>> good morning, everybody. welcome to "squawk box" here on cbs news. i'm becky quick along with joe kernen and andrew ross sorkin. the sun is up. it has been for a long time. i think since around 4:30. let's start things out with the market. another day of record closes for the dow industrials. it was the second lowest volume session of the year. take a look at the futures this morning. you'll see red arrows at least at this point. it looks like the dow would open down by 24 points, s&p futures down by just over 3.5 points and the nasdaq down by just over 11 points. we continue to watch gold. gold falling for a sixth straight session. its longest losing street since last august. you can see this morning, it was up by $2.40, $1,246.40 an ounce. it is a relatively quiet day on the economic front. we get april factory orders at 10:00 eastern. may auto sales throughout the day. we have china economic news, the pmi which showed an increase.

the market chatter is building around economic releases that come later this year, adp tomorrow. there's a key ecb meeting on thursday and the big nonfarm payroll report on friday. there is new data suggesting the individual investor may not be actively participating in the markets. maybe they're not making a lot. e trade is reporting that its customered averaged 14% fewer trades than in april. pimco's total return fund suffered its 13th straight month of outflows. the world's largest bond fund posted $4.3 billion in net outflows in may. the fund was up by 1.25% in may and that beat 79% of its peers. andrew, i'll send it over to you. thank you, becky.

corporate news this morning, pill pillgrims pride. last week tyson offered $50 a share for hillshire. we'll see where that all ends up. hillshire at $58, up a little over 8% in the premarket. apple says it will allow software developers to include virtual currency transactions in their applications. the announcement may pave the way for new forms of money to appear on iphones and 50i6789 pads. if you take a look at bitcoin, man is that spiking on that news. also speaking of apple, the company holding its worldwide developer's conference in california this week. new operating systems and a move into the health space and the home. apple revealing what's calling

its health kit which lets various users use health apps share data. home kit is zuned to make the iphone a remote control for a connected home. this allows this to communicate with the scale, to communicate with all these different things coming into one device. i will tell you, i know you don't think the folks in cupertino care about what i have to say. i do want to thank tim cook. i watched this thing live, streaming. i'm satisfied. i thought whatever they came up with next is not going to be enou enough. >> what's going on. >> i can get rid of the keyboard. they have all these other keyboa keyboards.

>> api? >> is that an oil indicator? >> so now you'll be able to -- i'll have a much better keyboard experience. some of the application stuff, some of the notification stuff, it's finally on its way to being 10,000 times better, comparable to all the stuff that's in the android that i like but with a better interface on iphone. this is a huge thing for me. i sat there with a smile on my face for two hours. >> you did not watch for two hours. >> i did. i was upset about how long it was. >> that's the intersection of what i know about android and apple. this is where you earn your -- you know this. that looks dirty. >> it does. i don't know what that is. >> i don't know what that is. >> i thought you were saying he listened to tim cook and he convinced you about the beats deal. >> no, he did convince me that i

wanted the next iphone. as long as the screen is bigger he won the game yesterday. >> in cupertino, they're setting up -- there are balloons, confetti is coming down. >> i did have somebody going on a corporate board yell at me across the room, hey, guess what, i'm going on such and such board. but you already know all about that. you talk about it every day. >> we have a good audience, an audience anyone would envoy. french government weighing in now on this bnp story, that bank paying a $10 billion plus fine to the united states. france's foreign minister says this country will defend the interests of the bank, calling the penalty unreasonable. bnp has been investigating with authorities who are investigating whether the european bank evoded u.s.

sanctions. this story is from a corporate comprehend sags p compensation perspective is good for me. >> let's say they pay him 1.5 million. he said no, please, don't do that stuff. would that have been worth saving the 10 billion or would it have still been the wrong move? 1.5, no one deserves to make that. do you know? >> if you had gotten a better ceo -- why is that ridiculous? >> because the point is it's illegal. they're transferring money to sudan. >> what if they had a ceo that was more in tune with what was happening and a better corporate -- >> ethically? you mean not ethically challenged? >> you don't think there's a ceo around who would have avoided this problem by not doing

business with sudan. >> not because of how much they're being paid. that's a world compass thing. >> you don't think any ceo ever earns their pay. they make hundreds of decisions a day. >> your argument is that he was such a dope -- >> he's clever. >> he was an idiot because he wasn't paid enough. >> you're penny wise and pound foolish. you are over there wringing your hands about how much you're paying your ceo. you just lost $10 billion because you're dealing with countries that have sanctions. >> the government has gotten involved. >> that will help. >> they're making at pale saying why are you coming after them. >> you're suggested they couldn't find a talented ceo that would have caught this? >> my argument is that ceos can be really good and really good at managing risk and running a company, really good at protecting shareholder value and good at protecting customers of the institution. i think ceos can make a

difference and make their way. >> can i say this? as everyone knows i am a huge fan of jamie dimon. >> everybody don't know that. >> i've said it on the set many, many, many times. >> you've written articles that are totally wrong about him. >> jamie dimon who i think is one of the greatest managers of a bank lost $23 billion. >> that was a shakedown. that's different. >> hold on. if you read the papers in france, they are calling this a shakedown. >> one man's shakedown is another man's legitimate fine. >> exactly. >> there are people in the u.s., i disagree with it because i thought some of this was a shakedown, too, in the u.s. >> you and your friends would be the first to argue. even though jamie dimon was paid a lot, he still couldn't avoid

the 23 billion. >> i believe in this particular case -- >> the opposite isn't true. >> you are in the same position of arguing. you guys are -- >> exactly. pay your ceo. get a decent ceo in there and maybe you won't be paying $10 billion. >> it may not matter whether you have a good ceo. it may or may not. you can't say whether it would. >> it might have mattered if they had a guy in there more talented who was -- maybe this guy was, you know, he's french. maybe he was taking vacations in portugal. maybe he had no idea what was happening in the sudan. >> i'm making a million dollars a year. why shouldn't i go to portugal? next thing you know -- >> i don't think that was the case. >> i do know. this happened first of all in the new york office.

i think there are no controls. >> exactly. >> there were other issues. >> what was the guy doing in paris with the people he hired here? not overseeing them at all? >> clearly he was an untalented dope. >> exactly. they couldn't get talent. >> they couldn't attract a better person because they couldn't afford one. >> you think that's impossible? >> i think this is about morality and ethics. >> bull shih tzu. >> wow. >> remember aig, people said there's no way for $400,000 a year i'm going to be able to keep people here? >> that's correct. >> don't you think if they would have paid more we would have recouped more than we recouped? >> you need the guys for lehman to be able to go back. >> the journalist envy people with corporate ceos.

>> i have zero envy. >> oh, please. the entire "new york times." why every quarter do you out these guys in the top 50 for how much money they make? it's total journalism. >> as does every other newspaper in the country. >> no, they don't. you don't see that in "the wall street journal." >> you saw it on "squawk box." >> they stand up, tells us who made the most money. >> right. reading right from the "new york times." >> by the way, there was another story that they'll have us skip through. pay for senior bankers rising 10% to an average $13 million. u.s. banks they say handed out much more generous packages than anywhere counterparts in europe. >> we should not have just done that story, clearly. >> every quarter, you out each ceo. you don't even mention like it's up 30%. jamie dimon is up 30%. after he was down 8 million or whatever. you don't even mention it at that point. look, there is journalist envy.

what i don't understand is, if you're so envious, go work in the gold room of goldman sachs. go do it, become a ceo. at least this is a country where you can still go do that. >> why would i want to do that? why are you asking many he to do that? >> you're making your money in other ways. you certainly do enjoy it and you certainly do enjoy the benefits of your highly paid compensation. let's go. a key primary in mississippi today with plenty of mudslinging. tea party candidate state senator chris mcdaniel in the middle of it all is john harwood. is john harwood, who i just heard an echo. who is joining us. is that a mississippi thing or -- you forgot the tie? what happened?

>> hey, you know, we're out in the field here. it's casual. and by the way, joe, i'm happy to rescue guys -- you guys from that argument still going on. i guarantee you there was no viewer who could follow that back and forth between you guys. >> thanks, john, like one of your reports, i guess. >> notice he's on a delay. >> andrew is going to go to the mail room and make $20 million in five years? >> i look forward to that. >> there's journalist envy about ceo pay, john. most journalists do not think there's any way that a ceo can actually -- they have no problem with a lefty -- with a fastball, they have no problem with sandra bullock making $30 million a yer but they don't think there's a corporate manager with 100,000 employees, shareholders, all these responsibilities, they don't think there's a guy who

can make 100 decisions a day where 90% of them turn out to be the right decision. andrew doesn't think there's a bnp paribas ceo -- >> which journalist, andrew and becky? >> no. i'm talking about gretchen morg morganson, the entire staff at "the new york times." >> oh, geez louise. is gretchen on the show this morning? >> no. no. she couldn't be here today. she's working on the next overpaid corporate ceo story. >> oh, man, please. save us. >> john, what are you here to talk about this morning? >> go ahead, john. >> i'm here to talk about mississippi and the republican attempt to try to retake the senate. i just want to take a little bit with the assistance of color coded maps, what the keys are to democrats holding or losing the senate. republicans need to pick six to

go from 45 to 51 in the senate. they've got plenty of opportunities on the democratic side. if you look at these blue states where democrats now hold the seats, you've got incumbents in north carolina, in arkansas, in alaska, louisiana. democratic incumbents who are in changer. you have open seats in places like iowa and michigan where republicans have a chance. iowa also has a primary today. but it only work -- the math only works for republicans to make those gains if they get six of those seats if they hold their own home turf, that is to say seats they already hold in republican states. there are three of those where there is some question. one is in georgia. one is in kentucky. both of those have already had primaries and picked the most competitive candidates although in georgia there's still a runoff. in kentucky, mitch mcconnell survived, which is what the party establishment wanted. here in mississippi today is the

last of those pieces to fall into place. you have a primary betweened that cochran, he was elected in 1978. he's he's an appropriator. he's being challenged by a young state senator in a nasty race who is arguing thatted that cochran works too much with democrats, too accommodating with the other side, too enmeshed with the culture in washington. he wants to change that. the race has been spiced by allegations that supporters of chris mcdaniel, the tea party challenger, broke into a nursing home and snapped pictures offed that cochran's wife who is ill, has been for some time. that has produced charges against some allies, felony charges, against allies of chris

mcdaniel. there is worry among republicans that iffed that cochran is upset today, which could happen. it's a very close race, democrats could have a chance of carrying this state, mississippi, as conservative as it is, and that would make the path to republicans taking over the senate that much longer. >> all right. that was not one of the great moments in american -- it's not even politics, i guess. >> when you sneak into an old age home. >> $10 billion. do you know how many million that is? do you know how to do the math? >> 10 billion? >> yes. >> meaning 10,000 million? >> there you go. >> 10,000. you could have hired 10,000 ceos. and maybe found one good one that would have been able to maybe save you.

