world, new york this is squawk box. >> good morning, everybody. and welcome to squawk box here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin. at least 13 people are dead after a commercial flight crashed into a river shortly after take off. there were 50 passenger and crew aboard. the plane clipped a bridge and crashed into the water. that aircraft belongs to transasia. >> that's terrifying video. >> in the united states a horrible train crash in new york city last night in the suburbs there. a crowded commuter train slammed into an suv on the tracks. it happened at rush hour. seven people were killed. at least 12 people were hurt. most of those people were in the train. at least one person on the vehicle. the crash caused the vehicle to explode and it set the front of the train ablaze.

the third rail pierced the front cabin and came up through the train. >> that's a horrible horrible situation. that's the train my father takes every day. among big business stories we're watching this morning if you read on jobs the adp employment report is coming up. forecasters say the economy likely added 245,000 private sector jobs last month. greece started debt swap talks with the imf. the new government wants to restructure it's debt after receiving $275 billion in bailout money since 2010 and in china a post mortem of stimulus central bank making a basis point universal cut in banks reserves ratio as policy makers try to encourage banks to lend. she'll join us in just a moment to discuss. >> first there's a couple of stocks to watch this morning that we want to keep you abreast of. disney shares getting a boost after results were better than wall street was expecting.

it's blockbuster film frozen is still hot driving home entertainment and toy sales. we're going to talk to an analyst and was excited about it. is it seven minutes? >> seven minutes. >> seven minute prething. somebody gets a cold or something. >> elsa or anna gets a cold and mayhem ensues. >> it's cold where they are. so it's probably common. >> now it's warm there. >> now it's warm. >> in the movie it's cold but in the new thing it starts out warm supposedly. i did a lot of research last night. >> i still haven't -- i'm going to but i haven't gotten around to it. >> your kids are older. >> they are but they have seen it. i don't know where i was but i have never sat through it. i'm not really sure what happened. but chipotle with weaker than expected sales. the cfo says the cold weather

seems to have slowed sales. that is the new standard for casual restaurants, mcdonald's and others are grappling with and part of the problem and chipotle not doing as well. macy's is buying bluemercury for $210 million and the retailer reported it rose 2.5% on topping street consensus and the macy's ceo and top exec will both join us first on cnbc at 8:00 eastern. we're neighbors with terry terry lundgren. those are two attractive people. equally attractive. >> they are. it's not just the photos. >> not just the photos. we'll see them in real life. >> in the flesh. >> there you go. now back to the big global story of the morning, greece and china. michelle is here to break it down for us. >> let's start with greece

because just about an hour ago the greek finance minister merged from his meeting with mario draghi the head of the ecb in frankfurt. he's in germany. he had gone in there trying to convince them to be more lenient. this is some of what he said when he came out. >> i had the opportunity to present to him and i'm wavering determination that it can't possibly be business as usual in greece. >> so greece believes the money they owe to the ecb, 27 billion euros is immorale and when i finish explaining to you why, you might agree. the reason greece owes is because the early days of the crisis 2010, 2011 he went out

into the marks and bought greek debt so they could reenter the capital markets and borrow again. it failed. they couldn't. so that 27 billion euros sits at the ecb. then remember this is private sector debt that's trading out there, right? they go on to restructure all of that what was the biggest restructuring in the world except the ecb refuses to go along with it. says no you're bog to pay us back in full. and greece -- >> for something that didn't work. >> for an experiment. >> exactly. >> i see their point. >> exactly. and they're like look if you had never bought that debt we wouldn't have to pay it back. >> exactly. >> however the ecb not going to budge. that is why, i think, we now have learned in the last 24 hours and we can bring up that wall graphic we have been using the last couple of days what does greece owe to whom the

same guy we just showed you gave an interview in italy, on the left is where he wanted that 195 billion cut in half and now he's going to say give us long erma tourty bonds. ecb he was going to try to get them to give long erma tourty bonds and they said no. now looks like he's asking the imf to do a restrukcturing and the only place left is the private sector. >> right. exactly. >> i don't think it's going to come to that at this point but the bonds have improved as has the stock market in the last 24 hours. >> but then the ecb is playing hard ball and saying there's no negotiating negotiating. >> they have the most leverage. they have all different ways they can bring greece to its knees. if they really wanted to hammer greece you could get to the point where you can't take out more than 100 euros from your

atm every day. >> that would make it more likely. >> exactly. >> but yesterday there are other things going on but we have 500 dow points in two days. the journal's lead story, greece's new leaders convince markets that they are eager for a deal. >> i think that's true. >> well i read that and then i read threatens to leave greece without funding. >> greece wants to do it. ecb doesn't. >> but yesterday the idea was that they were going to be able to get together somehow on this. >> it depends which pile of debt you were talking about. that's where we showed you the big graphic. >> didn't they seem more amenable yesterday than some of the hard talk over the weekend? >> greece bottom line every time appears to be backing down. it sounds like they have done that with the ecb now if we believe this article in italy today. i don't believe the premise under which the rally occurred is correct. >> and oil was up 2.50.

