hello, good morning and welcome to worldwide exchange. >> these are are your headlines from around the world. >> apple stuns wall street with a record 74 million iphone sales in the holiday quarter for the largest profit in corporate history. a one of banks raising their price target on the stock this morning. >> a volatile session on wall street. eyeing any change in tone due to concerns over the strength of the dollar. >> russia puts an anticrisis plan into action. this is a number of firms

reporting earnings this morning. >> that's gradually increasing for all sorts of reasons but we are quite confident about our actual risks in russia. >> he makes his first move halting the privatization of the biggest port and you till tillty. he tells cnbc europe must find a common ground within the new government. >> it took the left party to come to power in order to establish if a basic logic which is neither left nor right but that bankruptcy cannot be dealt with by more borrowing. >> you're watching worldwide exchange. bringing you business news from around the globe. >> and welcome to the show. these are live shots you're about to see from athens as the greek cabinet is currently being sworn in.

it's worth pointing out news overnight that they did pause plans to privatize one particular port asset which was part of the plan. as they are currently being sworn in you will see they will get to work. it will be interesting to keep a view on exactly what the greek government does in it's first days in office. >> yeah some say that winning was the easy part. now to work on negotiations with european policy makers. >> absolutely. all the focus will be on whether his rhetoric will be carried out in the early days of government. another big story is apple. first quarter profits with earnings up 48% while revenue jumped 30% to more than $74 billion easily beating estimates. apple sold more than 74 million

iphones. tim cook says the apple watch will start shipping in april. it's the first new product since the ipad was launched in 2010. shares did rise about 5% in after hours trade. once we got that blockbuster earnings report trading higher by around 4.7% in frankford. >> apple sales in china blew past forecast where is revenue grow 70% compared to last year. eunice is in beijing with more on that part of the story. >> hey, guys yeah. tim cook said that the excitement over the products in china was just phenomenal. he was talking mainly about the iphone and iphone 6, consumers here took to the big screens. the numbers as you guys were talking about were impressive. revenues came in at $74.6 billion and the number of iphones sold around the world came in at 74.5 million. we didn't get a break down of

the number of iphones sold specifically in the china region but we do know that the sales jumped by 70%. so these are big numbers and very impressive. there was a lot of speculation china could overtake the united states as apple's biggest market. that didn't happen but there's expectation that in this current quarter that might happen or sometime this year. that's because of all the excitement over the big screens, especially in the run up to the chinese new year holiday which is a big gift giving time. one other interesting development that happened overnight was that a research firm actually issued a ratings or their own research report basically saying that apple took the top position in the china market leapfrogging others from number six in october to number

one. this is really phenomenal and a lot of people have been talking about how apple would have to make end roads here by selling a cheaper phone but it looks like the bigger phone was what consumers really enjoyed, guys. >> eunice thank you for that. let us discuss this more. the bigger phone did so well which beat expectations. they don't release the exact break down between the iphone 6 and iphone 6 plus. but there was a $50 increase across the board. the 6 plus does well. as we talked about the last year so much on whether they can defend that margin they've got which samsung hasn't been able to do. this helps them do that. >> goldman sachs upping their price target to $130. so wall street believes this is not only a success story but a growth play which is interesting because last year's investors

thought it was an dividend play. but with the success in the iphone 6 this is also a growth play. >> absolutely. interesting you mention the dividend there because their cash balance is so vast now that it is higher than the market cap of 480 out of the 580 in s&p 500. >> amazing. >> absolutely amazing. since 2007 apple shipped more than 1 billion iphones, ipads, ipods running the ios system. doing well at the moment. on that note is the company better than ever with ceo tim cook at the helm. join the conversation. get in touch worldwide at cnbc.com or by twitter. our personal handles are on the screen now as well. >> it wasn't just apple in focus. yahoo! announcing it will spin off it's remaining $40 billion stake in alibaba.

those shares will be transferred into a new publicly traded company. alibaba makes up 85% of yahoo!'s market cap and has been a focus for investors since the chinese company's ipo last year. take a look at it trading up about 5.9% in frankfort. just days before alibaba reports it's own earnings chinese regulator criticized the retailer over the selling of fake goods. it has a zero tolerance policy for fake goods. eunice will join us in the next hour on that story. definitely an interesting development ahead of the highly anticipated earnings report on thursday. >> apple and yahoo! shares bucked the trend on tuesday. suffered the worst drop since early january. caterpillar, microsoft and dupont were among the worst

performers. >> the dollar index has come off an 11 year high. morgan stanley cited the strong green back and lower oil in it's decision to push out it's forecast for a fed rate hike from march of 2016 to january. quite the outlier there but most still see 2015 as the year the fed will move. >> earlier our colleagues spoke to the professor of economics at yale. he suggested the fed would be rise to stick to its time time. >> i don't know that inflationary pressures are at work here. it's somehow credibility. they have this forward guidance idea. they said they would raise interest rates. it would be an orderly world if they just did so and it seems to me that with the incredibly low

rates we have now, people are just amazed what's happening. to me it would give me maybe a sense of normality if they actually did what they said and pushed rates up. >> good morning to you both. let's kick off with you. the extent of the strong dollar. will that be the top agenda item at the fed meeting? >> i think we are going to get a very normal meeting this time and just listening to what rob said to return to normalcy i would say yes fed probably as we have seen what they did with tapering they didn't accelerate despite good data so when they start they will do it but given that nine central banks have eased this month i don't see how they can stick to the same time line. >> of course the question is if the fed does delay their rate

hike because inflation is below the central bank's target of 2% how does an investor make money? do they put money into dividend seeking funs or the utility's sector which hits new high. >> the tricky problem with the us. and rate cycle is you heard the fed say we don't want to be so transparent that markets rally and financial conditions get looser so they're trying to balance a clear message with one that says look actually we are going to push ahead and raise rates. but the story is europe is totally different. while we're talking about rate hikes in the u.s. we're talking about monetary policy being 0 for many many years. we argued that actually they could still double from here. it's a huge number. but it's part of the lack of yield globally. >> we can come back exactly to

the yield plays in a bit. let's focus on the fed meeting itself. will the content of discussion have changed from the last quarter of the last year where it was focussing on the struggles the global economy had while at home in america things were strong? the most recent set of earnings are starting to say things aren't that strong. could that be to lean back slightly toward the easing type of the equation? >> well it could. it's all in the language. we're looking at small changes in the wording to give the market expectation that the fed won't be as aggressive but we've had a strong run of payrolls and strong corporate earnings elsewhere so the fed has a tricky balancing act here. >> does this mean the stronger u.s. dollar play has less momentum? >> i would say so. the positioning is very strong in favor of strong dollar and i think the market might get

disappointed come march. it's too early for fed to change anything between six weeks. being patient, it's too early for them to change anything. >> let's talk about the sell off on wall street yesterday. we've known about the risk of a stronger dollar impacting corporate profitability. why such a big move in markets and rise in volatility? >> it's almost like one week ago and not now. but i would say the macrodata, they're not going to raise the rate so quickly. so to stay yourself would be like keeping it. >> durable good's number was a cause for concern coming much below expectations. >> fed looks at the inflation

expectation and that has dropped from 2 -- over 3% to 2.4%. that's something they'll look at. >> something that makes janet yellen's job more challenging. do you focus on the acceleration in jobs growth or inflation well below the central bank's target of 2%. we'll discuss more. for now, thank you so much. strategists and head of investments at cross bridge capital. but now let's get a market update. >> thanks. let's have a look in on european markets. we did have a bounce at the open and as you can see that's sold off over the last hour. we're exactly flat on the stock 600 having opened up around a half a per cent earlier which had been a little surprise following the sell off in the u.s. yesterday.