>> although somebody points out a $10 billion fine, gm fined 35 million after admitting it intentionally failed to fix -- >> it doesn't seem -- >> joe? >> yes, john. >> do you know how much members of congress get paid. >> not much. >> 135. >> they get paid about $160,000. do you think we'd have better government if we paid them more money? >> that's compensation inflation there. that's way overpaid. you have a point there. every quarter they should do a piece on that. i do. how come these guys like harry reid have pretty nice houses and stuff, don't they? >> if we paid them, joe, if we paid them a million dollars apiece, would we get better government? >> not for just a million, no. >> who goes into politics, john?

>> public service. >> people who want to do good. >> like at the end of -- whenever we have that final, the two cancers, it's like we always look at each other and go, aren't there like 300 million people in this country? this is really -- this is our choice and it's because people don't -- you have to have -- i don't know. i think you have to have a screw loose to want to do that. >> obviously you've got to pay them more. >> that might help. that might help. it's just market forces, john. if sandra bullock -- in "gravity" she didn't make 30 million. in "gravity" she made 70 million. >> don't forget a-rod? >> the list goes on and on and on. but they don't want to talk about that side of things. >> like i go to washington, get

a rash. you go to mississippi, you get a rash down there. >> that's why there's no tie. >> john, thank you, good morning. when we come back, everybody, we'll talk about bitcoin a little bit more. you've heard about all the ways it could be used. plus, seattle decides to hike the minimum wage to $15 an hour but it won't happen overnight. we'll have those stories coming up in this morning's executive edge. more "squawk" in just a moment.

welcome back, everybody. it's time for the executive edge. a business group immediately announced plans to sue to try to prevent the increase from going into effect. businesses with fewer than 500 workers have to raise wages to $15 over the next seven years, larger businesses have to meet that level within three or four years. gentlemen? >> businesses are suing. we'll see what happens. that's a long lead time to do that over seven years. they placated some of the people that are worried about it. when a city does it, i think it's kind of a petri dish, let's watch and see what has. the people that say it's going to cause people at the low end, jobs to dry up.

the simple math you do for a company, let's say you're a small business and you are just barely making a certain amount of money. you can hire ten employs at $15 an hour or 20 employees at $8 an hour. it just seems -- if you're barely making it, if you do the math, it could hurt the number of jobs. >> my worry is whatever happens in seattle to the extent it's successful may not be applicable elsewhere. >> why would you think it will be successful. >> seattle is high cost of living there. i don't have a problem with municipalities doing something like this. >> they can try it. we'll see. >> if businesses don't like it, they can move fairly easy across city lines. >> seattle is a thriving city, though. >> i worry about the home health care workers, the people that

need home health care if it suddenly is at a point where, you know, medicare can't -- it just -- you don't know what the effects are going to be as you're doing something that obviously is well intentioned. we heard about income inequality and everything else. you just hope you don't end up hurting the people you're trying to help. >> it will be an interesting -- >> 15 is a pretty big number. >> isn't is 15 at sea-tac, the seattle tacoma airport? >> in switzerland it was voted down. it was 25, i think. >> what you do in seattle, you can't do in detroit. >> or mississippi or something like that. >> if the huffington post is watching, they should write an article that a million is not enough. if a million is not enough for a ceo but 15 is too much.

>> there you go. good tieing together the "a" block to the "b" block. >> if they are. >> in case you weren't paying attention, there's the line. let's talk about another sto story. bitcoin could be changing divorce proceedings. lawyers are warning that the electronic currency could be used by divorcing spouses to hide assets from estranged partners. bitcoin accounts are hard to link to an individual. spouses in a divorce fight could transfer currency quickly and almost anonymously between online wallets. >> you were talking about it this morning. why? >> on the new iphone -- >> the apple. >> you can use different virtual currencies. it's going to be a huge boone, probably i assume to bitcoin if not others. >> is it just an app. >> it's built into the the way the operating system is. they'll have different currencies and because you're going to are able to use your thumb print is actually another

thing. before it was just on -- >> i have the new iphone 5. my thumb print never works. >> it doesn't work yet at least on my phone. >> now it will work for all sorts of purchases. if you're amazon and you can link to it, you don't have to do a password. >> it's something with women's fingers. i've talked to a lot of other women who have tried the same thing. once in a great while it will allow me in. >> she probably didn't set it up properly. >> it's cold fingers. >> she's been on the cold fingers thing for a while. >> i can hear you guys. >> i have a safe and it's never not worked. >> you have a safe? >> a fingerprint safe. >> you're hot blooded, no problems. >> i'll touch you with my fingers right now.

they're cold. that's why it doesn't work. >> check it and see, i have a temperature of 103. come on baby don't you wanna dance with me, andrew? hot blooded. coming up, it's a busy week. >> did i get the shih tzu in quick enough when i said the -- >> i don't know. >> it was like a delay of like a second. >> enough for a youtube moment. >> it's a busy week for economic data, from factory records and auto sales to the big jobs report friday. we'll talk market expectations. next, tomorrow, check out this lineup of power house of overpaid ceos. top executives from merck, amc entertainment, lennar and autonation. they'll all join us live. before we take a break, let's look at today's winners and losers.

the performance review. that corporate trial by fire when every slacker gets his due. and yet, there's someone around the office who hasn't had a performance review in a while. someone whose poor performance is slowing down the entire organization. i'm looking at you phone company dsl. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business.

drivers want to go further with their electrical vehicles. but you can't take a trip from lisbon to stockholm if you can't plan and re-charge along the way. the european commission is using cloud to make this possible. creating a single charging and billing network across 28 countries. so drivers can travel as far as they want to go and when they want to go.

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when you fell from heaven (awkward laugh) ...a little.. (laughs) im sorry, i have to go. at&t is building you a better network. ♪ i'm hod blooded check it and see ♪ ♪ i got a fever of 103 good morning. welcome back to "squawk box" here on cnbc. that was on air, yes. >> the second one. >> i'm joe kernen along with becky quick and andrew ross

sorkin. keep it together. in the headlines this morning, new developments this morning in the takeover battle. i was going to ask you earlier about this, hillshire brands. hillshire says it received an increase takeover bid from pilgrim's pride of $55 a share. that tops the original bid of $45 a share as well as a $50 per share bid from tyson foods. hillshire says it doesn't have the right to terminate its own agreement to buy pinnacle food which is started all this, hillshire says it's not changing its prior recommendation to approve the pinnacle deal and is making no recommendation with no respect to the pilgrim's pride and tyson offers. you found a deal book. i have a question. are you a links guy or patty guy for sausage. >> links. never patty. >> i go back and forth. >> ever buy the kind where you slice it and smash it?

that's jimmy dean. good. >> i haven't had that in years. >> that's what occurred to me earlier. >> as a deal guy. >> but you were definitive. >> i like pancakes. >> plenty of economic data. we have a guest here going -- he's like looking around. i was supposed to be -- anyway. >> on a business network. >> including big employment numbers and an ecb rate decision, let's get more on the busine busy week ahead. russell price, senior economist. he's seen this act before. that gdp number, you write it off immediately? bonds went up that day. i'm sorry, the yield went up that day on the ten-year.

