in town. fixed income will sell off as the fed hikes rates. i think you're right, simon. i think we're at a period now here where we've had just tremendous gains in the stock market and a little bit disappointing economic growth, higher inflation, something that could give you the stock correction. i would be cautious here. >> just to bottom line it for the end the year, what sort of gains do you think you will get on the s&p from here? what is the risk/reward? >> i think you're talking about something like in a 5 to 7% gain this year, which pales in comparison to 30% last year. but that should still be a

better return than what you're going to see on bonds. >> plus dividends. good to talk to you, thank you for your time, joining us from barclay smoos send it over to dominic chu for a market flash. consumer space, what are you watching? >> that's right. we're watching shares of aaron's to the downside. rent to own furniture, electronics, moving lower after rejecting a $2.3 billion offer from major shareholder vintage capital management calling it, quote, an adequate and e-louisry. instead it acquired a retail credit financing firm for about $700 million. lowered its first quarter revenue. aaron's down toward session lows off by about 7%. back to you. >> thanks so much. it is that time of year again, millions filing their taxes due today. this as many in washington clamor for changes to our tax system. former ceo of staples will tell us why he thinks tax reform is needed now. hayman capital's kyle bass will join us for an interview. why he's still defending general

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dow up 60 points as you can see. choppy start to trade. don't forget yesterday you surged 145 points in the last 45 minutes of trade. then we've opened further in positive territory. now we're tracking further down.

this seems to be quite a volatile market. i imagine thin volume. >> april 15th, tax day and this year the irs has a warning for the richest taxpayers. not only will you be paying more in your 2013 taxes, the irs now admits the higher up the income ladder you go the more likely you are to get audited. robert frank joins us with details. >> if you're a top earner your chances of being audited have more than doubled over the past five years. most americans don't need to worry if you make under $200,000 less than a 1% who get audited. $1 million to $5 million, 9% audited, $5 million and $10 million, 16% audited. those who made more than $10 million a year, 24% chance of being audited. about one in five will probably be audited in that category this year. it's part of the new s.w.a.t. seem the irs set up to target

wealthy tax cheats, global high wealth group, collected over $50 billion in enforcement revenue in the recent period. how do you avoid an audit? keep your taxes simple, avoid big round numbers especially on the deductions, avoid big swings in income from year to year and this is the most important, guys, don't include the word yacht on your return. i'm sure that's going to be an issue for you, right? >> i wish. but probably not this year, robert. thank you so much for that report. robert frank. as many rush to get their irs forms and payments in the mail we ask, is there a better way? can washington lawmakers find a way to really make u.s. tax policy simpler and fairer, better yet, should they? with us to discuss that is staples founder and former ceo tom stemberg, managing general partner of the highland consumer fund. thanks for joining us on an important day for many americans. >> a symbolic day for sure and probably time we fix what we're doing here. if you look at corporate taxes,

every day we are reminded how weird our system is. for example, yesterday, read the newspaper that walgreens, a great chicago institution, is thinking of moving its dom soil overseas. we have a couple companies in canada. statutory tax rate there is 25%. here it's the high 30s depending on what state you're in. you have to say, where would you rather dom mow soil in canada or the u.s.? think about the fact that we're looking for capital to fund growth here in america and corporation after large corporation has tens of billions of dollars offshore that they refuse to repatriate because we have the only place in the world where we tax global profits. i think we need to get our act together, get rid of the special interests and deals and especially for the energy industry and simplify our taxes and get down to a competitive tax rate. >> to be clear that walgreens proposal is something shareholders have been pushing for because they think it would be friendlier to the bottom line

for walgreens but think about companies like pfizer and facebook which have a lot of profits going through ireland where the tax rate is roughly 12%. we're looking at a chart right there that shows the u.s. all-in average rate about 39.1%. tom, there was a proposal earlier this year from the house ways and means committee to simplify the tax code, but many people say that because it's a mid term election year that's not actually likely to be debated until call it 2017. how should we prioritize what we do in the tax code if the full monte isn't possible because of washington politics? >> the problem is you have to get to the so-called full monty. you have to get simplification and have the courage to stand up to all the special interests that are out there that are going to fight to keep their little tax deals, whether it's nascar racing or all depletion allowances and all that stuff has got to go. and unless we have politicians that have the courage to push this through and it seems every

time somebody gets close they retire. dave kemp no longer there, max baucus no longer there. people are just loathed to fight the fight. >> you know, tom, i'm amazed how often we seem to be in a situation where if you repeat something often enough people will believe it. companies aren't paying anywhere near the sorts of rates of taxation put on that video just now. the total corporate federal taxes paid in 2011 were 12.1% of profits. if you look at the oecd which tracks it through the economy, it's 2.6% of gdp in 2011. that actually puts the united states 11th lowest in the top 27 countries. you know, the truth is the effective rates of taxation actually are very, very low for most companies an most people -- >> simon, that's only true if you're one of the really big companies who's managed to get themselves special tax shelters. several things like citi sports and david's t and our tax rates are up in the high 30s. >> only i believe goldman says

only 10% of the s&p 500 pays tax at the statutory rate we just showed on that wall. you know, just a few moments ago. if you took an average person, and you showed them what goes on in accounting firms with shells abroad, with the way in which they're able to write down, you know, capital projects and move it around so they can erase the taxes, the profits that are being made in other parts of big corporations there would be a revolution. there would be a revolution if people knew how they get away with not paying tax in this country, tom. that's the bigger issue. >> i agree with you. i think it's outrageous. >> but tom, when you have companies like apple where ceo tim cook was in capitol hill to discuss the way that apple is taxed, basically lays it out and then nothing happens, i mean how frustrated do you get when you see instances like that where there's a specific example and they are saying we are doing everything that is legal, and this is what is keeping us from bringing some of those profits

back to the u.s. i mean, do you think there should be a tax holiday? do you think that -- >> the fact of the matter is, that if we had a simpler tax code, with a lower rate that's kpettive with the rest of the world, all these games and shenanigans wouldn't be necessary anymore and people would pay their taxes and bring the profits home. we would all be happy. unfortunately, it's very hard to get from here to there. certainly don't have much courage in washington to do anything let alone something as complicated as this is. >> meanwhile on the other side on the consumer side, individuals paid $1.3 trillion in income taxes in 2013. at the same time that we're discussing this fragility of consumer spending that we've just now seen to come back. i wonder if you think there should be adjustments made in the near term to the way that individuals are taxed so that we can spread that recovery? >> again, the same principles apply. if we got rid of all the special deductions out there and lowered

the rate, i think we would all be better off. but again, take the most salient example, if you were to eliminate the charitable deduction, universities and museums would be up in arms and there wouldn't be room in washington hotels for all the lobbyists to work on the issue. the politicians don't have the courage do that though it makes sense to do so. >> i would suggest we reframe the debate in a different way. i worked abroad for many years. i'm a foreigner and a guest in this country. every single major corporation heads to this country first and foremost because it is the most profitable market to be in with 320 million consumers all speaking the same language with the same set of laws. and they come here and make money here and actually it's time that the people of america probably turn around and said okay f you want to make a lot of money in this country of ours you pay a more appropriate level of taxation. i think the debate is being seen i would argue from the wrong point of view unless you're a

small or medium sized business where arguably you are paying a lot of tax in this country. >> it's true. >> thank you. >> tom, before we let you go, it's a sad anniversary, of course, the anniversary of the boston marathon bombings. you had a business that was near the finish line affected. i just wonder your thoughts on that event one year later and how boston has recovered? >> one of our companies, city sports less than 100 yards from the bombing, our head of merchandising laura stood there and saw the people getting blown up. she couldn't go back to work for three weeks. and i'm proud to say today she's at the ceremony and she's going to actually run the marathon this year. meanwhile city sports, pioneering the 617 strong t-shirts able to give $125,000 to the one fund for the victims of this terrible tragedy and i just hope it never happens again and having great faith in boston public officials to make sure it

doesn't. >> we agree with you on that. a tragic day. but we thank you for helping us to put it in perspective today. tom stemberg, former ceo of staples. >> thank you. >> up next a multibillion dollar deal in the world of technology. zebra tech will buy motorola solutions for $3.5 billion. the ceo of zebra will join us live here at post nine for his first interview in the wake of that deal being announced. don't miss our interview ahead with kyle bass, founder of hayman capital, on general motors market volatility and, of course, the big bets on japan. we're back after this quick break. break. ♪