that means maybe the world's not ending. >> as long as it's not a slow down that warrants a 30. >> so they cut the reserve ratio requirement this morning that oversimplified the bank you don't have to keep as much in reserve in the bank so you can lend it out more which is undoing what they did not that long ago. the last time they did a widespread cut was in 2012. hasn't it been a little bit of take though? >> bottom line is this the sign to stimulate the market particularly in real estate. >> will it work? >> i don't know. i did see oil this morning and it fell as a result of this for fears that it signifies. >> that there's a bigger problem that people appreciate it. >> yes. >> this broke 12 minutes ago so

let's see where it goes. >> okay. thank you. >> she does well -- it's good. for viewers that she has to explain things to us. >> yes. >> if we understand it -- right. >> every viewer -- which is a role we try to play. sometimes we're -- >> i'm not -- >> sometimes we're not. let's check on the markets this morning. after 500 dow points only 3 points off of a new high which figures after that horrific january. there we are back a little bit. but it accelerated right into the close yesterday and even fair value up 19. so down 21 now on the dow down 4 on the snp. down just under 11 on the nasdaq. let's go over to europe. take a quick look at what's

happening. they have a little bit of red across the board there with greece notably down and then in the asian markets a nice move today especially up about 342. oil had a couple of good sessions sessions. then i saw some people -- someone was on yesterday that was pretty smart on cnbc and i was looking at some of the tweeting stuff saying that they haven't cut enough yet and there's still too many riggs. people thought it's over. they're jumping the gun. >> they're rallying about 20%. >> what was it? about 43? >> about $10 higher than where it was. >> let's look at the ten year note which it also has rising

yields positive for the stock market. it all has to do with what were all these markets seeing in the future that looked so scary and maybe if they were able to maybe bounce a little. let's look at the dollar finally against the euro and against the yen, 114, back to 114 on the euro had been down and there's the rest of the currencies. gold had a pretty good run. we talked a little bit about that yesterday. the world does seem more uncertain in terms of which currency to bet on since they're all -- everything but the dollar is going down. you wonder if the stock market does respond to what isn't 3% this year then where do you go? no yields in the bond market and if you're worried about stocks it's the first time in awhile i thought maybe -- i need some coins. i need some coins in my --

>> i don't think that's a bad idea. >> maybe i'll talk about that. do you remember how many times that was questionable. he wrote those puts on the s&ps years ago. it was in and out of the money now. >> they got paid billions of dollars to say the market will go up over time. >> request are you buying gold now? >> to put in my safe. just for coins. >> because you like the way it feels? >> everybody likes the way it feels but all the that glitters is not gold. >> no but gold does glitter. >> i haven't bought economy but people at 19, 100, 2,000. >> very close to the jewelry district. >> that's plated isn't it? solid is not necessarily good for jewelry. >> solid isn't good for carrying around in your pocket. heavy. >> let me tell you about something else. >> you don't have a pocket do you? >> no no pockets on here. in my coat.

but something that's performed even better -- >> she squusjust walks around with gold. >> disney is crushing expectations on the top and bottom lines. big drivers, the theme parks and off the park sales from merchandise of frozen. and since the market bottomed in march of 2009 disney is up more than 500%. david bank is here with us from rbc capital net markets. it's hard to imagine merchandise from frozen was still propelling this stock. >> it was supposed to be a nothing quarter on the run up to the star wars release and the shanghai park opening and frozen was like a year ago and it was a monster quarter on consumer products in the studio and the parks at 89%. it's all just kicking. so it is just amazing the legs that the franchise has had. it shows you that these guys are

a global branded consumer products company. they keep launching huge franchises. that's how investors are thinking about it. >> do you put a different multiple on it? >> i think at the end of the day -- >> is it coca-cola? >> you think about it as a coca-cola multiple as a png multiple as opposed to necessarily a media multiple. >> what's the difference? >> the difference is like kind of a high high high teens versus a mid teens media multiple and that's a big difference. that's how the stock keeps moving. it's near terms earnings expansion. >> you look at the company and they executed very well on a lot of levels but since they're a consumer products company how much is it the consumer is doing well right now. how much of it is macro and how

much is internal. >> to some extent it's consumer focused. the base of the business is espn is like 60% of the company or something so fundamentally the business is solid. i think it's less about the condition of the -- like lower gas prices. that's been a big impact? probably not. the bigger impact is can you keep inventing ip that people want to buy and consume? i think that's been a bigger factor than the condition of the consumer right now. it's their uncanny ability -- >> can i challenge you for one second? you're suggesting that espn is 60% of the business. 40% is the consumer business you're talking about. why would the multiple -- why would you give it a full on consumer multiple? >> because espn is a pretty high multiple business. it's arguably the best business

in cable right now in the broadcast business and i think what the consumer products business does is it gives you a growth engine but disney keeps reinventing itself constantly. that part of the business is a long-term driver of value creation and of earnings. >> is there a point at which you ever see an inflection point where it switches? means the consumer branded business you talk about isn't 40% of the business? it's 60 or 70% of the business. >> i think it's 60% of the company. in terms of the cable business the media nets business is probably close to 60% of the business. is there a point where i see it flipping? i think if you look -- this is how ieger talked about it last night. the biggest priority last night for disney is developing it's relationship for its end users. it's customers. for mining data and customizing

products, i think ultimately disney is positioning itself for something it doesn't want to happen right now but is prepared for. it's a direct consumer relationship. think about cnbc as a direct consumer relationship not being sold through your cable box. >> the disney ceo was on the closing bell yesterday. he talked about just that. why don't you take a listen to what he said about over the top program delivery. >> we believe that in an environment changing right before our eyes that some experimentation is necessary and i don't want to just say it's an experiment. we actually believe this is going to last but we are going to ache a careful approach and obviously not put in jeopardy the expanded basic bundle which is so valuable to the company and to the industry. >> what do you think about that? >> i think it's incredibly forward thinking. i think the way he's

articulating it is just about right. they're not encouraging it or welcoming it. this is a fabulous southern land for all of you guys. you shouldn't want to break that or encourage any damage to it but should it happen at some point, some point in the future the world is going to change. you need to be positioned for it but more broadly than just the channel itself this is about mining consumer data for consumer products for video games, for you, know all kinds of things that disney is trying to customize products for you and that's a differ priority than some other ceos have. >> are you the saving mr. banks. >> he had the s at the end. >> was it walt disney was the -- that was about walt disney making the movie of mary poppins. what had nothing to do with you? >> it's the father.

>> no residual. >> you got nothing. >> i'm waiting for the check. >> that's why you're here. >> and it's early. >> it's early. >> but you guys do it every day. >> thank you for sharing our pain. >> yeah. >> thank you david. coming up when we return move over. seattle getting a marijuana vending machine. first let's take a look back at this state in history.