it's a one off in everyone's mind. is there any way they're wrong, that it's just a one off? >> you can be wrong about it but probably not. there were two things that happened in the first quarter. i had terrible weather and i had a runoff in the rate of inventory investment. you know, last time i was outside it felt pretty good. we also, i think, are seeing from this report that we got yesterday, that businesses are probably stepping up their rate of inventory building this quarter. it was a one-0 of. i think we have a good quarter in front of us between 4% and 5% gdp growth. >> okay. my next question was going to be, do we need to get to three for the year or can we end up at 3 and satisfy people that have been depending on a better economy to justify valuation? if we average 2.25 but end up at 3 and 3.5, is that going to be enough for people? >> i think what's important is how the quarters themselves go

quarter to quarter. let's say if you had a pattern of 4% to 5%, 3.5%, 3.5%, even though you had to couldn't the the first quarter, the year may not be that good. it would be back-loaded, doing good toward the end of the year. i think that's what will matter. >> what do you think? same place? >> in the first quarter, what was most important, the idea that we could write it off, we had strong employment growth. we had 875,000 net new jobs created. we started to see wages start to increase as addition slack is taken out of the labor force. the consumer still drives this bus and as consumer activity continues to improve and wages rise and we're getting more employment growth, i think the path ahead still looks pretty good. just like you said, i think for the full year we'll probably be shy of 3% for the full year. but by the end of the year we'll

be coming out at a rate of 3.5%. >> i think maybe the consumer is really key there. we talked about this m&a activity, is it good or is it still more rationalizing? is it still guys trying to get more with less? if the consumer comes back, the corporate spending goes beyond corporate m&a. they might hire someone, build a plan the or something, right? >> absolutely. businesses have really been running, in my view, with tight labor force components. we've seen that in rising hours worked. as we continue to get that accelerational demand after the poor first quarter with be that will spur businesses too, higher. also, running into that whole mix is the idea that consumer confidence is at its high since the recession and business confidence is rising as well. >> even more when you look at

the income inequality debate, we h had someone on yesterday. that environment might signal the pendulum swing went so far. as it comes back and wages start going up and people get more money and we get better growth, 3% and 4%, i don't remember having those debates about income inequality when we're growing more quickly and unemployment is down at 5% or 6%. we don't seem to have that debate. we haven't felt that. >> that's right. and i think a lot of this concern about what the inequality is doing to the economy simply isn't expressed as much once you start to see a better economy. that doesn't mean that you rid yourself of the inequality problem. it's not a problem in my mind that it's enough to hold you back from having a good year. you've essentially had a

redistribution of income in this country, away from the very lowest income families. the people who were receiving money, they're also spending, too. maybe not as much as if it were earned by the low income families. they're still spending, for the low income families as jobs and wages pick up, they'll be in better shape to shop more at walmart. >> if we were creating jobs that weren't subject to minimum wages because they were well above where the minimum wage was, the whole debate goes away. that's the problem. the jobs we're creating are sometimes low paying that it would make a difference. thank you. russell. guys with red hair, russell is a good name. >> absolutely. >> did they know when you were born? did they look at you and say russell? >> i think it just fit. >> it did. >> rusty, russell, i thought about that immediately. i'm someone who is partial to red heads. >> as everyone should be.

>> they're the best people. >> that's right. when we come back with millions of consumers at stake, it is not surprising that automakers are targeting china as a major growth market but what chinese buyers want in vehicles might surprise you. we have that story right after this.

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welcome back, everybody. right now it's time for the squawk planner. the major automakers are set to report monthly sales today. en alifts are expecting the strongest may since the recession began back in 2007. tesla isding its annual shareholder meeting. among the topics of most interest to investors, any hints from ceo elon musk on the

location of the giga factory and the development of the so-called model e, the mass market, lower priced tesla due out in 2017. on the economic front there is one fed speech of note today. esther george will be delivering remarks this afternoon at the kansas city fed business leaders luncheon. we mentioned u.s. auto sales. china is becoming an increasingly important market for every major carmaker. eunice yoon joins us from beijing with a look at what chinese car buyers want. eunice? >> thanks, becky. chinese consumers are expected to buy 24 million cars this year. it's the world's biggest car market. and because everybody wants to be here, we decided to go shopping with a typical chinese car shopper. the man behind 9 wheel is just the person carmakers want in their dealership. sam jow. he's upgrading his car and we

are going shopping with him. >> the car gave me the freedom. i do like the option of freedom the car gave to me. >> reporter: zhao goes online, unlike car buyers in the u.s. or europe, chinese people have little brand loyalty. purchasing a car requires extensive research. >> on the internet, somebody else's suggestions is based on real experience. that's the power of social network. >> reporter: car buyers here are influenced by word of mouth and most prefer big cars. as part of his three-week search, zhao is checking out the same subaru suv his friend has. >> suc, big room, can hold all my family members, my mother, father, my son and my wife, all five persons can get in one car. that's very important for me. >> reporter: zhao visited ten dealerships. he's narrowed his choice to six brands. none are chinese. are you finding yourself to

foreign-branded cars versus chinese-branded cars or does it not really matter? >> sure i am chinese but i'd like to pay small price. for the brand so far, it's quality. >> reporter: like audi. he likes this extra long sedan. >> there's room size enough for me. it's for my son when he grows up. >> reporter: final price for his new a4l, $40,000, within his $50,000 budget. what do you think it says about where you are in your life and in your career? >> ten years ago, when i got my first job i don't imagine i can buy a luxury brand like audi. but after ten years, i buy it. oh, well, it's good. >> reporter: and most chinese are first-time car buyers and they have a lot to choose from. because everybody here wants to be here. china actually has twice as many

car models as united states, so it's just a very hypercompetitive market. andrew? >> thank you for that report, eunice. we appreciate. talk to you soon. and why obamacare may be giving a boost to entrepreneurship. we have the ceo of paychex. it all builds up to friday's big government employee report and the jobs number. "squawk box" returns right after this. ameriprise asked people a simple question: can you keep your lifestyle in retirement? i don't want to think about the alternative. i don't even know how to answer that. i mean, no one knows how long their money is going to last. i try not to worry, but you worry. what happens when your paychecks stop? because everyone has retirement questions. ameriprise created the exclusive confident retirement approach. to get the real answers you need.

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appreciate you being on. when you think of health in the digital age, i don't know if you saw what apple just announced yesterday, in terms of this new app and what they're going to be doing on their device. >> you know we're living in this moment of health care. where every aspect of health

care is being reinvented, reimagined by entrepreneurs and the entire industry is going through a big shift. we have seen it from retail, travel, to commerce. it's finally happening in health care. with apple's announcement yesterday and samsung's announcement last week, we are seeing the largest companies in the world really invest in health care in new ways. >> explain this to me. you incubate start-ups like. and the disruptors. who are the big companies i imagine that have to lose for them to win? >> it is a global start-up platform. we are build an army of entrepreneurs and innovators to reinvent every aspect of health care. you are seeing a big shift where every hospital system today,

every pharmaceutical company today is rethinking their business and where they go in the future. >> right. >> so it's a massive shift. >> i understand who can be the winners, the guys on your platform and others. my question, who are the losers? the incumbents? >> yeah. we have seen this creative destruction where the that sort of has been stagnating for a while gets overturned. this moment of innovators dilemma, if you will. you are seeing massive consolidation with hospital systems right now as an example. so there's a lot of shifting going on. and to be quite honest, there's a lot of uncertainty. that creates a lot of the opportunity of the next few years. >> will we see any in efficiencies in terms of the costs coming down. when they talk about more

productivity. and we often think that is going to in the long term equal more productivity and less cost. in the short-term it's quite the opposite. >> well, it's one of the great things about the data revolution and the digital revolution that's coming to health care. with with all these mobile devices, sensors, new ehr platforms, we are able to collect data that even a few years ago we weren't able to collect. so we are using it to analyze and create efficiencies in the market. we invested 8.5 million dollars last week. they are looking at data in interesting ways to drive the costs down. >> give me a 30-second version of what you think all of this will do to my experience as a patient in the next five years. >> well, there is this wave of

health care consumers. you as a patient are becoming empowering for the first time in the last 100 years to really own your health. for years we have been outsourcing to our employers. we have been outsourcing to the government. we have been outsourcing to your doctors. you will have price transparency. quite frankly, a lot of health care is going to be designed invisibly into the background of your life. so it will be an exciting time the next 10 years where things go as a patient. >> thank you for joining us this morning. >> thank you very much. >> i don't want any experience as a patient. over the next five years or ten years for that matter. >> experience may be you facetime with your doctor. >> southeast asia is when you

pick things up. >> we have wonderful viewers over there. >> the last time you came back you had what, an ear infection? >> swimming in a pool. >> all i know is you were on pretty strong antibiotics. i'll just leave it at that. >> when we come back, apple is hosting its annual developers conference. we'll ask if tim cook delivered what investors want. 'tis the season for road trips. what they tell us about the state of the economy. you can check out any time the you would like but you can never leave. "squawk box" will be right back. she's still the one for you.

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no apple watch. no apple tv. no new gadgets.

but the company now wants to conquer your health and your home while ripping apart the competition. >> many of these customers were switchers were android. they had bought annan droid phone, by mistake. >> will apple's game plan work for investors. >> the quirky way to keep you cool. how about uber cool. ben kauffman tells us about air-conditioners are demand. the second hour of "squawk box" begins right now. ♪ >> good morning, everybody. welcome back to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin.

another record day of closes. the the dow futures are indicated down 27 points. s&p off 4.5. nasdaq down by 11. the yield has picked up from some of the lower levels we had seen last week. in our headlines this morning, we'll be watching shares of hillshire brands. pilgrim's pride increased its over to $55 a share from $45. hillshire is planning to go ahead with his own acquisition of pinnacle foods. it says its agreement with pinnacle doesn't allow it to terminate on the paves of the bids for hillshire. also take a look. u.s. automakers will release may sales numbers. expected to be up 7.3% compared to a year ago. g.m. is seeing posting an increase of 6.7%. ford is expected to report 0.9. and chrysler is expected to see sales up 14.4%.

seattle city council has improved an increase in minimum page to $15 an hour. however, a local business group immediately announced plans to try to prevent that from going into effect. >> a few global market stories. central bank hinting it would not raise rates further as long as inflationary pressures continued to rise. central bank kept cash rates steady for a ninth straight policy meeting. china services sector rose to a six-month high in may. a group of retailers want the supreme court to take up a case involving swipe fee rules. they allow banks to charge debit card fees that are too high.