those gains initially at the start of play have been wiped out. let's look quickly. continental europe is still down .6% so continental europe is down. let's look at the european markets. that really highlights the story that we just told. the ftse 100 is flat today. germany and france both down slightly and the russian index bouncing back a little bit after a torid week. the fact that we are only down slightly for the week as a whole across europe a little surprise to some people following the greek election on monday and that bout of week earnings coming out of the u.s. yields of course are incredibly low. the story of last year was low yields. the story of this year starting to be negative yields. the japanese five year the latest to join the party. germany .38%.

greek yields moving in the other direction the last couple of weeks there at 10.3%. interesting than pointing out the history. looking low as well but the rest of the developing world looking high. will that continue to keep bond markets supported even if the fed suggests rate hikes are still on the cards. the u.s. dollar trends more broadly certainly on the up at the start of 2015. not across all currency pairs. the yen in particular managed to stem some of the losses it had last year. recover grown and find stability. it's at 117.6 but the euro continues to weaken 113 today down another .4%. the euro just coming back off some of the extraordinary moves it had. significantly away from where

the peg was at 120 u.s. dollar-rouble, 67.38. commodities, oil prices struggling. brent is at 49.16. it's off the best part of 1% today. let's check in on markets in asia. sri is standing by in singapore. over to you. >> good morning, wilfred. quite reasonable performance for regional equities in the asia pacific region despite the stumble you were talking about earlier on wall street because the data messes and earnings disappointments. we didn't really see the halo effect in the apple suppliers listed over here. mixed performance for the component suppliers but the real action was on our front doorstep

here in singapore. the monetary authority of singapore, unexpectedly easing policy by lowering the slope of the policy ban. singapore dollar we saw the weakest level in nearly five years. a degree of stability for the southeast asian markets as a result of this edged higher as did bangkok. they're in sharp focus this week. a lot of the policy meetings are live meetings. later on this week we'll have malaysia and thailand reviewing monetary policy and the new zealand central bank. very quickly, shanghai was the underperformer today. the financials the property market and energy stocks got hammered. we're down by 1.4%. back to you. >> sri, thank you so much.

coming up on the show just 99 days and counting until the u.s. general election. we speak to the former conservative party leader william hague about the close contest in an exclusive interview. that's coming up in 20 minutes times. canary wharf developers expected to accept a take over bid. >> and sony shares jump as the group plans to cut 1,000 additional jobs. we cross to tokyo live for all the details. right! now you're gonna ask for my credit card - - so you can charge me on the down low two weeks later look, credit karma - are you talking to websites again? this website says 'free credit scores'. oh. credit karma! yeah, it's really free. look, you don't even have to put in your credit card information. what?!

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welcome back. the greek prime minister is holding his first meeting. it's televised and going out on greek television. he is saying he will not pursue a destructive clash with them but he wants to restore national sovereignty and cigdignity and will be pursuing debt reduction. it's spooked markets. it's up to date now just below

flat but the greek bank index hit a fresh all time low. the greek athens broader index is down 3%. as you can see had some of the share prices moving sharply lower after what has already been a very weak week for them. >> we're seeing significant moves in the greek bond market. take a look at the ten year greek yield yielding 9.9%. the two year greek yield at 15.5% but what is more notable is the widingening spread between the 10 year greek bond and german bond up as investors try to understand the future of the greek economy. >> the latest couple of flashes coming out of the meeting. the greek prime minister saying we do not want catastrophic clashes over debt reduction but saying he must not disappointed the voter who is have elected

him and given him the mandate. we know very strong rhetoric used in the election campaign. >> that's right. greece's new government has got straight to work scrapping the planned sale of a majority stake in the port. it's dealing a blow to china's costco and other groups lined up as the 67% stake in the biggest port. the energy minister announces plans to halt the privatization. >> the role of the greek prime minister went to him who was several years an outspoken critic even reporting to it as an austerity. he was asked what would his first job be? >> find ways of ending the vicious cycle which is costing the average greek so much. causing the average european citizen an arm and a leg to

sustain this and creating forces throughout the continent and especially in this country. in third place in this parliament behind us. this is what happens when you humiliate the nation and you don't give it any hoke. >> it comes in sharp contract to the multiyear lows seen elsewhere in europe and across the world. negative bond yields. the story of the last few weeks. if they persist amid lingering low inflation, what are the best equity plays in this environment? joining us is barnaby martin. we talked bt increasing attractiveness for high yielding stocks in your view? >> yeah basically central banks are creating this asset class out of nowhere. six months ago this didn't

exist. in japan three months ago negative yield in government didn't exist. we used to talk about a race to the bottom in rates and they have clearly gone through zero now and we're seeing this creation of government debt and the effect of that will be the reach for yield or the theme of income becomes incredibly intense in 2015. one of the best places we think to exploit that is quality dividend playing stocks. they still yield more than 30 in government debt and in a world where yield is the most sought after asset class this year. we think there's a potential for stocks to double. >> are there sectors where you can find quality as well as income? >> yeah typically when we run a low risk dividend we tend to find it's insurers and farmer in there. the low dispersion of dividends and earnings estimates is what we call the low risk dividend basket. >> i want to talk about this

possible risk of yielding stocks being also value traps because you suggest your basket of safe dividend plays is yeelgd similarielding similar to three years ago. >> indeed. >> have they been increasing their earnings and dividends to maintain the yields or is there some kind of manipulation of people's earnings so they can pay yields and are they sustainable? >> it's a little bit of everything. stocks haven't done a huge amount in europe. they have had positive earnings growth. that sub sector of the world is likely to produce 7% earnings growth this year. but it's more the gap with corporate bond yields at the moment. it's a 2% gap and if you believe we could rerate if we lower the cost of debt the upside to these stocks is huge. >> do you think negative yield bonds is a trend that will garner attention going into this year? especially as we live in this low rate environment?