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>> welcome back to squawk box. we are in the chairs this morning talking about a host of stories including this one crazy story about a vending machine in seattle guys that's going to sell pot. >> right. >> do you feel okay about that? >> no. >> no? think about that. it's going to be like coin operated but you're going to be able to use credit card. >> they don't sell beer in vending machines why would you sell pot in vending machines? >> make sure you're of age. >> that's a way for underage kids to get ahold of these things. >> i'm unsure how it's going to

work. >> i think we pushed this whole experiment too far too fast. we pushed it too far and too quickly without trying to stop and figure out what happened. >> they're saying this is for medical marijuana but if you look -- i don't know if we can show the screen again. >> you can't get prescription drugs from -- this is ridiculous. >> you must need a prescription and you must prove i guess that you're the person. >> is there any reason to think that you don't need another person verifying any of that. that machines can take care of these things? >> i don't know why you need it to be so convenient to get your medical marijuana. >> lost a job for an employee. >> this was an experment thrust upon him. why don't we ease into this and see how this goes? >> there were brownies there. >> it was called girl scout

cookies. >> yeah. >> and they're girl scout cookies with pot in them. >> i don't think the girl scouts authorized that. >> you don't think. >> i think girl scout's cookies -- >> oh it's not -- they're calling it -- i would think there's a trademark infringement case to be had right there. call the lawyers. >> all right. the buffet thing i read it quickly it was not his -- he wrote a bunch of sold puts that this is the bet. this is the ten year wager. and they picked van guard. but all of his money in a van guard index fund. >> up against the hedge fund guys. >> index fund is up 63% and hedge funds are up 19.6%. the winner a charity of the

winners choosing would get a million dollars and the money that both sides put up is invested in the stock now worth 1.7 million. they give it to the charity. >> it's been an incredible -- he has pointed out for decades and decades if you're somebody not doing this for a living and you're not gifted at this go with the index fund and that will perform well overtime. we watched the markets soar and the indexes soar from some of the lows but his point is any ten year period that you pick he expects this would be the winner. he's been incredibly successful at this. >> he is a stock picker. >> he is the poster child for people that can outperform. >> but he also told his family that after he passes he wants all of his money -- >> he recommended that his wife should be in van guard. >> then he's stuck with all the people on cnbc telling us what

to do and one in a million. you better be really really good to make it worth while for your investors. 8,000 hedge funds are not going to be all that good. >> the ones that are are totally worth it. there's more than 8,000 hedge funds out there. >> exactly. >> i will tell you guys americans are feeling more chill these days. especially men. >> chill like relaxed chill. >> less stressed. >> relax a little bit. >> you guys appear less stressed. i am not. most americans 72% say they feel stressed about money at least some of the time. parents with children under 18 and young adults are more likely than young americans to point to finances as a major source of stress. 75% of young adults say money is a significant factor. women top the list for reporting high stress over money. 49% say paying for essentials

like food and clothing. >> no i mean i have a 15-year-old daughter. >> that's stressful. >> yes. that's all i need to say. >> people will children. >> she's great but i'm just worried that she's going to turn into the stereo typical 15-year-old. >> she hasn't. there's no reason to worry. >> right. >> you worry less about your sons. >> i worry about all three of them. anything can happen at any point. >> little people problems and big people problems. >> when we come back this morning net nix goes down for just about an hour last night and if you were looking at twitter you would have thought the world was coming to an end. we have the story behind the outage and the outrage that followed. >> did you see the guy that cutoff his hand because he had an internet addiction. that reminds me of these people.

one hour without netflix. >> read a book. >> smoke some pot. do something. >> you are on this pot kick. >> there's a machine. you can just buy it. >> do you see that guy on the corner there? i know for a fact that if you want -- just go right now. >> that guy or that guy? >> it's 6:30 in the morning. these guys are going to work. >> hey, buddy, hey. >> it's outrageous. ♪ >> inconceivable. ♪

♪ >> good morning and welcome back to squawk box here on cnbc. i'm joe kernen with becky quick and andrew ross sorkin. netflix users can finally relax. the online streaming service is back. there was an outage of netflix for a bit more than an hour last night. impacting users in north and south america and parts of europe. fans taking to twitter. thank god they had twitter so they had something to do for that hour to express their outrage. here's a sample. one user tweets netflix, netflix, netflix is still around. i guess i'll watch cable. this is so 2007. >> that's outrageous. >> these are people you want to be? >> that would be the britney f.

>> that was brittny f. >> okay. another britney, netflix is down, might as well take my books out of the plastic. other ideas of things to do this twitter, tweeter, suggests that netflix is down so maybe i'll go and talk to my family -- that's what i said. call your mom. they seem like nice people. i know you're joking but in every jest there's some truth. call your mom. >> i don't. >> i know how to use it. >> it's pretty amazing. >> what happens if you're in the middle of bingeing something and it stopped on you. you would be talking about it this morning. >> i could amuse myself.

>> don't look at it. >> that's not what i'm talking about. that's not going to take an hour. >> let's take a commercial break. >> we have to get to the headlines this morning. dupont and trian. this could lead to a compromise of the company over the make up of its board also approving the high profile breast cancer drug coming earlier than expected. shares rising in early trade this morning. watch oil because crude reversing. oil prices falling in early trading after a four day rally. >> it was a heck of a rally. we pointed out that crude oil actually searched 7% yesterday but if you look at what it's done over the last six trading sessions crude rallied more than 20% from its low that was hit last thursday. that was a gain of about $10. still to come on squawk box this morning the taste test of

chipotle's results. and later we will welcome iconic corporate leader jack welch. stay tuned. squawk box will be right back. ♪

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visit comcast.com/wireless to learn more. welcome back to squawk box everybody. he has sold most of his stake in news corp. the sale generated $188 million.

he stood by rupert murdoch during the phone hacking scandal. >> yes i do remember that. thank you. chipotle dropping a burrito bomb on the street. that sounds disgusting. it sounds like slang for something else. >> that happens after you -- >> dropping off the kids at the pool or something like that. beating on the bottom line but barely missing on revenue, the stock is going to -- its a $700 stock. we'll talk about the incredible rise. six years? anyway, the company citing rising food costs. higher beef, addvocado. steven anderson is a restaurant analyst at -- a restaurant analyst at -- that was too complicated for the person -- >> stop stop. >> thank you. >> thank you for having me on. >> so is that forecast tepid?