part of dodd/frank they limited it to 21 cents per transaction. retailers say the law intend the the cap to be even lower. now they want to lower it even more. >> was it durbin? >> it was durbin. >> there were connections -- i mean, there was more to it than just being -- and also -- >> and they argued they needed to do this to pass along savings to customers. and what happened instead, dividends to shareholders. >> right. >> but it was -- there was more there. like so many things. you have to look to connect the dots. >> follow the money. >> it's all about money. >> can we come together on that? >> that we can agree on. >> a new web domain will let

companies change things up with a dot vegas domain. it will have a more distributive url, an option that might not be available in a crowded world of 100 million dotcom domains. is andrew ross sorkin.com available? >> i own it. >> how much are you paying for that? >> i would be interested in erin sorkin.com. and high demand names will be up for option. apple is holding its annual worldwide developers conference this week. did you buy your name? is it available? >> fortt.com has been mine for a decade. >> fortt.com, what will i see? >> cnbc search page with my

latest hits and stories. >> no way. >> yeah. >> i see it. >> you're like a brand, a walking brand. >> i'm trying. take it away, mr. brand. >> i would say it was apple's most ambitious ever. even more than it first launched the iphone. there's so much to lose here. they are trying to move forward so quickly. they talked about new cloud features allowing developers to store their assets in the cloud if they build on apple platforms. the expansion of i cloud. it will allow people to use i cloud drive. more storage available for lower prices. and home kit and health kit. not exactly clear how ambitious these are.

but ways for people to get all their health information from various apps together. there's an i watch coming. also home kit for home automation. not clear how aggressive apple will be with home kit, health kit. but with this cloud stuff, there's big risk. because it looks like they are going to roll all of this out within a series of days or weeks in the fall. it could be the biggest strain on one company's cloud ever. think about it. people are pulling down ios 8. millions of people all at once. and trying to push all the photos and videos and files to the cloud. and, by the way, trying to get text messages relayed through you their phone. if any of that gets screwed up and you're missing text messages, phone calls, people will be outraged. if they pull it off, it's an

unprecedented advantage over android. overall, huge keynote for them. >> stay with us. more on apple's developers conference. with us now. and obviously this is your interview. they said, joe, his name is eric. that's the only -- it's gotten that -- i'm there just to introduce the guy. that's how each of us now. like in baseball there is a guy. >> synergy. >> not synergy. that was my role. now i'm just going to sit back. >> good morning. i was here just to say his name. this is your interview. >> let me ask a serious question about that. i would argue they're going to facebook. certain components that they seem to be strategically going after. the question, can they beat all

of those players at their own game? >> i don't know that they necessarily have to. the wider appeal apple was trying to make, people describe it as a wall. it just got a heck of a lot bigger. if there's indeed a watch it will go along with that. a whole new realm. a lot of third party people -- it has a lot to do with appealing to the third parties. >> john talked about the potential for glitches in the fall. >> yes. >> and if we're all being honest, as much as i love apple, and i do love -- as i said before, it's fantastic what they produced as an apple guy who was thinking about switching. now i have no interest in switching. do they out-do a dropbox? will you put everything in the cloud instead of using a dropbox

and does it matter? >> i think it does matter. apple hasn't been anywhere meaningful. i'm a happy apple user but i have been using dropbox for years. steve jobs famously thought dropbox. >> a feature. apple needed a strong play in the clouds. it has been confusing exempt for when you want to find your phone after you lost it or need to kill it after you lost it. they simplified it yesterday. they did the a lot of what they had to do. it's all about widening the universe. you saw them hitting android a lot. >> they are going to charge for the cloud. everybody here has pictures and movies. no way not to spend 399 a month.

>> this is about revenue. longer term, it's about margin. the reason they can command a premium over android and other devices is because the user experience is arguably better. things work together seamlessly. they expanded it off things work better off your phone to things work better between your phone and your mac. the whole thing is just supposed to feel better. on the revenue line, this suspect going to be significant. but if it keeps people in the fold, makes people want to spend a little bit more for storage it will help out margins. >> 90% of the futures said they advanced yesterday. you can argue again on android. you can use swipe on your android. there's a lot of stuff you can do on android. and android, i imagine, google will come out with something new in the next three months. >> i don't think it matters. this is the case that tim made

yesterday. when you look at android universe, there is a lack of consistency. maybe one small slice support the latest version of app droid. that's a heck of a lot of trouble to update. a lot of devices simply don't support it. apple makes very clear what device supports what. >> how much do you worry about malware and viruses? and the reason i ask, they are opening up in an eco system. they can transfer data from other apps. do they stay impermeable? >> they are not impermeable. they don't open themselves up to as much risk as android. one of the main ways malware happens, people put out a fake version of an app, download it and it steals your information that way. all of this is still pleased.

yes, there may be additional avenues of attack. when you start from a secure point it's easier to stay more secure. where if you start insecure, securing it later is hard. >> thank you now to eric hesseldahl. everyone remembers when steve jobs tried to buy dropbox. what is dropbox exactly? lock locks is where al gore keeps all his millions from his investments. >> a $10 billion company that shares your files and syncs them. >> i have too much stuff in the cloud i don't know what to do. it can't be backed up. what do you need to do? >> you need to pay more.

>> right now i'm not backed out. >> make sure they put out the new plan. don't pay too much now. >> i'm going to deal with that myself, my own backup problems. but my phone is not. we are very specialized now. thank you, eric. eric? last name. hesseldahn. squawk alley appears at 11:00 every day. and 8:00 pacific time. >> yeah. you can count on it. even more. >> good. >> when we come back this morning, more records from the dow and s&p 500 that were broken yesterday. will the next couple of days be a challenge for the bulls? we'll open that discussion after this. and traffic jam of news for the auto sector. tesla holding a shareholders meeting. we get behind the wheel later this hour. "squawk box" hrbg back.

welcome back to "squawk box", everybody. futures are looking a little bit weaker after another day of record closes. weakness picked up this morning. dow futures looked like they opened up down 40 points. s&p down 5 points. trying to reach a settlement with the sec the at issue,

regulators access to be audit documents. they have scolded the firms for fail to go share audit work with sec investigators. the investigator believe they could help them undercover accounting fraud. big economic reports. joining us right now is the newly appointed deputy chief investment officer. congratulations. joseph is global market strategist at jpmorgan asset manager. good to see both of you. let's talk a little bit about what's been happening with the market. joe, do you think this has been something that's been a good build? something that will continue to percolate? >> it's been painful. we haven't really seen any meaningful direction. volatility obviously has been down, but it's been a bit choppy. >> you had a gain of 30% last year. you're still up 4%. >> that's the crux behind the issue. you had a pretty amazing year

last year. valuations are kind of hovering near the long-term average. the bond markets, everyone expects interest rates to go up. many are sitting on their hands waiting for the one catalyst. >> how much u of that catalyst -- we were concerned about the economy. we got the rug yanked out from under us the first quarter. what do you think happened? >> i don't think anybody would have expected the bond market to be up 4%, commodities markets to be up 4% by the end of may. it's very unusual. not many strategists were predicting that. we actually just went yesterday under weight bonds and shifted into international developed equities. >> why now? >> when you look at the bond market indexes they're up 4.8% in the first five months of the year. a whole rear's worth of return in five months. so we think it makes sense to

make some of the profit at this point. >> did you think we would see gains of just -- the bet on bonds was, look -- >> the rates went higher. >> right. that was an unquestionable situation. >> we didn't think at the beginning of the year. we still think at the end of the year rates will end up 3 to 3.25. if you believe rates will be 3.25 by year end, the bond indexes will be flat or negative. >> 256. >> moved fast. >> i think it will move fast. when growth picks up in the second half of the year. international developed equities look appealing to us right now. in japan and the uk is 13 to 14 times earnings. it's still 19% to 20% all time highs. we think the doj and ecb need to ease and currencies need to come down as well.

>> it doesn't move on inflation. it doesn't move on what the fed does. it moves on growth. >> the 10-year? >> i think the back half of the year. you look at the trade of the international markets. what happens relative to in tphraegz. >> i don't know whether it became clear the growth would come. >> well, the growth wasn't here. >> they need more here today than last week when it was 2.42. >> we see the second quarter strengthen. we're into june now. we have a pretty good read on growth. it makes sense. the back half of the year will be stronger. >> jobs coming out friday. is this something you think continues to build? >> we are looking at that. we are looking north of 200,000. i think it's going to reiterate the message that economic growth

is bouncing the second half of this year. certainly the second quarter. but i think the real catalyst, what everyone will be focusing on is the eecb. a lot of expectation is building into the ecb. i'm curious to hear what exactly they're going to say as far as asset purchase. that's going to be the wild card. are they going to suggest -- >> i'm not sure they will launch or announce a qe program. but i do think you will get a little bit more verbal easing. more talking about the inflationary easing and how that would lead them to asset purchases. >> you see the ecb, followed by a strong jobs number, is that the type of catalyst that could push rates higher much more quickly, or do you think it takes higher than that? >> i think the ecb will move on the discount or refi rates.

i don't think they will go as far as asset purchases. draghi has been trying to talk the market through that. the jobs number will be strong but nothing that's off the charts to scare the bond market. but it is building consecutively every month. it bodes well the second half of the year. >> end of year, where do you think we are? >> i think equity markets grind higher. a lot of high frequency data we have seen in the u.s. is in fact, confirming growth is picking up. you have the european central bank being more and more kaopld aeufb. they grind higher. but i think they move higher. interest rates will also go up. you have the largest buyer of treasuries. >> joe, thank you for coming in. darryl, thank you. >> have you ever been on with diane swank? >> yes, i have.

one time. >> crank and swank. >> we should do it. >> i don't know why we don't. it's tv. >> we should put swank before crank. i think that's probably the right thing. >> tv does stuff. >> there's synergy there. >> we have a new segment. coming up, a hot and muggy oh, in the new york city area the next couple of days. but quirky work to go keep you cool. they teamed up with uber for on demand air-conditioning service you have to see this thing. that's right. it is on demand air-conditioning. we're going to find out how it works in the next hour of "squawk box". financial noise

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range of tasks from farm to film making. that looks like a military drone. i think what we are talking about is almost like a toy helicopter. >> you could see why they would want to have that for tv and film. >> i recently saw a drone that was trying to cover a marathon. it fell on a woman. she was knocked to the ground and she was bleeding. >> oh, yeah. it's bad. coming up, the head of choice hotels will join us. this is ben kaufman, founder of quirky. also known as the world's least important ceo. which is precisely why we tied him to this high-speed train. at quirky, our products are invented by real people who submit their ideas to our website. so whether our ceo makes it or not, quirky will continue to invent incredible new things. products invented by real people like you. quirky.

