>> good morning, everybody. happy hallow week. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. the fans of cleveland getting a treat last night with lebron james returning. but they got a trick at the end of the night. the big shot coming from carmelo antho anthony. james would only have 17 points on the night. i think they're still happy to have king james back in down. >> sure. would you sign -- if we could swing it with amc, would you sign on for this music every morning rather than the -- >> we have it 50% of the time? because it doesn't work when it's a happy day. >> it only works when the stock market is falling apart. >> we use the scary other ones.

but do i like it much better than the happy music at the top? i do. >> do you? >> i think we'll get sued because it so clearly identifies with the walking dead. >> we had our walking dead pictures up there. >> that is why we have lawyers, don't we? probably more overall financial pep than amc. >> we're bigger so we win? >> andrew, isn't that how it works? money controls -- >> you're tempting fate. >> we have the money. >> i think they like it -- it's the biggest tv show in history almost. >> and what do they say about imitation being the highest form of flattery? >> there you go. forget sugary chocolate the global market is getting an entirely different boost this morning with the bank of japan expanding monetary easing. policymakers citing worries and a decline in oil prices that can

hurt the areas. the yen dropped below did dollar to its lowest level since 2008, 1. 6/0. check out the futures, at this point, there are some huge up sides to this. dow futures look like they're indicated to open up about 188 points. the s&p futures, up by 22 points. the nasdaq futures up by 60 points. and if you check out was been happening in europe with some of the early trading there, you'll see similar moves. in france, the cac is up by 2%. german dax up 1.6%. the ftse is up by more than 1.1%. >> and on this last day of the month, let's get a little month in review. october has been a wild month for investors. if there was any doubt, check out these stats. here we go. from the lowest intra day point this month, the dow is now up by more than 8%. the s&p has gained nearly 7.6%

and the nasdaq is 10% higher. with the final trading day left, here is how returns stand month to date at this moment. the you dow, s&p and nasdaq each up about 1%. the small cap heavy russell index gaining 5%. >> the core of any gains we could see today. sfwh we're going to have more, of course wrb on the global market rally in just a minute. then in the next hour, legendary investors marc lasry. >> you may be surprised, he is in and out legendary. he had to have done that fairley young to be legendary.

that's a legendary tennis player and -- sports team owner, as well. he's having a ball, apparently. as far as the broader markets, i don't want to look at oil yet, hold on, but did they end qe a couple of days ago? >> yep. >> what does this mean? does this mean that it wasn't qe or -- or does it mean the baton has been successfully handed off to a 3.5% gdp? >> i think -- >> how about gdp? 3.3%, 3.4%? >> we've been waiting to where we could take the training -- >> you're right, it was 3.5%. >> training wheels come off, economy is growing. >> yep. >> and, you know, obviously, monetary policy works. in japan, i can't believe they respond to any policy that's not economic health.

>> i that you was what was so big about that, the japanese central bank was freaked out by the oil prices coming down and put them into a panic and made them do this. >> consumers are used to paying banks interest to hold their money, aren't they? let's look at why it would be a problem. 2779 at my gas station today. >> i saw $2.63. >> did you, really? >> yeah. cash, not with credit. >> but you're feeling up a -- what is that thing? its was an 18 wheeler the. >> it was already full. i couldn't ee stop and take advantage of it. >> wow. 7 handle, low 7s, i would still not cry for anyone, for argentina or anyway. >> this is making the crude oil guys pretty nervous. >> wah. wah.

>> the ten-year is 2.32%? the yield has to go up. let's look at the dollar. do i have 110? not yet. 125. >> 2.5%. >> and then gold i'm looking, we need 11. >> we got it. go down. go down with oil. >> nothing like being -- having a vested interest in every market and keering it on one way or the other. >> where did you go to germany? >> i did not go to germany in -- >> i just violated every rule, did it not, as a kid? >> the true is, everybody has their guyace he that don't

exist. everybody has biases. >> injury seeing even the mainstream media might have a buzz. >> sure. >> did you see in the journal the ten biggest halloween -- >> i saw it online. >> the in, times' tend commandments are the "wall street journal's" ten biggest halloween myths. >> what's a halloween myth? >> you have to read them. they're really good. can i read you some of them? >> yes. >> governments -- >> what knows what he's going to throw at you. >> for me, liberal is like tea party. actually, you use teabagger the. ever. >> tell me one. >> government spending stimulates the economy. republican candidates always have a big spending candidate over the democrats. raising the minimum wage helps

support. global warming is causing increasingly violate weather. you're supposed to sell off your land in moment. voter i.d. laws depress minority turnouts. this is a one. bicycle is gaining popularity. >> it is gaining popularity. >> hello. mcfly, it is. >> what is i annoy, up to 40%? popular now? >> it's more popular than it was before. >> i am find you a poll and give you the numbers. >> let's move on to another story. citigroup adjusted third quarter earnings southbound executiving assize an additional $600 million to cover legal costs. kayla touchy is here with more on this.

was this a huge surprise. >> it was a surprised that it wasn't disclosed because of a nuance and when the information was obtained. so citigroup adjusting its earnings by 20 cents a share and it attributed the negative change to what it called rapidly evolving regular tatory increase s. and it's been negative for the last service process because of angry new byanalysts said it's signaling broader issues at the bank. nomura's steven shuback said last night we expect that as management teams receive additional guidance from regulators, the firms will mrishl additional disclosure us/build legal reserves for such

matters. they're being investigated by authorities on fx matters and disclosing another investigation into fixed interest rate drops. while the investigations do appear advanced, citigroup, while it has the highest market share in fx, it's no alone. this week, joich what yeah bank took a $1 billion cut for this issue did i group's was taking $900 million for issue in the quarter. it says the closer the lightning is, the louder the thunder gets. so basically we don't know if a settlement is coming tomorrow or the next day. or even on monday. but as you get closer, that is when the numbers start and own then can the bank responsibly think about what it needs to spend. >> so that gives us some insi t

insight. let's bring in marty mosby. marty, let me ask you, what kayla ended with is a very good point. the idea that we might be getting closer to a settlement. what does that ultimately mean for the stocks? >> well, when these settlements get done, its takes the pressure away. this isn't a new issue. what we want to say is what are the ultimate costs until we get it behind the bank at this point. >> so the numbers that were bandied about last night, the initial reaction did put some pressure on the stock. what happens if you actually get the settlement? do you expect the stock to trade up from that? >> yes. initially, citigroup has had its trouble going through c car. if this is a control issue and accounting, all of a sudden that starts to open up a whole other problem for them as they go into next year's c car. but we don't think this was a control issue at all.

this is really timing and this is a normal course in the accounting principals that say before you put up your q, if you have a meaningful issue, you need to go in and adjust the results. >> marty, it does seem like this is an issue that's been telegraphed for some time. but it does leave the question of whether you can value these stocks even now, even six years after the initial crisis and it's helped predict what the numbers are going to be. at what point do us we feel like all the banks are finally out of the woods and we're not going to have to spend any more money on these legacy legal inches. >> what we've seen in these legal issues is the fact that they've been able to pay as they go. even with this adjustment, citigroup made money last quarter. it's not as if it's dipping into its capital pool. if you look at the impact of the rescission last night, it took 12 cents off of its, it's, $57

tangible book value, which is less than 0.5%. what we can say is investors look at them, question quarter from the next underlying fundamentals and momentum is still there. >> marty, we just saw that you have a buy rating on this stock, that you're looking for a $60 price target. which of these financials do you like the best? >> citi, going into 2015 is one that we think about build momentum as it gets closer to that c car. last year's failure was a big event auto. as they're being able to work through that and begin to see the ability to push through it and eventually we think even pull an ipo off of one main financial sets that they would be able to release some capital and even deploy meaningful amounts back to the shareholders next year. we think that will give it a nice lift going into 2015. >> marty, thank you for joining us. kayla, thank you. >> what have you got?

>> okay. here is was going on here. we're having a debate -- >> we're not having a debate. your sense tells you to push back on everything i say. but you're going to push back whether you have facts or not or this? >> i am. >> can politics count for you or not? does the washington post count for you or not? >> yeah, it's in here. >> it's auto here. >> you want do to go through them all? >> no. here is the -- look on the screen there. we're currently at 38.1% in favor ofbacker obamacare, 51.6% opposed. here is the chart as it goes back to 2010. here is approve, here is disapprove. >> okay. >> so where is that rising? where is the approval? you told me it's rising. where do you see that? >> the wording that you used in this -- >> it's the myth that it's getting more popular. and you said oh, yes, it -- >> actually, t technically getting more popular in states

that people are not trying to repeal it the way they wanted to prosecute. i was thinking about it in that context. >> so it's getting more popular as to how you asked the questions. okay. okay. >> here to join with us, jim oleando and jeff. the question we asked earlier, since you're more economics oriented, jim, is have we finally passed the baton now tore a gdp of 3.5% so the market is moving up, no more qe? are we ready? the training wheels are off. >> well, i think if you look at the labor market, we've been chugging along at 200,000 plus for a while. gdp has been weak relative to employment in the cycle. a lot of that is secular trends. i think you have to change your view of an average growth rate. i think 2% is a potential growth

rate at this point. i think legitimately the trend is now 33%. >> were you jumping up and down at the lows of october? >> no. >> the vix was overbaurt, treasuries were overbought and in our view, stocks were oversold. we're sitting here with our 2100 full year forecast which we thought was going to be a 10% year-end rally. we changed that to a 15% year on rally at 1820. >> you mean for more? >> for more, 1820. >> i think we're up almost 10%. >> you've got this much already, i think you should go to 20. >> we're looking at the s&p in the 2500, 2600 neighborhood. >> did you see his tie? i like it. >> i looked for an orange tie. it's great.