>> it's exactly what the ecb wants. their aim in europe is to create some animal spirits and they're doing that through the negative deposit rate and it's unlikely they're going to change that. one of the issues last week was when we did qe were they going to remove the negative deposit rate? they didn't. they kept it. >> paying for the privilege to lend money. >> absolutely. >> thank you for your time. a fascinating story to watch. >> coming up after the break, with 99 days to go until the general election we'll be speaking exclusively to william hague. here's thoughts on his party's prospects ahead of the closest election in decades.

a record 74 million iphone sales in the holiday quarter powering the tech giant to the largest profit in corporate history. a number of banks rising their price target on the stock this morning. >> investors eyeing the fed statement for any change in tone due to the concerns over the strength of the dollar. >> greek bond yields spike and banking shares hit a record low as the new prime minister says he's ready to start debt

negotiations. the prime minister tells cnbc europe must find a common ground with athens. >> it took a radical left party to come to power in order to establish a basic logic which is neither left nor right but just that bankruptcy cannot be dealt with by more borrowing. >> russia puts an anticrisis plan into action. there's a number of firms reporting this morning including concern over the business environment in the country. >> it's gradually decreasing and the geo political risk is there. we're quite comfortable about our risks in russia. uncertainty over greece is weighing on market sentiment right now. stocks have moved lower in the past 20 minutes. the ftse 100 down. xetra dax down as well. and the ftse mib with a loss

around .5%. but the big moves are being seen in the athens index which is down about 4%. the greek banks weighing on the index. significant losses across the board as the greek prime minister tells his first cabinet meeting that expect some radical changes but if you want to see significant moves take a look at the greek bond market because we're seeing yields spike right now. the greek ten year yield at 9.6%. also the spreads widen between the ten year greek bond and the german bond. so widening spread between those two and take a look at the 10 year treasury. interestingly enough we did see a spike there given the sell off on wall street. we had some investors switch out of equities and into bond. ten year yield at 1.8%. ten year bond at .39%. now on to stock specific moves.

>> let's look into individual movers. up 5.4% after announcing operating profits in line with analysts expectations. earlier we asked the bank ceo about his strategy in russia. >> that's gradually decreasing for all sorts of reasons. the geo political risk we are quite confident about our actual lists in russia. >> roche shares are off 2.2% after income fell 16% below analyst expectations. they blamed restructuring and impairment costs. h&m up around 2% after 4th quarter profit missed consensus expectations. they announced plans to expand into beauty products rolling out across 900 stores this autumn. finally st micro above flat after they were in line with analyst forecasts. they're expecting better than

expected revenue first quarter next year as they benefit from a weaker euro. >> morning, wilfred. well good news although it was expected $128 million that's to compare with the loss of $500 million a year ago. the improvement is due to the better product but in the automotive sector which saw an 8% increase in behand last year. and in the 4th quarter the numbers were in line with expectation despite a 9% contraction of the revenue but that was because the end of the products that were gradually phased out and the gross margin improved by 90 basis points because of the better manufacturing efficiency but also thanks to a positive

currency effect the weaker euro had a positive impact for st micro. for that reason the company believes revenue will continue to increase next year and it's targeting for the first quarter a stronger than expected revenue despite a 5% contraction. trading is a bit higher. >> thank you so much. also in the earnings mix today they warn there could be impairment charges in their full year results relating to commodity price falls but in the 4th quarter copper and iron ore production much higher. meanwhile, they raised the 2015 output guidance. this as the miner reported 2014 output in line with expectations. look at how the stock is performing down about 3% in today's trade. here to talk more is paul gates.

pleasure to have you in studio today. >> thank you. >> looking at the fundamental case for miners it doesn't look strong. china's money supply growth is decelerating decelerating. iron ore inventories have decreased. what do you do? do you cut your losses or wait for the situation or the story to improve? >> it certainly hurt. we've seen commodities fall. chinese demand decelerate when we're ramping it up. they're all going to hit the market at the same time. the demand has softened and has lead to this correction in prices. so a very painful point for anybody that's been exposed to the sector. i think the question that we're looking at here and now is how much further can we go down into the costco of production before we start seeing assets start to

close production. we started to see a number that will help reduce that supply-demand in balance and put a flaw on prices. we have to be closer now than the start of 2014 we've seen closures around the globe. alabama be it small closed production and all of that is going to start helping restore some of the balance here and hopefully mean to say that from here the future isn't as negative as it has been. >> let's see what we can learn this morning. iron ore was good. >> it was fairly strong. that's been this year and into 2015. that's very strongly that's a

very good result for the company. the other is the start of the big project. that's starting to produce tons. we saw some volume come out in q-4, 2014 and we have the ramp up of that operation over 2015. that's all good from a production perspective but you're supplying into a market that's probably the worst point it's been since the financial crisis of '08. but in the case of mark and anglo american you can't fault that strategy. they're a much smaller player in this market and they just have to continue with the game plan as they have layed out. >> supply-demand a big part of the story but the other part of the story is currency head winds. the stronger pound. how is that weighing on profitability going forward. >> strong dollar weak producing currency. they sell in dollars all the commodities are denominated in dollars. the cost of production in local

currency. so to the per cent it falls to the floor, you name it. one after the other of all of these producer currencies. that takes a fall out of the cost space of production and i think you have to always sort of put that commodity price fall in the context of the local currency in which it was produced. for instance, you look at the peso denominated copper price. they have been nowhere near as pronounced in the u.s. dollar falls in the price of the commodity commodity. that's a significant benefit and you really can't just put that copper price decline or iron oil price decline without also compensating for the exchange rate and oil price and global freight rates. >> a lot of factors to keep in mind which makes your job more challenging. >> always entertaining. >> thank you for your time. >> pleasure. >> now, moving on sony reportedly plans to cut another 1,000 employees in a bid to

restructure it's ailing smartphone business. for more on that story let's get out to the nikkei. >> yes the firm has forecast sales of 41 million units during the year ending march which is 20% less than the original target and it's due to stiff competition with it's chinese rivals. it's expected to book around $1.5 million this fiscal year. detailed plans are expected to be announced this week. but sony will cut another 1,000 employees bringing the total down 30%. the firm will scale back sales in china putting more effort in the u.s. and japanese targets. it will also focus on high end models and aim to bring the business back in the black by 2016. meanwhile, nintendo had a return to profit thanks to weaker yen

which boosted sales overseas. the firm halfed it's forecast to around $170 million but it will still be the first in four years. even with weak sales the wind fall is expected to increase the annual net profit by 50% to over $250 million. that's all from the nikkei. back to you. >> thank you very much. now the countdown is underway for the u.k. general election with 99 days to go before voters head to the polls. he has been taking a closer look at the issues said to dominate the race. >> for many voters the economy is seen as their top issue and for prime minister cameron he's seen as most trusted to handle the recovery. the u.s. faired relatively well come paired to the rest of europe. the economy grew by 2.6%. the fastest rate since 2007. this was up substantially from

2013 where growth was 1.7%. the unemployment rate also dropped to just 5.8%. >> look how far we have come. today there are 1,800,000 more jobs in our country than in 2010. we are creating more jobs here in britain than the whole of europe here together. >> but the conservative party failed to deliver on its promise to cut the deficit. the labor leader is sure to hound the prime minister. up next the national health service is the country's publicly funded health care system and on top of voter minds. this is where the prime minister takes a hit. according to a recent poll 47% of voters think labor has the best approach to the nhs. an 18 point lead over the conservatives. it's an issue that carries with it high emotions.