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welcome back to "squawk box", everybody. in our headlines today, eurozone inflation sagging more than expected. it made half a possess. ecb decision is due thursday. we just talked about it with our guest. that is something we're watching for. dollar general's quarterly earnings missing by a penny.

blaming a harsh winther weak consumer spending. sony will stop making the psp. it will have a device named vida. >> here to talk about summer travel trends is president and ceo of choice hotels. we have the brands up behind you. everyone knows a lot of these brands. have you been to comfort inn? sleep inn? >> i have been to most of those. >> they are all over the country. >> they are economy branded hotels. >> so when with we talk about a hotel capacity up 7% year over year, are they just your hotels? >> actually, we're doing a

little bit better than that. our survey and bookings are up 11%. we did surveys with our customers. they are going to take at least two trips this year. they are doing it most there by car. like last year, they are looking for value. there is still a lot of value to be had. the american traveler is back on the road. >> what is the average cost per night of a room across your brands? >> it varies a little bit. but we represent the 99% of the traveling public. so we are month rat tier mostly. 5,000 hotels in this country. we're somewhere in between. as low as 55%. it can be as high as $85 on average. we have a new brand cambria suites, that is an urban location. it will obviously be here. >> he said the 99%. there's no way. these are for people who

drive-through. they're in a car traveling. they're not on in a plane. they stop because it takes so long. >> there's no driver? >> no, no, no. but you said there's the 1%. but this is for the 99%. >> andrew has taken road trips. >> 88% drive themselves. >> going to the hamptons is not traveling. >> in terms of increase. in terms of the price per room, what does that look like if you were to look at price. >> it's about split between new travelers, more demand, and some rate increases. they ever still pretty modest. >> business travelers are back. even in the down turn. they are hitting the road this summer with the kids.

>> some of them have pools. >> almost all of our hotels have pools. >> seems the last decade the huge trend has been the suite hotels, where you can have a bedroom for you and bedroom with kids. as a family, we look for those on the roads. >> we had a big celebration last night. we have a new rollout for our cambria hotels and inn. it is faux suites. a separate space with a barrier between it. it does not close a door. but it work really well for families. the kids can be on one side with the tv. and separate space for it. it works well for the traveling families. >> and what about the kitchen? >> one is suburban. one is called main industry. 100 some locations. sustained stay. you can stay a week. grocery shopping. >> is that for business travelers? >> a lot of them are doing

projects. in our case, it's folks that may be working on a construction project. they may be doing some training. so they are there for an extended period of time. they want something that feels a little bit more like home. >> did you do "undercover boss"? >> i did. >> what disguise did you have? >> i had a mustache most of my 54 years. they dyed my hair. they shaved it off. >> where did you go? >> i was in florida and indianapolis. >> some of your properties are there? >> we did a lot of them. >> who did you go in as, the pay ron? >> the ruse i was in an unemployed restauranteur looking for a job in the hotel business. >> you have to explain the cameras. what did you find? >> it was a great experience. it was not fun. they keep you up 18 hours a day. they filmed 142 hour of film for

42 minutes of a show. >> wow. >> but we reached out to customers. we got an amazing response. our reservation volume went up 16%. >> what did you think of your hotels and your staff? >> this is the thing. i started out in the business i did these jobs. i did them lower on the tv show which lowered my credibility. but i did all the jobs but that was 30 some years ago. you forget how hard the jobs are and how special the peel are. except for a couple of breaks i would still be making beds. and the desire for those people to have a better life for themselves and their children. >> let's talk minimum wage debate. should we have a higher minimum wage? >> look, i am all for raising the standard of living in this country. but i go to basic economics.

basic economics say if you force a wage rate that's not being driven by demand, your going to destroy jocks. that's what the cbo said. i don't understand how 500,000 jobs and having a million people lifted out of poverty makes sense. what i don't understand is why don't we take half the money on quantitative easing and get a tremendous infrastructure to rebuild the highways, bridges, and airports and that will create good-paying jobs. not force jobs. no one was ever supposed to support a family of four working in a fast food restaurant. >> what do you traditionally pay? >> whatever the prevailing wage. obviously in new york city it's a lot more than in minneapolis. but we're typically not paying minimum wage. we pay more than that. but the minimum wage sets a floor for what then the wages are based on.

>> are the maids minimum wage? >> no. they are higher than that. they may take their first job at that. but very soon they are making more. a lot of general managers start out in hourly positions. >> we have one practical question for you. how much do we leave the maid? >> i'm generous because a lot of these people. $4 to $5 a night for the room. >> do you leave it at the end or per day? >> i leave it at the end. >> do they split it up? >> i think they share it for the most part. they pool it and share it. >> if you're dsk you leave more. thank you for joining us. >> we should tell you breaking news out from at&t. it is now saying it is raising its value. shares of at&t are up 41 cents.

they say they expect to see continued growth that it it adds in the second quarter for wire line. 2014 free cash flow supposed to be in the 11 range. >> auto sales coming out all morning long. tesla owners holding a meeting today. models ex, g.m., ford and much more after the break. and quirky teaming up with uber to keep folks cool in new york city this summer. ceo ben kauffman will talk new products and the latest promotion. "squawk box" will be right back.

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welcome back. it is a big week for the autos. tesla has its annual shareholder meeting. joining us with more on all of this is our very own phil le poe and david shepherd son. phil, why not kick things off with us. these numbers we just got, what do you think of them? >> the numbers expected today for the auto industry in terms

of may sales are strong. probably coming in 16.2, 16.3 range. there has been a little bit of chatter it might be 16.4 million. that's basically where we expect it to be for the summer months. chrysler's numbers coming any minute now. throughout the morning we're expecting all of the automakers to report a fairly solid numbers. >> and is that telling you something about the consumer in general? is this a bounce back from some of the weakness with we saw with the winter weather? >> most of that has been made up already. we saw it in march. we saw it in april. it's all made up by the end of may. look, the consumer, when you talk with dealers all saying the same thing, the upper consumer is strong. they have a desire to come up. maybe not pent up demand but a willingness to say, look, i got a five-year-old vehicle, six-year-old vehicle, it doesn't have the same content. certainly doesn't have the fuel

economy. now is the time to come in. >> what is the mood? are they starting to get their swagger back? >> sales are up. this could be the best may since 2007. third straight, solid month since the winter doldrums. g.m. is certainly in a bit of defensive position since it is trying to get past the recall, the report this month. they are still putting a lot of overtime shifts to meet the demand. so the mood is pretty positive. >> then you have the whole problem with g.m. and that issue is weighing heavily. tell us what you are expect to go hear this week. >> the report from the former u.s. attorney in chicago looking into this 10-year period now tied to 13 deaths and crashes is

going to be tough. it will put the company in for a lot of criticism. not sharing information between different departments and the first really detailed blow by blow as to what went wrong, who knew and how high up the food chain it went. >> phil, how long does this problem persist for g.m.? how quickly can they work on some of these things? what do you think? >> they are already working on some of then. jeff boyer is head of safety for all global vehicles. they have had a slew of them trying to stay more focused in terms of safety. not only with customers but the dealers and within the company. i think we're going the see g.m. on two tracks here, becky, the next six months. you have the recall scandal, if you will. that's going to play out on its own. and you have also get this company has continually had really strong sales. >> is it impacting sales?

>> it's not. people are still coming in. traffic is still strong. a slight drop but not a huge one. and i think generally speaking a lot of public looks at this and says this is terrible. this is a bad situation. the bad models were in 2004, 2008. that's not what i'm seeing in the showroom right now. >> the two big issues, first of all, any news about the gigabyte factory, where it will be built. and secondly, the new models. how reasonable would those be? are they seen as a little cheaper models. is this something an average consumer can get into? >> well, you're talking about the mass market one, becky? >> yeah. >> that's coming in 2017. they can deliver better battery performance while also dropping the price. it will be something to see

whether or not the public truly embraces an electric vehicle. the leaf and the volt had limited sales largely because a lot of people look at this and say why wouldn't i go out and buy a honda, toyota that can get me 40, 4 the 2 miles a gallon. >> the models they have really the s, e, and x? >> yes. . our producer put that together. i don't think they did it. x is for crossover. e -- they haven't officially said it's the the model e. people are saying it represents the every man car. >> they are considering changing the name of the newest model. even at mid $30,000 price point that's still potentially $10,000, $15,000 to a comparatively priced vehicle.

testa, can they continue to sell vehicles in the cache now is people are willing to pay a lot more because of the brand. >> tesla. tesla. tesla. >> telsa. we got it. >> i'm going to ask about the models the next time up. >> when we come back. quirky is delivering smart air-conditioners and ice cream trucks. it is an easy way to cool down this summer. the details from ben kauffman and talk product development right after this. ♪ ♪

(man speaking chinese)

welcome back to "squawk box". quirky has teamed up with uber new york city to deliver the world's smartest air conditioner on demand. we talked about this once before on the show. the world anticipates least important ceo campaign, founder and chief executive ben kauffman made a few deliveries himself this past weekend. joining us now is the man himself wearing -- i don't know what that is. >> this is a hawaiian shirt. >> we didn't have magnum p.i. music. we're going miami vice. we tried. >> what is going on here?

