i know it might look a little different here. but there was never anything going on there. >> where was that the white house correspondents dinner? >> we're just friends, though. i want to get that out. >> i was a witness. just friends. >> she looks great. >> and that lasted about a second and a half. that entire interaction. that was about a second and a half. i was gone and she was like god, i'm glad he's gone. >> right now it's time for "squawk on the street" 678. and congratulations to the super bowl champion new england patriots. what a game. what a franchise. what a season of football, too. good morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. we kick off the month of february today. a busy week of earnings from big media companies. oil hanging on to some of the bounce from friday when it

closed up some 8%. and then the ten-year yield still below 17. six more weeks of winter but a second chance for the markets this year. investors looking to kick off february in the green after closing out of january. represented the worst month in a year. >> lower oil prices pushing exxon mobil's fourth quarter down, 21%. but that's still better than wall street thought it might have been. >> and a controversial call on super bowl xlix rivalled by some controversial calls by advertisers. for two ceos, it gets personal. but first up hoping to get their mojo back up. they posted their biggest monthly losses in a year. blue chips down about 3-7. nasdaq down about 2-1. january was good for so-called safe havens. treasuries, their best monthly performance since 2011. gold an 8% gain. interesting month. things like netflix, merck, unh still working, jim.

>> yeah, it was one of those market where is the domestic stocks did well. a smattering of high growth did well. a couple of big caps. but in the end, it was a disappointing quarter. in the end, when we kind of limped into february companies that had done quite well apple, 118, 119, goes right back. visa, good quarter. right at the end it starts slipping. 3m had a good quarter. i can count on two hands, the really great quarters. just had a lot of quarters that were just kind of -- >> you said for last week for every apple, there's a ton of microsoft. for every sky works, there's a qualcomm. >> yeah. and the ones that -- a lot of these are favorites. qualcomm was a big favorite coming in. i just feel like there was a sense of -- thank heavens this month is over. their earnings are so low, you've got to see the whole aggregate of the s&p go down.

>> it can conversely go up. we start with continued focus -- i almost hate to say it -- on greece. there's just no way to get around it. we're going to keep hearing various things and it's going to be difficult to get a real read on that situation, but it is going to roil the markets to a certain extent. the dollar continues to show itself in the face of guidance that we'll get from any number of multi-nationals. that will continue. i guess we'll be dealing with this for some time. not to mention ukraine doesn't look quite as bad. >> ukraine is bad. one of the things i thought was just really confusing was that some companies just got currency totally wrong. some companies did a little bit of hedging, did it right. but no matter what, the conference calls -- if you go back over the ibm conference call it was basically how the

currency made it and it was just tepid anyway. and the guys who were tepid and had not so great currency are really the ones that continued to just roll over. >> opposed to google, which actually had a pretty decent quarter and currency did hurt. >> yes, but there was one where if you look inside it you're right. it was a very good quarter. because there were a lot of metrics that started to go up. also they had some discipline. i think that was the theme. who was the disciplined spender who hadn't been and then you have these really crazy things. you had shake shack. it was just so expensively valued, and so you have all these other panes that are really struggling and then you have shake shack, you say i don't know, i mean this market is euphoric on a given day. downbeat on two days for every euphoric day. >> it's a good way to look at it. >> tough start. >> exxon did fall, but that share is a beat.

>> gives you a sense since estimates have come in. >> you'll see the stock -- not roar, even though it should. >> exxon is a really well-run financial company. >> in the meantime we got additional ripple effects.

>> wages going up. the cost currents whether it be greece, whether it be china, they're just really not great. >> although russell would back up your point about staying stateside. >> he passed it. to give it to marshawn. oh the russell index! a lot of good calls. domestics as well. >> are we still held hostage to oil prices so to speak in this market? >> i think so. we haven't seen weak ones yet. we haven't seen the ones that

are beginning to say we are cash flow. when i see that i see that exxon is cutting back its buy, the next thing i know is what happens to these other guys? the guys we know haven't reported yet, where the cash flow is just falling off a cliff. >> you mentioned russell wilson. super bowl xlix will be remembered for what some say was the worst play call ever. one yard away from the end zone 20 seconds to go in regulation the seattle seahawks choose to pass the ball instead of handing it off to star tailback marshawn lynch. the result was that interception by butler giving the new england patriots a 28-24 victory. a fourth super bowl title, bill belichick as coach and tom brady as quarterback. bring pete carroll said real hard luck. real hard luck. trent dilfer was a great quarterback in the hall of fame,

saying look you have the greatest running back in the world right now. in the world. in the end, winner. advertisers. stayed until the end. right? versus last year. advertisers, turned it off. >> i didn't even have a rooting interest and i still find it painful to watch a team lose like that. and i just find myself wondering as a jets fan, if my team made it and lost like that it might even be worse than being 3-13. i don't even know. all of my fandom is in question. why do i even bother, if that can happen to your team. >> would you have wanted to face paul allen in the moments following that game? oh, my gosh. >> he looked unhappy when they were winning. >> he did. >> you know i'm a richard sherman fan, they threw at sherman once and it looks like he has to have an operation on his elbow, maybe an operation on

his shoulder. the other side of the defense, byron maxwell is a really good player, but they had guys that got hurt. i think we always want to look at the last play and it's a lot more up to the last play. >> by the way, you mentioned advertisers winning. the most tweeted super bowl ever 28.4 million tweets. 265 million facebook posts. >> wow. >> the cfo tweeted an interactive thing. and i wish them -- you know i think this is kind of a make or break week. if they can say you know what the quarter started, and be a little less episodic. but you go from super bowl to what? i mean that's the problem. what's the next big thing that we're going to be -- >> and it comes back on twitter, talking about the stock to monthly average users and what kind of a growth rate will we really see and continued conversation at least from the investment community about the difficulty of really accessing that world.

>> you don't think average users is going to transcend the month? >> no. >> i don't either. >> but dick costolo -- >> that's what it's come to. just silence. >> that was the best one yet. >> my advice is to give it to marshawn lynch. >> we'll see what the earnings say. by the way, they do have a new instant timeline. meaning as a new user you don't have to curate your own timeline. the times today, are reviews it and says it was actually better than the reviewer's own timeline. >> it's what people areal kaing for. but everyone's on to him. why am i so frustrated with twitter? here you go you're on "meet the press" and it's a real honor. everyone's tweeting the pictures. it's not like twitter is paying

us. how much are you paid when you tweet? >> i'm not. >> but how much are you paid for everything else you do? fair amount. but twitter's got this huge number of people, the biggest people in the world, they're all tweeting and they can't monetize it? i mean they're giving twitter this unbelievable base of content, and it doesn't seem to matter. >> how about the twitter fights between john legere -- here's legere. half -- commercial half-data speeds. do we have some of the response? >> the ceo of sprent. >> dude you have trashy kim. ha ha. joke's on you. >> i think it's interesting that he's not going to just take it from legere. >> you get this kind of thing. >> you don't see randall

stevenson. it must be the kids that tweet. kids are in there. >> we'll talk more about the ads later on in the program. what did well. what did not. a couple of advertisers took it on the chin last night. >> a couple of busts. >> also william cobb will visit us. we'll hear his game plan for beating the competition this tax season. one more look at the pre-market. down two months in a row. eight out of ten sectors down year to date. a lot more "squawk on the street" from post nine in a moment.