>> this is as good as i could do. are you sure? >> i like it. >> this is so orange, it turts me. it hurts me to wear it. it hurts me to have it on. well, that's good. how does it -- why is october always having the major lows? >> okay. so the one thing we keep hearing about is that 5.9 the% isn't real and that it's participation rate driven and that it's part-time workers and that there's no income growth. is 5.9%, should we feel good? why do we feel so bad about the employment picture? why did 70% think we're going to wrong way in this country? >> i think you look at the confidence numbers and both the confidence core number and the

michigan number. they're at recovery highs. i think there is some appreciation for the fact that the labor market has been improving. and within the conference survey, the relative amount of numbers who are saying the jobs are hard to get, they're plentiful, and it's been consistent approval consistent with the unemployment rate. meanwhile, we go back to the numbers, we're getting a 2% rate of increase in employment, 227,000 per month so far this year. the working age population is growing 0.9% this year. this is more than enough to keep bringing down the unemployment rate. it's totally unambiguous that the labor market is improving. >> do you think, either one of you, that we wait until 2016 for the first great entries? >> absolutely not. >> we're still on the june the 15th camp. that is spendant. we think it probably happens somewhere in the middle of next year. >> if that happens, do you think the stock market stumbles at that point?

do you think expectations are baked into this? what happens? there has to be something in the market. >> i think initially there is that negative knee jerk reaction down, no question. but at some point, the market will think it through and say b with wait a second, if the first is normalizing that and ultimately that drives stocks higher. >> wow. and next year, do we get double digits again? >> 2350 by the end of next year on the s&p. >> what do we end this year? >> 2100. >> that is 250, another 10%, then? >> yes. and, again, looking at 25, 2600 discounting 16. >> you don't have to make predictions, so you can protect yourself. give me auto ten-year prediction. what's the yield by tend of next year? >> i do make forecasts. >> you do? all right. >> the s&p i think continues to go up and i think the back drop

is positive. but the bond market will have to replace significantly. so 3.8% next year. >> inflation will be around next year, then? that's the key. it's unambiguous if the labor market is improving and the fed acknowledged that is in the at the same time this week. they're increasingly coming to the view this is absolutely for real. that is really where the uncertainty is, i would think. the labor market side is looking very good. >> really? good. hopefully there will be enough to -- i mean, there are places where people can ask for more money, depending on what kind of skills they are. >> the employment rate is going to come down. these numbers are a little more ambiguous. if you loot wage income, it's 5%

year over year. >> how many hot wings do you have? >> three or four. >> i thought this one would be a nice one. >> you're not giving jim credit. he has orange, too. >> he has a nice tie, too. >> that is not orange. this, this is orange. that's -- i don't know what that is. >> it's fancy orange. >> this? >> that is handmade. that's what that is. >> i'd have to look at the label. wow. coming up, better than expected profit for starbucks may not be the big story of the money. it could be that the coffee house chain is getting ready to take some wild swings. "squawk box" returns in just a moment. (vo) you are a business pro.

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starbucks had a big miss on same-store sales. but on the conference call, the ceo howard shurlts announcing a food and beverage delivery service. you can hang out at home and they'll bring it right to you at your office. joining us now on set, david, is this like a mcdonald's story? how do you ascribe what is happening here? >> you know, they had a lull in traffic late in the quarter and it seemed like it continued into this quarter. that slowed down, the bottom line is they had a 11% traffic growth in the is he september quarter and that was disappointing.

the company said they were not happy with that. there's a little bit of a gap in their marketing. but also, they cited retail traffic, something we don't normally think about with restaurants was weak and that probably weighed on their traffic, as well. >> that is weak because? >> that's the problem. there's a lot of doctor howard schultz was talking about retailers complaining about a back to school traffic that didn't happen. it was a nonexistent back to school. was it iphone 6? was it something else? >> is it online shopping? >> yeah. could it be -- >> a new trend that everybody is going to get -- >> well, certainly, before the december quarter, that's going to be a factor. and one of the things that howard is schultz was complaining about last year and something they were preparing for for the september month was the fact that they would have to lean into this correlation that they have with retail traffic during the shop season. they take a ride with we tail during that quarter, they had 5% comp last year and they had programs against that coming up in december. that what happened was the weakness started earlier and

perhaps it was something like iphone 6. and, of course, we're talking about one or two points here. this is not -- >> is that why they get to the next point, the idea that they would be actually willing to bring it to you? >> right. well, i mean, one of the things that starbucks want to do here is be the manifestation of the bricks and mortar play on a new digital age. they want to be relevant, have -- be available. so whether it's mobile order and pay, which is another thing that could be a break through, you order before you get there and you -- it recognizes when you're on premise, you don't even have to wait in line. and then, of course, this delivery. >> what do you think this is? explain the delivery service and what do you think it's going to be and whether people will use it? >> to some degree, i feel like this might be a minor point. mobile order and pay is the bigger point. but tloifr is something that gets people's attention and imagination, of course, in certain markets that might be widely used. and we'll see. to some degree, this is teeing

up the analyst data. >> what is the cost of delivery going to be? >> we don't know the details, right? it seems a little early to be talking about it. of course, they're going to be talking about this more at the december analyst day. to some degree, this was letting -- >> aren't they going to have to -- if a coffee -- what is the average cup of koee now at starbucks? the drip coffee is a smart part of what they do. cappuccinos, lattes and the likes. you might be talking high twos. the brewed coffee might be 11%, 12%. >> the cost of brnging it to me physically is going to be another $5. >> if it's an office and -- >> they might do a minimum. the check size is larger. their check growth was 4%. as food is becoming a bigger part of their business. and, of course, if you deal with

more of a multi party check, if you have a delivery order, perhaps you get more of those. >> we're new to the conversation there. sorry we don't have any starbucks this morning. it's squawk coffee. >> almost as good. >> later, don't miss an exclusive interview with starbucks ceo howard schultz. he's going to be on "squawk on the street" a little later today at 9:00 a.m. eastern. >> i don't like strong coffee. >> if it -- if it is very dark and feels strong, it actually has less caffeine than mild -- >> then there's absolutely no advantage to try to gag down strong coffee. >> i know. i have to water it down with a lot of milk. >> you might as well go for the

dunkin which is very strong and -- >> they specifically don't want people to think of it as a kronan. up next, more earnings. gopro, provides adventure, chills and spills. now they're providing some excitement. we will have that story, next. right now as we head to a break, check out some of the stocks. "squawk box" will be right pack. smart sarah. seeking guidance. just like with your investments. that sets you apart. it does? it does. you're type e*. and seeking another perspective is what type e*s do. oh, and your next handhold... is there. you don't have to go it alone. e*trade gives you the support and guidance to make informed decisions. are you type e*?

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♪ >> yeah. it is unbelievable. good morning. turn into the guy from jurassic park. >> you're kidding? >> yeah. >> no, but that's a -- >> the -- >> oh -- >> good morning, welcome back to -- >> okay. 15 minutes. >> yeah. >> i remember now. >> it's fiction. >> yeah. i thought it was the same actor who played it. >> sometimes i'm not so sure it's fictional. i think maybe the devil might come some day. i don't know. anyway, it's halloween, we'll give it the benefit of the doubt. i'm joe kernen along with becky

quick and andrew ross sorkin. we have pumpkin carving in the studio. do you like pumpkin pie with or without cinnamon? >> without. >> with or without whip cream? >> either/or. >> this is not a halloween trick. installation is under way across the chicago river. that is where named aerialist nick wolinda will attempt his next big challenge. on sunday, the daredevil plans to walk on a high wire between sky scapers without a net and while blindfolded. >> you think of the winds in chicago, that is the windy city. >> i remember the last one i did not enjoy that 20 minutes of my life. wasn't that -- what's his face was there. your buddy, the tall guy. funny, it was a weird gig for him. >> willie geist did it last time. >> i think he's going to be

there on sunday, as well. i think. >> he was going over the -- >> no, no. >> anyway, last year, wolinda walked across part of the grand canyon. and global markets getting a huge boost this morning. u.s. equity futures are this morning are up almost 200 points after a 200 point gain yesterday. a lot of people are saying, hey, qe ended. this is not necessarily the thing people thought would happen. we're not alone in the world any more. japanese stocks soaring on an announcement. policymakers expanding monetary policy easing. making it even easier. planning to buy more bonds and other as es. maybe they're buying nikkei futures. as a result, the index is rallying about 5% today. then chosed at a seven-year

high. >> that is a big move, a 5% move, what would that be in the dow? >> 800 or 900 points. but 16,000 -- we don't want to do this in this country. remember the high? 40. 45. how long ago was that? >> ten years. >> more, i think. >> and now 16. can you imagine what we would be doing here? if you just say, you know, a good stock market is okay, but we wish it was -- >> undervalue. >> if we went down to 8,000 and stayed there for ten years, you would say the stock market is not the economy. the economy is not the stock market. we would feel worse than we do now about -- >> we're in good shape ride now. >> we are, although for some reason, there is an undertone in the country that we're in the wrong direction, 70% or something. >> you know where people are feeling pretty good about

things? >> gopro? >> gopro investors are feeling pretty good about things. shares of gopro popping as much as 8%. in fact, that's a 14% at one point after reporting quarterly results. that stock this morning up 17% after beating earnings expectations. revenue crushing expectations for the quarter. it's only the second were eggs report since the company went public back in june. joining us right now is charlie anderson. he covers gopro for dower & company. charlie, you yourself said these were heroic results in your notes. >> they were up 8% in the quarter above where we expected, 12% in q4. i think the big surprise, more than just the volume, is the fact that they're selling more of the high end cameras. specifically in q4, they're pointing in the direction of the $500 cameras. they never sold before a $500 camera. that will be probably the biggest seller giving where they're guiding the gross

margins. >> in terms of unit or in terms of revenue? >> it's going to be close. definitely revenue and potentially units, as well. we'll see. >> so who is buying these cameras and what are the high end cameras do? >> you know, the biggest change they're making with the $500 camera is they're giving you 4k video. i think as i said in my notes, it's a referendum. their holiday on the consumers care about 4k. there isn't a lot of things you can watch in terms of content. so i actually have a theory that people taking videos on their gopro cameras will be the largest source of 4k content in the near term. >> they're not just a gadget company, they're not just -- with these cameras that they are a media company. if you look at all the video that's been put out on youtube and the universe with these things, that they are a broader media company. is that a valid argument? >> i think it's still a theory at this point.