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data provider ginip for an undisclosed sum of money. they have helped provide social data to businesses. they are up 2%. twitter shares helped along by this bit of news. back over to you. >> thanks very much. zebra technologies has agreed to buy motorola solutions enterprise business in a $3.45 billion deal. zebra borrowing for what will be a bet on mobile computer services for businesses such as amazon.com that need to track inventory, products, and employees. anders is the ceo of zebra technologies joins us at post nine for a first interview. >> thank you. >> you are borrowing $3.25 billion i assume much in the bond market at what may be a good rate. nonetheless you will take on a good deal of debt, debt equal to about five years worth of current ebitda. why are you willing too lever up the company for this deal? >> we think first we we're

comfortable with the debt level. two leaders in the industry cash generative and the terms of the debt market is very favorable. within three years we believe we will be well below three times ebitda to debt. >> and the deal itself, i mean right now, sort of hand in glove. not necessarily a competitor with motorola as much as i guess the way explained to me, you will be able to integrate for the customer, end customer, is that right? >> yeah. we've been working together in front of the same customers for 20 years. basically we have two points of the same solution. so by combining the two companies we can offer a much broader, much more strategic end to end solution for our customers in helping them to really get much more into the, you know, putting a digital voice on the assets so they can have that data stream to do an lytics and other things for the business. hopefully we will be able to be the first call as cio will make in order to get more understanding of what's going on in their business. >> this is a big deal for you

guys. you're going from a billion to about $3.5 billion in annual revenues. your employee base is increasing greatly. why are you confident you can pull off an integration like this? >> we are good operators, i believe. we made several other large operational decision implementation and smaller acquisitions over the last few years. we outsourced our entire supply chain a few years back with good results. the brand erp system at oracle the same as motorola has and a number of acquisitions. i feel we have a very seasoned and experienced team that i have confidence in will be able to do a good job on the execution. >> what is the current state of the business you're buying? how is morale? i think some of the metrics have been soft recently. it's obviously a company that could do with or unit that could do with reinvig rags. how will you do that? >> yes, i think the good news we know each other very well. we know lots of their people in the sales organization. we have the same channel partners and customers.

i think we have a similar culture. i think the strategic fit is so good that i expect that we will get a boost from this with their employees. we are very, very pleased and very proud and honored to have welcomed them into the zebra family. >> you mentioned the concerns about the debt that david raised and the rate environment. those who track cap exand m and a argue ceos know that environment is going to change and so they're doing a lot of these things while the getting is good. >> sure. >> anything wrong with that view? >> i think that the debt markets today are very favorable. if you -- if this had become an opportunity for us say three years back, we would unlikely have been able to do that. we know quite sure for how long the terms will be for as favorable but the opportunity presented itself and we thought it was a good time for us to engage. >> first response from your shareholders is not necessarily a positive one. the stock down a little over 4%. does that surprise you? >> that's news i guess. when i first came in here we

were up. >> you were. >> several dollars. >> it's turned around in the last hour or so. >> as has the whole market. dow went negative up almost triple digits. >> thank you for joining us. >> thank you so much. >> bring you back and check on the progress. >> thank you. >> the ceo of zebra technologies. >> certainly a transformative yield regardless of what the market is doing. kyle bass is coming out in defense of general motors despite the recall crisis. join us live on set for an exclusive interview. you won't want to miss that after this short break. reak. you, my friend are a master of diversification. who would have thought three cheese lasagna would go with chocolate cake and ceviche? the same guy who thought that small caps and bond funds would go with a merging markets. it's a masterpiece. thanks. clearly you are type e. you made it phil. welcome home. now what's our strategy with the fondue? diversifying your portfolio? e*trade gives you the tools and resources to get it right. are you type e*? a short word that's a tall order.

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about an hour into trading some of the stories we're talking about 7:30 on the west coast, the home builder sentiment index for april edging higher to 47, up a point from a downwardly revised march reading. economists expecting an increase to 50. j&j beating the street with its q1 results a lift from prescription drug sales and raising their full year earnings guidance and shares of charles schwab up 3%. the brokerage posting better than expected numbers helped by a rise in trading commissions. >> thanks very much, carl. shares of general motors are down about 20% this year. the automaker under investigation for the way it's handled the recall of over 1 million vehicles. my next guest believes gm is still worth making investment

on. joining me in an interview is kyle bass, founding and managing partner, you may have heard his voice while introducing you. a difficult issue to address but let me start with your ownership of the stock. you came on actually i think it was on the phone in early december when you first took a position. after seeing this evidence, and what has been mounting here in terms of the case against gm, why not just say, you know what, i'll revisit it another time and sell your stake? >> you know, this is a really difficult issue. we're talking about deaths and in all auto companies there are roughly 30,000 car accidents a year. there are many deaths caused by car wrecks each year and they're not moan know causal. there are many variables and inputs that go into people passing away. as you know we lost one of our dear friends and colleagues at hayman about a year ago. it's an issue that i believe i can empathize with.

but when you look at the evidence and watch the congressional hearing and you try to parse through all of the publicly available data there's interesting narratives that aren't being told in both the press and in the halls of congress that i think are worth while. they're worth understanding. for instance when you look at the 13 deaths we're talking about 13 deaths out of 2.6 million vehicles. there are, you know, 250 million cars on the road today and of those 13 deaths that happened, 12 of them either weren't wearinger that seat belt or under the influence of alcohol. so again, we don't know what caused each of these deaths and each of them i think has a multi variable equation that goes into what happened. but i think it's really important to understand the narrative being told in the press versus kind of the factual narrative that yes, all deaths are tragedies, and human beings seem to think that is tragedies can be prevented or even greater tragedies, but in this case, i

don't think that the narrative is beelg being told. there's no upside for the press to tell the narrative to drooip drive with your seat belt on and be sober. >> others would say just because people may have been driving under the influence or not weariwea wearing their seat belt doesn't mean they should get in a car where the air bags and power steering doesn't work? >> exactly. the public policy issue is a larger one. you have to think about a statement if a consumer product company or automaker were to deem a human life to be infin e infinitely valuable then they couldn't sell a car. so there is a public policy aspect of this that's so difficult to context actualize and understand but when you look at nhtsa, nhtsa i would say our auto business, is regulated better than any in the world. ten years ago there were 40,000 accidents per year. now there are 30,000. so -- or deaths per year.