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for the second straight week, the northeast getting hit with a winter storm. in the middle of it all today is adam reese, who's in white plains new york. adam, good morning. >> good morning to you, karm. round two for this region second time in less than a week. it's ground hog day. this is winter storm linus. and it has left about six inches of snow in this region. started at about 8:00 last night. as you can see here in white plains, we're about 30 miles north of new york city.

and they're stimll digging out here. new york city is doing okay. businesses are open. schools are open. but in this area there are a lot of delays. a lot of schools are closed. the big problem will be this afternoon as this snow turns into ice, slush, mixed with rain. that's going to be a problem. the roads are beginning to be very icy. you're going to want to be very careful. and this afternoon's rush hour is going to be a problem. so again, on the roads this afternoon, we're going to see some ice as temperatures drop. carl? >> adam, thank you so much. certainly we're feeling it here in new york city today. adam reese of msnbc. the president is proposing a $4 trillion budget for the 2016 fiscal year aimed at aiding the middle class. among his proposals, a tax on companies' overseas profits, raising spending on highways and transit systems. he's going to talk more about this later on this morning. but 14% repatriation tax, 19 down the road. you get taxed on that one time and trying to link that to about

half a trillion in infrastructure spending. >> makes sense, but are they really trying to link it just to that? one of the things i felt this this administration has been saying jack lew said it let's move on comprehensive tax reform. did all the things that they talked about that were against the 1% or isn't that all part of one? are they beginning to say listen, without the tax increases for the wealthy, you're not going to get this. because i just think that this is kind of thrown out there. sounds kind of interesting. not exactly the rates anyone was looking for. i know from the republican party. but if it's comprehensive, it's dead. the republicans are not going to vote for the tax increases for the wealthy. >> no but does it become part of a larger conversation about tax reform? do you really get there, or is it all just doa? >> i think it's doa permsonally. >> there's still some hope that you'll see movement on the corporate side of things. >> look if this were just proposed and they came back to say that was their opening bid and then you got back to nine

and come out with 11 i think it would be great. it's all linked with a step up in basis that would hurt the middle class more than anything they do. you know they're trying to tax the people they think really have the free ride and republicans don't want that. so what does it matter? >> just a carrot of interest. it's just a fairness thing. >> that's where you raise the money. >> although that won't amount -- they'll tell you it won't amount to much. >> it's easy to call just a couple of guys. >> $4 trillion. it's funny 50 years ago, our budget was $99 billion. johnson was coming in under $100 billion with his budget. >> all these numbers mean nothing versus the entitlements. this is that sliver discretionary. the entitlements just start ballooning and no one's talk entitlements, right? the only reason you're doing all this shuffling is because there's this little part of the budget that they're able to control. the rest of it is medicare and social security. >> there is some hope that we

bent the cost curve on medical. >> yes. >> and that would be huge. >> if that happens, then our kids are doing okay. >> if you look at this we don't talk about our kids anymore. there was that period where, well, what is our gift to our children? when you look at this stuff, it's bad. >> we are getting some ratings information on the super bowl last night. which was on nbc, of course. our corporate parent delivering the highest overnight rating in super bowl history. with a 49 -- if i'm reading this right, a 49.7. >> wow? a 49? >> and it looks like 72 in the demo. overnight topped to 50 in each half-hour, from 8:00 p.m. forward. up 4% from last year. up 3% from the prior record. >> tv? >> television. linear television. yeah. >> people didn't play video games? they watched this game. they watched katy perry. >> approaches our numbers right here on "squawk on the street."

>> that's amazing. >> it is a shared experience as everybody says. the one we have as a nation, everyone would argue is the intel. >> isn't that something? we're a great secular nation. >> we'll get cramer's "mad dash." we'll count down to the opening bell in just a moment. more "squawk on the street" is back in a minute.

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seven minutes or so to go. >> some stocks are just houses of pain no matter what. it just never ends. jeffries goes a big estimate cut here. now you say, well where have they been? people kind of hoped. they kept hoping that at some level, this thing would represent some value. when day rates roll over we have seen patterns where these stocks have always been the worst to own. the oil service, rig companies. and you're going to see a lot of -- as all these big projects are cancelled that are deep water, that's their specialty. >> but there's got to be a bottom somewhere. you're talking about a stock that's down as you can see 62%. >> you've got to worry about that balance sheet. >> you are. >> this is one of those where it's going to transcend stock and you're beginning to be talking about it from the finance side. >> right now where we're worried in this area is larger private companies that have borrowed a lot. aubrey mclendon. and then you've got kkr deals.

>> free port you're borrowing a lot of money. >> and then you're talk about a public company. a lot of the other guys are capitalized fairly well. >> this company does not have young riggs versus say energy services. but that doesn't matter either. one of the worst performing stocks in the s&p. i know people want very much to buy this every time they see the oil futures tick up. if you feel that way, buy exxon. just don't fool around with the balance sheet. it's too dangerous. >> now we want to move to pepsi. >> wells fargo knows they reported february -- they report february 11. pepsico, big presence in the halftime with katy perry. so then the question is do these things matter to brand? does it matter to drink? if you actually see an acceleration in a line item like gatorade, that would be very big. it used to be one of the great drivers. good yield, good management. why not buy some?

not bad. >> continued pressure a bit from an activist there. >> well, on the board. maybe johnson on the board can get in. a very smart guy. >> johnson going on the board. that's right. >> and not distracted. >> you're absolutely right. i actually had forgotten frankly. >> how can you remember anything after pete carroll's move? >> what if you're a seattle fan? >> the russell 2,000. i've got to change that. it's the butler 2000? the west alabama 2000? >> "squawk on the street" is back with a lot more.

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you're watching cnbc "squawk on the street." live from the financial capital of the world. opening bell in about a minute and a half as we kick off february with the dow and s&p down for two straight months. the last four dow moves have been by either up or down 195 points. that volatility that was missing for a while is clearly back. >> yeah and people can't seem to get adjusted to that 17,000 18,000 level and how that may not be that big. instead, they say wow, this is a

horrible day. i thought it was interesting when visa split. but what's really happening to me is -- what i see is people are losing faith. i think people feel like we've had a really big run. stocks got extended. a down january after three or more up years, that has been a pattern and this is a third year in a president's term those have been good. so maybe we just say january, special exception let's see what happens. >> got to get through a lot this week. disney chipotle earnings auto sales tomorrow. we'll get fox core's go pro, twitter, buffalo wild. >> these are all stocks that are deeply identified with the retail investor. i look at that number for super bowl. gasoline coming down. does that impact it? you're going to see a lot of -- hear a loott of stories that are very retail.