>> historically it's been early year with guidance. i do think they'll start to increase the guidance as the year goes on but i think that given the sharp drop in gasoline prices that has occurred that's lifted traffic across the restaurant sector i was a little bit surprised that they didn't go ahead this quarter to increase it and that's why the street was a little bit aprehencive today. >> the revenue is in line. >> i would call it in line. >> 16.1 versus 16.4. >> it's priced for perfection. it's a perfect stop because it went, what was february of '09? six years ago? >> $46. >> now where is it? >> 726. >> for a restaurant. >> after hours trading went down. >> so how many restaurants did they have in 2009? >> they had only maybe about several hundred. >> how many do they have now? >> just under 1800.

>> and they can't -- there's none that close to where i live and there's plenty of -- its not starbucks yet. it's not on every corner. >> that's right. you look at where we think saturation is its probably somewhere north of 3,000 units and where they are, you know they're heavily concentrated here in manhattan. they have yet in my view to really infiltrate the suburbs. >> this is something that is going to be copied again and again. i would try to open a fast-casual mexican chain. >> fresh food. but you have to execute, right? >> you have to execute very well. what we've seen in the last 18 months is we have zoe's kitchen trying to follow in their footsteps. shake shack is probably the most prominent example today and all

the stocks could be under pressure. >> he thinks it's overvalued. >> in the short-term. >> are you short or not? >> is it a five year game. >> is it overvalued? >> right at this minute. >> so it discounts five years. how do you mean it's overvalued. >> i don't think most investors are actually discounted -- >> when is tesla going to earn a profit? 2020? >> tesla is discounted in the future. where are you on shake shack? >> well shake shack, probably it's just when we look probably in the 30s at this point. it does well. manhattan does well but even looking outside manhattan.

>> they're not the same. >> they're not the same but still the average operating bond north of $3 million and $1,100 per square foot. >> are you talking it up or down? >> at this point longer run it's a good name to own but at this point i'd probably wait for it to come back in. >> i understand institutional ownership and the like. >> i've asked management that. >> what's the problem? >> well i mean -- >> buy 100 shares. how much is that? $70,000. >> 72,000. >> no, that's why there's not a lot of normal people that buy the stock. >> doesn't seem very democratic

or very share. >> berkshire hathaway never split. >> i'm still disgusted by i'm going to drop a burrito bomb. i'm going to find out who wrote that. >> i have a guess. >> i didn't write that. >> you didn't write that and you don't like it either do you? chipotle doesn't like it. >> i would say i would like the stock in come in toward the low 600s and that will probably -- >> low 600s. that's like going from 72 to 62. >> for a long-term stock it's a good name to own but for the next 12 to 18 months probably not yet. >> does taco bell have the same problem as mcdonald's with chipotle? it's not fast casual? it has a stigma. >> taco bell is still fast food. there were a few observers a couple of years agathao that tried

to see it as a come pet to to chipotle but it's just not the same level of ingredients. well i would say that they're good for different occasions but i mean younger people love chipotle. >> steven thank you. >> we have a couple of other stocks to watch this morning. toyota raising it's full earnings guidance. it's helping offset slufringmping demand in japan. sony has cut costs of its image centers and video game consoles and gilead announces a share buy back. >> aflac chairman and ceo -- >> say it right.

>> what's that? >> aflac. dan amos. the real thing driving business might surprise you. maybe he'll come with his own question this morning. >> aflac. >> check out the most-clicked on stories on cnbc.com. >> that was much more annoying.

welcome back everybody. jm smuckers buying big heart buying pet brands for $3.2 million. that's the maker of the popular meow mix brands. this is smucker's first into the pet food market. >> i don't get that. like peanut butter and jelly for dogs? >> yeah they're taking up a bigger space. were you're bigger you can get better sales. >> yes, you can. in the meantime let's talk about aflac. i can't say it -- >> aflac! >> there you go. channel gilbert gotfried. after flak did meet expectations but the company said profits were hurt by expenses related to payroll changes.

the stock down nearly 2%. the chairman and ceo, he joins us on more on the quarter. good morning to you. did you bring us the aflac question, do you know the answers usually when you see them on "squawk"? >> i know some of them but not all of them. you know they're written by different groups of people. and we as do sports. so i don't ever claim to try to know them. i just listen and enjoy them. >> dan, we think of you -- we think of a duck but we really should be thinking about japan, tell us -- a huge part of your business is in japan. as a barometer of the economy there, what is going on and how it impacting the business? >> well we had a stellar performance in the fourth quarter. our sales in japan were up 28%. it was driven by two things. we introduced a new cancer policy over there which increased our sales almost 120% for the quarter. and it was driven off japan post

which, as you know, is about the largest insurance company, or distribution system in the word today. that, along with our existing sales force who had a very good quarter, too. so, people were talking about the economy, but people still need insurance in japan. and we're helping to fill the voids that are out there in the health care system so we're very excited. >> and how are they supposed to think about the currency issue? because that's going to be a headwind and the question remains how long is that going to be a headwind for you? >> well we've also given our earnings guidance excluding the yen. when times were good in terms of the yen, strengthening it help ed ed us, but we excluded it because we bring all of our money in in yen. and we pay all our claims in yen. it's only when we bring it back