certainly, they have a large viewership on their youtube channel. they're starting to produce more stuff originally. so you see a lot of things on their youtube channel. they're two, three minutes. now they're producing stuff that is 12 minutes long. you can see the trajectory, call it on your apple tv where they become a channel in and of itself. there are a lot of things to be proven there still. >> you just hit on an interesting thing on the media side which is they're starting to effectively create their own content and the cost associated with that content. there's two types of content on that channel right now. one that looks like i made it myself, which isn't so great, and then some beautiful stuff. but the cost of the beautiful stuff -- and i recognize it is being done with a gopro cam a has to be, i assume, edited examine all those things. what kind of costs do you think will be associated with that as they start to mf in that production as a production

company? >> you know, to be determined. i will say if you look at the operating stenss, they are up substantially. they're up faster than revenue. so that is definitely a foot. the one thing i can say about gopro is they are some of the most creative companies i've seen. the videos are stunning. that will be something we have to watch. it will be hard to tell because i don't know if they'll separate it out, per se. that will be difficult to figure out in the media term. >> charlie, even though you're impressed with the results, you still have a neutral rating. that's because of the valuation? >> yes. simply valuation and it still continues to trade at multiples beyond anything we've ever seen in consumer electronics before. we would want to see the multiples come in or feel like the estimates are higher. what would do that is if they had a new product. if they went beyond the traditional camera, maybe something like a drone, for example, a home security camera,

things like that that maybe give you confidences in higher estimates. >> charlie, thanks for your time this morning. >> good to be with you. coming up, from hooters to hot buns, how the founder of cinnabon is trying to turn the company into a billion dollar business. cnbc next, 25 profiles, that's coming up straight ahead. as we head to a break, quick check off what's happening in european markets right now. looking at green arrows across the board. back in a sec. "i'm 16 and just got my first car" feeling. presenting the buypower card from capital one. redeem earnings toward part or even all of a new chevrolet, buick, gmc or cadillac - with no limits. so every time you use it, you're not just shopping for goods. you're shopping for something great. learn more at buypowercard.com

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2013, 20th anniversary and returning to the futures with our list of cool have the biggest influence on the next 25 years.

indulgence into ubiquitous global grand slam is the cinnabon in her own words. take a listen. ♪ ♪ >> i started out working in the restaurant industry when i was 17 years old as a hostess. i became a server and then a bartender. so when hooters restaurants was looking to have someone go to help open new franchises all over the world, i was asked to go. that turned into a lifetime career of building franchises and building global brands. and so for cinnabon, we needed consumers to understand cannabon

as a brand we knew and loved could be accessed in the mall and in so many other places to meet them where they were in a way that they wanted. >> i think the business is about this concept of coopition, where you're cooperating, those companies that might be some lenses they view this competition. the lesson in that is having enough discipline around the brands and what it stands for that you know what not to give up, share or compromise. but you're very honest about what you cannot deliver. for cinnabon, what we know and bring to the table is highly differentiat differentiated, highly irresistible indulgent. part of the success of cinnabon that is absolutely necessary for any retail business is to adopt some of the behaviors and practices of the tech industry. so this way of having crowd sourcing of ideas and hacking into the system in order to come up with the next new thing can

and should be translated into any industry. if you look at my twitter handle, the little description, it says connected, creative, conscious, community building capitalist. and i believe that's also the future of business. being conscious about the decisions you make as a business leader, being creative in the ways you share the gifts that you're given and being connected to your communities and other businesses are absolutely necessary, cutting through the clutter and leading organizations that mix money and -- and therefore can be sustainable over time. >> okay. if that didn't make you hungry this morning, i don't know what will. i can smell it. >> if you let yourself go -- >> oh. >> i would sooep eat those every minute. >> and i asked kat, how often do you eat? you can't possibly eat these things. she said no, she allows herself one of the tiny ones that she can eat.

>> they sell those and you get like 12 of them. >> no, you can get one. if you take the big ones, she said you can cut out the center ring. >> you know you can smell it from miles away. that's part of the whole marketing -- >> i don't think i'd get tired of it, honestly, three meals a deal. it's called cinnabon. it's a cimma-bun, isn't it? >> it's a cinnabon. >> do you like milkshakes? so when you have one of those and then i finish up, the kids don't finish, and i told my wife, if you make a bathtub and put me in a bathtub, i would not -- i think i'd die. i would not stop. i would not -- i cannot stop with a milkshake. >> i'm hungry thinking about it. >> my stomach could not hold a bathtub full. right. that would happen, literally. >> like a dog, you can't get enough food around.

up next, it's the season for pumpkins. we have our very own carving station at cnbc this morning. we're going to talk about the halloween business. did you know that the average american is expected to spend $250 this year on this holiday? "squawk box" will be right back.

♪

it is the most haunted time of the year. new york's historic hudson valley is fully lit up with jack-o'-lanterns galore. a walk-through experience with illuminated pumpkins. joining us is the master pumpkin carver there. he has a few customized "squawk" pumpkins he's been working on. this year check out what he has brought right here on set with us. take a look at mr. moneybags over here. you said this is -- your personification of what halloween has bk. >> it's like two sides of halloween. the old fashioned on the left good, fun, little creepy and scary but overall a good vibe. and on the right side, the more not sinister but more evolved and slightly darker. just a little crazier.

>> how long did it take you to make that? >> this took me, i'd say half day working on and off. >> wow. >> can i ask you a question? >> yeah. >> the sorkin family, we carved recently. but we take the top off, we make holes in it. you don't do that. it always looks a lot cleaner the way you do it than the way you do it. >> well, yours aren't going on television were for one. >> can we do it the way you do it but are we not cape snbl. >> it's all about practice. practice makes perfect. this is a sculpted pumpkin, not a jack-o'-lantern. it's about having that classic look. whereas this is kind of speaking to the idea of the new direction of halloween. what's the growth path. and this in terms of pumpkin carving is where pumpkin carving is going.

since i've been doing this, the place is ten years old. we started with about 20,000 visitors year one. we're up to 115,000 visitors. that's a huge growth. >> just tells you about the numbers that go into it. the average american expected to spend $250 on this holiday. this is a commercialized holiday. >> yes. >> do you hate squirrels? >> no. they're fine. >> i hate them. the little bastards. they ruin our pumpkins. what do you use? >> we spray the pumpkins with deterre deterrent. >> what is it? >> it's called hinder. >> every year they ruin -- >> but if you give them a diversion. >> i catch them inside the pumpkin. see them coming out. it's the same guy, i think. >> give them a pile of peanuts or something somewhere else so they're distracted. they'd rather have the nuts than the pumpkin flesh. >> thank you. we want to thank you for coming

in and all the pumpkins you carved too. >> my pleasure. >> are you wearing a costume later today or is this it? >> i will have a costume later. >> you will be what? >> alex voss. >> how many times have you seen pumpkin. >> i haven't seen it. >> you should. it's your movie, man. coming up next -- you know who was in it? linda hamilton and that handsome guy from the volleyball 30-something, that dude. what happened to him? coming up, an expert in finding opportunities among the walkers and zombies of the business world. mark lazry of avenue capital, owner of the milwaukee bucks, he's got good at timing. he bought it just before ballmer got involved with that other team. anyway, he will be our guest host on this halloween edition of "squawk box." etirement, will you outlive your money?

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♪ welcome back to "squawk box," everyone. this is cnbc first in business worldwide. i'm becky quick along with joe kernen and andrew ross sorkin. happy halloween, everybody. there is a big treat for the bulls this morning. trading sharply above fair value. at this point dow futures up by about 180 points. s&p futures up by about 22 points. and the nasdaq up by more than 57 points. the big catalyst here is a huge shock from the bank of japan overnight. expanding its monetary easing.

it's got more plans to buy bonds and other assets. you're going to see the trade doing the same thing. and europe right now, france, the cac is up by 1.9%. the dax in jerm nir up by 1.8%. and the ftse up by 1.1%. that's before you look at the futures this morning. that would have been hard to believe just a few weeks ago. volatility the big theme of the month of october. check out some of these statistics. from their lowest points, the dow is up by more than 8%. the s&p has gained about 10% and the nasdaq is nearly 11% higher. this is all coming off of those lows where we saw the huge dips. who better to talk about this with all the market moves than mark lazry. he is on set with us this morning. mark, it's great to have you here today. we have a lot of questions for you this morning. before we get to them, andrew's

got the top stories. >> let's tell you about the top stories. shares at citigroup, they're under a lot of pressure. the bank adjusted its third quarter profit to 88 cents from the originally reported $1.07. that came to setting aside to cover legal costs. among the other movers this morning to keep your eyes on, gopro shares, they're soaring. latest results beating the streets in a big way. also forecasting better than expected holiday quarter sales. and then there's linkedin. more businesses used that site to hire staff. and good news for consumers. company announcing its plan to launch a food and beverage delivery service. you don't want to miss an interview with howard shultz nap will be right here on cnbc. >> up over 60% coming out of the

financial crisis in 2009. since then his firm has made billions. why make millions? for the investors across the global fund. joining us nous on set mark lazry, avenue capital chairman and ce o rks. the fund is over $14 billion in assets. he is also the owner of the milwaukee bucks which we're going to talk about right now. mark, we know each other and you keep -- i don't know -- it's hard to get you on because you keep a low profile. and we're glad to have you here for an hour. guys like you many times do that. because you do -- quietly you do what you do and you end up with $14 billion under management. but you do have -- will you share some of this with us today? >> some of his money? >> some of the way you do it. like, how did you know the milwaukee bucks when you bought them for -- i think it's a matter of public record, right? what was it? >> $540 million.