>> let's get a look at the opening bell here and a peek at the s&p at the top of your screen. h&r block marking the top of the tax season. we'll talk with the ceo in just a few moments. over at the nasdaq the philadelphia 76ers celebrating its new patriot hardware platform. >> they have something to celebrate. the opening bell. that's terrific. certainly not the record. which is horrendous. >> their time will come. >> you think so? >> well the draft. theoretically. >> i went to see them recently. they won a game. >> are they in double digits in wins? >> no. are you kidding me? >> my mom was a season ticketholder. they went 9-73. it was the worst in history. mike smith sat next to her. at that point, he still liked philadelphia. this team is going to rival them. >> s&p. so s&p is right around the 2000

level. some of the refineries are beginning to chase what happened to them. >> again, this whole talk about the idea that there's been a dramatic increase in driving dramatic decrease in drilling. there's a sense that maybe some of the economies have a wider start. they're just not seeing the spending. these are very very well-thought-of. they're just now seeing the goodness. >> on a day where there was a miss. even though incomes are okay. retail effect is a bit like waiting. >> 25% for paying off debt. but he did point out, said once that is saved on average, by the end of the year they're looking for nice spending buzz people

feel better off. visa's conference call was brilliant. it's a play. if you think of these conference calls as plays, they kind of lead to an overall conclusion. visa's was don't worry about the dollar. we're going to make the number anyway. it was very joyous. well, it's not going to be set to music. >> joyous. >> joyous. >> that's very nice. >> maybe they'll make it to broadway. >> somewhere in previews. >> i think that dfs, that was very much a new haven. some of these other guys are just pure summer stock. >> did want to come back to shake shack. public offering right behind us on friday. we spoke to the ceo and founder danny meyer.

it was up over 128% at close. priced at 21. enormous amount of loyalty. there's no doubt. i had a chance to speak to a few hedge funds. i thought for sure they're just going to short it. but a few looking at still buying it. maybe not quite here. but not far off from this level. because of the loyalty of their customer base. the fact that even when you look at that base versus some of the competitors that we talked to them about, the five guys the in and out, they still seem to have a lot more stickiness with shake shack. it's hard to get there on a valuation at this point. >> here's the issue. when you mention it to some critical people, they say look they each make a huge amount of money. i see the loyalty. and danny meyer, if you go there and you say i love my sister, they're not giving you a free

burger. >> no. >> get a hug. >> i thought the mcdonald's commercial was very interesting. it's not for everybody. not everybody gets i really love my dog, here's a big mac and fries. >> there's a contingency. >> but interesting approach. >> i thought it was telling that it wasn't about the food. because that is not their selling point right now. >> it's funny buzz niny because shake shack is so totally about the food. >> i didn't get any on friday. we actually had to go. it was all around us. the truck outside was a two-hour wait. >> you don't want this to be like the container store where there's great loyalty, you pay the people a lot and then the stock fizzles. you want it to be like chipotle from day one. and that's very hard. because chipotle -- their main thing is throughput. supply chain. that's what happens when you get up to a certain number of stores. but i think you're absolutely

right. the fact that you have said there aren't going to be -- at least in your base it's extraordinary. they buy some more and they get an okay basis. >> it's hard to imagine at this level. stock now actually flat to up on the day. >> the "times" once called danny the best restaurateur ever seen. >> i call it the fire people. the fire table. >> i don't think you can fire me. i mean you could. >> we haven't touched on some retail needs. lands' end new ceo. ever core macy's with a buy. >> terry was here last weekend. he was right. that offensive line that he outfits for brady, i think that macy's is a great domestic

situation. lands' end was definitely hurt. still have some association with sears. it's tough when you're associated with sears. just very tough. >> yeah. >> we haven't mentioned china. some of the data out there over the weekend not encouraging. >> were you? >> i'm worried about china. it's almost as if they stopped importing. almost as if the country is on pause until europe starts. i think that we all -- 3m's conference call, well-orchestrated again. >> was it joyous? >> no. it was -- it was like a rhapsody. >> a rhapsody? >> yes, a rhapsody -- >> not in blue. >> well 3m is more like -- in china, they have respiratory

problems. >> people just wearing the masks. >> both of us having been there recently. >> you can't. i don't see how people -- it's not a way to live. >> and they didn't stop the cars and trucks for you when you got there. >> i wasn't in beijing at the time, but they were doing it there because they were having -- the president was there. but maybe it will move to shanghai. >> another city i've never heard of. 500 cities that are larger than philadelphia where i'm from. >> did want to mention shares of apple, because we have news that the company is doing another bond offering. if you remember when they did a bond offering previously, i think they hit the lows on the ten-year right around them. back towards those lows right now. i don't see that in the filing

but just mentioning -- some may wonder why are you going to be issuing, whether it's 5, 7, 10 or even 30-year notes at am when you have 170-plus billion dollars in cash. it's a reasonable question. but it does go back to a previous conversation, corporate tax reform. can't bring it back without paying a very large -- well, what you pay in taxes. >> i wonder if the interest costs are tax deductible. use it to buy back stock and you actually save money because of what you're paying on your dividend. >> just the insanity of the koesmd i think everyone know s code. i think everyone of sane mind looks at something like the apple people and says this is exhibit a for why we've got to fix this code. but good luck. >> the dow is up 44. let's get to bob pisani who is back on the floor for us. >> a week after covering the etf

conference. gold is on the downside. but oil is up. that's helping oil stocks and exxon's beat here. so a look at some of the big names. these names are stabilizing right now. haliburton was, what $70 six months ago, but it's $40 now. and that's stabilized in the high 30s, low 40s. just the last month and a half or so. that's certainly good news. schlumberger conoco accidental. the important thing about exxon's earnings is things fell apart in the fourth quarter, but here's the full-year earnings for the company for the last few years. 2013, 7.37. 2014 actually made more money. the prior three quarters were great. here's the problem. look at that 2015 number. $4.28 for the estimate. huh? we're talking about a 40% decrease in earnings. take a look at exxon stock.

it's little wonder you're essentially sitting at a 52-week low. let's not quibble about a couple of dollars. that's where we're at right now. the other big problem is the buy-backs. exxon announced a $1 billion buy back for q1 of 2015. i'm going to project that out. if they're talking about 4 billion for the year, that's a problem. they've been reducing the buybacks for a few years. 21 billion, 2013 16. 12.9 in 2013. you're talking about a company with a market cap of $370 billion. a $4 billion buyback if that's what they're going to do in 2015. that's a rounding error. that's virtually irrelevant. it's not going to have any impact on the stock price at all. i think that's the problem. why not increase the buyback when the stock is down? i don't think they know where the oil prices are. what if it stays low for another two years? i think that's the problem. one good thing about exxon right now is they keep increasing the di dend dividend.