nhtsa has effectively regulated this business. if you listen to the congressional hearings of gm, the congress people were saying, you should have realized gm that there were 135 complaints over ten years. again, in itself in a vacuum that sounds like a lot. nhtsa gets 45,000 complaints a year. a little less than 4,000 a month. over a ten year time frame they get half a million complaints. it's very, very difficult. i believe they do -- i believe nhtsa does a very good job in trying to understand what causes car accidents and in this case, if there were bad actors, if there were engineers or people in the executive suite of gm that knew and hid this issue. they will be dealt with. >> they will, but kyle, part of the weight of the argument against gm is not just the 13 deaths and things that didn't work, but the fact that this went on for over a decade without it being brought to the attention and/or something done about it? i mean that seems to be sort of central to the indictment so to speak public in the public realm

of the company. >> look, right now what gm is dealing with is they've already been indicted in the court of public opinion so what mary bare ra and her new team what their job is going forward, is to kind of eat the humble pie, which she did in the congressional hearing and figure out how to invest going forward in saving the brand, saving the 220,000 people that work for the company and also in helping the 10 billion or so drivers of the car they sell every year stay safer. >> make the investment case for me. you continue to own it. i assume you bought more as it's fallen. that would seem to be a risk adjusted thing to do. >> we have. it's our biggest position. and i think that the investment case is unbelievable with gm. they have almost $30 billion of cash on balance sheet, $20 billion of unrestricted cash. when you look at their enterprise value, net of pension liabilities cash and everything i'm talking about, their enterprise value today only about $37 billion.

we think they're going to do $15.5 billion in ebitda this year. it's trading at almost two times ebitda. it pays a 3.7% dividend deal, when the rest of the s&p pays about a 2, somewhere around there. >> learn its market cap and ebitda in two years. incredibly low valvation. >> still the spector of extraordinary litigation regardless of whether they may be protected by bankruptcy, she has to ken feinberg to do something that would involve giving out a lot of money. >> yes. they've set aside between $600 million and a $1.3 billion. think about it in context. they will do right by their customer, invest in the brand, do right by the people wronged by engineering mishaps, whatever they can do. >> you don't believe consumers at home will be impacted in their decisions about buying a gm car. >> i think it would be naive to believe no one would be impacted by their decision to buy a gm

vehicle. gm is taking the right steps to invest properly in the crisis and move themselves forward into the new gm and we're talking about the new gm here where it is a much -- i think it's better operated, better capitalized in a better position for the next ten years than it was in the last ten. and i think they're addressing these issues and six months from now the issues will be behind them. they'll have done right by customers, their employees, and historically the automakers trade 4.5, 5 times ebitda. today trading just over 2 and everything looks better and not worse. >> everything looks better in your view although, of course, fewer may want to buy a gm car. that wouldn't necessarily be something better. >> that lost market share to ford in the bankruptcy about two, three points of market share and maybe they'll get that back and maybe they won't. when you make 15, $16 billion in ebitda, 5 to $7 billion in free cash flow and your enterprise is

only worth 37 that's somewhere as a fiduciary you want to invest your capital. these potential these moves down give you an opportunity to invest in these kinds of things for the long run. >> why have people hit the sell button from your perspective and said i know it was cheap when i went in and you haven't mentioned the reasons that underpin your decision to buy the stock back late last year but this is going to be too much of a crisis? why keep watching it go down? i mean clearly this has not been good for hayman fund holders? >> it hasn't been good for my shareholders, hasn't been good for my countntinentcontinents. not so good. but it's been an interesting lesson in the narratives told in the hallways of congress and the press and trying to understand why they're being told that way and digging into the facts and looking into -- it's one of the great companies of the united states. you know they sell, you know, 10 million cars a year worldwide in 37 countries and it's one of our

pride and joys ear in the u.s. and i think we should get behind the company and help them solve the company. >> you believe mary is the right leader? >> i do. i think she's a very capable ceo. >> on the issue of blibltliabile bankruptcy code will protect them? >> they're indicted in the court of public opinion. they will set aside $600 million to $1.3 billion to do right by their customers. from a legal perspective i believe their product liabilities were discharged in bankruptcy. going forward they're going to do what's right and they don't have a legal obligation but a moral obligation and i thinker that they're going to own up to their moralobligation. >> you're one of the view voices to say positive things about gm. >> there's no huge audience in the press telling people to drive with their seat belts on and stay sober. no political capital to be earned on either side of the aisle to defend gm. the republicans want to embarrass the obama

administration for its ownership of government motors. and the democrats want to, you know, it's a product liability issue where the plaintiffs lawyers have a heyday and that's their funding source. it's this confluence of events where no one is willing to defend the company because there's no upside. >> the company hasn't been doing a very good job defending itself. >> this is a sensitive issue, all deaths are tragedies. they can't just state facts. they need to be morally obliged to the constituency of both their a employees and the customers. >> i always get questions we have about 45 seconds, but japan, because people will say, you didn't ask him about japan, great thesis which hasn't necessarily followed what you -- in our many interviews in the past thought it would even though you benefited from the fall in the end that took place last year. where are we on japan? >> in abe nom knicks you saw the hike 3% hike. we're seeing goods prices move

more than 3%. when you have inflation of 1.4 to 1.7 through monetary policy and then you have a tax hike, i think the next inflation prints you see out of japan, the cpi numbers, are to be north of 2, to 2.5, which if you own a ten-year bond that pays you 58 basis points in nominal yield, and you see a 2% inflation print, what are you going to do? the interesting thing in this sell-off in the marketplace in tech and biotech in the u.s. and now the market, and this huge sell-off in japanese equities, the japanese bond market hasn't gone anywhere. yields haven't collapsed which is fascinating. their bonds are actually acting pretty terrible given the environment of their equity market. so we'll see what happens. again the question is, will they lose control of rates or they escape via the currency and we believe the currency will move before the bonds do and we'll see when the bonds move. >> i know you'll be joining us along the way and we will spend more time on that important subject. hopefully at a future tile.

thanks for giving your time today on gm. >> thank you. >> kyle bassman, hayman capital, over to you. >> thanks so much. want to get a check on the markets. we have had the dow and the s&p go back into positive territory but the nasdaq has stayed negative down about 13 points as the tech softness continues here in the market. briefly slipping below 4,000 as well. >> meantime up next, coca-cola stock rising after its results today. the best performer on the s&p. find out what the company's ceo had to say about the quarter and that latest attack from activist investors david winters when we're back after a break. mine was earned in korea in 1953. afghanistan, in 2009. orbiting the moon in 1971. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation.

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shares of coca-cola jumping after the company's first-quarter profit beat estimates largely as a result of what's happening in emerging markets. dominic chu is back at hq with more details. take it away. >> simon, so shares are up like you said in early trading after the world's biggest soda maker reported earnings and revenues largely in line with most wall street estimates but more importantly coca-cola showed that demand for soda products is still there at least for now. despite concerns of a slowdown that really manifested itself during the fourth quarter of last year. now on a global basis, case volumes rose by 2%. that's small but case volume growth is there nonetheless. china volumes grew by 12% along with 6% growth in both india and russia. that really helped offset weakness in europe and flat results in north america. which is by the way coke's biggest market. the results may also help ease concerns about the company's ability to execute its strategy. of course there's also that battle, of course, between coke

management and shareholder david winters of wintergreen advisors. winters questioned the fairness of coke's stock compensation plan and whether it dilutes the ownership of current shareholders. muhtar kent was on "squawk box" this morning and responded to the questions. >> the dilution is much closer to 1% levels than the 14, 15, 16% numbers that are floated out there. and our new equity program that we have proposed to our share owners in this coming month in april is completely in line with previous equity programs that we have actually implemented in the company. again, i wish he would have called me and i've known david and respect him as a share owner all along. >> now winters has sent another letter out to coca-cola's 25 biggest shareholders including warren buffet to ask them to review the stock compensation plan before voting at the company's annual shareholder

meeting which by the way takes place on april 23rd. kayla, back over to you. >> shareholder season heating up. thank you for that. coke obviously one to watch there. still ahead, today the last day you can buy a tesla in new jersey. auto dealers winning the fight in that state but things are hardly over between the two. the chairman of the national auto dealers association will join us a little later on with more. that when "squawk on the street" comes back. comes back. all stations come over to mission a for a final go. this is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers. i'm bethand i'm michelle.