>> was it three months later a team was going to go for $2 billion. >> i was hoping they would. i can't tell you i thought it would happen. >> that's not the best investment you've ever made, is it? >> it's the best investment i personally made on short-term basis, yes. >> but it wasn't -- >> wes is my partner. so he's done -- we've done extremely well. and then jamie dimon is also our partner. he's done well with it. >> you sure they're going to be good this year? tell me what makes you think that. and they let you shoot hoops and you drive to the basket. none of them can stop you. are you sure it's your skill that does that? or is it because you're the owner? i mean, you really think you're putting moves on these guys, right? >> i think i am.

people may think it's because i'm the owner. >> have they lowered the hoop so you can dunk too? >> it's down to eight feet. it makes it fair. that's how it should be. you know, it's kind of funny. one of the first times when i went out there, i asked one of the players, we were kidding around. i said i used to play in college. so let's not play one-on-one but what if we play up to 15 and i think i could score one basket. and, you know, he looked at me. i said what do you think? should we play? he just goes, check ball. which means let's go. and i was like seriously, you don't think i could score one basket? he goes, no, sorry. >> did you do it? >> no. i was so shocked, we didn't play. >> i think you could -- i don't think the ball would probably get past him. >> that's what he said. >> yeah. awesome. okay. so maybe we'll return to this. we started the show with lebron,

which i thought was funny. very first thing we said was about lebron. we mix it up a little. so the big news this week, you watched what happened. they finally did it. mou how much of the action of central bankers around the world played into the moves you made in the past two years? >> i think for us it's been far more beneficial for the markets. for debt markets, we've been focused more on what's going on in europe and obviously what's going on here. but it's forcing banks to take reserves. it's forcing banks to clean up their balance sheets. that has sort of been the opportunity set for us. that as banks are being forced to sell, we can buy those assets a at a discount. but i think, you know, you've had this easy money that's been out there for a i while. i think finally with the fed stopping it, you're going to see now that things are going to be a little bit harder.

obviously the markets are moving up, but i think the markets are moving up because of the gdp growth. >> i see what you're saying. the same thing that maybe generated this action by the fed was the financial crisis. that's what also has caused people to become much more wary and to tighten up the lending. so financial crisis created the opportunity, but per se you weren't benefitting from necessarily the money. >> not for us. mainly for the fact we were trying to buy those assets at a discount. so we're not really playing on the equity side. so we're trying to take advantage of the fact that what you've got in europe and everywhere is this massive deleveraging process going on. as long as we can take advantage of that, i think that's a five-year minimum play in europe. we'll be able to keep buying those. >> so you've been buying things for the past two years. have you harvested anything?

>> we have been buying for the last five years. >> and mostly in europe? >> europe, u.s., and asia. and you've got all the -- u.s. is much more idiosyncratic. there are specific siptuations you could do here. europe there is a deleveraging process going on and banks are being forced to sell assets. we end up buying travel lodge. i don't know if it's a company you've stayed at. >> i have. >> i have. >> very nice. but it's one of the largest hotel chains in great britain. and we ended up buying that debt and converted that debt to equity. now we own the equity of that company and the company is doing well. >> is this because europe was so far behind where we were? >> exactly it. >> you knew this was going to happen. >> you do. and it's a bit of a philosophy. if you look at the u.s., we force the banks to take equity in 2008-2009.

europe, you can't do that. because there's so many different countries. so the ecb has lowered rates and banks have to spread the income. so that's how they're actually creating earnings. but that's a ten-year process. >> obviously that's a better scenario for an investor like you who can look for distressed assets, look for things on the cheap. but if you were advising politicians and people in charge of a country, which is the better way to try to mend things and fix things up? >> i think the way we did it. what you've seen is our economy. all everybody keeps talking about, look, it's only growing at 2%. and now sort of 3.5%. everybody wants this 4% growth. right? but one of the things you've seen since 2009 is we're not worried about our banks anymore. if you think back to 2008, the u.s. banks were the worst. the european banks were the strongest.

today when you look at it, u.s. banks are viewed as the model. right? and european banks are viewed as having the issues. remember, we did our stress tests 2009, 2010. you just finished having the stress test right now in europe. so europe is just a number of years behind us and also because of the process, it's going to take them longer. because you've just got different governments, groups, and banks. you can't have this uniform system. >> the treasury did the right thing, you're saying. >> i think we did, yes. >> i want to make two points. one, europe couldn't have done it for a different reason. they couldn't have afforded to do it. >> that's correct. >> but the second piece is, if you're right about europe does that mean that europe -- you could buy virtually anything in europe right now and it would still work? that europe is the equivalent of 2010 in the u.s.? >> no. because i think europe today also has a lot of structural issues. right? so if you sort of look at it -- and there's two parts of europe.

there's northern europe and southern europe. even though everybody talks about it being one of the same, in europe it's a legal system that we would understand. whereas in southern europe the legal system is different. things take longer. when we talk about europe, we're investing in northern europe. >> so what can -- if you do this right, what can your investors expect in analy annualized retu? >> millions, billions. >> we're in an environment now where someone referred to the market as there's no alternative. and when you're in a 2% world on 10-year paper that even 5% or 6% is attractive. that's not why you're in this, right? >> no. >> if you're smart in the distressed debt area, can you do 20% a year year in and year out?

>> no, i don't think so. today it's close tore mid-teens. but if you think about what you just said, think about in 2008 the risk-free rate. if you just left your money in the bank. you made about 4%. today if your leave your money in the bank, you make zero. so what is -- let's say it was 25 base points. six years ago if you made five times that rate, you made 20%. everybody was excited. it was actually very good. today if you make five times, you're making 1.25%. so the risk you're taking is substantially greater. and i would say to try to make 10%, you're making -- you've got to do 40 times the rate. so people today are very happy if you're making low to mid-teens returns. because of the risk parameters that are out there. so it's just substantially harder, i think, today to do it than it was sort of six years ago. >> so are you -- in avenue

capital, would it have to be a black swan? are you hedged in that way it would have to be an end of the world type scenario for things to really head south? or could you lose 30% with just some bad -- you know, just making the wrong move? >> i think you can always lose money. >> really? >> absolutely. >> it sounds like you've got it good. distressed debt is not popular. not a lot of people do it. we rarely have people on where that's their -- we don't talk about it. >> that's the advantage. there aren't a lot of people who want to do it. what you're doing is buying assets at hopefully liquidation value. that's really sort of our mantra. that you're taking substantialliless risk. yet you're generating returns that are higher. >> i'm also trying to figure out how we tell our average viewer to get into something like this. and i don't think they can very easily. >> i think it's hard.

>> etfs, anything like that? >> no. i think it's -- i think part of it is through mutual funds that are buying assets at a bit of a discount. i think there's some of those out there. >> basically you're just going to keep it all for yourself. your basketball team. you own like the greatest resort in the world. anyway, we can't all be him. apparently. thanks, marc. much more throughout the hour including his thoughts on the recent -- are you going to talk about the oil market too? >> sure. if you'd like. >> we want to do that later. coming up, we have merger news after the break. also citigroup making an adjustme adjustment. should investors make an adjustment to their shares? that's next as "squawk box" returns on this halloween day. e

financial noise financial noise financial noise financial noise

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welcome back to "squawk box," everybody. if you are just waking up, take a look at this. dow futures indicated up by another 170 points. s&p futures up by about 20 points and the nasdaq by 53 points. believe it or not, this is off the highest levels of the morning. it's coming after what we saw from the bank of japan saying it's going to be buying bonds and other assets. that came as a huge surprise. nikkei closed up by 5%. markets in europe trading higher.

we'll see that here, too, if things continue at this pace. a deal this morning with omega health care buying aviv. that price represents a 16% premium. let's talk citigroup. setting aside an additional $600 million to cover legal costs. joining us now to talk about it, part of sandler o'neil. jeff, explain this to me. what do you think is coming? when do you think it's coming? and why didn't they know about it beforehand? >> my answer to all three would be i'm not sure. we knew fx was coming, we didn't know when and still don't know when. when you look back at the mortgage security stock, you can look at how much they securitize it. can't really do that with fx. there's not much of a prez dense there. we know it's coming.

>> do you believe there's a global settlement at work? a lot of reports suggest something is going to happen potentially among citigroup and groups in europe. do you think that's real? >> that's how it seems. if you look in the third quarter, almost all the involved banks took litigation reserves and cited fx. it seems they're all getting close to something they think is a settlement. which was not the case with mortgages. it was more chunks and bits. >> then in terms of estimating this, they didn't do the right job in terms of figuring what this would cost. do you fault them? how do you think about that? >> you know, when it comes to accounting, you can only set up reserves for what you think are probably ande estimate. i think the key to me is i did not expect a $600 million adjustment to last quarter.

i'm running $2 billion-plus through my income statement in the next 12 month. importantly i don't think this reflects any control or accounting issues on citi's part. it was conversation with regulators a the quarters. they had to do it the way they're doing it. >> you think about this as a one-time issue. doesn't affect anything else. does it change how you look at the company over the next 12 months? >> it doesn't change how i'll look for citi at all. citi is my top pick. it's a stock i'm bullish on. if anything, this probably brings down future litigation costs. our base operating assumption u is that citi and its peers are going to be running hundreds of millions of dollars of expenses indefinitely. so our current earnings estimates already are flat that these things respect going away.

>> i don't know if you saw this story in "new york times" about prosecutors trying to come back, to circle back on previous deals that were made. you know, we always look at these as one-time expenses. do you have to model out now that these aren't one-time expenses. it just seems to be part of the business. i hate to say that almost cynically. >> conceptually, it probably is part of the business. the order of magnitude is the key. $500 million settlements, things like that should not be the normal course of business going forward. that's where you sit with this. we don't know what settlements are going to end up being, but we know it's going to be a lot of money. and each bank will be on the hook for hundreds of millions of dollars. understand you could kind of be up or down. but the underlying fundamentals are what matters. you won't even notice at the bottom line. it's these hits that show up.

>> jeff hart, say i had to our friend jimmy dunn. appreciate it. >> i'll do that. thanks. when we come back, black friday is coming early this year. forget about the day after thanksgiving. walmart says the holiday shopping season starts this weekend. are you kidding me? take a deeeeep breath in. . . and . . . exhale. . . aflac! and a gentle wavelike motion... ahhh- ahhhhhh. liberate your spine... ahhh-ahhhhhh......aflac! and reach, toes blossoming... not that great at yoga. yeah, but when i slipped a disk he paid my claim in just four days. ahh! four days? yep. see why speed matters at aflac.com. [sfx] duck snoring

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walmart seeing black and orange this weekend kicking off its holiday promotions. they will offer discounts on 20 million items starting tomorrow. offering free shipping on top 1 hurkss gifts. walmart offering steep discounts for the holidays. when we come back, crude has been on a scary ride. taking a big dip in the past six months. but that fall may bring treats for investors. our guest host marc lasry, he's

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welcome back to "squawk box," everyone. we've been watching the u.s. equity futures this morning. you want to check this out. they are trading sharply higher this morning. right now the dow futures are up by 175 points. s&p futures up by 20. nasdaq up by 55. if the dow futures open near where they are now, that would be a new intraday high for the dow. right now it looks like we are there with plenty of room to spare. but we'll see how things shape up as we get closer to the open. the reason you're seeing all the green arrows is because of what happened in japan. the nikkei soaring about 5% over night after the boj expanded its monetary policy by making things a lot easier. that's got markets moving around the globe this morning. it is a busy morning for economic reports. we'll get the latest income and

spending numbers at 8:30 eastern time. the chicago purchasers managing index, also the university of michigan's consumer index will be out. oil giants exxonmobil and chevron are set to report this morning. exxon's numbers are expected at 8:00 eastern. chevron a half hour later. and twitter has hired an executive. daniel braff who had been consumer products chief will be replaced by kevin mile. also check out this video. there were tense moments last night for a parachutist. the chute gets caught on a communications tower leaving him hanging 155 feet in the air. he'd been b.a.s.e. jumping. it took crews two hours to get the man down. he was not hurt in this incident. >> wow. when you're b.a.s.e. jumping that means he jumped off the top of the tower. >> not the brightest thing.