highly unlikely they're going to freeze or cut that dividend. that's their big differentiator. they're talking about very significant increases in inflation, over 5% for food costs in 2014. guys, keep an eye on that. the number of companies mention that in the fourth quarter. become to you, david. >> thanks very much bob. in that deal, of course with -- remember u.s. foods. they're going to be selling a number of food distribution centers to performance food group in order to get that u.s. foods deal through the antitrust authorities, or their hope is. so that's why that is taking place there. on friday as we told you around this time on friday we would, we got later that day the results from that huge auction of wireless spectrum by the u.s. government that raised roughly $45 billion for first responders networks and probably just for the general treasury as well. we found out who the winners

were. i should say who paid the most. not clear that they're winners so to speak. but who paid the most. at&t the leader. but a lot of the analysis this morning is focused on dish a company that's kind of a riddle wrapped in an enigma wrapped in a puzzle to a certain extent. what is the strategy being pursued by its controlling shareholder? what is the plan there? having spent $13.3 billion gross, around $10 billion net is what they will have spent. we're not getting on friday anything beyond confirmtory press releases saying yes, we spent that amount of money. we're going to have to wait to really hear more details around their strategy whether it's at&t and its decision to spend over 18 billion, or verizon, which perhaps spent less than some anticipated, or as i said,

dish. you may say wait a second they actually made their bids through so-called designated entities that are allowed to buy at a 25% discount. dish does control 85% of those entities, or owned 85% of the entity, but it doesn't control them. and it will. it may kind of be polluting the intent of this. we're moving through this a little too quickly here, but the fact is if they were to sell that spectrum within the first two years, they'd have to pay become that discount. we've got a lot of people weighing in wondering what's dish really going to do with all of this spectrum. it spent about $3 billion on spectrum that's now worth multiples of that. and then it buys another $10 billion worth of spectrum in this auction. what is it going to do with it all? has it gotten too large simply through the value of the spectrum for anyone to actually buy? do they just reach commercial

agreements with a lot of providers out there? basically leasing the spectrum? or was there something bigger coming here? we don't know. they say most of the ideas we've heard are implausible, impractical, or illegal. as for all of the kerfuffle about this designated entity strategy and the fact that they shouldn't be able to use it well, wrote a very good note saying it's been used in the past. same designated structure by at&t and verizon and the fcc won't have much justification to do anything but issue those licenses to dish. finally, let me show you a great chart here if i can on spectrum holdings. that's where we all end up. lack at sprint. we forget how much spectrum they own. >> wow. >> that's why they didn't bid at all. >> right. >> their problem is not

spectrum. it's getting the network to work properly. >> and the former ceo used to speak. so we've got a lot of places that we don't cover. >> let's get to chicago now. rick san delltelli joins us. >> the treasury market continues to be in kind of short pass mode and clearly, it strategized that higher income even without the accompanying higher spending, was pretty good news. you see rates crept up a bit. but we're only about a base point and a half to hire from that level, considering we're back down at 169. we're off the 164, 165, opening the chart up. friday was the lowest close since may of 2013. as you can see on that chart.

and the 30s, of course had their all-time low closing yield on friday, and 2-2-2 couldn't quite get down there again. if you look at a two-day boom similar, they traded under 30 basis points twice. last week and today. so they have a double bottom right around 29 basis points. jgb is hovering around 30 basis points similar yield. but it's fascinating to see that their mid january low all-time close is down at 20 basis points. this chart starts at the 21st. no big bounces, but definitely short passes treading water. back to you. >> thank you very much, rick santelli. it is that time of year for hr block's ceo. william cobb will be here at post nine in a minute. don't go away.

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sir, we're hearing about 6 million people about to be surprised because of the affordable care act. how many of them have come to you because you've got those extended hours and they know that they can't figure this out by themselves? >> we've had a fair amount of people. people are confused because they either have to reconcile if they're in the exchanges, against their actual income, or they have to pay a penalty. so the government now estimates about three to six million people will pay a tax penalty, and about 20 million others are so are seeking an exemption, this which is what we can help people find. >> how many people would you say normally have not needed help versus now? it's a well-off group of people. >> it's hard to estimate, but now because of additional forms and this reconciliation to the actual -- your actual income, it is a lot more. i mean it's millions more. we're seeing that in the amount

of people coming into our offices now. >> is there a way to quantify the margins dealing with those types of customers as opposed to customers in the past? >> well it's a little -- you know, we're still figuring it out, carl, because it's so early in the season and i've said this all along. i said we have to see this play out. some people are coming in -- we actually even had a day early in january, where we just answered questions. people are trying to figure out what to bring in etc. i've told analysts this is going to play out over a couple of years. tax season is just kicking off. >> what are you finding in terms of response to this new ad campaign that you've got out there that i think a lot of our viewers are probably seeing? >> yeah you know what's been great -- we call it refund season now. that's really what tax season is. about 85% of people wind up getting a refund. so that's really what we're trying to do. it's the most important financial event for so many millions of americans that we've had a great response and we've got our taxpayer richard is a bowtie guy. and people really love the ads.

and it's drawing people in. >> people are talking about how this is going to be one of the latest periods where the refund has come. how will that impact consumer spending? >> refunds just started coming in. we've actually sent out a few billion already. but the irs just started releasing refunds friday. so people over the weekend started to get refunds. so i don't know exactly how it's beginning to affect but it's about the same timing as last year. might even be a little earlier. but at this point, refunds seem to be flowing in in a normal course. >> are audit rates creeping up as they were in the past few years? >> i would -- hard to say about this year carl, but i think what we're seeing is that this is beginning to happen -- this is going to be easy to audit on the affordable care act. you either have insurance or you don't. you either fill out the form or you don't. people will say i'm not going to worry about it. this is an easy one to audit, frankly, which is ironic. >> i think that when i listen to the tax code i've got to ask

you. all these different proposals. the 529 in and out. the step up in basis. these are radical proposals, aren't they? >> they are. and that's one of the reasons why i don't react to any of them. i have to see what becomes the law of the land. what we do we don't lobby one way or the other. we interpret the law. but obviously we observe it. but i can't react to anything until it actually becomes law, because otherwise, you know i'll drive my tax institute crazy. >> sounds good. >> thanks so much for coming in. >> thanks for having me. >> william cobb. >> we'll get stock trading with jim in a moment. dow is down about 28 points. do go away. then there's trusting your vehicle maintenance to ford service confidence. our expertise, technology, and high quality parts mean your peace of mind. now you can get the works, a multi-point inspection with a synthetic blend oil change tire rotation, brake inspection and more. $29.95 or less.

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quickly on tax reform you think we'll get something done? >> not a chance. >> you don't buy it? >> never. >> wall street? >> nothing's going to happen. >> that was jim on "meet the press" yesterday. >> did a lot of talk. you cannot link corporate with individual. republicans want individual cut for wealthy. president wants individual rocks for wealthy. you get all this cool stuff about income tax and corporates but they're not going to let these be unbundled. >> let's get stop trading. >> i tell you, this is a treacherous market. when the oil started going up these airlines are getting killed. united airlines delta. take a look at those stocks. this is the definition of a treacherous market. these go up big. and then you get a little bit of a reverse in oil and then they get crushed. just be careful right now. got to let this thing go. >> what's on "mad" tonight?