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we had the wild triple-digit swings in the market yesterday. more action like that today. we were up almost triple digits, and now up 20 on the dow. the comp has gone down 19 points, right around the 4,000 level. that will be critical to hold according to some technicians. let's get to the cme group with rick santelli and the "santelli exchange." hey, rick. >> yeah, let's kick some types with peter, and thank you for taking the time to be our guest today, peter. >> thanks, rick. >> all right. listen, you and i have discussed this a lot. let viewers and listeners in on first of all how big treasury

international capital flows for the month of february were, and how soft they were in the rearview mirror with regard to 2013. >> well, over 90 billion net of u.s. notes and bonds were bought in february. that compares with selling of about 500 million in january. net buying in the entire year of 2013 only 10.5 billion, and over 4.5 billion worth of treasuries net bought in 2011 and 2012. so they came back in february. now, whether that's a standard or not, is a different question. we've seen a big slowdown in the trend, as i mentioned. but february, they came back in a big way. >> now, do you think that played in part to the dropping of yields that seems so counterintuitive to many regarding our rates in general? >> yeah, i think so. january was a big rally in treasuries. as we saw the 10-year fall from 3% to 2.70 level. so maybe they were just buying after the rally. but interesting, a lot of the buying actually came from

belgium. belgium is the third -- >> yes! that's where i wanted to go next. what's up with belgium? >> i'm still trying to figure it out. don't know if it's insurance companies -- >> the conspiracy theorists are out in full force regarding the issues in europe, maybe what's going on in russia or ukraine, but we don't have any answers. let's visit another area. we're been watching the crb index. show the chart. 18-month high. is this disinflation issue a myth so central banks can keep tinkering? >> yes, it's nonsense. i think they rely on that, because central bankers now, at least the fed, are trying to ease the pain of taper by telling everybody there's no inflation, and therefore, okay, saying they can keep rates as low as they want for as long as they want. inflation numbers will not accommodate that thesis going forward. >> many of us look at the

month-to-month change, .2 up on cpi. and we e-mailed it to you, but we're showing a chart based in $85 going back seven years, and other than a little down blip around the credit crisis, i wish i had a portfolio that looked -- 45 degrees up is this. you know, why is it that we never talk about we're just nibbling on the edges to disinflation when every historical projection, even the ones government controls, always just show up, up and away when it comes to prices? >> right. a chart like that is what the government call price stability, which it clearly is not. the central banks need inflation, because it gives them power to tweak things when they think they need to respond to the economy. when inflation is close to zero, they lose control. that's their fear. but you hold -- most americans, do you want a higher cost of li living, they'll say no. it's only government officials and debtors that want higher inflation. >> well, peter, thank you very much. those are two issues i think

that everybody down here continues to talk about on the exchange. thanks for taking the time. >> thank you, rick. >> simon, back to you. >> thank you very much, rick. coming up on the program, it's one-day offer. today, google will allow you, only today, to place an order for google glass for $1,500, but john steinberg will be here to warn you that from firsthand experience that wearing google glass could generate hostility in others. [ hypnotist ] you are feeling satisfied without standard leather. you are feeling exhilarated with front-wheel drive. you are feeling powerful with a 4-cylinder engine. [ male announcer ] open your eyes...

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markets right now mostly back in the red. the nasdaq down by nearly 30 points. the s&p just by -- shy of one point. the dow holding onto slight gains, very slight. barely one point there. but sitting at 16,173. so we'll keep an eye on the markets, as well as they continue to move and cross the flat line several times, carl. people can't decide what data, what earnings they want to trade on today. >> yeah. >> and how they feel about -- >> yeah, i think xlu is a fascinating story, the utility index. you have to go back to 2008 to find levels this high, as people are just pushing up utility stocks, locking for yield and safety in that sector. pretty interesting. if you're just joining us this morning, here's what you

missed. >> announcer: welcome to "squawk on the street." here's what's happened so far. >> every time you go in and buy gilead up a buck, there's a guy that comes in, slams gilead, and you lock like a moron. and you ought to stop doing that. i think it hasn't worked. paying off since this market rolled over has been a true sin and dumber than wood. >> i think we need to get our act together, get rid of the special interest and the special deals, and simplify our taxes and get down to a competitive tax rate. >> by combining the two companies, we can now offer a much broader, much more str strategic end-to-end solution, and i have confidence we'll be able to do a good job in execution.

11:00 a.m. on the east coast, 8:00 a.m. out west. here's what we're watching for you today. another volatile session for stocks. a couple of ipos standing out. if you always wanted google glass, you better act soon. the company is opening up sales of glass to everyone, all for the price of a cool $1,500. today's big question, is glass worth it? we'll take a closer look. >> the first battle between tesla and car dealers in new jersey may be over, but the war is just beginning. we have an update from the head of the national association of auto dealers a little later this hour. and it is april 15th, so hopefully, all of you have finished doing your taxes. but if you haven't, don't worry. all you need is a tablet to get started. we'll show you the future of filing in a few minutes. >> all right. joining us this morning, the guys -- the two johns we like to call them. john steinberg, buzzfeed's coo and cnbc contributor, along with jon fortt. good to see you both this morning. and we said, another choppy session for the markets.

it looked like we might see green on the screens today. the momentum names leading lower. facebook, tesla shipping. king and grubhub, they're struggling, and watching netflix in particular. this would be the lowest close of the year at 320. >> yeah, amazon is down around 315, 310 as well. that would be the lowest close of the year, as well. i believe they're down around the levels of last fall. i was talking to one of the traders on the floor, particularly about grubhub and king, and at one point, it was down 10%. they said, look, you still have all of the ipos looking to come to market on a week where, you know, passover, everybody is out of town, what are they thinking trying to force the things out the door? seems like there's a lot more supply than demand now, and possibly, depending on how these tech earnings go, it could have an effect on sentiment even further for the momentum names, which we've been talking about. >> there's supposed to be 11 ipos, and we saw paycom this

morning, it was stalled. last week, priced below the range. one of the very few ipos this year to do so. you can see the trading has not been positive for that stock. john, if you're a company, and you already stalled once or delayed or you're pricing below the range, should you go out at all? what's the stigma? >> you have to be careful on the pricing. if you look at the momentum versus super momentum names, like grubhub and king, you really have to be careful with the price. grubhub was a solid company, $2 billion valuation. it ran up to $3 billion, and now around 2.6 billion. it's really a question of where do you brice the companies, and are there fundamentals to them? >> another factor, traditionally, you have until the second week of june if you want an ipo, and if not, a lot of people go on vacation, they want to wait until the fall. a lot of these are getting pushed out the door. >> and also the question of guidance, john. if you're going to issue some kind of forecast for the year, which not every company does, do

you want to set a low bar that would make it easier to finish out the year? or do you want to risk any sign of weakness knowing what could happen to your stock? >> the most important bars are low bars for top-line metrics. coming out and talking about the mobile users, registered users, and setting relatively low targets you can sandbag against, it's what you have to do in this environment, because the market has gotten so far ahead of where the companies are at in terms of growth. >> these companies have gotten a pass, google, netflix, making the big investments, amazon, for things that haven't shown results, and just now we have google, which i know we'll talk about later, but buying a drone maker. facebook was going to do the same thing, amazon. do you think in a market where it's risk-off, that investors will be willing to put up with some of these farther afield ventures? >> it depends on the size of the investment. the new-line companies buy companies, because they don't have r&d enter prices of that