>> yeah. that's incredible. was he doing it at night or he was hanging there for so long it got dark? >> it took about two hours to get him down. >> okay. i could just look at that -- fascinating. crude oil dropping almost 19% over the past six months. our guest host is an expert in distressed investing and says now may be the time to get into the energy sector. marc lasry, did we accurately describe your view? >> absolutely. >> and how would you do it? >> what's ended up happening -- first of all on a macro standpoint you want to be in energy. u.s. is going to become energy sufficient and the question is is it over the next year? next two years? how long does it take? but what you have today and because of what's happening with oil prices over the course of the last 30 days, a number of companies are having issues on the energy side. and again, what we try to do is buy that debt at a discount so

that you're able from a macro standpoint, you want to be invested in energy. because long-term it's actually very good. but now short-term you've actually got the ability to invest and buy that debt anywhere around sort of 60 to 70 cents on the dollar. >> but you won't buy the equity right now? >> long-term i would. i actually think -- you got to remember, what we're focused on is i want to go from sort of 60 to par or 70 to par and take very little risk. if i buy equities today and i think a number of them, a number of equities have gotten hit 25%. because prices have come in so much on the oil side, if you look at it and say over the course of the next two, three, four years i'm going to end up doing well. that would be good. as long as from a credit standpoint it's one of the great companies out there. >> just name some names? >> look, i've always been told by my compliance guys i'm not

supposed to name any names on this stuff especially on things we're investing in. but i think if you say -- if you take a look at a number of these companies, the equities of these companies are trading cheaply. the question is are you going to have any issues where you refinance that debt or the capital. if they're able to, then those equities are going to be worth quite a bit. then firms like ours will get control of that asset. and if we get control of that asset, we've ended up creating that equity cheap. >> that's the piece of it if you're playing at home you can't really participate. >> right. >> outside of the traditional sort of big players, are there -- are you a natural gas guy? are you buying up all sorts of other stuff? solar? wind? would you go near any of that? >> we've done i think on the -- i mean where it is public what we've done is txu. so that's the largest -- >> that's after they had their own problems.

>> that's correct. they filed for bankruptcy in april of this year. we ended up buying those bonds and we bought those bonds in the low 60s to 70. those are trading around $115. and the reason for that is when we bought them we thought we'd get control of the company or hoped that we would. and now it looks like we're just going to get paid off at par -- not at par but par plus accrued. but we may get the equity of the company. >> i have a separate distressed question for you outside of crude. michelle caruso-cabrera said ask about this. venezuela debt. and puerto rico. would you touch any of that stuff? >> so we're involved in puerto rico. we're not involved in venezuela right now. the reason we're involved in puerto rico is depending on the specific bonds, you can buy those bonds at a big discount.

>> the reason you're not involved in venezuela? >> i look at it more of a binary bet, it's a political bet. so same thing in argentina. right? do you want to make political bets? and i think for us what we're trying to do is make credit bets. >> i would ask about a distress situation. it would be about the democrats this tuesday. because he's one of the -- you're like the original fob, as you know. friend of bill. you haven't seen him much because he is everywhere right now. he's the guy that people want to come into their area to try to help their chances. >> he's out there campaigning quite a bit right now. >> every place he's needed. >> i think so. >> he's needed in a lot of places, unfortunately. you're not flying him around at this point, are you? >> no, i'm not. >> but does it hurt the relationship? you don't see him as much, right? >> don't see him as much. but he became a grandfather.

i became a grandfather. so hopefully we'll have a play date or something. >> you want to ask marc about his wife's comments? >> sure. >> you see what hillary said? >> i thought you meant marc's wife. >> no. i meant bill's wife's comments which is hillary. did you see the hillary comments last week about businesses don't create jobs? >> yes. >> he's a capital -- >> so what did you think? what do you think that's about? do you think she's tacking left for political purposes? do you think that was just a mistake? what was going on there? >> look, i don't know. i haven't spoken to her about it. knowing her and her track record, i think at the end of the day i think you're going to find she is going to be more pro-business. so i don't know why those comments were made. >> more pro-business, usually you need an object.

more pro-business than what or whom? >> i think just more pro-business. >> we're going to leave it there. marc will be sticking around. >> do you see how you get to where he is? there's only eight words. you only use eight. you don't even use a modifier. coming up, you're not going to believe who owns this spooky house in the middle of new york city. here's a hint. he invests in dying businesses. details just ahead. but up next, the ceo of wpp talks -- i just said pp again. >> i noticed. >> its recent stake in television and the future of all media. "squawk box" will be right back. you do a lot of things great.

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♪ welcome back to "squawk box." the futures right now are surging up almost 180 points this morning. if it holds, the dow could break

its all-time intraday high which i don't know how many people predicted that. >> 17,350 and change is the all-time intraday high. >> at the height of the dallas ebola scare as well as the german durable goods, china, all the things that were happening and now all of a sudden we could do it today. trick-or-treat. i don't know. but that was september 19th. the dow needs to rise 155 points today and close there to reach that level. >> if they open there, it is an intraday high. all they have to do is open there. >> oh, for an intraday, right. but the close. advertising group wpp posting lower than expected quarterly sales citing concerns over geopolitical tensions and a slowdown in the global economy. the company's ceo joins us here on set. martin, it's great to see you. >> thanks for that encouraging introduction.

sales growth was 8% in the quarter. >> what joe was talking about. the global concerns when it comes to europe, you've got to see that closer. >> qe-3, rise of isis in syria, and most importantly hong kong and the impact on china. china sneezes, we all catch a cold. and in our industry, a third of the delta this year the increase really basically comes from china with a 7.5% growth rate. >> we're feeling a lot better in the markets today than two weeks ago. >> that's probably ukraine today. japan today. maybe. >> well, japan it was the bank of japan i think is the huge move that helped things out with that. >> the ukraine is good news as well. i was in moscow a couple weeks ago, clearly sanctions are starting to bite. not on consumers. where it is biting on is on refinancing corporate debt and of course there's been an outflow of money. the ruble is very weak. so i think if there is an easing

of tension over in ukraine -- that was the q-2 problem. the reason not for investing or hesitating or cutting back was around hong kong and china. >> well, this laundry list of global concerns -- >> the swans, as we call them. black and gray swans. >> there's a lot of them out there. we're feeling together in the markets, but how quickly does that translate into add spending. >> if you look at growth, 2.7 real. business council focuses is much more conservative. what happens over the year is the professionals start high and then they sort of come down to where the business council and the people running companies are much more conservative. seen that for two or three years. 3% real at the moment. so it's going to be very similar next year to this year. going to get ready for a good

olympics in 2016. rio will be fantastic in my view. we'll have the elections that joe will be delighted with hillary clinton wins. >> i knew you were going to say that today. >> everyone is catching up with you and i on that one. >> are you voting now? >> no, i'm not allowed to vote. >> exactly. but you're allowed to talk. that's the thing. that's the thing i don't like. >> should be told not to say anything. >> that's why i had to buy you lunch last time. >> and then we skr the uefa football championship. it's steady as it goes. and top line growth is tepid. it's sort of like a square root sign with the bottom being '09. it came back in '10. and then a little bit of growth each year. >> ki ask you an advertising question? >> yeah. wasn't that an advertising

question? you can ask me an advertising copy. >> i want to know about twitter as advertising medium given their earnings, given some worry that they are not doing as well as facebook or at least not on the trajectory they want to be. i want to stand up for somebody who buys this stock. >> google, $3 billion. we've done $2 billion in nine months. big growth, mobile search, and video. facebook, $650 million this year. >> so $3 billion to $650 million. >> google is the gorilla. facebook 650 this yooer we're targeting. twitter haez gone from 50 to 100. but with the big opportunity with twitter is the data piece. we've got the data alliance with them where we get data on consumer engagement. which shows like programming like this is much more effective

than we thought it was. two people sitting on the couch watching a live television show are more likely to tweet one other than talk to one another. >> decline of humanity. >> you spend only that much on twitter. >> we've had this debate. i anger people when i say this. twitter in my mind is a branding mechanism that upsets the people of facebook. the real prax thtraction we get mobile search. that's the real power. >> one more for you. cbs announces they're going to sell an over the top package. you can buy just cbs without buying hbo. do you care and will it work? >> i don't care and it probably will work. but i do think for the furst tomb that we're starting to see a shift in tv consumption

habits. and if you look at the data which is time spent versus advertising investment in the u.s. advertising is about 45% of the budget for the industry, not wpp. time spent is 38%. so it's the first time we've seen a discontinuity between the time that consumers are spending watching classical television, free to air television, and the investment. >> what about with dvrs or you watch things on demand? >> that has less impact than we thought. >> that's how i watch most television though. >> that you watch. >> you still want to sell things to people that are watching "survivor" and "amazing race." seriously? how old are those people? >> younger than you. >> ha-ha. well, then you've got problems, fella. >> back to andrew's question, i think it will work. but it's going to fragment the industry and it's going to cause challenges for the free to air

operation. >> it sountds like you're suggesting you're spending too much money on tv at the moment. >> i think the softness in the out front market was more driven by cyclical rather than secular. and a lot of analysts have jumped on the lower up fronts. i think money is being shifted to the scatter markets. our people were into -- >> are you going to buy advertising on his regional network when he gets it going? >> of course we are. >> he means the regional basketball. >> oh, that's even more important. sports generally, live sports. look at the payments being made for rights. you take the nba deal, long-term deal, nine-year deal. why? because they didn't want to -- they wanted to lock out google. what will the market place look like in nine years' time with google? it will be a very much more

fragmented market place. so if you're free to air or if you're a major legacy tv company, you want to lock it in for long periods of time. >> you see the olympics deal? >> yeah. absolutely. >> how long was that? >> same thing. what year is it? '14? that was like 2030. >> '30 or' 28. >> the reason you do that is you lock it in and prevent the online competition from coming in. >> "big brother"? seriously? "big brother"? >> channel five in uk viacom took it over. i think they'll take that show off. >> i see that on and i'm like, are you kidding. >> i've never watched it. >> i've never watched it ten years ago. there are new people every year that -- >> i didn't know it was still on. >> it is. >> they're not reality shows. >> i'm knocking reality. i'm not knocking cbs. >> kind of like "squawk box." >> well, this is not reality.