>> we have a company called dexcom which makes diabetes monitoring. you get apple, you link it with your cell phone, you link it with your device. next thing you know, you find out if your kid's got a problem at school. very important if they have diabetes. >> see you tonight, jim. >> all right, thank you. >> jim cramer tonight, 6:00 p.m. when we come back breaking news on ism, plus some super bowl ad winners and losers in a moment. i'm only in my 60's. i've got a nice long life ahead. big plans. so when i found out

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got some breaking news here. rick santelli is in chicago. rick? >> construction spending up .4. last month revised from minus .3 to minus .2. but to be up .4 is a bit smaller than we were looking for. the biggie is january ism. expecting 54.5. we end up with 53.5. that's the weakest number in exactly one year. 51.8 last january of 2014. let's look at prices paid. they were at 35. we're expecting a number of 40. if we look at the employment index, because a lot of employment numbers this week had moved from 56 to 54.1. and of course the other biggie we like to watch, new orders

move from 57.8 down to 52.9. so definitely anything over 50 is positive. but positively could have been a bit better according to the whispers i'm hearing from traders over my shoulder. back to you. >> rick thank you very much. rick santelli in chicago. welcome back to "squawk on the street." post nine at the new york stock exchange. simon is off this week. markets down session low is 67 points. at 17,103 we exactly a thousand points below the dow's all-time high. january marked the worst month for u.s. stocks since january of last year. can we expect a more bullish month for february? joining us this morning on post nine is the bull of wall street tomley. it's good to have you back. >> you don't mind being called that do you? maybe you do. >> it's long as it's not a permanent label. >> fair enough. >> are you worried about how the year has begun? how earnings season has transpired?

how some of the macro data is turning out? >> a down january is not what you want to see. earnings have been -- the bottom line beats have been good, but the guidance hasn't been great. but i think we're really looking at a plethora of sort of negative headlines, whether it's europe oil, dollar. but we really have to focus on some of the things that are going to matter like consumer. the consumer i think is beginning to have some positive catalysts over the course of the year and i think that's going to turn sentiment back into bullish. >> we're going to wait to see. we continue to wait for gas prices to show their face in the form of spending. jobs this friday, the estimate for wages is a plus-3 but we remember that negative print in december. >> and there was some confusion because of that. i also think we have to remember credit is really a big story. it's been restricted to consumers. they've had bad credit stores. that reset is happening this year. i think lending standards are coming down and i think it's going to play through stronger housing. i do think we're going to see some things that get us more optimistic about the durability of the expansion. >> you mentioned the dollar.

it's a big theme on earnings season and we're watching the headlines out of greece. does the u.s. dollar make the u.s. stock market more attractive particularly for foreigners? because art hogan was quoted in "the wall street journal" today. he called it a magnet for global capital, the fact that we've got a strong u.s. currency. >> yeah we published a piece last friday just looking at this issue, and pes expand. that's a capital flow issue. and another thing that happens when you have strong dollar is actually there's a flurry of inbound mergers. european companies buying u.s. and of course that's good for value indications. >> you expecting that? >> yes. yes. so i think the u.s. companies have so much cash. got a big cap ex cycle. i think we're going to see mergers this year that act as a catalyst for stocks. >> a stronger dollar -- i mean we have better buying power overseas as a company as opposed to the other way around. >> david, it's counterintuitive because we looked at over 30 years of merger data and you would think hey, with a strong dollar we go on a shopping

spree. turned out, companies want to be where capital will have the best return which means they chase strong currencyies, relative growth is strong here. that's why the mergers come this way. >> any sectors in particular, you're looking for that to happen in? >> typically, it's actually the industrials, health care and materials. that's really where the mergers take place. health care is unique. but industrials and materials the companies are so interchangeable. i think that's why really mergers take place where you want mergers to take place. >> back to the consumer for a second. we haven't seen that spending uptick that many have talked about as a result of the savings from the falling gasoline prices. i don't know if you've done any work on this historically or not that leads you to believe we will see it. right now it seems to just be being saved. >> yeah and mastercard made that comment. >> and visa did, too. >> that consumers are saving a big portion of the savings. i think it's because until it feels permanent, they're going to take the extra money and put it back into liquidity. i think as soon as they feel it's permanent, i think spending

really picks up. so i think it's a june quarter, march quarter story of consumer spending. >> just in time for gas to start bouncing back if you're a boone pickens or somebody like that, right? >> yes. and i think sometime this year energy is going to be a great investment story as well. >> not yet. >> it might be. it might be. you just have to do it when everyone's given up and the stocks go up on bad news. >> you got a year end target still in place? >> yes, we still think we're going to have a nice double digit year. i know people are worried stocks haven't risen seven years in a row. we published a piece saying it happened 1,280 times since 1870. in other words, there's 1,280 times you can have seven consecutive years of gains. >> it's all playing with your charts and i guess where you stop and start. >> or there's a problem with people just doing calendar analysis. that's really why people are saying stocks don't go up for seven years. we found the longest streak was 14 consecutive years of gains.

>> you happy with this earnings season so far? it doesn't feel particularly good. >> i think the guidance hasn't felt good. but, you know companies love to have reasons to cut expectations. and this is a great time for companies to dial down. lack of visibility. but i think companies are cutting guidance. and the bottom line beats have been very strong. i think it's making it easier for companies the rest of the year. >> how does the fed dynamic play into your forecast? counting on something? one and done in september? something 2016? >> we're not real fed watchers, but to me intuitively, i just don't think there's inflationary pressures on the wages or housing, so i think the fed is going to be patient. i think it's more of a 2016 event. >> there's been a couple of calls for the first hike to come the next year. good to see you again. >> great to see you guys. another monday another major storm blanketing the east coast and parts of the west coast.

tremaine lee is at laguardia airport with the impact over there. what are you seeing so far? >> the great yogi berra once said it's like deja vu all over again. across the country, 2,700 flights cancelled. with chicago hit the hardest. here at laguardia, where we got about four inches of slushy stuff, folks are hunkered down throughout the terminal. jfk, not far from here, 124 flights cancelled. so folks are waiting to see if they can get in or out of the city. folks are concerned about later on today and this evening. what happens once the temperature starts dropping and remains below zero? will we get that ice skating rink effect on the highways? so the mayor and other city officials have urged folks, if you can stay off the roads, do so. here at laguardia, when you see that red, folks are seeing red.

the frustration and concern over will they be able to get home. and they're kind of preparing for what could be a long icy road back to where they came from. >> everybody knows exactly what you mean. thank you so much. when we come back, we'll talk to the top democrat on the house budget committee, on the president's budget proposal unveiled today. and it is being widely recognize lyly criticized this morning, the seahawks choosing to pass with 20 seconds left. and look what happened. we'll round up the worst corporate calls in history. what tops the seahawks last night? new coke blockbuster passing on netflix. tweet us some of your ideas at "squawk on the street" and we'll show you a little later on. dow is down, we're back in a moment.

dow down 122 now.