>> i do whatever the tell me to do. he rocks the hawaiian shirt. i chose to pay homage to him. >> this uber thing, i saw it's on here. >> isn't it awesome? we went out in ice cream trucks. we turned it on 9:00 a.m. saturday. all of a sudden we got an order. we delivered. there another order came. we had over 2,000 requests on uber for air-conditioners just this weekend. >> did you deliver 2,000? >> no. we could only deliver 200 because we only have six trucks. >> what are you doing next weekend? >> we'll be out in full force again. >> is uber paying you? >> we entered a marketing arrangement with uber to get the promotion kicked off. >> if i ask for a car, then i

ask for the air conditioner? >> no. you put it over to uber cool and then you hit the uber cool button. quirky ice cream truck pulls up. we will drop it off and keep you cool. >> do you think this will be the best-selling product you have? >> it's off to a great start. >> how much does it cost? >> $300 air companier. >> delivery? >> the whole thing, $300 bucks right to your door. >> and what is this most unimportant ceo about? >> it's the campaign. unlike most companies where ceo has power because at quirky, because we listen to your community, i have none. so i'm giving foot rubs, strapped to trains, doing things for our community. >> you will do a foot rub? >> do you need a foot rub? >> i do.

>> really? oh, my gosh. here we go. >> the world's least important ceo. >> whatever you need. all for you. on national television. good old foot rub. how am i doing? everybody okay? >> i can't unsee this. >> hawaiian shirt live on cnbc. >> this is amazing. >> walk ard enough? >> totally awkward. >> you should see the e-mails by people saying i'm very disturbed by your commercials. >> the most unimportant ceo in america. >> is that why you didn't bring socks today? >> i saw you in makeup and i

thought, oh, my god, he's not wearing socks. hard dress shoes. i don't even ask anymore. >> some people don't wear socks. it did occur to me. paris. remember the heat wave a couple of years ago. >> paris hilton? >> no, the city. they don't have much air-conditioning. you rent a couple hundred trucks over there and you could make millions. >> 20% of energy in new york city is window air-conditioning. ours is more efficient. >> but you don't go international? >> i don't know if they do foot rubs. actually, they probably originated over there. >> it starts with the feet. >> 6 million window air-conditioners. >> i would think most people have them by now. >> different shelf life. a lot of landlords don't provide

them. a lot of the walk ups we drink them. kid that are just moving in and need to stay cool. >> you will draw the line somewhere with what you will do. >> the the world's least important ceo? i have given foot rubs live on cnbc. >> but there's some things you won't do? >> he won't rub your feet. >> will you rub my feet? >> if necessary. i'm in. let's go. >> i'm getting tweets that say i need to do something about my feet. >> compared to the feet i rubbed on national tv, they were pretty nice. they were pretty good. not bad. >> no, no, no. >> we have to go. thank you. we do appreciate that. always fun to see you. we have to go.

we have to go. it's been a nice rebound. key jobs data. we'll talk about the prospects for u.s. and european markets after the break. apple making moves into digital health for your home. we'll talk about it. yesterday's announcement from tim cook. squawk box back in a moment. there's this couple in sydney. worked hard. raised two kids. they've never been to moscow. but they sent money there. rented an apartment. all because, they have this 19-year-old daughter who loves to dance. in over 700 cities worldwide, products and services that make a citi client anywhere a citi client everywhere.

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new closing highs for the dow and s&p as investors get ready for key data points. we turn our focus to the jobs front and speaks speak to the ceo of paychex. >> apple firing the first shot in a new app war. >> half of our customers in china in the past six months switched from android to iphone. this is incredible. >> what investors sho take away from big announce.s. >> and who pays the highest property taxes in new york as the final hour of "squawk box" begins right now. and welcome back here on cnbc.

squawk on the feet. i'm joe kernen. "squawk on the street". today it is squawk on the feet. becky quick is here. >> and i agreed to that. >> i saw it on the things. i thought there was a chance. you know, there was a whole under belly of society if you google. really uncomfortable. because it seems like you enjoyed that. you were perfectly willing to go with that. let's look a feet exhibitionist. i don't know who is weirder, the the feet -- what's it called? >> no peeping tom is called a -- >> peeping tom. >> fetish. >> there is a term for it. >> voyeur. >> i don't know who is worse, the foot voyeur or the foot exhibitionist. >> i'm looking to become a foot

model. >> like george. george was a hand model on seinfeld. >> i think that might work. except for a couple of those blemishes that the whole world knows about now. >> his feet aren't bad. >> let's talk about food. >> good idea. in our headlines, pilgrim's pride is increasing to $55 a share from $45. all that may be moot because hillshire says its own agreement to buy pinnacle foods does not allow it to terminate. that's a condition of the tyson and pilgrim's pride bids. we are watching shares of at&t. the company raised its full-year revenue guidance on strong wireless trends during the current quarter. at&t is expected to add 800,000 long-term wireless customers to this is quarter compared to 551,000 the same tool a year ago.

edmonds.com is estimating industry wide it will be up 7.3%. edmunds.com is reporting general motors to report a 6.7% increase. toyota, 10.5%. chrysler, 14.4%. ford, 0.9%. >> let's get to one of the biggest buzz stories. dan marino among 15 former nfl players filing a concussion lawsuit. there are at least 300 other lawsuits claiming similar negligence. he doesn't have a significant history of documenting concussions but did have a neck injury late his career. so this is going to make a lot of news. people are going to talk about this a lot, what it means.

>> new data suggests they may not actively be participating in the market. e trades 14% in may compared to april. trading has been declining on what a monthly basis. charles schwab and etrade. >> it's not that big from an investors perspective. they are just holding to some of these positions for longer, which is a fair point too. >> it's a big week for economic data. and someone is writing on twitter. quintin the tarantino. i thought of uma thurman.

john travolta and samuel l. jackson, it doesn't mean zero when someone rubs another person's feet. >> you going with that? >> nowhere. i got thrown off a roof because he did that to marcellis wallace. he actually did something. you don't want to rub someone's feet who is married. i don't know whether pillar knows what happened. >> she hasn't said anything yet. >> no. she's watching the "today" show. >> adp private payrolls.

hans olson just took his shoes off. that's a one-shot deal, hans. rebecca patterson, were you watching earlier? >> i grew up in florida. we never war shoes. >> true. i ain't seen my shoes all day long. what about the jobs report, hans? and then we'll get to rebecca. >> i'll still stuck. >> i can't un-see it either the the whole day is shot for me. >> maybe there's a new cottage industry in foot rubbing. >> you were just so comfortable, just whipping them out and putting them on the desk. >> 4:30 is usually when i get my foot massage every day from the

butler. >> consensus is 215,000 for friday. i think it's going to come in for that. and the real question will be revisions for the higher numbers. and the trend is higher. >> as we accelerate does every quarter get better? >> look, i think we will be trending 2.5%, 3%. we'll get a number above 3%. >> we will? >> sure. >> will it get to 4? >> you know, that would be the surprise. if you look at that first quarter gdp number and you look at the components of it and revisions from the first print, what was revised higher? consumer spending.

consumption. you will see a catchup in inventory rebuilding or restocking. it has been postponed or destroyed. pretty about story. >> what were you doing when hans was talking? did you have a problem with anything he said? >> i'm a big fan of hans. i am sitting here intensely listening to what he is saying. the data we have gotten out of china the last month is stabilizing. ecb question mark how they price in. it is certainly adding some support to europe's recovery. swra pan looks like it might be in the worst. i think it's good news all

around. we are getting four times more firms up versus down. it is good news at the end of the day for corporate earnings. >> you heard the story we just talked about. where is the individual? there's no trades? there isn't much excitement for new highs every day. it is sort of just grinding at 20, 30 points a day. the next move, will it be 200 points up? will we hit 17,000 on the dow. 18,000, 19,000. >> there is more upside for equities. they tend to go hand in hand. with valuations in line with averages it's hard tore post the gain.

it's still a grind. we're still holding on that position. we have taken our commodities up to neutral. still being attractive to us, common in the u.s. and china relatively speaking improving. really importantly in this friday's payroll number will be important to watch for this. the fact that u.s. inflation has turned the corner. still low. i'm not waving a yellow flag. but it is ticking higher in america, not lower so you want to start, just start taking first steps in a portfolio to think about that inflation risk. and going neutral in commodities is an easy one to do. >> i was watching a news piece last week. people actually went product byproduct where people are used to getting 10 juice boxes. you now get 8 for the same price. you used to get 24 cookies.

every single thing. diapers. every single one in the last six months they have taken 10% out. >> isn't it because in a down turn, in a time you are trying to return from recovery, it is easier to cut what you are giving people rather than cut prices. >> you are right. if you look at the wage growth, hourly earnings. if you look at rent increases which factor into the cpi, which factor prominently. those things are -- the amount that people are paying of their income for rent is up above levels that we haven't seen in quite a while. in some areas it is crowding out other things. you would expect at some point it will manifest broad inflation numbers. we have certainly turned the corner on any talk of deflation in the united states. we have the the workings of a capitalist economy that is doing

what it should be doing, right? >> uh-huh. all right. used to be 350 for dr. scholes. we're going to beat this to death. who does the athlete's feet. that poor kid. he went running. >> did he? >> he did, didn't he? >> did he go to wash his hands? >> i wanted to wash my hands afterwards. people are tweeting more corns than a july 4th barbecue. >> you don't have ugly feet. >> thanks. >> feet in general are just creepy in general. it's just feet. >> elbows, knees. >> elbows are kind of gross too. >> coming up, a lot more of my feet. plus, apple giving an update to

a system and making new app announcements. pwup where is the tv? the talk, products, innovation and a lot more from the biggest tech company. as we head to break, check out the squawk market indicator. and the feet indicator later too. with all the opinions about stocks out there, how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today. in a we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better