size. $19 billion is an outlier, the small acquisitions, whether it's a drone company or r&d expenses. >> speaking of drone companies, if you wanted to buy google, now is your chance. today -- glass, that is. for one day only, google is selling the wearable computing device to anyone for the price of $1,500. it's updating the glass software, adding improved battery life, but removing video phone calls. it comes a day after they purchased titan aerospace, the high-altitude solar-powered drones that we thought would go to facebook. what's going on here? >> okay, glass at 1,500s. i think here in new york, on the coast, we can get skewed. how many things are there that people pay out of pocket 1,500 bucks for? maybe a tv that tend to last five to eight years. maybe a computer, though these days it's like 500 to 1,000 bucks. the list gets awfully short from there. i hope that google makes some sort of pivot with glass going forward to sort of make this

more of a mass market thing, not just something that doctors will use to save lives, which is great, but while disabling all google services in the process. >> john steinberg, you are one of the elite few. >> and this has the earbed, as well. there's only 10,000 of these in circulation in general. i think the whole point of opening up is a closed data process really only works if people are clamoring to get into it. they had the first glass explorers, and i tried to invite three people. nobody wanted it. so they have to get this thing out here to see if anybody can actually use it, and anyone can use it in real life. >> how many do you think they can sell today? >> oh, today? i would be very surprised if they could sell 10,000, 20,000. it's too expensive, to jon's point. the technologies always start out expensive. the key is, there's such a social stigma to wearing it many people think, oh, you're desperate for attention, that's why you're wearing glass. >> no, you? no!

>> how about the titan thing? is that about bringing the internet to everybody on the planet. >> it's like android. everybody thought it was a huge, risky bet. thank god google did that, and this is about getting more internet usage. if you get more, you get more facebook usage, more google usage. >> the subtlety of google glass in today's one-day sale, you actually have to sign up for a google wallet account to get it. so presumably, you had to do that. >> yes. >> ask that to build momentum into that product, or maybe they haven't seen anything? >> it's the easiest way for them to process payments, as well. and also, google wallet is effectively the same as a google play account, which you want to sign up for if you buy apps on android. it's about the flywheel of getting all of the things going. >> titan, jon? cramer's point is he would have preferred to see yelp or open table. >> yeah, i think, as john mentioned, research is important for tech companies in general. but the question is, is this the area where you want to see google investing research?

yes, they've done things in servers, as well. we know that green energy and efficient energy is very important for data centers, which continue to be key for them going forward. i mean, how much -- how much are they going to get out of drones down the line, even if this does -- >> but nobody ever -- nobody ever likes these very future kind of going acquisitions. moving the needle. >> it's not that you don't like it. i mean, the payoff on android is sort of clear, right? if you can dominate mobile, there are returns -- if this drone thing works, and you can cover some areas in emerging markets that aren't covered now, or facebook won't cover with its drones, what exactly does that get you? granted, the investment google is making is small, so maybe give them a pass. is it a sign of the times? >> but android, years ago, remember, everybody was, like, what are they doing with flip phone company? it's crazy. it feels a little like that. if there are tens of millions of people getting internet from drones, five, six years from

now, we'll say, that was brill want. >> is one of them superior? >> i wouldn't make a drone comparison. i'm definitely out of my realm at this point. >> we want to see if you get over your skis, ever. when we -- oh, no, next up, shares of yahoo! in the green after being an upgrade. they recommend a buy, put a $40 price target on the stock. yahoo! set to report earnings after the bell. they say the core business, jon, is basically not improving, but they're looking at 160, $180 billion in ali baba. >> looking to see growth accelerate over what it did in q3. they're looking for 59% growth up from the 51%. a quarter earlier. really, it's about that momentum story, still in ali baba, hoping this isn't a slowdown. we don't see another twitter-type issue, well, maybe it isn't, you know, as strong as we thought growth-wise. >> you have to be a real trader to play this one at this mointd. the stock is at 33, $34.

ali baba comes out at $150 billion, or gets there quickly. the report has it at $36 a share. if you see expansion on the ebitda, you goat head room. but you're at $36, the head room right now. >> there are analysts sounding the alarm on potential taxes for yahoo!. of course, they'll have very significant capital gains when the company does go public. the number of analysts, even the ones bullish, are looking for no growth out of yahoo!. so they either have to give some metrics that are strong in mobile that look better, or some of the properties that they've been launching, like their vertical. more than just talk about the celebrities who they're getting to head up the various channels. you want to see growth in what they're able to yield. >> now it's the creative

director from "elle" and michael wolff, saying welcome to show business. >> yeah, they're losing more search share, even though marissa mayer shas the desire to get back into search. i think five-times multiple is a relatively low hurdle. if they just do something, they can get a little bit of expansion there. >> you going to cover the numbers tonight? >> i'm on a plane tonight, heading to the bay area. i'll be sitting down with intel ceo tomorrow. his first post-earnings interview. so there'll be lots to talk about, depending on, obviously, what the numbers say. >> yeah, a huge night for tech. john, thanks a lot. >> good to be here. >> keep your eye on the nasdaq. down a full percentage point, down 36, below 4,000. off the lows, but we fell below 4,000 for the first time since early february, and that's been one demarcation of weakness in the eyes of some traders. >> and that as the other indices

are flirting with the flat line and sometimes going positive. no sign of any recovery for the nasdaq at this hour. let's get over to dominic chu for a "market flash." >> info sys, outsourcing company, if you want to look at it, the stock is moving lower after the company reported fourth quarter sales below forecasts. its revenue forecast also for the year coming shy of expectations. the stock is trading at a six-month low. you can see they're down 7%, 8% in today's trade. over the past year, it's still up about 23%, still, kayla, certainly ones to watch in the tech trade. back over to you. >> all right. thanks, dom. if you live in new jersey, time is running out to buy a tesla, thanks to a new state law. today is the last day you're allowed to buy a tesla car across the entire state. the fight is over, but what's the next battleground between tesla and the auto dealers? the chairman will tell us in a moment. first, rick santelli, what do you have your eyes on today?

>> i'm sure there will be a flood of people buying the teslas. we're going to talk about april 15g9. there is a significance to april 15, and i'll tie it into a bit of maybe the one percent. we'll have some fun after the break. mine was earned in korea in 1953. afghanistan, in 2009. orbiting the moon in 1971. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve.