>> this is not. >> this is fantasy. yeah, this is fantasy. when you're on, it certainly is. >> thank you. >> thank you very much. and on that note, you buy me dinner next time. >> hillary is writing you a check and she's got plenty of money from the college tours. when we come back, we do have a special trick-or-treat rapid fire with marc lasry. check out the futures. at this point dow futures up close to almost 200 points. s&p futures up by 23. nasdaq up by about 60. "squawk box" will be right back.

back to our guest host today, marc lasry. we're going to play rapid fire. i'll throw a few things at you, give us answers whatever comes to the top of your head. >> sure. >> in s.e.c. filings you have new holds. ford motor is one of them. why ford? >> we moved down to the equity we think b it's cheap right now relative to the others. >> i also saw boyd gaming and yrc in that list. >> same thing. boyd, cheap stock. i would say on yrc we ended up buying the debt, converted that debt into equity. i think it's up 30% from where we bought it. again, i think it's pretty cheap relative to where their peers are trading. >> one of the stocks you got rid of is dynegy. why? >> it headed where we wanted it

to go. it worked out well for us. >> i know this is not something you're typically somebody who forecasts specific market moves, but if you're looking at the 10-year note would you guess it would hit 10% or 2% first? >> 2% first. >> because? >> because i think right now you're not going to see rates really moving up over the course of the next six months. if you're asking me over the course of, you know, the next two years, i think it's going to hit 3% first. but for the next six months you'll see rates staying where they are. >> we didn't necessarily bottom just a few weeks ago? >> no. not -- i think you still have some room if you want. >> we know you're a big halloween fan. in fact, we have video i think of your house all decked out for the big night if you want to take a look at this. yeah. that is amazing. why do you love halloween so much? >> well, we have five children. when the kids were growing up, we started buying -- we started putting things out at the house.

every year it got bigger and bigger. >> just add more every year? >> it's a great time. it's my wife's birthday. >> do you do other holidays? >> we do. but not at the house. at the house it's mainly halloween. it's amazing what you find when people come. normally you think people are taking one or two pieces of candy. you always have the kids that just come and grab a handful and you have the good kids that take one or two. >> who do you feel worse losing to cuban or ballmer? >> i'd just hate losing. >> who's more obnoxiouobnoxious? >> that's a great question. no, they're both great guys. >> we have a great surprise for you. we have our pumpkin carver who's here with you. he's been carving pumpkins up. he has one to add to your

display. basketball and here's one of you. >> wow. that's scary, isn't it? >> that is scary. >> and the bucks. look at all that. >> wow, that's great. >> we want to thank you michael, he's the e creator of hudson valley and the master pumpkin carver. thank you for making all these. we appreciate it. >> my pleasure. >> marc, thank you for being here. >> my pleasure. when we return, the market's looking to end a scary october on a high note but could exxonmobil, could those results dampen the mood? we'll find out after the break. later, halloween isn't just for kids, it's for the super rich too as we just found out. a look at some of the most expensive haunted houses in the country. we'll be right back.

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♪ good morning, everybody. welcome back to "squawk box" here on cnbc, first in business worldwide. i'm becky quick along with joe kernen and andrew ross sorkin. the bank of japan expanding the pace of its quantitative easing. that is what set things off that

sent stocks soaring in asia. a gain for the nikkei of close to 5%. announcing it would triple its purchases of etfs and reads. deflation in japan is a very, very frightening thing. they've been dealing with it for two decades at this point. this really spurred stocks and the yen falling sharply on that news. i think it was a decline of 2.4% against the dollar. you can see at this point, the dollar trading at 111 and change to the yen. that has change to a real treat to u.s. investors as well. look at what's been happening with the futures. dow futures up 187 points above fair value. we'll see what happens as we get closer to the open. right now the s&p futures up by about 22 points. the nasdaq up by 58. and the s&p would be just a few away from a record high as well. >> we should just have rolling

qe as the sun moves across the sky. japan, then go to europe. let's throw in a qe-4. then we start in japan again. we'll be at 100,000 on the dow in no time. will this work? >> there is no alternative. >> but it's weird. is any of it real? that's the thing. i don't know. central banks. you know, and it's a rush to the bottom. someone has to make a stand. maybe it's us. >> we'll know whether this happens in ten years. let's tell you about corporate news this morning. check out stocks on the move this morning. here's what's going on. citigroup adjusting their thrd quarter earnings. they set aside $600 million to cover legal costs. and royal bank for manipulating currency markets. that's what people think is happening with citigroup. and that settlement may come soon. also saying further fines for past misconduct were possible. also gopro shares, they are soaring on its latest results beating the street. and the company forecasting

better than expected holiday quarterly results. then there's groupon. the daily deals provider seeing both billings and its customer base grow during the quarter. and linkedin beating the street. more businesses use that site to hire staff. and boston beer stock getting a big boost. the maker of sam adams beer says it will be concentrating on increasing sales of new brands. and then there's starbucks. good news for consumers, the company announcing it's planning to launch a food and beverage delivery service. you don't want to miss ceo houston shultz of starbucks on at 9:00 a.m. eastern time this morning pop. you have exxon? >> looks like the dow's going to get more help from exxon. shares already trading higher on this news. probably some questions around

this because of the massive decline we've seen in oil prices over the last three months. if you take a look, though, this morning, the company coming in it looks to me like -- i'm sorry. $1.89. >> increases 6% versus that estimate. dividend per share increase 9.5%. >> wow. >> which the 3% yielder now. it had been 276. that doesn't hurt either. a 10% increase in the dividend. 69 cents per quarter right now. so cash flow from operations, asset sales total $12.5 billion. still a huge -- very few -- how many other $400 billion companies are there? one? >> what's the other one? >> apple. >> apple, yeah. >> and then apple and google and microsoft, right, are close but not quite. i think this is the only one.

>> 377 for google. >> so exxon is number two in terms of being valuable in the entire world. we're going to have an analyst. we're going to talk about one of the things that people look at are production and oil equivalent and how they replace reserves. this in this case they reserved 4.7%. if you exclude the impact of some abu dhabi concessions -- >> although cramer has looked in the past at expenditures and said it was declining. for that quarter they're down 17%. >> continue to buy back stock. in the third quarter that totaled $3 billion. $3 billion in buybacks. $2.9 billion. >> we should also take a look closely at the dow. get another look the futures

already. already looking at them up by 190 points thanks to what happened from the bank of japan overnight. right now up by 182. not much help at this point. but continue to watch shares of exxonmobil this morning. it was a wild october for stocks. frightening at times with swings. dominic chu joins us with the three craziest movers. this should be interesting to hear. there were some wild rides. >> investors may not have liked the rides. let's look at some of the big wins here. qep resources. among the biggest swingers in the month of october. down by 22%. but check out the range on qep during the month here. if you look at qep resources, there has been a large range of where this stock has gone. let's move on here to check out what else is happening. also check out some of these other stocks because netflix another one.

qep resources high of $31 a share, low of $20. look at this netflix down 15%. but a huge swing for investors. look at the range here as well. again, 467 to a low of 331. back over to you. >> all right, dom. thanks. dow's closing in on it's all-time high after the wild ride this month. we were worried about exxon, but it's an integrated -- that means up stream and downstream. and are they -- so they're okay downstream. are margins better because of the lower play? >> yes, because refineries have a higher margin as a result. >> unlike some of the producers in the middle east. >> yeah. >> joining us now to talk about what to expect from the markets the rest of the year is david blitzer. does he have a bow tie -- i was going to tease your bow tie.

index committee managing director and chairman, it's been quite a month. has it not? and once again i mentioned earlier history doesn't rhyme but there is something about october in terms of volatility but making a bottom as well. we always seem to forget that bottoms are made. we always look at sort of the half empty view of october. >> that's right. but this october, i think, is relatively calm in comparison to some we've seen in e the past. i guess the word is spook given today's date. it did spook an awful lot of investors. it almost made 10%. so if you count anxiety as causing a correction or being the measure, we definitely had a correction. if you want to do the numbers, we didn't quite make it. but we're coming out of this month with surprisingly good economic numbers. strong gdp reports, deliciously

low unemployment, initial claims running well under 300,000. the economy hasn't looked this good since before the financial crisis. >> it is amazing. and, david, i had -- you made me think of a couple of things. number one, even though it was spooky as you said, there are some people that said that the complacency returned pretty quickly because of the notion that everybody has this mantra now that there's nowhere else to go. so people got a little bit nervous, but not to the point maybe in prior spooky octobers. so i wonder whether we're setting ourselves up for another scare sooner than in previous times. maybe we didn't make a great bottom this time. i would generally agree with that view. the recovery of optimism was incredibly fast. i mean, it's my -- you know, you had a nightmare, you got up, the sun came out and that's it. you're never going to have another bad night. and i think that's a mistake.

markets don't go up forever, obviously. so some place in the future there's going to be a much bigger drop than 9.8%. but i don't think it happens right away. we -- the fed has essentially told us yesterday the economy is good. enjoy that part. don't worry that we're sitting a little bit closer to the sidelines now. and really don't worry that we're getting ready for the next move. and the next move which i think is middle of next year, rates will go up. and when that happens, that'll be the shocker. i think that's when we'll discover that 9.8% down is not as far as we can go. >> people always talk about that. when the fed reverses course and i wonder whether ending qe qualifies. raising rates certainly in the past has spelled trouble for the markets. the other thing you made me think about is the economy, the numbers have been good. so you think the fed successfully passes the baton to the underlying economy.

maybe they did their job and it's actually improving. but i think maybe the fed passed the baton to japanese qe. because today, you know, i don't know whether it's really the economy or just passed it to another part of the world to do the qe lifting. >> the overnight is compliments to the japanese. and that was very nice of them. but what happened up through yesterday's close was clearly the u.s. economy and the fed. i don't think the end of qe is going to spark any kind of reaction beyond a lot of newspaper articles and comments. long, long lead time widely announced, widely expected. when rates go up, it's always a bit of a spried and they always go up by more or faster than anybody anticipates or expects. sop a lot of people get nailed by that. and that's why i think that's going to be the big event that really spooks the market. the fed, i think, has handed the

baton to the economy and they said as much. in the background they move from two hawker dissenter to one dovish dissenter. where janet yellen sits in that center of gravity is hard to tell. cheerily she's not and probably can never be a dissenter. >> we've got to go, but it'd be nice to put the stake in the heart of deflation worries. and we worry about stagnant wage growth. so this time if what causes rates to go up more quickly than we're anticipatiing is a little wage growth, maybe that's not as bad as in previous cycles. we are still worried about global deflation as japan is worried about. maybe we can raise rates a little this time. >> i think you're right.

the other thing is if you think back several years, there was a day when high inflation scared us. not low inflation. >> that can still be out there too. >> not right away. >> all right. thanks, david. love your costume today for halloween. >> thank you. have a good day. >> you too. see you. >> very trim beard this time, i thought. >> you think he glued that on? >> i didn't see the seam. he did a good job. >> you did a good job. >> i did. i got it on frontwards. coming up, quarterly results from two oil giants this morning. we'll speak to an analyst about that sector next. look at exxon which just reported and chevron which is expected to report in about 15 minutes. "squawk box" returns with all that and more in just a minute. . with available forward collision warning and new blind spot monitor and a 2014 top safety pick plus rating.