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welcome back to "squawk box", everybody. we have been talking auto sales all morning long. chrysler rose 17%, better than 14.4% they were expecting. phil lebeau joins us with more. >> what stands out about the chrysler number is not only they beat the street. jeep. sales, the best ever monthly sales in the history of jeep. chrysler is estimating that the auto sales pace for the month of may was 16.9 million vehicles. that is way above what other people have been estimating both on wall street as well as in detroit and the auto industry. most are saying 16.2, 16.3. chrysler is out saying may was so strong the saoeuls pace will be 16.9 million vehicles. so that's worth watching today

as we get the other numbers from the other automakers. >> are there big sales over memorial day? >> strong memorial day. great weather. and five days after memorial day. remember, you get a lot of traffic coming into the showroom. you have five days afterwards to close those sales. we heard from a number of o dealers who said, hey, memorial day weekend was fantastic. i think that's what we are seeing here. if the $16.9 million number is true, that's huge and represents a big breakout in terms of the american consumer. >> do you think this is a sign that the american consumer is back, or do you think this is potentially between great weather that pulled sales forward? do you expect that to continue, jim? >> becky, they didn't pull sales forward. there were not huge incentives. they were a little bit richer. we were a long day from the 2003, 2004 when you go into a showroom and you automatically get $5,000, $6,000 off the price

of a car. we are not seeing that now. it is a rather competitive market. sure, in certain segments, certain models, you can find a sweet deal. right now what you are seeing is you have a lot of consumers because of the economy and because of the job situation, a lot of people are saying, okay, now is the time to go out and buy. or more often than not, they are also leasing because those lease payments are so low. >> all right. phil, thank you. the best may sales since 2007. phil below, we will talk to you again soon stpwhrb apple announcing home automation and home tracking software. skroeupbg us is jonathan gellar, founder and editor-in-chief. you were pretty impressed by what you saw. >> i was. amazing event. we spoke a week before. no one knew what they were going to do. a lot of big surprise. >> it was a little in the weeds for people who aren't falling

every day. >> it is. that's why you can see the reaction, down a couple of points. it's not taking effect. the reason why, there's no products. no new phones, devices, tv. but they have laid the foundation, the groundwork for things to come in the second half of the year. it's going to be a huge second half of the year for them. >> why is this so important? it's about opening up the system. >> it's about giving customers things they have kind of wanted. they have wanted other key boards, ways for apps to talk to each other. the system got a little old. they opened it up in a secure way. not undermining the safety and security of their platform. >> i'm a huge fan of the keyboard. this is something that does that. andrew has been excite build a bunch of other things. >> i'm psyched about so many things. but the the question i have is whether apple -- when you think about the i cloud and all the things they're trying to do, whether it will all actually

work. meaning apple has struggled when it comes to services historically. not only will they have to do this all the time. but in the initial load factor it is going to be tremendous. and what happens during that pivotal three or four-week period where everybody is uploading and downloading images and video to the cloud? >> well, i think it's a great point. the only stumble we saw was mobile me. 2008 or 2009. ever since then, you don't hear a lot about itunes problems, app store problems. they have been really good. and i think they will be ready for it. apple is starting to get better at the things google does. what apple has done with their eco system and being able to leave off what you're working on multiple devices, switch and have phone calls. these are amazing, cohesive things. >> google will come out with its

own android app in the next two or three months. >> sure. they will announce it this month. google has been great about the features. it's about refinement. people are on old android operating systems. only 14% are running the latest android version. so a lot of people are stuck in time with the features android announced. >> what do the phones look like? 4.7. rumored 5.5 for another one. it's possible they will go that big. i would expect two new phones and two ipads. they are like desktops. it will be an amazing second half. >> thank you. >> thank you. >> coming up, france to the rescue of b and p.

and later, if the small business jobs index from paychex. how the engine of the economy is running. as we head to break, have a look at the footsie. e

financial noise financial noise financial noise financial noise

welcome back to "squawk box". the french government weighing

on on pariba paying a $10 billion fine to the united states. they call such a penalty unreasonable. they have been negotiating with u.s. authorities who are investigating whether the european bank evaded u.s. sapbgszs. wha lot of market watchers waiting for this. then you think your property taxes are high? wait until you hear the numbers for the highest taxpayers in new york and how they stack up against the rest of the country. right now as we head to break, u.s. equity futures. still indicated lower. dow futures down by 35 points. we did see strong numbers from chrysler. ♪

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welcome back to "squawk box"ing everybody. pilgrim's pride raising its price to hillshire for $55 a share, topping the original $45 a share, as well as $50 a share for tyson foods. india's central bank loosen credit.

australia central bank kept cash rates steady. big economic data coming up. the focus of course on friday's jobs report. we also have a key rate decision from the ecb on thursday. steve liesman joins us with a preview of what you need to watch. >> they have pwfpb saying next time for a while. i'm going to save on that. tomorrow morning we will have the cnbc fed survey -- -- -- fed aoe tkeulgz. quantitative the easing as well as additional long-term guy answer. >> would it be something they do thinking it was a big success he he here? is there anything that could

scare them away of not being able to get out? >> i don't think that's their question. it is their rules and how they would get around with what and how they would buy it. that would be a key issue. >> let's talk about u.s. data. i don't expect to go on three times today to correct the ism reports like yesterday. you can see what happened when we corrected that data from the ism and their mistakes. watch this vehicle sales number. you were listening to phil in the last hour. >> way better. >> not only that, but chrysler is saying the whole country could do 16.9. >> right. >> that would be a massive number. it is the first time in seven years we have had that kind of average. this is right along with that spring bounce back. >> very important to check on the health of the consumer.

>> that's one thing. the other thing we want to watch, becky, once they start to sell more cars, this is for their production schedules. it works into growth and gdp. wednesday, that's tomorrow. 210 on adp. international trade should be pretty much in line. watch for the services. 2:00 in the afternoon. thursday, jobless claims. friday, nonfarm payrolls. 210. 6.4%. here's two measures you can see right here. had been going along together the last several years. look at the error rate in the private sector. you can see it over there. >> you took it away from your

pike. 38,000. 23,000 in the last month. so pretty close. rapid update. minus 0.8% in the first quarter. and 3.6% for the second quarter. there's the bounce back. do we continue at a 3% level or go back down to the 2% level? a lot of bets on the 3% growth. we will watch factory jobs as well as vehicle production. >> i didn't watch the ism. you had to correct it? >> they came out with a number 35.2. they were plugging the incomes in. he said this the doesn't make any sense. he thought what they did is used the prior months seasonal adjustments for the may data.

which it was a big disappointment. the market sold off when that number came out. >> they messed up? >> they messed up. but then we called ism and talked to the ceo who told us that the number was 56. about 40 minutes or an hour they call and say no, it was 55.4. so we had to go on twice with that information from ism. the first number out of the chute was the first national number. i think i said on this program was six of the seven regional manufacturing were reporting to growth. so this showing that growth had decelerated was surprising the market. >> you had to fix it twice. >> big surprise. >> steve, thank you. >> my pleasure. >> iranian oil exports are

running higher. cnbc's chief international correspondent michelle caruso-cabrera is here with the details. she spoke with members of the treasury department to find out what's going on. what is it? >> if you look at what iran exported from july 2012 to october 2013 that's the month before we started negotiating with the iranians in november. they were running 1.07 barrels a day. you can see what happened the subsequent months. november to april of 2014, 1.23 million barrels per day. q1, january, february, march, you have 1.36. we would be close to 1.5 million barrels per day. six or seven countries okayed by

the u.s. government to be allowed to keep buying iranian oil. they had to find other sources. the biggest buyers were the chinese. there's a lot of volatility. it is a day by day number. what have the chinese done? they have dramatically increased. running $800,000 a day. that's a very, very high number for them. they give two different ones. well, the period of time where we said it would be a million barrels per day was six months. we are already out six months if you count november. if you go to january, which is when they signed everything, we're not there yet. boy, you have to see a huge reduction in the next couple of months. the other explanation is they are selling a type of oil product. >> did we count? >> we seemed to have accounted

more. before they aoefd sanctions much. it was 800,000 barrels a day. somehow we have never gotten a clear explanation whether or not there was a legal decree. david cohen is the secretary of treasury in charge of administering the sanctions. cool title. terrorism and financial. is the administration looking the other way? >> we are not. what i would say, though, let the process run its course. we are in the beginning of june. we have more time on the joint plan of action. we will watch to see how things develop over the rest of time. >> i was at a big conference yesterday. they talk about natural security. that's the one bottom line is now sanctions are considered part of -- for a long time

people thought they were a failure. now look look. >> and i guess no clarity where we are. this is working on the front with from the a nuclear perspective. >> well, i think what is absolutely clear we can say there was a middle to limp nate any nuclear power in iran. they have given up on that. now it is to what degree. iran will be a nuclear power. will they have arms or just be for energy? >> what about sanctions with putin and russia? >> i asked if he thought putin backing down recently was in response to sanctions? he said it has dramatically hurt their economy. he will leave it to the history

books for them to back down for now. >> the glasses match. how many pairs of those do you have? >> i have six pairs of war by parker. it was total coincidence. >> really? >> this guy is loaded. all these glasses now. >> glasses for 100 bucks. >> you have the tie. everything is going. >> do you paint your toenails? >> did you see his toe nails? >> whose toenails? >> you didn't see it? >> you painted your toenails? >> no, i did not see it. >> don't the show people's feet on television. people with feet fetishes. >> he got a foot massage. >> a vision in orange.