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take a look at utilities. we mentioned it at the top of

the hour, trading at its highest level since january 2008. dominic chu back at hq with that. >> carl, utilities once again the better performing sectors in the s&p 500. in fact, the best performing sector this year by a wide margin. the s&p utilities sector is trading, like you said, the highest level in six years. among the individual stocks that are making moves here, public service enterprise group at its highest level in nearly six years. you have northeast utilities, dt energy, wisconsin energy, agl resources, all at record highs. a good year for utilities, and remember, the best-performing sector year to date, it's five times better than the second-best performing sector, which is health care, guys. back over to you. >> and a defensive sector at that, dom. thanks. today is the last day tesla can operate stores in new jersey. the luxury electric automaker plans to change the stores to galleries which will force serious buyers across the river to make the purchase. phil laboy jones --

>> reporter: thank you, kayla. we're here every year at the conference at the new york auto show, and we're joined by a special guest. forrest mcconnell, chairman of the national auto dealers association. >> thank you for having me. >> you guys are at this conference when there's a lot of transition in the auto industry. let me start first off with a lot of questions swirling around whether or not dealership groups and dealership associations should be fighting tess la in terms of opening up stores in different states. what's your position there? >> ultimately, it's the state's call on what to do as far as with their individual states. you know, the legislature, the dmvs, what they know best for their state, and a lot of them they take into consideration, but the good news is, there have been obviously -- several of the issues have been settled as far as with new jersey, but i know ohio and new york have been settled out. i think you'll see that in the coming months. >> today is the last day tesla can sell vehicles directly here

in the state of new jersey or just across the river in the state of new jersey. and a lot of people are sitting at this conference and saying, is that fair? do you personally believe that tesla should be allowed to have stores selling directly to consumers? >> i think it's up to the states, whatever they decide is fine. it's up to the state policymakers. what they come up with. i think they'll find that they'll weigh the pros and cons. there's a lot of advantages. dealers, the franchise system, the important thing -- the franchise system creates intense price competition, which drives down prices for customers, where they can shop recall situations right now. they're there. and they put millions in the local economy. >> when you talk with mike jackson, who runs auto nation, chairman and ceo, he comes out and runs the largest auto dealer group, and said, let them sell cars directly. it won't hurt the other dealers. do you understand that position? >> it's strictly up to the states. there are many states that let them sell direct. there's others that have extra layers of accountability they've put on. it's clearly up to the lawmakers

and what they decide, and the dmvs. >> later today, we'll hear from gm ceo mary barra who will be speaking at this conference, and speaking with folks later, what's your opinion? >> mary barra, i believe, is a good leader. she is pushing forward to get with the 4,000 gm dealers that are spread all across this country. from new york to all these small rural communities that customers can get their recall work done. you know, safety is the number-one concern for the dealers in this country, to make sure we take care of our customers. >> a third of all safety recalls are never performed. people don't bring them into the dealerships, because they don't want to deal with the dealership. >> the good thing is dealers are incentivized. we ged paid to do the recalls. we have a huge incentive to get customers in. i would encourage them to come to the dealer, get it done, make sure your car is safe.

>> the last question, when you're hearing back from dealers about sales for the month of april, are we continuing to see the upward trend we saw in march? >> car buyers are really coming out in droves. march was actually a record month with the bad weather. i would tell you the one thing is, that's also good news for the economy, because dealers have -- generate 15% of all the sales tax in the country and employ a million people locally and those are jobs that can't be outsourced overseas to china. the good thing, it's good for the local economy and gives money to the things people want in their hometown. >> forrest mcconnell, joining us from here at the jd power auto conference. back to you. >> phil, thank you. phil lebeau. more and more people are filing their taxes electronically this year, according to the irs. about 91% of the returns filed so far were sent in electronically. but for the uninitiated, what is the best way to efile your taxes? our own jon fortt will talk about that later this hour. aflac.

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♪ let's get over to the cme in chicago. rick santelli with the "santelli exchange." hey, rick. >> hi, carl. we live in a great country, and everybody needs to pay their fair share, and we have to keep the lights on and all the programs going, i understand it. but there are some trends, and i won't dig into them, they are what they are. according to cbo and written up by the "wall street journal," put it on the screen, increased taxation of a couple with two children making more than 150 grand, which i understand is a lot of money, has jumped from 65% in 198090% in 2010. believe me, it is -- nobody's

going to a thank the higher earners for their extra contribution, but maybe we should. yu bed, i was reminded of a lot of dynamics with regard to, you know, the rich, the 1%. mary thompson did a great piece on athletes and a great piece comparing them to wall street dynamics, and it reminded me of "atlas shrugged." it was going to be called the strike, because people who could got tired of being taken advantage of, so they decided they would call a strike and whatever it is they did, run railroads, make steel, they were going to stop. let's consider three groups, okay? now, we discussed mary thompson and our wealth pieces, and we have hollywood, we have wall street, and, of course, we have sports figures. and what i always find interesting is if you look at hollywood-types and

sports-types, they really are a good chunk of the 1%. but the wall street types get all the attention. but consider this, in the true spirit of ayn rand, let's say for one week, anything that has to do with sports is shut down. maybe some of us wouldn't be so happy, but i don't think the world would end. all right. let's take another direction. let's say hollywood, okay? a lot of money. sandra bullock alone made $80 million on "gravity." it's what shapes our perception. let's say they close everything down for a week. yes, maybe we'd go on youtube or netflix or comcast on demand, but it wouldn't be the end of the world. what if wall street and your banks, everybody should down for a week? not to mention those horrible energy companies like exxon, who pay billions in taxes. what if they shut down for a week? just think about that for a minute. i'm coming in under time on this, because i think i've said enough. you know, you can have whatever type of opinions you have about the 1%, but it certainly seems

like there's a boatload of hypocrisy embedded in the 1%. back to you. >> thanks so much, rick. we want to show you shares of coke rallying after earnings topped analysts' expectations, right now up close to 4%. it wasn't good news for coke, especially when it comes to global sales. we'll explain more on that in a moment. plus, the bells are about to sound across europe as the markets here go negative. there's a few moments left in that trading day. we'll have the details on the impact at home after this short break. up. a short word that's a tall order. up your game. up the ante. and if you stumble, you get back up. up isn't easy, and we ought to know. we're in the business of up. everyday delta flies a quarter of million people

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europe close is about one minute or so. a lot of eyes on ukraine this afternoon. here's simon. >> yes, there were right from the beginning, actually. down in negative territory, and europe managed to pull itself higher, but headed back down again. clearly what is happening in the ukraine -- and various reports coming through -- is a concern. certainly, ukraine tensions are one way why german investor confidence fell for a fourth month today. in terms of statistics, macroeconomics, statistics coming out of europe, the most staggering, i think, is london house prices are now up almost 18% during the course of the past year. a superbubble as far as many are concerned there, and arguably,

britain around the rest of the world like me, may not be able to go home, or go home and afford house in london. if you look at the stoeck markets, italy is where forming worse, down 2.2%, and a number of issues, the blue chips, the italian bank may according to reports have a bigger capital increase than we thought. telecom italia has an important board meeting under way. they're changing the corporate positions across the italian landscape, particularly for the state-run industries. italian ten-year bonds continue to rally. the yield on the italian ten-year is now, believe it or not, at an all-time low of 3.11. tomorrow, we'll get inflation figures in europe, and you've seen spanish yields come down on the talk of possible qe, if it were to come from the european central bank.

we've spoken a lot about that this week. the only other thing i wanted to mention from italy, it is being reported by the anser news agency, berlusconi has a one-year sentence about to be sent down, community service. it's community service because he's 77 and because of the nature of the crime. it is reported, not yet officially confirmed. apparently, he'll serve that time in a facility for seniors. they, of course, will be able to look forward to the fact he began his career singing on cruise ships, and as he left office, he had a love album he put out to much italian acclaim. >> really? i'd like to get a listen. >> a man of many talents. thank you so much, simon. we want to bring it back to ukraine, because that's affe affecting the u.s. markets. the hostility, conflicting report has caused major indexes to give up the early gains. we are now back in the red with the dow down 14, the nasdaq losing 35.