across the united states it's reported that makes the difference. the yen has been weaker. but, remember over half of our profits cup from dollar denominated securities because a lot of our portfolio in japan is dollar-denominated. >> dan, you guys are introducing a new product which is pretty interesting. i hope this becomes not just a mainstay you that guys are doing, and everybody follows suit which is one day pay. which is you actually will pay people out the exact same day that they had submit? >> that's correct. and we're introducing it on the grammys. and what in essence, we're saying is that we will process, approve and pay all in one day. so in 24 hours, all you have to do is submit it on a smart claim. now, everything has to be filled out properly as you would expect. but if you do that on our policies, it's going to be a fabulous way of getting money in people's hands when they need it

most. and, so we'll be kicking that off. you'll see it on e! where the duck will be on the red carpet. so it's a big thing for us. and we think it's going to really be a divide in setting us apart from the competition. especially in the health care area. >> so dan, to implement this and i wonder not just for you, but what it would cost for others what does it do to your margin? and what have you had to do behind the scenes to actually process a claim in 24 hours? i don't know before this how long did it take you guys? >> well they have seen of our commercials, we talked about four days. so this is will get it down to one day. now, remember, this isn't all claims. but we estimate that over 1 million claims will be processed this way this year. i think it may be closer to 2 million as the information gets out about it. so it's calculated in our projections going forward for 2015.

we said our earnings will be in the area of growth of 2% to 7%. so all of that's in the numbers. >> okay. okay hey, dan -- >> it just shows what you technology's doing. >> dan, you've always sold cancer insurance in japan. i mean that's your thing. what was different about the latest policy up 120%? i don't understand. >> well remember our number one selling product has been medical insurance in japan. but it was japan post that we had an exclusive to sell for us and they went back to all of their potential customers and started selling it through their distribution channel. along with we hadn't had a product in several years, a new product. so our existing distribution channel went back and started selling it as well. and i just think we've always been number one. we've always dominated the market. and we started pushing it. and it was just an unbelievable growth period for us.

and i think it's going to continue into 2015. >> yep. you are an american -- there is an american thing. i just checked it all out. there is american life insurance, and there's actually another one that has nothing to do with you. and your dad started this company, right? >> well my dad and my uncle john started the company, that's correct. it's interesting, it was called american family life insurance in wisconsin. and we did insurance, too. and we had to flip a coin back in the '50s to decide who would go with our insurance and their insurance. >> there you go. i think you're probably safe though. your dad and two uncles. you've got a pretty good -- pretty good hold on that job, dan. thank you, we appreciate you coming on as well. >> thank you. >> dan amos. coming up the top stories plus the results of merck. and a man who leads little

if any introduction legendary corporate leader jack welsh will join us as the leader as "squawk box" comes right back. we needed 30 new hires for our call center. i'm spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast? go to ziprecruiter.com and post your job to over 30 of the web's leading job boards with a single click; then simply select the best candidates from one easy to review list. you put up one post and the next day you have all these candidates. makes my job a lot easier. [ female announcer ] over 100,000 businesses have already used zip recruiter and now you can use zip recruiter for free at a special site for tv viewers; go to ziprecruiter.com/offer2.

straight from the gut, jack welsh joins us for the next two hours on the economy, energy prices american competitiveness and the race for the white house. earnings alert, two big pharma names reports. glaxosmithkline and merck. plus general motors and the cfo. measles cases in the united states growing. and the debate over vaccines

heating. you a health policy specialist the second you hour of "squawk box" begins right now. >> announcer: live from the most powerful city in the world, new york. this is "squawk box." welcome back to "squawk box." right here on cnbc. first in business world, i'm andrew ross sorkin along with becky quick. we have terrifying pictures after a jet crashed into a river in taipei after takeoff. the images i'll warn you in advance. you'll see them in a second here. 58 passengers and crew aboard. authorities say the plane clipped a bridge and crashed into the water. the airplane belongs to transasia. an unbelievable image to watch. meantime, back here in the united states a horrible train crash, a crowded commuter train slammed into an suv on the

tracks. it happened at rush hour. seven people were killed. at least 12 people were killed. setting the front of the train abraise and the ntsb is now investigating. we do have breaking news when it comes to business news as well staples is buying office depot. among the other stories that we're watching just an hour away from an early read. joe, do you have something? >> no if you want to know it's $11, office depot. it's cashing in stock. i don't know if you have any other details. 7.5 in cash .228. and by the third full fiscal year. >> you can see right there, staples' stock is down about 3% on that move. office depot, looks like their shares are halted pending news. that's the news until that is reopened as well. the adp employment report is expected to show that the economy added 200,000 private sector jobs last month.

we'll get that number about 8:15 this morning. and disney shares getting a boost after results beat the street. it's blockbuster film "frozen" is still hot, it's been driving home entertainment and toy sales much bigger than expected. and macy's is buying spa services blue mercury for $210 million. first quarter comps rose 2.5. that's better than the street had been expected. macy's lou london and top executive will be joining us on cnbc at 8:00 eastern. the dow up 2 cents ahead offing expectizations. revenue is what i would call in line because it is 7 -- i'm sorry, 10.4 billion. and street was looking for 10.449 million. that's pretty close. the guidance foreign exchange will have a hul impact

in 2015. we're looking at 20 cents a share on negative impact for foreign exchange just for the year. >> and 349 is where the street is for 2015. 349 in the k350e is talking about 332 to 3.47. i don't know what that's trading at. that's an adjusted number? probably apples to apples? yeah, that's why, because of the currency. 3.33 to 3.47. >> right. >> okay. a budget battle is heating up in washington, as congress looks at the president's priorities. let's get a check on the state of the economy. foreign policy politics in the next two hours, jack welch, executive chairman at strayer university. he's a neighbor now. it's much easier to get to the studio. but you're gracious and nice about coming up to -- actually