let's get to dom. >> shake shack down. the stock has moved lower to the tune of around 6%, over 6% now in early day two trading. remember, they priced their stock at $21 a share. the stock rocketed higher, more than doubling making it worth more than a billion and a half dollars. valuation concerns will be a big part of this for some time to come. so interesting day here for shake shack shareholders. back over to you. >> session lows here on the dow. s&p well below 2,000 at 1982. jim's point earlier with royal on the rise, hanging on to a slight gain. airlines are just getting she shelacked. some of the cruise lines. >> looked like we were going to start february on an up note after that brutal january for

u.s. stocks. worst month since last february. and the big question people were wondering is does that set the tone for 2015. it certainly didn't last year. but it does have a high percentage chance of correlating with the way stocks perform the rest of the year. so not a great way to start the month of february. we've got a lot of big reports in terms of earnings and the jobs report on friday. >> a lot of data still to come. we'll get auto sales tomorrow and start that monthly charge toward the jobs number. adp on wednesday. productivity thursday. and then the estimate for jobs i think is 235, which is lower than the three-month average of 288. and the estimate for wages is again for a slight gain of .3 even though we've been let down in december. november was revised down a touch. >> and with that 200,000-plus job creation number a lot of folks are saying it's a factor especially when it comes to the bond market what the federal reserve is looking for. the other big story, of course is the presidential budget. set to kick off the new fiscal

fight with congressional republicans. of course, we're going to talk a lot about this. this is the $4 trillion budget. calls for more infrastructure spending. but pays for it in the way of higher taxes. for instance, on corporates. let's talk a little bit more about the president's budget. we've got -- do we have out in washington, d.c. right now? chris van hollen joining us here to preview, congressman from maryland, a democrat and ranking member on the house budget committee. thanks for joining us congressman. >> good to be with you this morning. >> so is there anything in this budget that we think that republicans and democrats will actually agree on? or is it just dead on arrival as the pessimists are saying? >> well, a couple things where i hope we can find common ground. number one, on the infrastructure piece you just mentioned, there's actually some overlap between the way the president proposes to pay for it dealing with portions of the international tax system. and the way the former

republican chairman of the ways and means committee proposed to deal with some of those international tax issues and use some of the proceeds to fund the transportation trust fund infrastructure at a substantial level. so that may be one area of potential agreement down the road. there are also a lot of republicans that would like to see us increase the defense and national security component of the budget. the president said he'd like to do that. he'd also like to increase our investments in science and research, infrastructure and education. >> paul ryan already called it on nbc over the weekend envy economics. says maybe popular politics to go for the middle class economics, but this whole top-down distribution does not add to economic growth. what's the response to that? >> well it's interesting, paul ryan's tax plan the one that he and mitt romney put forward, actually redistributes income from the folks in the middle up to the folks in the top. so it's interesting to hear this talk about the politics of envy.

the tax policy center said that that ryan-romney plan would actually increase the tax burden on folks in the middle a regular family by about $2,000. what the president says is the current tax system is skewed in favor of folks who are making money off of hard work. and he wants to create a tax system that rewards work. >> do you really think that through these adjustments to the tax system, the president can efficiently tackle inequality, which is such a big problem? do you really think this will move the needle when it comes to closing the gap? >> actually i think boosting economic growth and new incentives for some higher wages, as well as allowing middle class taxpayers to keep a little bit more of what they earn? yeah, by definition they'll have a little more after tax income to go out and spend in the economy. >> the other complaint about this budget is the debt levels. i mean nearly 500 billion deficit grows by the year.

that is high. and that goes back to the republicans' argument that we're going to bankrupt our children and not be able to pay for anything in this economy. that is historically a record high. >> you know it's interesting, because republicans are planning to bring to the floor of the house as we speak some corporate tax cuts that are not paid for, which would significantly increase the deficit. look in fiscal year 2016 the president's budget actually reduces the deficit as a share of gdp. as you know. and over the ten-year period reduces the current baseline. in other words, reduces the deficit relative to the baseline by about two trillion through a combination of targeted program cuts, but also the elimination of a lot of special interest tax breaks that don't belong in the code. >> congressman, you think the white house is chastened by its

reversal on 529s? >> well, i think that was a mistake on both policy grounds and political grounds. but the reality is if you look at the president's entire middle class tax cut package, it will provide significant benefits, especially to families with young kids who are struggling with childcare costs. they'll get about a $3,000 tax credit to go to pay for childcare, and all of us know that if you have a working family, you want to make sure that your child is in a secure place, and a place where they'll be able to learn. >> what are the chances you think they lose their tax exempt status? >> that i don't know. there's not been a lot of discussion about that. all i do know is i know the seahawks are kicking themselves after that last call. >> yeah i'll say. >> we'll see how the politics play out around the budget.

thanks for joining us. democratic congressman chris van hollen from washington. when we come back take a look at shares of exxon mobil today. best beat for the company relative to estimates in about five years. the earnings calls happening right now. some headlines in just a moment. but first, do not adjust your television set. this was a chevy ad that ran last night that had more than a few households grabbing their remote and jumping out of their chair. winners and losers of the ad bowl. after a break.

budweiser once again capitalizing on the cuteness of a puppy, making what many are calling the best ad from last night's super bowl. forking up to $4.5 million. ratings showing last night did deliver the highest viewership in super bowl history. joining us to break down some of the winners, losers and the impact of social media is jim cooper. it's god to see you. >> good morning. >> overall grade, good or bad? >> in general, i would give it a b-plus. i think there was a lot of interesting new players that showed up. that took a huge risk in spending that $4.5 million. these are small companies, their creativity was really good. now they're on mainstream radar after being in such a big stage. >> you want to explain what was up with the fascination with dads? >> yeah dadvertising was interesting. >> is that the term?

>> maybe now it is. >> in general, the super bowl this year was very positive. very family-focused. dads were a big part of it this year. and a lot of these ads were pretty good. >> except for nationwide. what were they thinking? >> nationwide, i have no idea. it was the one sort of downer of the entire super bowl and they got crushed on social media for us. they just brought the mood down. a dead boy? >> freaked out my 9-year-old i'll tell you that much. >> freaked me out. >> does someone get fired? >> someone will definitely be called. >> you think so? they got talked about. >> they got talked about hard on social media. the tweets were relentless. >> the recognition, even though it was broad, it has to be good otherwise it's not valued? >> they'll get a little lift but i think that was pretty tough. i think that people really were bummed out about it. >> a lot of these ads, i couldn't tell you who they were for. and i just wonder to what extent that actually goes beyond my attention span. because so many of them are a message, but then you don't even

know who the actual advertiser really was. >> that's true. it was very intense and powerful, and you sort of forget that it's an ad for bmw or something else. but the social media gives them a very long runway before the game to really sort of see their branding. so by the time you see a lot of these ads, you actually do know what they were for. >> i think he was talking about the always one. >> sarah had to tell me who it was for. >> it was actually interesting. it was p&g's always brand, which is feminine hygiene products. nothing you would have taken from that ad, which had a great message. >> that was released earlier last year and it did so well virally, that they felt like they had to do it over again. >> microsoft, with the prosthetics. very heartwarming. obviously coke trying to turn social media sb a less evil animal. things like that. mcdonald's. you give hugs as currency.

in abage of social media, do those play as well? >> i think so. sentimentality and humor really do well. people want to feel good ultimately watching these ads during the game. snark and sarcasm doesn't really play that well. and i think that all those ads sort of tapped into that sentimentality. >> they are sometimes in the position of having to defend it later because of that snark that you mentioned. but they know that's the deal. >> they know that's the deal. there weren't too many of those ads in this game. i really think that everybody leaned very heavily against being positive and up beat. >> what about t-mobile and kim kardashian? you think that risk was worth it? >> i don't. i mean, it's kim kardashian. you really need to sort of go there and have a much more creative ad. i thought the ad was very flat and there wasn't much there to it. >> how about the blue pill ad? i thought given the lack of humor, i enjoyed that ad. >> it was clever. it was unexpected and

beautifully shot. >> four and a half million. is it a bargain? in this media era? >> i think you have to start taking the context that this super bowl had the biggest television audience ever. broke a record. it was also the tweet bowl. the most tweeted super bowl ever. so you do get a lot of exposure for your marketing, especially if it's received well. the newbie ads. 15 guys who have never been to the super bowl before. those guys are now on our stage. we're aware of them because they advertised in the super bowl. >> big part of the game, no doubt about that. thanks for coming in. >> my pleasure. thank you. >> best part of the game some might argue. coming up more on exxon results out earlier this morning. plus other than ads, it's what people are talking about this morning. no question about it. passing on second and goal. giving up an interception. and the game. so we're asking what business decision rivals pete carroll as the worst? tweet us get creative.