with us is michael cagino, president of portfolio funds. michael, good to have you. when we have a day like today, that's such a reminder that geopolitical issues can spook the market very quickly, how do you invest in light of that? >> well, we run different strategies, a bond strategy, equity strategy, and multirisk parity strategy. so i think you want to hedge your bets. we've had a mixed year so far this year. we would advocate after the five-year stock market run that we've had, we think the next five years aren't going to possibly be as good. we would recommend taking money off the table, diversifying, obviously stocks are still reasonable bets. but, also, with bonds, u.s., non-u.s., relate estate, natural resource-type equities and precious metals for the uncertainty factor. >> there's been a saying that comes back on a week like this that equities are the last to know. you see a rise like we had in the morning on positive data. but the treasury rally has been going on since late yesterday afternoon. do you think that there's a

leading indicator in the treasury market that more investors should be paying attention to? >> if you look at treasuries, it's been more than yesterday. bond yields, especially at the longer end, have been drifting down the last couple of weeks, and i think it does reflect a little bit of the uncertainty going on geopolitically. i mean, i think a lot of investors have an eye on russia. obviously, it's not impacting us day to day in the states. shou however, from a longer-term global story, it's significant, and its effect on that region. and, also, economic statistics have been mixed. we all think it was the weather in the first quarter and, you know, whistling past the graveyard-type behavior, but we really don't know that. we hope there's growth, we're optimistic. but there are mixed economic signals, and i think investors, you know, are buying bonds on that, as well. >> michael, are you as willing to put faith in the second half of the year as some others? people are writing off q1 because of the weather, sort of a transitional phase now. and then, in a rising rate environment, you begin to see

things like cap ex and m&a pick up in the latter half? >> i hope so. i'm optimistic, but, no, not ready to bet on it. i think the weather definitely had an impact in the first quarter. but i'm not ready to say that's the reason. i think you'll see a lot of companies use it as a crutch. to mask sort of real robust revenue growth. and i think coca-cola is a great example today. it was a decent report. global growth company, right? decent report, but onto revenue line, it was soft. and there wasn't that robust economic, you know, here we go, we're growing type of mentality. i think you're seeing that across industry spectors. look at the banking sector last week with wells fargo and jpmorgan. reasonable growth stories but not robust. that's sort of holding us back from being real aggressive on the forecasts in the second half right now. >> the heavier growth names, michael, have been quicker to reverse in a psychological market that all of a sudden becomes spooked like we've seen

in recent weeks. where do you find growth without finding risky growth? >> well, we would be sort of contrarian in a sense. i mean, for equities, where i think you want to be in the long term, is growth stories. you know, volatile growth stories. growth stories are going to outperform the broad market. to some degree, the sell-off in some of the aggressive names presents a buying opportunity. you know, there's a reason -- you can argue about valuations and the short term maybe getting overextended. but there's a reason why some of the technology companies, why some of the biotechs, have been outrunning the broader market. it's because they have real revenue stories and growth st y stories going there, and investors are looking at those type of stocks for that growth. we would view it as a longer-term investor, in a pullback in sort of those types of stocks, as a potential buying opportunity. >> and, michael, this idea that janet yellen wants to put more capital on banks. i know you mentioned the banking sector before. but i'm just interested if that is such an engine of growth, or

should be an engine of growth, what do you think about what's happening in washington to try and tamp down on some of that activity? >> yellen has been focussed in saying interest rates aren't going anywhere in the long term and the fed is ready to do what's necessary. it's really been the story for the past few years. the fact of the matter is, we're creating tremendous amounts of liquidity around the world. i know the velocity on the liquidity is low. one of the primary reasons we don't see inflation risk now. but it's there in the u.s. and around the world. we talked about qe in europe possibly tomorrow, simon on the last report. so there's a lot of liquidity, a lot of potential structural inflationary pressure around the world, but we're not seeing it yet. i worry about those sorts of comments in the long term. >> you have to put that liquidity to work. michael, thanks for joining us this morning on an important earnings week. >> thank you. >> michael mentions coke, by the way. they did post inline earnings,

posted a small revenue beat amid the slump. the ceo addressed active criticism in an exclusive interview this morning on cnbc. >> i think we've created substantial amounts of shareowner wealth and value, and our program is completely married to the interests of sharonowners. when share shoulders create -- are given wealth creation and created wealth for themselves, management also benefits from that. if that's not the case, management does not benefit. that's how our shareowner program works. >> and sales fell. caroline is here with us, and it's good to you have back, caroline. good morning. >> good to be back. >> stock's done well. it makes you wonder where it would be without that dividend. >> my goodness, yes, less cash

flows. >> what did you make of the global soda decline? why is the market willing to overlook it today? >> i think expectations were low going into the quarter. so the fact that actually, you know, on average, volume was pretty decent and it was driven by china, some of the emerging markets, was a sigh of relief more than anything. >> it looked like pricing held up, too. why is that? >> price mix was okay. there was a lot of inflation pricing in countries where there's been a lot of devaluations. so those emerging markets, again, coming through. and price mix was okay on soda in the u.s. surprisingly. >> you have written in the past about how they're trying to put premium products over volume. we always look at volume every single quarter. can that work? and if they really are raising marketing by $400 million, how serious are they about bringing soda back? >> well, i think it's actually you've hit the nail on the head. coke has to retrain investors to get away from looking at volume, to looking at transactions. they need to drive price mix. if you look at sugar taxes,

which are being implemented in mexico, and i think are a real risk in the united states and other parts of the world, we have to get away from selling more volume. we have to get price mix. and, hey, we're selling one of the world's most valuable equities. we should be able to do it at a premium price. price mix should be the name of the game. it will be a transition period. you won't get much volume growth in soda according to what he thinks at the moment. you can create value longer term by moving up the value chain. and i think it's going to be a while before that happens. but steady and slowly, i think they can get there. >> caroline, this morning, muhtar kent said sas a company with 80% of the sales abroad, he said they have taken in billions of dollars of hits on volatility and currencies. he feels like that momentum is now moving in the right direction. do you have confidence that what coke is doing on the currency side will actually rebalance what they have lost on some of the volatility? >> well, they had a 10-point hit

to earnings in the first quarter. it will be 7% in the second, and 7% for the full year. it's a tough headwind. investors are soften willing to look through that. they take a lot of pricing to offset that in the emerging markets. but i do think it's a major headwind. as you move forward, i do think this will be a difficult year. there's no way around it. i think there are probably better places to put your money in the short term, but you get a different donald for staying with the stock. they buy back shares that will help you. not my favorite idea for this year. and i think that these sugar taxes are an issue to think about. but other the long haul, the distribution is second to none. and as long as they can sell water, juices, teas, other things, that helps. >> finally, it does set up expectations for pepsi should we be looking for a better number? >> not a better number. they are bailed out by having a wonderful snack business. i think in beverages, they are getting their head handed to them by coca-cola. >> caroline laying it on the line, not beating around the bush today. thank you for your time.

always good to see you. >> thank you. >> caroline levy joining us. we want to update you on the situation in ukraine. michelle has more. >> we're getting headlines crossing the wires, carl, that i think are affecting parts of the market. the associated press and reuters are reporting that they are hearing gunfire at an airport in eastern ukraine, and now, in the last few moments, ukraine's acting president has said their military, the ukrainian military, has restored control over an airport in eastern ukraine. what is actually going on? as we know fog of war, we're very far away, difficult to know. take a look. we started to see reaction definitely within the 10-year yield as we saw perhaps some safety buying within the treasury market, as we often do. it was 10:00 exactly, right when you start to see yields decline, that the very first headline crossed, where ukrainian defense ministry officials said that armed forces were carrying out a, quote, special operation in eastern ukraine, and that's where the airport is located. in the last few minutes, reuters

and the associated press both reporting they have reporters near, they're hearing heavy gunfire, and the active president saying they restored control of the airport. who knows what is going on? we have a crew on the ground, nbc news does, on the road from donestsk, and they're seeing the military gather force, and helicopters landing in the field, 17 military units and special forces personnel. so something is definitely going on within eastern ukraine. some kind of ukrainian response by what we've seen from the pro-militia -- or russian militia, depending on who you believe. >> michelle, we know as the activity begins to emerge, you'll bring us the latest. we appreciate that. especially as the market continues to sell off. today is april 15th. it's tax day, and hopefully all of you already finished filing everything. if you haven't, don't worry. you can still do it all right on your tablet. our own jon fortt will show us how it's done when "squawk on the street" comes back.