it didn't really bother you to come out to headquarters right? >> it was great. but this is pretty nice stuff here. >> yeah. >> and hopefully, you'll be able to come more. we've liked the guests that we've had on -- it's better on set. >> it's truly better on set. you have a great lineup since you've been here. i really enjoy it more. >> that's awesome. you know i'm -- we go back so long. i know you and love you, obviously. so if maybe i'm not totally objective. but but you always have something -- i think it's because you -- you know you've written books on management. you've written articles. you're always thinking about something that you could actually write a probably 10,000 words on it at any given time. you always come here with something. and i know there's something, and instead of me just trying to figure it out, why don't you just talk. >> just talk. >> yeah why don't you just go for it. >> i think if i had a thought

today i've never seen cross currents in my 50 years, some years in business like they are today. you've got the e.u. germany versus greece. you've got, you know, saudi arabia sticking it to iran on oil prices. you've got hezbollah and the israelis. you've got so many battles. everywhere you look, there's a crosscurrent that's unique this environment. on top of this you've got this crazy foreign currency change so fast. for year i drew stocks now 21% global 28% global we're 70% global. very excited about procter & gamble and ibm. we don't want to be global at least for the next six months. for the next sick months you want to be a u.s.-centric producer hopefully providing

commodities, converting to high-value stuff and making a ton of money. you don't want to be exporting. you just had a 25% price cut by your competitors as you show up in foreign countries. and you know the crosscurrents are amazing, oh yeah six months i had reviews for the last two days with nine companies. >> for clayton? >> yeah. and we had -- we used to be on chart it's in spring about how penetrating the vacuum. how we're doing the basin. how we're moving stuff here. now, we don't even know we got oil. i mean we haven't thought about it. only 5%. we're only 7%. i mean it's a flip like you've never seen in six months. so every presentation has changed. like for example, one guy says i've only got 5% directly selling buildings to the oil producers. to the shale guys.

but 17% of my sales go to those counties. so schools, buildings, the peripheral hits based on oil for these companies, is unbelievable. >> puts a lot of ownaut fot of onus for consumers. we thought it was a tax break for everybody. >> but you get this foreign currency change it's a whack. >> it's a double -- >> then you get oil. for some people focused on capitalized -- >> and look at the states. louisiana is now with a million bucks. north dakota getting smashinged in revenues. so you're forgetting that these bond issues they had to build schools as people came there to work on that. you know i've got a chart. i always have a chart for you. this is a fascinating chart. this is an employment chart. >> here i'll put it up.

keep talking, we'll see if we can get it on the -- >> this is an comploument chart. texas look what's happened in texas. it's negative. >> i don't know if you can see it. >> there's texas and then there's the total u.s. employment. >> since 2008 it shows texas employment is up 13%. u.s. employment is down -- >> yeah. so this had oil thing is incredible. >> and texas always trying to point out it's not all oil. it's a lot of oil. >> it's a lot of oil. well they have come across more oil than a lot of other guys do. so the crosscurrents are amazing. the meetings are so different. we've got other companies, totally domestic growing 5% 6%. >> you have seen orders with those companies? >> always a stone. >> really. for years you've said people

say they're going to be -- the expectation they're going to improve but they didn't actually see the improvement. you're seeing it now. >> yeah for domestic-centric -- but look at these numbers, that's a domestic company. >> right. we've always talked about them as being an international company just for the tourists that it draws in. >> yeah maybe that's true. it's a domestic espn the network, the major parks. >> yeah. >> i mean the consumer. look if you're in a restaurant business right now except for weather, things are booming. you want to be so u.s.-centric you hate globalization. >> jack, real quick, i just see this note is this what you're talking about here. revenue from this year 42.229 billion. forecast for next year 38.3 to 39.8. down 3 billion.

and they say 2.6 billion is just sales. >> it's a killer. >> that's unbelievable. >> you say oh that's currency yeah i know it's currency -- >> by the way, it's worst than the street was expecting. the street had taken it down to $30.5 billion but this is going to mist those expectation. >> you won't see procter & gamble -- you saw their numbers. >> yeah. >> you won't see a lot of ceos coming in saying i'm 75% global. i've expanded my -- >> how do we do 3% gdp then? >> the consumer. the day that oil prices were heavy. and i think we're going see it. we're going to see a lot of it. but this is a u.s.-centric converting to high-value products. we've got a business that is a terminix-type business.

the trucks $10 million. tailwind. $10 million in savings in gas in the trucks. so when you start to think about that stuff, it's all right here right now. >> although it question it raises is is this an opportunity? because we've had some guests who have come in and said if you don't think these trends will last more than six months or a year, is this an opportunity to get the stocks? or do you think these are longer-term trends? >> well in '85, when we had had the oil collapse it lasted eight years. now, who knows. nobody can predict the oil prices. it's all over the place. clearly, most people estimate it will be $60 or $70 by the end of the year. that's conventional wisdom. i don't know thing about conventional wisdom. but i would say this that there are opportunities right now, for guys that are strangling to pick up debt to do a number of

things. but people have stretched for the shale oil thing. so there's some assets to buy throughout. and some shot guys will pick up some good assets. >> you know geez i think all the companies, they wanted to become multinational and based on oil, and now you don't want to be either. based here and got nothing to do with oil. >> yeah. i've seen presentation looking at some charts from people who six months ago were showing all the plans in premium base oil. marcellus thing growing. and, boom i don't even go there anymore. >> we don't need to run into specific names that have moved big into oil and gas in recent years either. >> well there's a bad rate for a short period okay. >> all right. we're going to take a quick break. much more from jack throughout the morning. okay coming up when we

return, in addition to jack the measles outbreak in the u.s. drumming up a lot of controversy over vaccinations including a clarification from senator rand paul. weighing in on the topic when we return.

welcome back to "squawk box" this morning the cdc saying measles outbreak is growing with 18 added new cases to the tally.

there are now more than 100 new cases reported across the country. the outbreak is traced to several dozen people exposed to the disease in disneyland california. last night, the ceo said the measles haven't kept people away from the theme park. >> we're not doctors. from research that i've seen from the cdc suggests that getting inoculate said a smart thing. it's a proven strategy in terms of combatting a disease that can be dangerous to young children. so personally, i would advise it. >> the debate among vaccinations continues among politicians. rand paul clarifying his position. on monday the kentucky senator appeared on "closing bell" saying quote, i've heard of cases walking talking children who wound up with profound disorders after vaccines.