you're up. >> no, you are. >> i thought you were. the whole orange thing. >> which is the new blue. >> orange is the new black. ceo of paychex and the latest jobs index. and second biggest cost of home ownership is property taxes. if you live in new york, expect to pay five times the national average. that's according to zillow. what pays these outrageous numbers? find out after the break. i want to do something with this day. i want to build something. create something. i'm only one in seven billion, but i know i can make a difference. i'm just asking for someone who believes in me. for over 200 years, citi's job has been to believe in people and their ideas. wherever ideas come alive. wherever you are. the world's citi.

new data out showing top property taxpayers in new york. robert frank is here with more. >> yeah. we didn't just do insure. we did new york, new jersey, connecticut. the top property taxpayers in the whole tri-state area. coming up in number three, charles wang. his mansion in long island has a market value of $36 million. his property tax over a half million dollars. number two is a name familiar to those in financial circles. brad jack. his ocean front mansion in fairfield, connecticut is on the market right now. it can be yours for a mere $62 million. the property tax bill is $579,000 a year. >> didn't he run into a problem? he was arrested about a year ago

for buying some prescription -- forging prescription things at cbs. >> he's had some issues. and i think he helps pay for the local police with his property taxes. coming in at number one. the number one property taxpayer in the tri-state area is ira renner. this place has a market value of $247 million. it's on 63 acres. main house has 29 bedrooms, 39 bathrooms, an additional 30,000 square feet of out buildings. his property taxes are $649,281. but they're actually a bargain if you look at comparable properties in california. and the formula one heiress pays a million a year. gary winnick 979.

you look at this. for the wealthy, they do pay a lion's share of the income taxes and also property taxes. >> but you look at it and it's like cry me a river. >> we are not feeling sorry for them but you look at your own tax bill and you think of paying a million dollars in property taxes a year. that is a big check to write. >> i thought in california it was set up so you -- at one point if you lived there for 10, 20 years you're not going to be paying property taxes. >> the three i just mentioned have recently purchased houses. >> so it's a new house. >> the northeast it takes a lot longer to catch up. now that values are coming back, property taxes will come back as well. >> you did a survey to find out where the most expensive were in the country? >> you look at the actual tax burden, the top two are

westchester county where you grew up is number one in the country. >> thank you. >> number two is nassau county in long island. number three is right where we are now, bergen, new jersey. average of $8,000 a year. >> that's ridiculous. >> yeah. >> it not the market value. it is hard to compare these things. they look at how much people actually pay. those are the three counties where people pay the most in the country it's something we don't talk about. people go crazy over property taxes. we talk income taxes. we don't talk about these as much. >> it's tough for retirees. >> there's a lagging effect of two years. so we haven't seen yet the effect of these property value increases the last two years on

property taxes. >> and they went down. >> that's correct. >> it was 30%, 40%. >> the wealthy were suing the towns saying you have to reassess this. >> you were immediatealarm bell head, right? like throwing out a fishing line for the weirdest people in the planet. >> we have an affluent, sophisticated audience. i know that. >> do you think there are some among them? >> i think there are. more on the web than tv. >> the dark, under world subculture. >> we'll have more foot rubbing. also jim cramer on the markets hitting highs. what you need to be watching in today's trading session. stick around. tomorrow the on "squawk box", guest host and auto nation

ceo mike jackson on the state of the auto industry and the economy. plus, top business leaders from the yale ceo summit. merck's ken frazier, jerry lopez and steve miller. right here on "squawk box". profit from it. financial noise financial noise financial noise

welcome back to this is andrew in slow mo getting a foot rub from ben kauffman, in honor of this momentous event. here's a look at some feet moving stocks. foot locker, deckers outdoor, dsw. >> in the box. >> nike and brown shoe. >> and folks he hasn't put his shoes back on because his feet are slimy and sweaty. >> still have the gross lotion on. >> so we're all better off because of that. >> yeah. >> let's get down to the new york stock exchange where we probably grossed out jim cramer. >> star of squawk on the feet. >> how are you? >> well, i loved your piece.

i mean allergan is a drug company and they're about trying to solve problems and i think what's happening is a shame and i want to say it, i think more ceos should come out and say it because piatt developed the best drug company, not a poorly run company, the best run company. thank you for what you wrote. important people speak out. >> here's the question. do you think -- this is the piece i wrote in the "times" about valeant and allergan, do you think that allergan is really trying to push back on the transaction to say no we'll never merge with you or part of a negotiating dance for a higher prices. >> i think it's a negotiating dance. it's probably a foregone conclusion. it's look, i just kind of feel i wish that companies that don't have a great reputation about r&d wouldn't go after companies that do have a great reputation because i want drug companies to solve problems, not to be sales forces. >> right. >> how do you play the hillshire situation this morning? >> you got to stay long hillshire.

obviously this is a company that is a proprietary company that are to commodity players. they want more aisles in the supermarket. i got to tell you, where does this leave pinnacle? pinnacle was the way hillshire was supposed to get away from being meat that was not natural and organic. pinnacle has bird's eye, but hile shire is amazing. this company was 32 bucks a couple weeks ago. >> the bed and breakfast links or patties? >> we do -- when we're in a jam, we go to summit diner for our bacon there, joe. you know, they've got pretty good rashers. >> all right. >> before you go, apple? quick opinion. >> hey -- >> what did you think of yesterday? >> you know what, since when did people feel that this developer conference is anything other than opening the commona to developer offers to do more stuff. i thought this was a shame that the stock ran in anticipation. this is actually a nuts and bolts meeting and i know that

they said they're disappointed. disappointed in what? in the schematic of a machine? enough. the company is doing well. >> jim cramer, see you in a couple minutes. "squawk on the street." when we come back the ceo of paychecks, back in a moment. ♪ no matter what kind of business you own, at&t business experts can help keep it running... seamlessly. so you can get back to what you love. when everyone and everything works together, business just sings.

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this morning we're getting a read on the climate for business with the may release of the paychecks small business index. joining us first on cnbc with the results marty musi, the ceo of paychecks. good morning. tell us about the survey? what did you find? >> we had a little moderation from the april survey, but it is our best three months combined, the last three months, since we've started tracking the survey really back in 2004 when the index started. >> so, what did the number, it was up by how much? >> it was down a little from april but the three months show the strongest growth in small business changing growth in jobs since we started tracking the index. we feel pretty good about it. slow, steady growth continues. >> when you look across the nation i'm sure some areas performed much better than others. where is the strongest part of the nation right now? >> yeah. the western regions are still growing stronger than the eastern regions. i think a lot is the high-tech jobs in the pacific northwest as

well as the housing rebound and kind of the arizona markets and some of the areas of the california housing coming back a little faster than on the east coast. >> looks like in the northeast that's where you see the biggest problems. new jersey, pennsylvania, new york. any, new york, and new jersey have foreclosures that take a little longer through the regulatory process. we think some of the foreclosures are just getting done there in the east side where the west went faster and are recovering quicker. >> how do you actually compute this index? what components go into it? >> we look at 350,000 of our clients same-store sales. kind of year over year. and look at the number of jobs that they have this year, versus last year at the same time. so it's the same-store worker count, the growth, it's really the growth in employment in hiring year over year. >> when you talk about small business you're talking about 50 people or less. >> yes. under 50 employees, that's correct. >> and in terms of what these people tell you in the surveys you do and hear back from them, what are their biggest concerns

and maybe how optimistic are they feeling overall? >> you see a lot of mixed results as you talk about today. consumer confidence, some numbers are up, some are kind of flattish. i think small businesses still looking to add slow and steady and being still cautious about the environment. but feeling, you know, it's good that it's continuing and it's sustainable growth, but it's still slow. >> i read somewhere today that, you know, this has been a pretty amazing year. washington finally seems to be kind of stepping back. you don't see these big pricing moments we've seen in the past where congress and the administration are kind of going head to head on issues. apparently, though, from what i've been reading today small businesses are still having a tougher time recovering from some of that. do you think that's true? >> yeah. i think small business has to be more cautious and so when they saw health care reform and number of other changes, they're cautious about how it's going to impact them. when they're just looking at health care reform it's changed a number of times. the dates have changed, how it impacts businesses over 50,

under 50 employees. i think they're more cautious. they're always a little more on the edge when they're under 50 employees than the larger businesses who can sustain a little more change. >> we do have government jobs report coming out on friday. based on what you've seen with the surveys you've done with this index, do you expect that number is going to be a strong number? >> well, we don't -- this isn't really a predicative model but i would say based on who we've seen it would be around the same number or maybe down a little bit. it's not really a predictor of employment. it's more what's already happened. >> is it strange, though, to think that april was a slightly worse number because i had been thinking the first quarter was a bad number from the gdp numbers we got, from the weather, did it surprise you to see a dip in april? >> well, april was a little bit -- april was stronger and then may dropped a little bit. >> i'm sorry, may, dropped in may. >> dropped a little in may. i think april my mite have been some of the hiring coming out of the storm and a little more rebound there in april. but when you take the three months together, march, april, may, it is the strongest increase in rate of hiring that

we've seen since the beginning of the index in 2004. >> all right. we'll take some good news on that. marty, want to thank you very much for joining us today. >> great to be here. >> again, marty mus snishgs thanks, everybody, for a fun morning filled with feet. join us tomorrow. "squawk on the street" begins right now. ♪ move up to your destination ♪ though you may find >> good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. stocks are cool to the touch this morning after the dow and the s&p seven of the eight past sessions. factory orders in about an hour. ten-year note around 2.55. the story around rates continues to be in europe ahead of the ecb on thursday. eurozone inflation at a