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>> last day of the month friday. >> if you were just tuning in, that's a sort of positive importance. that is a positive importance, not a negative ebola importance. >> it can be negative sometimes. this morning it's positive. >> as we know it has been in october at different times. but that is a -- it's like, wow. positive importance. up 187. you wonder why? it's a rolling qe now. my suggestion is we do with the sun each area that has sun around the splanet does a round of qe. we print so much money that everyone in the world is a billionaire. a takeover today of nursing facilities. omega health care is buying aviv. it is valued at $3 billion. that's a 16% premium over yesterday's aviv close.

and i guess 16 is enough of a premium to warrant this music. >> we'll take it. >> it's a big premium, andrew. and exxon had really good numbers for all of us that were worried about oil and the effect it would have. >> stealing my thunder. you're segueing. >> yeah. >> exxonmobil did report quarterly results moments ago. joining us on the "squawk" news line right now is the senior energy analyst at oppenheimer and company. thanks for joining us this morning. better than expected. does that mean we should be buying the shares right now? >> not really. because if you look at the future oil prices, oil prices would be down about $10 to $15 from the level that we're at in the third q. so going forward, the picture does not look too good.

>> but -- okay. so gloets back on the earnings report for just a moment. am i missing something when i say that it was better than most -- >> absolutely. earnings were a lot better than that we were expecting because gasoline and diesel margin was. the downstream part of the business did very well. but was basically selling oil and gas did not do as well because oil prices are lower than a year ago and natural gas prices higher. so down 4% in a year ago. but for example the downstream which in the market it was up 17%. and so whatever the loss, made even more on the downstream. >> if that's the case, though, is there not the expectation that the refinery margins will continue to out-perform? >> well, refining margins were

significantlier than what we model and the rest of the analysts model. that strengthens the downstream for exxon. not a big enterprise going forward. but right now people are looking at what is going to happen in the first quarter of 2015. and all indicators are lower for the first quarter. >> if you were to fairly value the stock, then, at $96 -- if $96 is what it's trading at now, it should be what? >> well, if oil prices go down by $10, exxon earning would be down by $3 billion or $4 billion. so definitely the valuation would be rich at $80 oil. exxon would actually borrow money to pay its current dividend. so that is not a very good picture. >> i don't know if you got a

chance to hear what marc lasry said. he's buying for the long run. are you talking just short-term or long way out? >> people are buying exxon because of the safety of the dividend. they raised the dividend by 9.5%. this they have a strong balance sheet and still maintain. most investors would buy exxon, they expect weakness in the energy sector. which mean that you buy the word not as a gross story. >> got it. thank you for joining us this morning. >> thank you. >> appreciate it. all right. coming up this morning, when the world crumbles and is overrun by zombies, where will you have the best chance to survive? believe it or not, we're going to show you right after the break. ♪ snot (receptionist) gunderman group.

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♪ we have all wondered, i'm sure, where the best place to be when the zombie apocalypse -- >> i actually have thought this through. >> if ground zero was in atlanta, it's warm at least down south if there's not going to be

any heat. but the real estate firm trulia has shed some light on the worst cities to seek shelter if the undead do, indeed, hit the streets. using four criteria, number one is walk score. you need a walkable neighborhood. the lowest density hardware stores. that's not going to help if you can't find a hardware store for supplies. the highest density of hospitals. and finally the most congestion. and island dwellers beware. are you listening, mr. president. honolulu came in at number one the worst place to be. new york, number two, sorkin, another place that you wouldn't want to be. number three, ten minutes from my house, newark, new jersey. not a good place. number four, boston. number five, washington, d.c. so the east coast -- it says

here in the teleprompter -- is pretty much screwed. okay. all i did was read -- what didn't make the list, oddly enough, atlanta. so maybe head there. did you see sunday? >> no. stop, stop, stop. don't tell me. >> don't. >> can i give you just two -- >> no! >> you already told me your two words. >> if you love starbucks but don't want to leave home, starbucks has an answer. announcing it will soon launch a food and bench delivery service. that will begin in a few test markets do you think if there was a zombie apocalypse, they're still delivering? >> maybe. >> joseph? >> i've got to watch what i do with the pen now. someone tweeted.

and i really want flipping this guy off. i subtly give guests my opinion of because i was like this. it's a pen. i'm going to stop using a pen. that was not intentional. >> you're never subtle. you tell people what you think. >> it's all over twitter now. so follow me. i'm turning this into a positive. never too early to start holiday shopping. then a lifestyle of the super rich and famous. the most expensive haunted mansion in the country. she's still the one for you. and cialis for daily use helps you be ready anytime the moment is right. cialis is also the only daily ed tablet approved to treat symptoms of bph, like needing to go frequently. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. u

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. got some breaking news. let's get to rick santelli. rick? >> let's start at the top. third quarter employment cost index up .7 of 1%. that's a couple tenths higher than we were looking for. it matches our prior look. on the income side for september, up .2 on income. down .2 on spending. you know, i think -- i like that combination, actually. but i don't know if the federal reserve will.

of course the economy needs spending. but you need income to spend. even though visa looked good yesterday, credit's a good thing but we need some horse power behind those purchases. let's look at some of the deflator inflation. month over month up .1. and if you look year over year, up 1.4. that's .1 lighter than expectations. if we look at the core, you know, strip out food and energy, you're looking at 1.5 year over year and up .1 month over month. both those match our last look and expectations. on the wage side, up .8 versus up .6. so i guess in summary, i agree with "the wall street journal." u.s. economy is amazing. the best ever. and despite all the burdens put on the knapsacks of this mule trying to get uphill, we're still doing pretty well. i can only imagine if we get a congress that actually takes their mission serious, we could

have some serious growth. back to you. >> you got the wrong idea. we don't need any laws or government at all. my idea is -- >> oh, no, no, no! we need them at least to take the hurdles they've set up and lower them back down. >> no, rick. my idea and i've been talking about it all morning is a rolling qe that follows the sun. >> yeah, no. and with each qe they send out 100 million hammocks, okay? because it's the hammock society. they can be endorsed by the european commission. socialism and hammocks for all, right? it doesn't work. sorry. >> it's working. if we print enough, everyone in the world can be a billionaire. just keep -- the sun comes up, japan has qe, europe, us. >> listen. the stock market going up isn't a bad thing, joe. but i don't know. when i commute from where i live to here, if everybody i passed along the way in all the little

towns getting to the big city, i ask them wow we're up 200 in stocks today. how's that going for you? i just don't know that that's the world where they evaluate how their own personal lives have been proceeding the last couple decades. >> you're right. then we talk about japan. still at 16,000 20 years later. >> we all love peter bookfar. did you read this comments? my god we are just so bummed out energy prices are going down. let me get this straight. this is an island with no energy other than nuclear. they're not so happy with nuclear these days. so they are so psyched on trying to get the sausage out of one side of the factory that they don't care about productivity and what's more, lower energy costs when you're a manufacturing island. you should be thanking your lucky stars. instead they're upset it's making their inflation numbers

look higher. >> rick, thank you. happy halloween and we'll talk to you next week. >> happy halloween. >> folks, we should tell you about chevron earnings just out. a much bigger number than analysts had been anticipating. chevron looks like it has the same story. chevron coming in with earnings it looks like of $2.95 a share versus the $2.55 that the street had been anticipating. again, they're citing the same thing chevron did. higher downstream results because of the lower feed stock coming in. as oil prices come down, it's good news for the refineries. this is an argument that could be out there for making sure you don't break up some of these oil companies. that you keep the downstream and upstream together. people on the street have suggested these companies should be broken up. but this is an example of where that actually pays off for some of these stocks. take a look at chevron shares. they're up by about 1.5%. again, this is the same story we heard from exxonmobil about a half hour ago.

>> and the revenue number, it's supposed to be 58? is that apples to apples? >> i know that exxon only has a couple of analysts. >> it's always hard with oil companies and revenues the way they do it for some reason. but it looks like it's -- they said -- >> there's only a handful of it. >> anyway, that number is much higher. and you're right. they're talking about reliability and refining margins being much better. but still the upstream earnings $4.6 billion versus 1.4 with downstream. in this case $1.25 billion was bought back in the third quarter as well. >> they're telling me in my ear it's the same with chevron. only four analysts gave an estimate for revenue. 20 are there for earnings. >> why do you think they do that? >> it's always been the case with exxonmobil. that's why we usually don't look at the revenue numbers.

it's such a small sample. but that stock looks like it's continuing to trade higher now at 1.6%. we know it's halloween today, but we are already looking ahead a couple of holidays. we're going to start talking holiday shopping. just 54 days away from the big event. retail outlets have been preparing for weeks at this point if not months. shares of tanger outlets are on the rise. right now joining us is steve tanger. he is president and ceo of tanger outlets. how are you feeling about the holiday shopping season? >> well, good morning and thank you for having me today. i think the consumer is cautious but consumer confidence is way up over the past couple of months. i'm proud the previous analyst on was incorrect. in some places you can buy gas for less than $3 a gallon.