>> he's in denial about the crisis in the nhs. this is on his watch as a result of his decisions. >> finally, immigrations and the u.k.'s relationship with the european union emerged as a key issue. it's the issue that nigel and his u.k. independence party campaigned on. the conservatives have already seen two of their mp's defect and it's a real worry conservative voters will turn to his party. but less than 100 days to go and a race too close to call anything can happen until may 7th. >> i'm delighted to say that joining us now in the studio is william hague former leader of the u.s. conservative party. thank you for joining us. >> great pleasure. >> we have 99 days left until the election. it's the 7th general election you'll be directly involved with. is it the closest one in your career? >> one of the closest.

on current opinion polls one of the closest. you may not be old enough to remember the election of 1992. i remember that. it was one of the first ones i was a member of. it had some similarity with this situation. conservative prime minister presiding over the beginnings of an economic recovery. campaigning on the national health service and the result was a clear conservative victory. i'm hoping for the same this year. >> interesting comments over the weekend. he suggested for the first time a coalition with your party was a possibility. what is your response to that? >> we're going for a conservative government. it would be difficult to make a coalition because it's not clear from day-to-day what their policies actually are. talk about the national health service, policy on that changed several times just in the last few weeks as to whether they

want to apollbollish it or conserve it. we're going to implemented our economic plan and take it through to success. we need the security of a conservative majority for the country. >> given how close things are, have there been any discussions? >> no we are going for a majority. i unchaired the conservative side negotiating this coalition after the last election. but having been through 4.5 years of a coalition with all the constraints and negotiations you have to do every day within government i can see a majority of government would be by far the best thing for the country. so for that there is every possibility of getting that.

it's 99 days to go and things are moving in a conservative direction. we'll go for the majority. >> let's talk about the health of the economy because that has been front and center this election despite the acceleration in jobs growth. inflation at a multiyear low, some would say the government isn't getting the credit it deserves for the economy as a whole and i wonder if the reason is the failure to admit on borrowing performance has been poor. debt to gdp has risen and it's still rising. you failed at the move the debate away from that. >> we want the debate to be about the deficit. the only thing i quarrelled with in the package, is that we failed to cut the deficit. we have cut the deficit dramatically. we got more than 10% of gdp borrowed every year and this coming year it's 5%. well that's still high at 5%.

that's why the conservative party has a plan to further reduce and eliminate that deficit. we run a surplus toward the end of the next parliament but there isn't any other party that's going to deliver that at all. they criticize all efforts to reduce the deficit. >> let's move on from the topics that are already widely discussedened talk about english votes for english laws. you introduced the first set of proposals in december. where are we now? >> i'll announced the preferred ones on this. this is about the problem we have now in the u.s. where we're giving greater the evolution to the scottish parliament but they're still able to vote on everything that's going on in england as well as scottish parliament. so there is an imbalance now, an

unfairness in the british constitution so we will announce in the coming week what is our preferred option is. what we will do if we win the general election to make sure that on matters that only effect england than the english mps will have a decisive say. >> can we assume in the conservative manifesto there will be a specific pledge to have a new english constitution. >> we don't have a written constitution in this country but there will be a specific pledge to have fairness for the whole of the u.s. but including england, specifically how we will bring about as you say english votes on english laws and we will go into the detail of that so people will know in the general election what they will get if they vote conservative. >> thank you for now. we'll be back to discuss more with william in a couple of minutes. >> let's get you up to date on what's happening around the world. the russian government is set to

inject 300 million rouble. it's part of a plan to offset the slump in oil prices and on going western sanctions. the russian micex is trading higher while the bank reacted positively for this move. >> ukraine's policy officially claimed russia as an agressor states. >> this comes as hostilities continue to escalate. buildings were damaged on tuesday after separatists fired rockets on the city of donetsk. this prompted some leaders to ramp up their rhetoric on further russian sanctions. >> coming up we'll talk to william hague about the

important decisions he made and the world leaders he has met. we'll be back in a couple of minutes.

still with us is william

hague the current leader of the house of commons. i want to move the debate until the international arena. of course the greek election at the weekend has elected left wing and antieuropean union party. is that indicative of sentiment growing across europe? >> well it is. there's a great deal of discontent across europe and as we're seeing in the euro zone a failure to generate the economic growth and creation of jobs that we are seeing in the u.s. so there's quite a contrast there. i am a strong standing critic of the euro and i said back in 1999 that the euro would be a burning building with no exits and i was criticized a great deal at the time that that was an exaggeration but that is true. that's how people in some european countries including greece feel about the consequences of the euro. we don't want it to fail. we want our neighbors and

partners to succeed. let us move forward in the coming days and weeks. >> but ten years from now will we still have the euro? >> not in the prediction business. i think it has fundamental flaws. there's an immense political commitment in the countries in the euro zone. but it does have fundamental flaws. you're asking greek and spanish and italian people to live in the same exchange rate and interest rate regime as german people which is an economy with different levels of competitiveness and product activity. well that has a very dramatic effect on employment in those countries and the economic prospects of those countries. it has very serious flaws. let's put it that way. >> let's move on and talk about the colorful characters you've met in your long career in politics. first off with your four years as foreign secretary. what do you think motivates

vladimir putin? >> well i think he has the view that russia is a great power. he has spoken about his great regret of the demise of the soviet union and has the view that there's a sphere of influence. you're allowed to exercise enormous influence over the policies of neighboring countries. many of us would think in the modern flexible world where proximity matters less that's grown out of date but i think that is still the view in the cremlin so you see as ukraine has tried to assert a greater independence and freedom, an attempt to prevent ukraine from being able to operate as a normal country and that's what we're continuing to see in the escalation of this violence in recent days. >> and you were foreign secretary when the crisis kicked off and the sanctions were

imposed. did you at that point expect it to drag on and escalate in the way it has? >> we thought it might well do so. we were hoping flu the imposition of sanctions on russia to deter that. those sanctions are having quite a big effect on russia i think and clearly there will be if russia continues on this course that we've seen the last few days there will be a further grave deteriorations between the european union and russia. >> very final quick question, if you were leader today would you be taking part in the television debates? >> i'd be saying the same as david cameron which is debates are fine but they have to be fair to everybody. and we've already pointed out that they should be included in these debates. so step forward has been taken but let's see if it can be agreed. >> judging by today's

performance you would be a performer in the debates if you could. good luck in the final three months in parliament. >> thank you. >> and your political retirement. thank you for joining us today. >> thank you very much. >> william hague former leader of the u.k. conservative party and current leader of the house of commons. >> we're taking another look at apple's products as several other u.s. heavyweights take a hit from the stronger dollar. more on that coming up next.