last night he said i did not say that vaccines caused disorders just that they were temporarily relatei did not allege causation, i received booster shots for vaccines when i went to guatemala last year. the senator tweeted a picture of himself receiving that vaccination. let's bring in scott gotley resident fellow. thank you for joining you. i will say the amount of attention this is garnering, the parents that have concern about this. politicians are bringing things up and make people wonder if they should get their children vaccinated. what's the answer? >> this is a safety net that protected our own childhood. clearly, the vaccines are important. the science around these diseases of these disease, and autism was debunked years ago.

there's been many more studies. i think for too long a lot of people public statements allows these myths to propagate because they said things like we don't think there's any correlation, but we need more research. we don't need nor research. we have thoroughly debunked any association between autism and these vaccines. >> we thought we had eradicated measles in the year 2000. what's happening and how dangerous is it? >> it's growing. last year about 700 cases. probably going to have more this year. we're going to have to ask whether adults should go back and get booster shots as the outbreaks become manifest. and women who are becoming pregnant are encouraged to get a booster as well. the rates have fallen below the magic number of 90% that

prevents the virus itself from propose pa propagating. >> i never had the measles myself. >> it's a serious illness. people aren't familiar with it they take it for granted that it doesn't president anymore. >> okay i was born in -- i'm not going to say. >> 1957. they assumed that everybody has it. >> if you were born after 1957 cdc generally recommends that you consider a booster. >> yes. yesterday, joe, you made the argument, other people were making the argument that -- >> it's federally mandated. >> not necessarily federally mandated, do you think that? >> frankly, i don't think we need to federally mandate. 20 states have put in exclusions and i think those are inappropriate.

the states have done an awful job of mandating this. >> if the states mandate it why would you be bothered if it was federally mandated. i say why should it be a state issue? >> frankly, i would have no argument against the federal mandate. that's not the way our system works. the cdc generally doesn't work that way. you're asking to change a system that's been in place for many years that has been working up until very recently. >> you know it's amazing that even this becomes a discussion between democrats and upper west side, versus this and that. i mean it's crazy. >> what i like the most about the democrats, they're absolutely certain about this. and that gmos have to be totally -- anything even if you feed an animal a genetically modified piece of corn you can't eat that animal. >> the science -- >> for the science to be exact, it's calling. >> there are times, i think of t

the thing that everybody said was safe. >> these are things that haven't changed. >> there some -- >> some vaccines are newer. >> yes, joe made the argument yesterday that there was a problem with the polio vaccine. >> well as a way to argue it maybe the measles vaccine isn't necessarily science. >> the issue with the polio vaccine you that referenced was that the manufacturing stance was very different years ago. >> true. >> and some genetic material -- >> there seems to be absolutely sure that red meat causes heart disease, but ten years later - there's some are things that we have to accept the truth because it's been so thoroughly studied. and this is one. >> there's an article on "the washington post," there's a woman with a child with autism who says we're facing a double backlash. i have doubts, i have concerns. my physicians group is saying my

physicians group will no longer see me. the idea that you're getting so many shots at a time. the timing together. to have the issues. are parents correct that have concerns? >> well the theory of reported link between vaccines and autism have shifted. it happened in the intestinal tract, wakefield's theory. >> and his medical degree. >> exactly and then the trace mercury elements in the vaccines that have been reformulated and taken out. and you now the theory is the vaccine schedule itself. it's hard to argue when the argument is changing. >> now, it's about the nanny state with a slippery slope. >> and the federal mandate. >> exactly the point. you think it's a function of social media? >> absolutely. i mean it gives everybody voice. they're out there winging it. >> oprah had jenny mccarthy on more times than on "playboy."

>> yeah. >> and what about the kennedys? what the kennedys said about autism. >> that gives the idea that maybe adults should get their booster shots too. if a parent is concerned, i had had someone tweet, in my child is sick should i go beyond that? >> a local outbreak. you get the first shot in 12 months. there has about 12 month has the passing of immunity from the mother when you're born. you can move that up. it does not break in your local community. that's something to consider. >> what absents, what about hank paulsen? >> there are exemptions in the state. there are a small number of people that won't get it because of medical conditions that obviate getting it. the exclusions that allow people to say they won't get it because of what's in the newspapers that shouldn't be allowed. coming up we are expecting results from general motors -- you don't put my into -- >> you were doing the slippery

slope thing yesterday. >> i'm still doing the slippery slope. i don't think it should be federally mandated. there's nothing more romantic than a spontaneous moment.

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still to come this morning, we have jack welch on the terror threat from isis. plus new york city mayor bill de blasio outlining his plan for affordable housing.

we'll get outlook from real estate magnet richard frat. we take a look at u.s. equity futures. so far, red arrows. dow futures down by 52 points. nasdaq down by 20 points. and s&p off by 8. ♪ e financial noise financial noise financial noise

financial noise

♪ welcome back. general motors out with quarterly reports. phil lebeau is here with the details. phil. >> joe, these are much better than many people expected in terms of fourth quarter earnings. general motors reporting excluding items $1.19 a share for fourth quarter. that scharcompares with the street estimate of 43 cents per share. the street was expected 30.4 billion. $2.1 billion adjusted. that's what they made in the fourth quarter. up 20% chaired to 2013. why the bead. part of it can be explained by

the lower test results when you factor in the recall expenses there. cash at the end of the fourth quarter, $25.2 billion. operating cash flow better than expected coming in at $3.8 billion. $2.8 billion is what it was at the end of the quarter of 2013. becky, pay attention to this remember your interview in davos with carl bass saying give us a bigger dividend. it plans to ask the board to raise from 36 cents a share that would bring the dividend deal up 3.4% than where 2 is at 3.5%. again, they plan to ask the board. that means the board is likely to go ahead with this raising up to 36 cents a share. guys we're talking with cfo chuck stevens coming up in 15 minutes. we'll go over the better than expected dollar share. and also the implication that they're raising the dividend. >> so that's big news.