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♪ an hour into trading, some of the stories we're watching signs of a slowdown in

manufacturing growth. the ism index falling more than expected to 53.5 in january versus 55.1 in the previous month. pitney bowes posting a quarterly revenue miss. last night's telecast of super bowl xlix delivered the highest overnight rating in the championship game's history. a 72 share. that means 72% of televisions were tuned to nbc's broadcast of the game. meantime keeping an eye on shares of exxon, climbing right now after the company reported fourth quarter earnings that actually beat the street. stock up more than 1% with oil continuing to struggle. what will it take to revive these companies in the market? joining us on the phone, paul sankey. i understand you just jumped off a call with exxon mobil. what can you tell us in terms of the highlights and the tone on oil prices and how exxon is dealing with it? >> the call was frankly boring. it always is. but i think the tone here today that we're beginning to rally a

little bit in oil prices. and exxon is going up relatively less, but still catching a bid here given that the market stopped going down every day. >> i think that's what some of the investors are wondering, if exxon earnings were down about 18% from last year, nearly halved from last what does that mean for the smaller companies if exxon is considered the powerhouse and the more insulated one of the group? >> yeah and don't forget that these results were flattered by a legal win that they had regarding venezuela and some additional tax give-backs neither of which were true operational earnings. so we're not considering this to be a beat from exxon. >> we think it's a miss. >> extremely defensive. a terrific standout here right now. we think it's retained some kind of buyback. we had chevron going to zero

buyback on friday. so it will remain very defensive as oil falls. the key question for us is when does it start going back up again. we're going to see much less spending and it's beginning to be difficult to avoid much higher oil prices in the future. >> exxon is on the call right now, as you know. we remain committed to growing our dividend. why such a stark difference in balance sheet strategy between exxon and chevron? >> well chevron has been spending much more aggressively. chevron for a smaller company, a company of 2/3 the size of chevron has been spending more dollars, up to $40 billion annually recently to try to grow production really through australian lng, exxon has been

more conservative and that's been a huge differentiation. the other thing exxon has is more refining much more chemicals. that obviously heavily affects its relative earnings power when oil and gas have fallen so hard. >> that chevron halting buybacks was somewhat of a surprise. will it be able to maintain the dividend that has been such a good draw for investors? >> yeah for these guys all of these companies, it's very very lasting. they have to keep increasing it because it would become a real decline. but if you don't beat inflation, your real dividend is falling. for chevron, let's say $30 billion of cash flow they've got 8 billion in dividends to pay. still spending over 30 billion of cap ex. so we do expect the cup to be

required certainly if oil stays anywhere near where we are today. and these companies will become more and more dividend payout stories with essentially shrinking volumes over time. conoco phillips are just accepting that's the way the world is going to be. the less they spend, ultimately the higher the price they'll go. we think the pain will last. >> quickly, paul, one call that wasn't so boring occidental petroleum. i think you asked the ceo whether it was going to put itself up for sale or looking at m and a possibilities. what can you tell us about that name and others that might take advantage of these cheap valuations? >> he's got an excellent sense of humor. he had taken a look at chevron, and i think he was joking because of the possibility of

taking over chevron is zero. alternatively, the stock started going up because people assumed he was thinking of selling the company to chevron, which is out of the question. so it was kind of a -- i think the general picture is we're going to have to see oil prices stay low into the second half and then there will be a huge second leg down in the oil equities. that's basically what we think will happen. >> thanks for joining us paul sankey, oil research analyst. >> so you guys made mention earlier pitney bowes, after reporting earnings that were in line with expectations. pitney bowes now sees revenue, looking for growth of 2%. so those pitney bowes shares the

worst performers in the s&p right now. when we come back, keurig green mountain is going cold. don't go away.

let's get over to the cme group. check in with rick santelli. >> good morning, carl. i'd like to welcome my first guest of the week charles bearen. thanks, chuck. >> good to be with you, buddy. >> i know there's a lot of macro indicators. baltic dry index. it's 608. hovering at the lowest level since '86. we'll call it darn close to 30 years. how does it weave into the story, charles?

>> well zero interest by the central bank has created a tremendous amount of excess production of various commodities around the world. and so there was lots of buildup of tonnage to carry all this stuff because supposedly it was going to be sustainable. but what we're realizing is that all that excess demand when interest rates first went down is just temporary, a one-shot thing. now nobody needs that much cargo capacity. >> now, i know gdp is a very crude mechanism to assess the entire economy. but it is what we have. and when we factored in our last look at 2.6, basically put the entire 2014 right around 2.5%. you know which is arguably just a couple of tenths better than we've been averaging the last several years. what does that tell you? >> well look, the quarter of the gdp game was due to higher

health care spending under obamacare. hospitals, drug companies charged whatever they want and the government pays. so that was up. we had inventories up. gee, that's great. we have junk loans, financing, huge amount of auto sales. and we have our children are being given money by the government to hang out while they're supposedly going to school. and then when they finish they become, you know mid 20s. they have so much debt they can't become entrepreneurs anymore. because they're strangled by that. so we have a no-growth economy, like i've been saying on your show for the last year i've been saying interest bond prices have to keep going up. long bond has to keep going down. i think the long bond is going to make the ten-year will be at a record low and not too long for now. >> what do you think important variable for that is? in my own calculations, i can't dismiss that possibility either but i have to tell you, one significant turnstile of buying

that has to be going full tlot throttle to challenge the 138 of july 2012 closing all-time yield for tens, would be weak stocks. if that turnstile isn't there, i'm not sure that the linkages to europe and some of their lower rates is going to have enough horsepower. your thoughts? >> bond prices have been going up, yields have been coming down at the same time stock prices keep going up. so as long as the number of shares in the stock market does not grow and there's more money chasing fewer shares stock prices are going to keep going up. and it doesn't mean the economy is not going to get -- you know the economy is not getting any better. and therefore bond prices are going to keep going down because the only thing central banks can do is print money. they can't create sustainable growth and we have no growth government policies. >> charles, thank you.