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apple stunning wall street with record sales in the holiday quarter powering them to the largest profit in corporate history. a number of banks raising their price target on the stocks this morning. >> u.s. futures point higher. investors eye for any change in tone due to concerns over the strength of the dollar. >> greek bond yields strike and banking shares hit a record low as the new prime minister is ready to start debt negotiations. the new prime minister tells

cnbc europe must find a common kbround with athens. >> it took a radical left party to come to power in order to establish a very basic logic which is neither left nor right but just that bankruptcy cannot be dealt with -- >> new york city escapes the worst of winter storm juno but parts of new england are digging their way out of about 30 inches of snow. >> you're watching worldwide exchange. bringing you business news from around the globe. >> and traders were saying we didn't see a storm hit the northeast as large as we were expecting but a storm on wall street. perhaps stocks trading lower by 1% around the board. u.s. futures pointing to a higher open. does it have to do with apple and the record breaking earnings quarter. the dow up 80 points in premarket trade and the nasdaq

which will be in focus given the two big movers. not just apple up about 6% right now but yahoo! also impressing wall street seeing a gain of around 4% in after hours trade. let's focus on europe. we have been seeing a mixed day of trade so far for european markets. xetra dax coming off of the loes of the day. up about 14 points. cac 40 the lower by 14. micex, we have been seeing an interest move in russian equities. yesterday we were higher by around 2% and that rally continues up another 1.2% so perhaps investors feel like the risks are already priced into the russia market at this time. >> it's interesting to point out overall european equities not doing too badly given the elections in greece and u.s. equities sell off yesterday. let's have a look at the greek

bond. 10.18. it was 10.3%. around 50 basis points coming because the first cabinet meeting taking place under his leadership and he said he will push on to carry out his mandate including renegotiating debt term which is has increased risk on greek bond yields. germmy still incredibly low of course. .38%. it's still very low relative to history. will there be more movement today following the fed meeting. let's have a look. the rally this year has continued to be strong similar to 2014 but it has been a little bit more divided against particular currencies. most notably the yen having reached around 121 last year.

weakening against the yen to date. much have been higher in particular the euro. 113 today weakening about 10 basis points so far. >> the dollar index has come off an 11 year high amid some expectations the fed could strike a more dovish tone later today. it announces lower oil prices in the decision to push out it's forecast to march of 2016 from january but most economists are still sticking with a forecast for a june rate hike saying the fed still sticks to its patient pledge. >> earlier our colleagues spoke to professor of economics at yale. he suggested that the fed would be wise to stick to its rate hike time line. >> i don't know that inflationary pressures are at work here. it's somehow credibility. they have this forward guidance

idea. they said they will raise interest rates. it would be an orderly world if they just did so and it seems to me that with the incredibly low rates we have now people are amazed what is happening. it would give me a sense of normality if they did what they said and pushed rates up. >> let's talk more about what to expect with the fed, lower oil prices is intensifying the debate on whether the feds should raise rates this year. what's the big risk of letting the fed delay their rate hike to early 2016. we'll see unemployment dip to a historic low. >> the fed is in a tough position. it's caught between this tug of war. unemployment is falling to 5.6%. record number of job openings and consumer confidence is at

record highs. you also had weaker economic data. you had weaker retail sales a couple of weeks ago so the underlying patent is not entirely clear. you have a much lower energy price coming through to feed consumers and it's potentially a thousand a year. so you have to see what the fed does and how it reacts. >> the last couple of fed meetings there was a lot of talk about the global environment and whether that was going to effect the domestic situation. will the fed be more focused this meeting particularly if we look at the u.s. earnings we had out the last couple of weeks? >> it has to have an impact. it's a relatively closed economy. only 13% of gdp comes from exports compared to many european countries where it's 30, 50 and other end is 80%.

so the focus is much more on domestic u.s. rather than the rest of the world but the fed has to bear in mind the consequences of its actions. i'm not sure the fed is keen to have another 20% rise in the u.s. dollar. >> does that rise in the u.s. dollar slightly welcomed by the fed in that it allows them to actually put off the scary prospect of raising rates? it's like tightening a little bit and therefore this step by step approach is given to it as it were? >> no that's true. it's one more thing they have to throw into the mix and one more part of the smoke screen they have to try to look through. >> when you talk about inflation trading well below the 2% level the central bank has as a target. if we raise rates ahead of inflation meeting that level does that remove the valid statements around what the fed has put forward in terms of

raising rates? >> it's not just inflation. it also has to focus on unemployment and job creation as well. the fed is afraid if it raises rates too early it could have a big negative impact on the jobs market. >> we also know heavy rating on wage pressure as well which continues to disappoint. >> it's not something that we're seeing at the moment. wage inflation figures came in weaker than expected. the fed will leave everything late as possible. the whites of the eyes of inflation is what everyone is saying. >> if it's not about earnings then it's all about the fed. that's what wall street is focussing on. we'll leave it there. thank you for your time. >> the s and p 500 suffered it's early drop. they were the worst performer over the impact of the strong u.s. dollars. all moving sharply lower

yesterday. >> but if you were looking for a bright spot look no further than apple reporting record first quarter profits. earnings rose 48% while revenue jumped 30% year over year. apple sold more than 74 million iphones. way more than expected helping to get back market share from samsung. apple is luring customers away from rivals that use android. it fell 18%. the apple watch which will start shipping in april, it's the first new product since the ipad was launched in 2010. let's talk about shared performance. it's up 24% but it is trading higher by around 5% in frank fort and will be the out performer today. >> indeed. part of that is because china was the bright spot in it's earnings where revenue grew 70% over the last year.

let's get more on that particular part of the apple story from eunice. >> thanks so much wilfred. it was an all around good day for apple today. tim cook actually described the excitement in china as phenomenal and a lot of that is because consumers took to the big screen iphone 6s. that was a main driver today. the revenue numbers came in very impressive for the quarter at 74.6 billion in terms of the iphone sales numbers, 74.5 million but at the same time we were hoping to see a little bit of a break down of the iphone sales figures for china. no much luck. however the revenue figure was also a big number. $16 billion and that was a 70% jump from the previous quarter. now there were people here that were hoping to hear that china had overtaken the united states as apple's biggest market. at least for the iphone. that didn't happen. however there's still many people and analysts in

particular who believe that apple is going to continue to gain ground and do well here especially with it's iphone sales in the current quarter because of the run up to the chinese new year holiday. that's a big gift giving time and people are expecting iphones to do well. there was the release of a survey. they were ranking all the various smartphone makers and in their eyes apple has now jumped to number one from number six just last october and previously as you guys know a lot of people were very skeptical about apple's positions here because they haven't released any real low end smartphone. they're getting a lot of competition on the budget hand set side. but it turns out at least based on some of the figures out today that maybe they didn't need to release a cheap phone. instead they just had to release a bigger one.