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chips again? we'll talk to five-star fund manager bill nygren, and the war in the valley. google versus facebook. who stands to win the battle? and bank analyst mike mayo called for citi's cfo to resign or be fired right on this show. and on the conference call yesterday, he demanded someone at the bank take responsibility. did he get what he wanted? we're going to ask him, and what does he think about the earnings, all straight ahead, kayla, at the top of the hour. >> that was a big focus of the call yesterday, it will be interesting to see what he says the day after. the hours are winding down to the end of tax tuesday. and some are turning to the digital space to get them filed in the time they have left. our own jon fortt joins us with more. most people do efiling, but how many people actually do them on a tablet or on some other mobile device? >> well, kayla, i'm a simple man. always done my own taxes, ever since i got out of college. and i've always done them on a pc or in the past couple of years, actually on a tablet.

look, half of people either use an accountant, half use an accountant, half file themselves through some sort of digital means. actually, one in five people last year used a mobile device. and that's accelerating. 6 million people at the beginning of this month had already filed on a mobile device, up from 5 million entire last tax season. we could see more than a third of people who file themselves doing it on mobile devices this year. that's according to intuit. so it's an interesting show that it's not just about viewing content on mobile devices anymore. increasingly we're using them to actually create content, to fill out complicated forms. people who file a simple return can take a picture with their phone, but even more complicated taxes -- you know, i had a move from california to the east coast involved, other things like that, i did it on a tablet. >> you are at the heart of the consumers, so i imagine you did shopping around. what app did you eventually

decide to use to file your taxes on your tablet? >> i'm a turbotax user personally, partly because i've been using them a while. they have 66%, 67% of the tax-preparation market themselves. they have a lot of tools that kind of walk you through various processes in the state and federal realm. of course, h&r block is a strong competitor to them. tax act. but, you know, that's what i've done, and consumers are increasingly kind of weighing, well, is it worth it going to an accountant versus doing it for myself? for me, i keep so much of my information digitally, it would be a hassle to hand that over to somebody else than just search through my files. >> how about the danger of having your data compromised if you're filing from a tablet? >> the key thing is being sure you're on a secure network. wireless itself comes with some degree of risk, but if you're home, wireless network is relatively secure, versus doing it in a coffeeshop. never do that.

>> there is a report last night from the pew research center that surveyed americans to see how many people had sensitive data like their social security number and bank account information, how many of them had them compromised, and one in five roughly said that they had in the last year. that was a 63% rise. so do you think that that's just because people are using some of the nonsecure wi-fi locations -- >> that's a big part of it. mobile, particularly android, sorry, has some security issues. i talked to a security expert at st. john's university, who used to be a cop in new york, said, look, there's so much personal information in these devices, make sure you don't store that locally and be careful with wireless. >> jon, thank you, as always. you have a busy day today. you're getting on a plane for a big interview out west tomorrow. that, of course, is the ceo of intel, the first on interview after intel's earnings live at 12:30 p.m. eastern. you won't want to miss that.

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the selling has accelerated since about -- well, the time europe closed about 20 minutes ago. the nasdaq is down, as you can see, more than a percentage point. netflix, tesla, wynn, netflix down almost 5% as we get set up for what could be an interesting afternoon session. >> nasdaq near correction territory, down 9% from its highs. certainly an index you'll want to watch. we want to bring in art cashin to put everything in perspective for us. the second day in a row we've seen some of the early gains taper off in the middle of the day, this time on geopolitical concerns. i'm wondering what you're seeing in the market and what directions people should be watching. >> well, i think there's a couple of things that we saw so far this morning. nasdaq came down and broke its low of yesterday. it broke through the theoretical support at 3,985, and i think traders were surprised that that did not bring trap-door selling.

they thought maybe that would lead to something much steeper. i think they'll look and see if the selling accelerates, 3,960 or so. to hold up. but once again, kayla, it is the 10-year that is calling the tune. this is like -- almost like an orchestra conductor. it's exactly what the ten-year does, and the equities are responding to it. earlier today, the yield on the ten-year was down 20 ticks and that had the first mile selling. and the rumors out of the ukraine began to build up, it dropped another seven, eight ticks, and it gave us another leg down here. if the viewers want to watch one thing only, keep your eye on the yield on the ten-year. it's being used as the thermometer for global anxiety, if you would. >> and are there levels to watch on the yield, now 2.61? we began at 2.65.

>> if you break 2.6, you may see things accelerate again. the concern is up until now, it's just a few ticks, it's speculation. i think if you get down below 2.6, or 2.58 for sure, people will say, maybe there's a lot more here than we know about, i think i want to be cautious. >> the last two nasdaq sell-offs, or corrections rather, were in 2012, so we haven't seen one in a couple of years. if we do get that 10% full move to the downside from the march highs, what happens then? where is the psychology of the market going? >> i'm not sure it turns quickly. i mean, we're having strange anniversaries. if you look at gold, it got clobbered today, but if you look back a year ago on tax day, it got clobbered again. i don't know that there's a relationship there. >> some were trying to make the argument that the boston bombing a year ago today might have impacted the markets on that day, too. which i can't remember how the market acted. >> i'm not sure that i remember

exactly either. you know, it was an evolving story, even though the cameras were present on the scene. and it immediately turned into -- i mean, obviously, compassion for those who were hurt. but immediately it turned into a mystery hunt. and that kind of diverted people's attention. >> a multiday event, of course, a lot of volatility during that time. art, thank you so much, as always, for putting this into perspective for us as we continue to watch the sell-off. we'll continue talking about it this morning, because it's what everyone is watching. we'll bring you the biggest losers in just a moment when we come back on "squawk on the street." ♪ [ dog barks ] ♪ [ male announcer ] imagine the cars we drive... being able to see so clearly... to respond so intelligently and so quickly, they can help protect us from a world of unseen danger. it's the stuff of science fiction...

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(aaron) purrrfect. (vo) meee-ow, business pro. meee-ow. go national. go like a pro. welcome back to "squawk on the street." we're at session lows. the nasdaq 100 and composite now down over 1%. overall, we're at a 4 1/2-month low for the tech-heavy index. everyone is on correction watch. in fact, since the highs of this year, we're down over 9%, so getting very close to the 10% correction level. over the past several weeks, real damage has been done to the nasdaq. in fact, 75% of nasdaq 100 stocks are in correction territory, and nearly 30% are in bear market territory, which means we are down 20% from the

highs. so everyone watching the levels at the nasdaq, carl, and how much lower we can go. >> yeah, matt melee mentions the 200-day at 3942. maybe a level. scott wapner, you'll have a lot to watch. >> not that far away from a nasdaq official correction, and it's been sometime, as you and kayla were just documents. >> 3,960, 3,942, pick your number, it doesn't look like a day to the upside, scott. >> yeah, pretty ugly. welcome to the "halftime." right on the mark, bill is here live on the latest moves he's making in his portfolio. pass the mayo. what does one of the bank's biggest critics think now? we'll ask mike mayo. who is likely to win the battle for domination?