>> do you see an instant sort of reaction when oil prices are down, let's say prices at the pump are down for lee, four weeks in a row. how quickly does that start to translate into sales at your outlet stores? >> well, there's not an instant correlation. clearly if there's more money in circulation, consumer confidence is up and people have more money to spend and save money in tanger outlet centers around the country. >> steve, i know you're looking at consumers who are very interested in outlets. i just wonder is it better for you when consumers aren't feeling all that great? do you win more people that would shop in an outlet than normal? >> obviously it's good when the consumer's happy, everybody's happy. in good times people like a bargain. and in tough times like these they need a bargain. we're looking forward to a good holiday season. our stores are all stocked at great prices. >> what is a good holiday season

for you in terms of sales? are you look k at same-store sales up 5%? >> we don't protect same-store sales. but we would be very happy if they were up 3%. actually, we reported earnings this week. we beat consensus by 2 cents and raised our guidance. so the consumers are doing are shopping in tanger centers across the country and we're doing very well. >> when we were going through a few weeks ago, all these concerns about ebola, the airline stocks took a hit and there were concerns about retail stocks as well dpp you have plans in place? did you have discussions about how to handle that? >> well, our centers are outside of the center city area. we have disaster plans in place, but fortunately the medical system in this country was able to handle it quickly as everybody knows it's not transmitted airborne, so we're hopeful it's contained and it

hasn't stopped people from shopping. we just opened a new center up in ottawa, canada, and we backed the highway up for five miles with people looking to shop for the first time in ottawa. >> okay. steve, we want to thank you for joining us. and we'll keep watching through the holiday season. >> thank you for having me. coming up next, jim cramer from the new york stock exchange on whether or not this will be a spooky halloween for the markets. and a personal valet. a new app being offered in san francisco to help solve your parking problem. we've got details on that just ahead. check out the futures at this hour. they don't look too scary right now. dow looks like it would open about 159 points higher. we're back in a moment. financial noise

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♪ for anyone who's ever tried to find parking in a busy city, there's a new app for you and it's officially rolling out in san francisco this week. josh lipton on the west coast joining us now with more on that. josh, good morning. >> well, andrew, if you spent any time in san francisco, then you know traffic is bad and parking is even worse. according to a new company named luxe valet, drivers spend an average of 20 minutes looking for an open spot.

so born of his own frustration, ceo curtis lee created an app. >> i live in san francisco. i own a car. and i realize that a lot of times i would just get -- there wouldn't be a great way for me to get from point "a" to point "b." i'd be circling around the block. >> so here's how it works. you download the app and order a valet who comes and parks your car. when you're ready to leave, say when you want to pick up. the cost, an average of five bucks her hour with an average of 15 bucks per day. on-demand parking, this is already becoming a competitive industry. there's also valet anywhere in new york city and carbon now testing here in the bay area. still, lee sounding confident in his business and plans to use that $5 million to beef up his staff and expand to new york,

philly, and chicago. they all have big potential, he says. >> let's get down -- you got the answer? >> no. >> o earthquakkay. let's get to the new york stock exchange. jim cramer. santelli wouldn't play with me. my idea is qe just takes a turn. whenever somebody ends, somebody else does it and we finally get to 100,000 on the dow and we're all wealthy. >> remember when qe-3 ends, we'll be probably dropped maybe 8% to 10%. >> what happened? was the economy ready for the baton to hand off? >> well, because policy makers turned out to be not stupid. the ideologues stayed with their view. it's very difficult for me to deal with our viewers because there were so many people who came on air and scared people out of the market. based on a federal reserve policy that had very little to do with the profits of major american companies.

>> what about that it's -- since this is uncharted territory, the end of an easing cycle that the end of qe doesn't constitute the actual end. it's when rates actually go up. so the market doesn't really feel indigestion until we get the first rate increase. >> we're in the grips of deflation we're wide. japan when they're saying they're buying everything, obviously japan last decade are now going into a new decade. >> for people that say so the stock market is higher that doesn't help. think if we were stuck -- if we went down to 8,000 and stayed there for 20 years. you'd feel pretty sick that the market was acting like that. it's nice to have a market go high. >> you're going back to '87 and recognize that tokyo is much bigger than our market. and that destroyed the nation. almost like the dotcom period that went on forever. the idea that our market is up that much on japan is stupid

too. but, you know what? the world flows. the hedge fund flows. just go from one country to another. i keep coming back to the profits which are amazing at companies. something larry kudlow taught me. and we can sit here and talk about the fed or talk about why the market went up. which is the companies are doing better. some companies are going to describe the fact that they're doing better to the fed. i am tired of it. i have done my best on "mad money" to put this into context that it's accessible to individuals. and i have failed. and i have failed because i am a loon. >> no. you've been very effective. it's just you're yelling out there in an empty -- in a big forest of things. jim, let me ask you what you thought about chevron and exxon today? >> you know, it's funny. i see exxon with 5% production. it's not growth. it's like negative yardage versus positive yardage. at the same time these companies were supposed to say really horrendous things in the

commentary. they should have looked at wheat, at corn, at everything other than dairy and coffee. because everything else is going to come down. all protein's going to come down next year. so, look. these companies are very challenged. no one cared yesterday at all. because everyone in decided these are also in the grips of deflation. exxon has not had the growth. they need to buy. their last acquisition was a disaster so they haven't done it. chevron has great drilling prospects but haven't delivered consistently. i don't know. these are not the companies. >> one other thing occurred to me today. when we do get the first rate increase, if it does drive -- if it does finally allay our fears about inflation and wage growth, could it not be a negative because it actually shows we're out of the woods in terms of

worrying about it? >> i have believed for the longest time when rates start going higher, you're going to see a profit explosion that's going to shock you. housing's going to come back, retail's going to come back, world's going to come back. and when these things happen, we will be even -- we will be able to understand why the market went where it is and why it can go higher. but i am fundamentally positive and optimistic. and i feel very alone and it is bugging the heck out of me. >> all right. happy halloween. >> you too. >> you give out the little bars or you give out the big bars? you're a guy that could give out big bars. >> you know, i used to -- here's my philosophy. here's the basket, take a handful. >> on the honor system sort of. >> exactly right. >> you only hand out one at a time? >> i don't -- we are under construction. i'm not sure anyone's going to show. i wouldn't walk up to this house. i'll tell you that much. jim, thank you. we'll see you in a couple minutes.

that's what i asked you earlier. do you pick a high-rise and do one building? >> multiple buildings. >> you do? >> we're starting early. i think we're starting at 4:30 this afternoon. >> and you walk down a dingy hall and press doorbells? >> the halls we're walking down are not dingy, my friend. >> in new york. >> yes. jeeves carries candy -- >> there's a bucket of apples unwrapped. you take one and eat it in new york? >> sure. >> no way. >> no way, man. >> hold on. the apples in new jersey? >> yes, jersey apples. >> when we were younger you said don't eat them because they put razor blades in them. >> that's true. but i mean that's not true of all. >> maybe some of the current psychos might not know that. >> i'm just looking for reese's pieces butter cups tonight. coming up, exxon, chevron, and other market movers we're watching this morning. and coming up on "squawk on the street," you've got to watch this.

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a couple of big central bank announcements. the bank of japan surprising investors by expanding its monetary easing. with plans to buy more bonds as well as other assets. policy makers citing worries decline in oil prices could hurt consumer prices so they worry about inflation, the lack of it, in japan. >> russia raising its key rate more than expected to 9.5%. that news put pressure on the ruble. >> dow component exxonmobil topping estimates on top and bottom line helped by stronger performance by its down stream and chemical businesses, also beating earnings estimates, fellow dow component chevron with improved refinery profits. there is drug maker abbvie. it beat estimates, raised its full-year forecast helped by surging sales of its arthritis drug. >> madison square garden's

bottom line helped by the sales of its fuse television network. it is halloween. we are finishing the show on a spooky note. dow looks like it could open up higher 163 half points higher. we'll be back in a moment. >> when we return, the spooky ridge. the high-end haunted house market is reaching frightening levels. >> we have a list of the most expensive haunted mansions when we return.

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welcome home. taking control of your retirement? e*trade gives you the tools and resources to get it right. are you type e*? time for the squawking dead. we are taking a look how the super rich can be the spooky rich. robert frank is in costume dressed as clark kent, where bigger is better when it comes to halloween decorations. robert. >> this is one of the most famous trick-or-treating homes in all of new jersey.

more than 2,000 trick-or-treaters came here last year. this year in the next few hours, this will become a scene from "walking dead." the business of decorations becoming a big business. king of that industry is cliffhanger productions. >> you'll see ghouls and see actually the "walking dead" walking out of these graves here along with lots of surprises, dead fred, the ring girl is going to come out. it's going to be awesome. >> do you a lot of the decorations for the rich and famous all over. i gather that c.c. sabathia has something special this year. >> yes, he does. big change from last year. last year he did the spooky thing. this year he's doing "frozen." couldn't resist. >> what is the most expensive halloween decoration you've ever done? >> the most expensive display has been $23,000.

>> what's your favorite one you've ever done? >> my favorite one is always the last one i've done. i did one last week in saddle river. it was a haunted mansion. we actually scared the piss out of 17-year-old people, literally. we can sigh that, right? 17-year-olds, if we scare them, we are doing our job. >> you've got to come here later on. they are going to have actors. they've got amazing lighting here. they are going to have a lot of zombies. this is your kind of thing. >> it absolutely is my favorite holiday. i'm glad there are people that can spend money like that on this. it's not going to be us. $23,000, $24,000? >> the owner of this house does a lot for charity. he loves the community and is a great entrepreneur. people come from the tri-state area to come here. it's insane. it's what he likes to do for the

community. >> tell cliff he looks exactly like he should have looked to do what he does and be in this interview. thank you. >> i can hear you. thank you. >> happy halloween. >> happy birthday to my wife. join us on monday. "squawk on the street" is next. good morning and welcome to "squawk on the street." i'm scott wapner with jim cramer live on the new york stock exchange. carl and david are off. we have a live and exclusive interview with starbucks chairman and ceo howard schultz. futures are up sharply in reaction to a surprise stimulus move from the bank of japan. the nikkei jumping almost 5% to a seven-year high. gold falling sharply on the boj news. our road map today starts with new records in sight for the