>> that paps was the solution. thank you so much. you know wil pred, wefred we talk about the economic slow down in china. sales in china out pacing the u.s. >> absolutely and in particular the larger one which boosts their margin further but not just the iphone. that was the real boom for this set of results but looking forward to new products coming out. >> the success that apple had in the smartphone space can they see similar success in that apple watch in april? a lot will have to do with price point. $299 is what it will sell for? is that too expensive or are all the apple fans going to buy one because they want to be a part of the apple ecosystem. >> there's two other interesting small points. one is apple pay accounted for $2 of every $3 spent by touchless payment since debuting many october. still a tiny part of the pie but a potential future earnings

driver for apple. on the negative side quite interesting to see how poor ipad sales were and that was hidden by how strong iphone sales were. but ipad down 18% for the quarter. >> if you have a larger smartphone screen do you need a tablet? >> absolutely. >> so in a way their larger smartphone is eat agoway sales perhaps from the tablet division. >> indeed. with apple's record results we're asking you is the company better than ever with ceo tim cook at the helm. >> let us know what you think. quite a bullish call there. get in touch with us. e-mail us with the worldwide at cnbc.com or you can tweet us at cnbcwx. >> to the positive side yahoo! made investors very happy by

announcing it will spin off it's remaining $40 billion stake in alibaba. the shares will be transferred tax free into a new publicly traded company with the inventive name. the transaction is expected to be completed in the 4th quarter of the year after a lockup here. it's been a focus for the company. >> after an exhausted review we're pursuing this transaction as we believe it maximizes values for shareholders and optimizes efficiency and certainty. >> days before alibaba reports it's earnings chinese regulators criticized them over the selling of fake goods. alibaba says it has a zero tolerance policy for fake goods. eunice has more on that particular story. >> it's another big earnings day in the u.s. we're talking about facebook

taking center stage after the closing bell today but we also hear from some of the big multinationals. boeing fiat chrysler. how is the stronger dollar weighing on corporate profitability? >> greece's new prime minister gets straight to business on debt negotiations but his pledge is spooking markets. we'll discuss as we hear from the government's finance minister straight after the short break.

given leaders a man date for radical change. but he vowed to avoid any quote, catastrophic clashes with

creditors. the meeting comes a day after the cabinet was sworn in. she has been an out spoken critic of the policies toward greece. michelle caught up with him in athens after he was appointed to the post and asked him what his first job would be. >> to find ways of ending the vicious cycle which is costing the average greek so much. costing the average european citizen an arm and a leg to sustain this and creating dark forces in this continent. the nazi party in third place in this parliament behind us. but this is what happens when you don't give the nation any hope. >> bold comments from the greek finance minister but let's take a look at top stories on this hour. president obama met with saudi

arabia's new king tuesday after traveling to pay respects to the late king abdullah. he was along side a 30 person delegation comprised of top u. s. officials. there were concerns over the islamic state and on going war in syria. he expressed support for income clear negotiations in iran. they failed to discuss oil prices. >> wells fargo is vowing to reopen a popular tourist destination in san francisco after thieves rammed a suv through the front door and made off with gold nuggets on display. it includes two stagecoaches and working telegraph and other memorabilia. they stole around $10,000 u.s. last week thieves stole high end clothes and gear from a patagonia store. >> developing story. still to come on the show an

overblown forecast? we pick up the pieces and assess the damage of the northeast blizzard. that's coming up next. [ male announcer ] meet jill. she thought she'd feel better after seeing her doctor. and she might have if not for kari, the identity thief who stole jill's social security number to open credit cards destroying jill's credit and her dream of retirement. every year, millions of americans just like you learn that a little personal information in the wrong hands could wreak havoc on your life. this is identity theft. and no one helps stop it better than lifelock. lifelock offers the most comprehensive identity theft protection available. if jill had lifelock's protection, she may have been notified before it was too late. lifelock's credit notification service is on the job 24/7. as soon as they detect a threat to your identity within their network they will alert you by text, e-mail, or phone

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new york city may have been spared the brunt of this week's snowstorm but parts of new england got 30 inches of snow. flights are expected to resume from logan airport and the city's transit system and amtrak service will be back up and running. kate rogers sent this report on some of the transport problems in the wake of the storm. >> almost 24 hours after the airport was virtually shutdown the first plane was put on a schedule to finally take off and a few lucky passengers were able to get their hands on boarding passengers for a spirit airlines trip to fort lauderdale. >> i overheard an airport worker saying spirit had five flights coming in and i ran to the spirit desk and i said where can you take me? even if i couldn't get to denver i wanted to get out of new york and i was able to get a connection through fort lauderdale. once i get home i'm going to

shower and sleep for like days it feels like. >> not everyone here though that lucky. there were passengers that were stranded over 24 hours. resting on cots. they say comfortably. airport security staff taking care of them with water and ooeneven tooth brushes. in total flight aware.com reporting more than 8,000 flights completely cancelled due to winter storm juno and tuesday upwards of 4,000 flights. that accounted more than 15% of total u.s. air traffic daily. in new york i'm kate rogers for cnbc. >> now the warnings of of #snowpocalypse may have been exaggerated but hundreds were heading to central park with their legends. >> that's what i would do. >> that's pretty good. skiing down the street. >> but it doesn't snow as much here in london.