you always give us different points to think about. not all of them good necessarily. thank you. sarah, it's all yours. it is one of the stories of the morning, widely criticized. the seahawks choosing to pass with 20 seconds left instead of just giving the ball to marshawn limpbl lynch. so we rounded up some of the worst corporate calls. some business decisions that rival pete carroll's for all-time worst. one of the biggies, new coke. remember that? coca-cola introducing a new recipe to much fanfare. only took 79 days new coke was gone. had to bring back coke classic. excite, which has evolved into ask.com, had the chance to buy google for only $750,000. and another one, blockbuster passing on netflix over a decade ago. i do not remember this. for $50 million. now its market cap is $27

billion. and jcpenney, another one ending proportions. remember ron johnson got rid of coupons and sales and promotions. obviously since sacked. but not before sales fell off a cliff along with the stock price. i know you guys have been going back and forth. >> hp autonomy. hp compact. time warner aol. netflix quickster. remember the quickster fiasco. >> i would throw in sprint and nextel. m&a i always come back to. some of these you can't say if they had bought google it would have been google. if mcdonald's had not spun off chipotle, would it be chipotle. >> still coulda woulda shoulda. what is google now? $400 billion company? >> quite a bit. >> one other person says letting gates keep the license for ms doss. a lot of them are involved in tech for some reason probably because there's just so much change. >> also the facebook phone was out there.

amazon's phone was out there. we could go on all day with these. >> sometimes we do. >> yes, of course. up next keurig green mountain a moon shot the last two years. but a new report, not too optimistic ahead of earnings. coke pepsico, keurig green mountain, we'll discuss when we come back. of americans try... ...to cook healthy meals. yet up to 90% fall short in getting key nutrients from food alone. let's do more... ...add one a day 50+. complete with key nutrients we may need. plus it supports physical energy with b vitamins. one a day 50+

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the 415, 628 area code overlay begins. starting february 21, 2015, if you have a 415 or 628 number you'll need to dial 1 plus the area code plus the phone number for all calls. even for calls within the same area code... you'll still need to dial 1 plus the area code plus the phone number...

so when in doubt dial it out! for more information contact your service provider, visit the website at www.cpuc.ca.gov/415areacode clsa with an underperformed rating noting they're cautious over keurig's planned cold system rollout. certainly got our attention. joining us is the beverage analyst, levy. good to see you. why are you not optimistic like a lot of wall street on specifically keurig cold? >> we're much more cautious than average on the cold system. we think one of the big advantages of hot, and it has been a huge success, is that it's convenient. it's much more convenient than

making coffee from grounds at home. the difference we think that soft drinks are so widely available, so inexpensive, and to pop open a can takes about three seconds. so you can argue it's a little heavier to get it into your fridge. but on a price value basis we're just not sure that it's such a compelling idea to middle america. >> well i think they would argue that it's not just soft drinks, right? it's not just carbonated beverages. there's going to be all sorts of other cold drinks and a new and exciting way to reinvigorate a category that's been declineing for the past several years. >> obviously coke agrees with them. i think that there's potential for this to be a great success, but a lot depends on exactly how functional the machine is. it's going to be using pods that have a chemical that creates a carbonation effect immediately. don't know what the uptick will be on that.

the at least wealthy americans tend to be the biggest users of packaged soft drinks and we don't know how widespread penetration and uptick of the machine will be in-house. >> why do you think coke is buying them outright? a lot of folks say the bull case on cure rigkeurig is coke just buys them outright. >> i think they would have to offer about a 25% premium. and coke's balance sheet isn't as strong as it might appear at first blush. they also have 40 billion plus in net debt and a lot of their cash is actually sitting overseas. so not so easy for them to make a u.s. acquisition. it's not impossible. i would argue that the board is probably not in a hurry to approve another expensive large-scale acquisition.

i think the equity stake method is going to be the way they stay in this. >> i actually mentioned brian kelly used to be an executive at coca-cola. how does 2015 shake out for coke? what's the plan for growth? do they have any sort of convincing plan to turn around this prolonged slide in soft drinks and the business? >> their plan is very much to grow carbonated soft drinks, grow brand coke which is quite different really from pepsi. they're gaining market share, but the problem is the market is not growing. they have reversed for a month or two a decline in sugared colas. i don't see anything particularly different. i think the fact that they've taken a stake in both green mountain and monster tells you that they've recognized they've got to go outside their core business. so we're actually very cautious. they obviously have terrible

head winds from currency. it's going to hit them later, but it's still going to hit them. >> pepsi has a big stake in russia. earnings for coke next tuesday, a lot of investors are waiting for this. do you think pepsi is going to enter that system because coke obviously has the partnership but dr. pepper has a deal with them as well. what does that mean for pepsi? >> pepsi has been slow on the uptick on a number of different things. i think they're going to watch it very closely. they will look at getting in if they have to. as the ceo said, if it takes me three seconds to pop a can open and 45 seconds to brew a cola at home that's probably 42 seconds too long. so i think they are very skeptical and again, i don't think there will be no uptake but how deep amongst middle

america this machine will have and how it's going to be priced. >> finally, now that there's a board member at pepsi what do you think is going to be done? looks like pepsi still doesn't want to split the businesses but what sort of changes do you think he's going to push for? >> i certainly believe this company eventually will be split into two businesses. i've always believed companies that focus on one thing tend to perform much better over time. i think the better performance of both businesses is what you really shoot for. i think he's going to push for that very hard. it may still be two or three years away. >> a lot of potential changes to watch. thank you, caroline. good to see you. >> keeping our ion apple this morning as well. not quite back to the record levels of last week. but filing some documents for

another bond sale. a little bit earlier in the year this time. not quite as big in the last couple of years. people are talking about the yield expected to be almost a full point above treasuries. >> yeah, i mean that's what we've been seeing in the investment grade bond market is not necessarily coming down as much as rates have come down. you do have spreads widening a bit. certainly high yield where you've seen so much -- you have such a large concentration -- energy has been a bit dicier if you will it's been important to keep an eye on those bond markets. >> yeah, this has been the corporate bond bonanza. especially in investment grade. because treasury yields have been so low. >> for years. >> with apple and mind and technology let's have a look at what's coming up next on "squawk alley." >> we're going to dive more into those super bowl ads.

tech names, a little controversy in there. also winners and losers in social media. finally, amazon has been selling off stake. similar to what bill gates has done overtime. is that going to get amazon into trouble? we'll talk about it. tune into "squawk alley" coming up next. your mom's got your back. your friends have your back. your dog's definitely got your back. but who's got your back when you need legal help? we do. we're legalzoom, and over the last 10 years, we've helped

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welcome back to "squawk on the street." the second worst performing stock today is moody's. that's after the "wall street journal" reported they are investigating the credit ratings agency. they are looking at the firm's bond ratings ahead of the financial crisis but the inquiry is in the early stages and may not lead to a lawsuit. that comes on the heels of another which is also being scrutinized by the doj. back over to you. >> thanks for the update there. let's take a look at how the broader market is fairing. a little bit better. the dow is coming back from earlier losses. was down more than 120 points at one point. now down 35 on this first trading day of february. we've got a jobs report later in the week of course and many more

big earnings report. energy was the worst performing group in january. over to you for "squawk alley." good morning. it is 9:00 a.m. in glendale arizona. "squawk alley" is live. welcome to "squawk alley," day after the super bowl. who better to talk to than john steinberg who's forgotten more about ads than most of us will ever know. the patriots of course 28-24 against the seahawks. delivered record ratings for our parent nbc.

time to measure up madison avenue's winners and losers. companies paid $4.5 million on 30 seconds of air space from the brady bunch to that throwback