>> certainly not as much. we had quite a lot last year that came late. so there's still a chance of it. one real month of winter left but not looking like we're going to get any. >> do you get snow in the country if you get outside of the city. >> well not necessarily in terms of north versus south, scotland versus london. but doesn't look like we're going to get cold enough. >> absolutely. it was interesting some traders were saying we didn't get the storm we were expecting in terms of weather but we did see a storm on wall street. the dow down as much as 400 points yesterday. cat pillar caterpillar has the worst day since 2011. microsoft down about 9.3%. that's one of the reasons we saw the big sell off. a lot of it had to do with the stronger dollar. >> really fascinating. such a big sell off. there were interesting comments that did spook investors but

people have been calling an extension of the tech rally particularly in the safer tech plays for 2015 as compared to 2014 and clearly people realize as soon as you get a tiny bit of bad news how far the stocks have run. >> finding value in tech has been a winning trade in 2014 but now perhaps that situation will change when you have apple delivers solid earnings and record breaking sales when it comes to the smartphone. >> indeed. >> maybe that has to do with futures now. nasdaq up 48 points. a lot has to do with apple and yahoo!. dow by 12. we're going to discuss more about wall street markets, what to expect in today's trading coming up after this break.

thanks for joining us here on worldwide exchange. >> here are your headlines from around the world. >> we'll start with apple. apple stunning wall street with a record 74 million iphone sales in the holiday quarter powering the tech giant to the largest profit in corporate history. a number of banks raising their price target on stocks this morning. >> u.s. pufutures pointing higher. any change in tone due to concerns over the strength of the dollar. >> banking shares hit a record low as the new prime minister says he is ready to start debt

negotiations. meanwhile new finance minister tells rnbc europe must find a common ground with athens. >> took the radical left party to come to power in order to establish a very basic logic which is neither left nor right but that bankruptcy cannot be dealt with by more borrowing. >> new york city escapes the worst of winter storm juno but parts of new england are digging their way out of 30 inches of snow. >> you're watching worldwide exchange. bringing you business news from around the globe. now a tough day on wall street. disappointing results from the likes of caterpillar. but right now we're looking at futures higher across the board. so a change in sentiment if you will. does it have to do with apple and the stand out earnings

report? the nasdaq up about 4 37 points. a higher open by around 7 points. s&p 500 showing a gain of around 7 points. taking a look at european markets and how we're trading so far, take a look at the dollar. right now the euro trading at 1.13 against the dollar. this year the euro lost about 8% against the dollar in 201.4. the stronger dollar has been a big concern for the multinationals because it makes their products and services let competitive. in terms of european markets let's see where we're trading either now. mixed day of trading so far weighing on investor's sentiment keeping investors on edge. how will these negotiations move forward. right now the ftse 100 down.

xetra dax, we were seeing a gain but now we're trading down about 56 points. cac 40 down 35. micex strengthens .4% despite concerns around tensions in ukraine. >> apple recorded first quarter profits which coincided with the holiday earnings. rose to $3.6 a share while revenue jumped 30% to $74 billion. apple saw more than 74 million iphones helping it claw back market share from samsung. tim cook says apple is luring customers away from rivals that use android. they overshadowed another sluggish quarter for the ipad which fell 18% in revenue terms. the apple watch will start shipping in april. it's the first new product since it was launched in 2010. it rose 5% in after hours trade

and up 4.4% today. >> joining us from chicago to talk more about the results. let's kick off with the headlines. in particular the rise in the average selling price suggesting the iphone six plus did marly well. how important is that for protecting apple's margin moving forward? >> i had high hopes going to the quarter but apple defied everyone's expectations. on the blowout iphone numbers you talked about. three factors played together. one was samsung faltering. apple gaining share. apple launching the products in china and there was a demand for larger screen sized phones. on the chinese front what was spectacular is that the china

revenue contributions now are very comparable to that of all of europe. now this defies the investment community that said if you want to sell to china you have to sell cheap phones. i think it debunks that and people will be looking at china as not a low cost country but people that can spend money and finally the capital gains. the country talked about $130 billion returns of the 130 billion. could they authorize another 100? 130 billion? this is a market cap company so potentially they could return their market value to investors. overall i think it was spectacular. no complaints. i think we're in the stock and recommending investors to hold on to it. >> some saying this is a good

growth and value play for shareholders. but let's talk about wall street's reaction. already goldman sachs increased their price target to $130. do you think wall street is overly optimistic of what tim cook can achieve or deliver over the coming quarters? a lot of the sales have been driven by the iphone 6 refresh which was during the holiday quarter. >> that's a great question. >> when i step back and look at the apple story, it's going to be a little tough to repeat that but when you step back and look at apple trading, such a strong balance sheet, buying back so much you know a significant portion of the market share and shares. how do we look at apple? do we look at this company as an industrial mid season single digit grower or a product cycle company? i think investors are looking at this balance between growth and

value and going forward the value aspects will kick many a little stronger when you step back and look at the story in the near term you have product cycle capitalists. i think there's a good return on a longer term basis too. >> clearly bullish on the stock but let's talk about the future. this wearable opportunity. finally we get the apple watch in april. morgan stanley expects apple to sell almost 60 million wearable devices at $299 each in the first year. what are you expecting? >> the way i looked at this thing is from an installed base. if you assume there's a two year replacement cycle and 4 to 500 million iphones out there. if you have a 10% penetration that's about 40 million units. if you think it's a 5%

penetration it's 20 million. soy think that's how people are look at it. obviously at this stage, not many of the analysts are including these numbers in their estimates. we'll see. in april this will get launched and i think that north of 20 million units is very reasonable. that's what i have right now but it's set up for the adoption and that is something we have to see when it comes out in april. >> we'll leave it there. thank you for joining us so early and given apple's results we're asking is the company better than ever with tim cook at the helm or is this a one time. >> she says apple watch will be a future flop and that apple is spending money on junk ideas instead of buying back stocks.

i also wonder is the stock at some point going to be overvalued because they had a great year in 2014. i gained around 30% so far this year. also been outperforming. analysts are going to say it's gone up too high. >> well i think the key focus for the core part of earnings is very much still on the iphone. that gave a lot of confidence to results yesterday. the focus is the replacement cycle. it will be something to watch for sure. now in other major earnings news at&t reported a fourth quarter loss. shares rose 2% in after hours trade. up about half a per cent today. >> yeah electronic art when up with results beating forecasts as they downloaded more digital

content. rose more than 4% in after hours trade so this will likely be the day of tech with a lot of these companies beating expectations and you'll likely see big moves in terms of when wall street does open. the nasdaq will be the outperformer. >> facebook set to report fourth quarter earnings after the bell. following an outage that took it off line yesterday. investors will look for details on emerging markets. shares in facebook are up close to 40% over the past 12 months. they were down of course yesterday, 2.2%. plus coming up investors may be cheering yahoo!'s decision to spin off it's stake in alibaba but the move could rachet up the pressure on marissa myer. so turn the rest of the struggling company around. we'll discuss after the short break.

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yahoo! is making some investors very happy today as the company decides what it's going to do with it's large stake in alibaba. let's join landon dowdy standing by. >> wilfred good morning to you.

yahoo! bought a 40% stake in alibaba in 2004 which is reducing overtime including through the u.s.ipo last year. now yahoo! plans to spin off it's remaining 15% stake worth about $40 billion and to a separate publicly traded company. it will keep it's stake in yahoo! japan for now. it will save yahoo! billions of dollars it would have had to pay. the spin off is expected to be completed in the 4th quarter of this year. alibaba makes up 85% of yahoo!'s market cap has been a focus since before the blockbuster ipo in september. >> after an exhaustive review we are pursuing this transaction as we believe it maximizes value for our shareholders and optimizes transaction efficiency and certainty. >> yahoo!'s move increases the chance alibaba will buy back the shares. the company is concerned it may create a shadow market for u.s.

listed shares. and little control and there's a risk they could trade at a discount. yahoo! has been under pressure to decide what to do with the alibaba stake. they have urged the company to cut cost and consider merging with aol. marissa myer is responding to those that say she spent too much money on acquisitions. she said yahoo! returned nearly $10 billion of the proceeds through stock buy backs. profit and revenue fell in the fourth quarter but still beat forecasts. on the conference call the core business is returning to health. >> we have created more than $1 billion of new revenue annually basically from nothing in just two years. in 2015 we expect it will contribute over $1.5 billion to our business. >> in europe they're up 7%.

wilfred over to you. >> landon thank you very much. >> big move in shares of yahoo! which had to do with the announcement around alibaba but the next challenge so fix the core business. it's about time. >> absolutely. i think of course this has benefitted the share price to no end and the spin off being taken very very well yesterday but once that happens what happens to the rest of the share price. >> yeah now our attention will turn to alibaba and their earnings report on thursday. chinese regulators criticized them over the selling of fake goods on its website after releasing the report on the quality of online merchandise. eunice has the latest on this story. >> hey seema. we're seeing a rare public dispute over the authenticity of the goods sold on alibaba's site. especially it's crown jewel. there's an unusually strongly worded white.

>> paul: thaer the state regulator issued today where they found some of the products were substandard and violated trademark or were illegal. this is after the same agency that said that out of the products examined only 37% of them were genuine. so this is really a very public display that we're seeing here for the first time between the two sides. soon afterwards they issued an open letter questioning the sampling of that survey and then the reaction of the government was that they fired back by releasing this white paper. and the company itself issued a statement soon afterwards saying fake goods are a tumor in economic development. they are saying that taobao is a victim and he say we made efforts in the fight against counterfeits but there's still

much to be done. however we alone cannot do this. we are willing to work with departments to get rid of this tumor. in other words they're saying they're the victim but very much willing to work with the government agencies to attack this major problem in the country. now one thing guys that is really interesting here is it really highlights one of the key concerns many analysts had ahead of the ipo and that's that the relationship between the company and the communist party is something very important and that the company's fate could rise and fall just based on the attitude of the communist party. guys. >> thank you very much for that update. now before we go to break let's remind you of the headlines. apple posts record profits but other warn over the strong u.s. dollar. u.s. futures point higher after a volatile day on wall street and greece's new government vows

to start debt talks prompting bond deals to spike while banks sell off. we'll be back in a couple of minutes.

so european markets now in the red. they opened a little bit up but following the first cabinet meeting of the greek government where he stayed committed to some of the comments he made saying he has a man date to be radical. that's put greek bond yields quite significantly higher. the greek bond yield is around 10.4%. it is 10.7%. so it's moved up the best part of a percent during trade today which is a good indicator of how seriously people are taking his

comments. of course the move from bonds in the rest of the world is in that direction. >> big news in the greek bond market but let's talk about u.s. futures. stock closing down by around 1%. at 1 point yesterday the dow was down as much as 400 points in terms of stock specific action. the stronger dollar impacting profitability. right now though futures pointing to a higher open. perhaps the tech standouts like apple and yahoo! are lifting sentiment. nasdaq with a higher open by around 48 points. dow up 15. s&p by 5. earlier our colleagues on squawk box europe spoke to robert the professor of economics at yale. he suggested the fed would be rise to stick to its rate hike time line. listen in. >> i don't know that inflationary pressures are at work here. i think it's somehow credibility. they have this forward guidance

idea. they said they will raise interest rates. it will be an orderly world if they just did so and seems to me with the incredibly low rates we have right now people are amazed at what's happening. it would give me a sense of normality if they actually did what they said and pushed rates up. >> joining us from new york city is the managing director of b.k. asset management. pleasure having you on this morning. what is the fed supposed to do in this situation? stronger dollar impacting profitability but lower oil prices is good for the consumer but weighing on some margins will they delay a rate hike? is morgan stanley right? >> it's interesting because if you listen to all the arguments for why they have zero economic merritt behind them. the fed needs to raise rate to

establish credibility. that's what they find themselves in. there's zero economic reason for why they need to raise rates right now. inflation is low. demand is relatively weak and wage growth is nonexistent. so for the real reasons why the fed tightens policy which is to basically control economic growth there's very very little reason and this leaves us with this whole eckxpectation game. this is going to be the most uneventful fomc meeting. they want to be very cautious. you are mindful now of the fact that a stronger u.s. dollar could temper growth further as we go further. all the multinationals are screaming at them not to expedite the process because it's going to hurt their sales overseas. >> what's the big concern if

they stay low so long. that net interest margins on the banks will be squeezed but aside from that what's the big risk. >> none. it becomes a matter of philosophy rather than a matter of economics. i think it's just simply a matter of whether people are feeling that we have to raise rates in order to look physically prudent and go back to monetary policy. we still need to live in very non-normal times economically. it's why you're seeing the markets stand down and begin to wonder whether the fed is going to do it. so what you're seeing here is a question mark as to whether the fed is going to commit to the june time line. >> specifically what about the euro dollar? despite quantitative easing on

one side of the fence, is it due for a little bit of a bounce? >> it's due for a little bit of a bounce. if the fed produces any rhetoric today perhaps they say we may or may not raise them in june. that would give us the perfect excuse to bump itself up. that was 113, 114. they're due to go up. the other issue interesting about europe and a lot of people are missing this point, there's all this very very nonchalant talk about greece exiting from the euro. it was a project as political in nature as economical in nature. the point was so there would be no more conflict. that's a point being missed completely here in the discussion as an option. >> boris, thank you very much. we'll have to leave it there. that was the managing director at b.k. asset management. that's it for today's show. thank you for watching. >> next up is "walk box."

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good morning, apple surges past expectations and it's earnings after selling more than 74 million iphones. the company earned $18 billion in a single quarter. remember when we thought exxon was doing well when it earned $10 billion. $18 billion. tech will be the talk of the town today. yahoo! gets a boost following the plan to spin off it's remaining alibaba stake. and what about the almighty dollar? multinationals you saw yesterday were hurt by a strong green back and some of the biggest exporters wanted their situation to get even worse.

squawk box begins right now. >> live from new york where business never sleeps this is "squawk box". good morning, everyone. welcome to squawk box here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin. we have a lot of news to tackle this morning. we have apple and issues hitting the multinationals. let's get to the other stories to watch today. the fed will be wrapping up a two-day policy meeting setting in washington. a statement is due at 2:00 p.m. eastern time. there is no janet yellen news conference this month. we'll read everything we can out of that statement. the latest read on mortgage applications will be released at the top of the last hour.