the stock 33.98 is trading at 35.40. a big part of it has to be that move potentially raise the dividend. >> right. >> and, remember becky -- >> the u.s.-centric consumer-driven, and yet a great outlook domestically in the next year. >> yeah. >> they had had a got outlook. phil? >> and remember becky, they're sitting on $25 billion in cash. and another $10 billion revolver. that's what carl bass is talking about, saying look free some of this up. this is clearly an indication they're starting to do that. >> phil thank you. great to see you. among the other stories that we're watching this watching merck earnings beating the street. staples buying office depot for $11 a share and cash and stock. the total equity value about $6.3 billion. and mortgage activity slowing down in the last week and there was a slight increase

on government loans. and during the past week jordan had offered to swap a prisoner for the pilot. that did not happen. instead, icis released a video of reportedly showing the pilot being burned alive in a cage. let's get back to our guest host this morning. let's go to that topic, jack which is to say, how does this all end? does it every end? what do you make of all of this? >> well look i was going to make one point, first, i'd like to if you take office depot and staples. are they one and two? >> they are one and two in the market. >> so the argument is amazon or something. >> right. or walmart. i bet walmart sells more office supplies at some point. >> you're going to have to redefine the marketplace. big time. >> i don't know you just raised the question. >> good point.

>> with sirius xm and spotify. they still look at it. >> you never know. and you're using the earthing ball which is an index. >> they did to at&t they did it to t-mobile. >> and they can do it with this for sure. you want to make it amazon. you want to make it walmart. you want to make the market bigger. >> right. >> we'll see. >> they would have prevented some companies, some merging, five years ago. even though it's all digital now. they still would have done it based on that -- this is your fault, too. >> why is it my fault? >> your dad's -- you oppose all these deals. >> i'm desperate. i told you this as a time warner subscriber in new york city, all i want is the comcast deal

happen because i'm hoping it will make my cable system better. >> buy satellite, too. you'll have both. >> you said it threatens net neutrality again and again. >> no netflix has agreed to net neutrality neutrality. >> and at&t is going to. >> yes but i've also made the point that i'm managing whatever transaction between time warner and comcast cable, that have restrictions anyway. so i think the competition is going to be fine. all right, do you want to talk about the burning in the cage now? >> no we're not going to talk about that. what do you make about that what is your sense? >> i think there's a part where we we've got to get -- we've got to get support from the muslim community. >> that's what i thought dmrp. >> they may have just gone

behind that resolution. >> the king of jordan was very resolute. they've responded already in kind. >> yeah. but i mean it's got to be a bigger effort. there's got to be ground efforts. we've got to get rid of these guys. we've just got to do it. i'm going to switch topics. we're going to talk about taxes and the president for a second. he put up his budget proposal which we all agree is not going anywhere fast. what would be, when you look at that budget and the idea of a territorial -- if you think of that as a territorial tax system, what numbers would make sense to you? to repatriate the cash? what's the threshold? >> i don't know 13%, 14%. >> that's what i'm saying 14% tax too much? tax holiday in 2004 was -- >> i don't know if it's going to

make a difference. forget this short-term travel and globalization. you've got money overseas that you want to expand with. >> you don't think the money is coming back anyway? >> i don't think the money is coming back, anyway. i don't think that's the issue. >> oh but for the past two or three years, we talked on this show, not necessarily with you, but other ceos that say we need to bring the cash back. but that is the key. the flexibility of having an option you know. >> you know any system like that would be much better. and we shouldn't be taxing it in anything. i mean it's just wrong. >> trying to compete for all the wrong reasons. >> yeah ideally it would be zero. and to take it to bill rhodes is a fascinating argument. >> andrew, what you missed the money what would come back and maybe some would be left over but the money that would come back you don't need to look at where it goes. even if it went to dividends, the dividends are taxed so the

money would be in the federal coffers. >> my argument is to say, the money doesn't necessarily -- i'm not sure companies want to bring it back. >> if they were to bring it back, the not clear to me that it creates jobs. >> that's what i just said. it doesn't matter whether it creates jobs. just having it here is better than having it there. >> and the availability of it. >> both sides have taken their ball and gone over. the corporations say, fine we'll leave it over here. the obama administration says fine, you leave it over there. if you brought it back and it went purely to shareholders through dividends, you'd still get 30. of what's over there in the corporate. instead, it's just over there. even if there's not a single job created. at least it comes back what's paid out in dividends, the money sheer. it's creating wealth here. it's creating government revenues. doing all that you want to do instead of just saying okay forget it then leave it there and we're never bringing it back. >> i'm just saying you're never going to get it all to come

back. >> probably get half. people that leave it -- and the thing is we should want companies to want to have it here. because we treat capital better. an that's what we don't do. >> that i agree with. >> we should be attracting it. and we shouldn't be adversarial with a government with corporations. we should be working together. >> right. >> this is by no means a jobs program, though. that's the crazy idea. you bring it back it's going to create jobs. >> what are you talking about, it's better here than over there. but there's a lost other things to create middle class jobs. other than raising the minimum wage and transfer payments and redistribution. there's a lot of things we can do. >> more regulation. >> right. >> we can clearly do that. you can have less tax on capital. >> right. >> you can do a number of things. >> more regulation. >> that's the article in "the wall street journal" that costanza wrote. >> it was. i tried to bring it here i got nowhere.

everything that -- like costanza started getting dates. started succeeding in life when he did the opposite. ♪ >> if the president would propose the opposite we'd probably have -- >> easy visibility. we sloun do that. >> even the 529 thing. >> but i'm not going to -- >> yeah i know. we're going to leave that part of the conversation. jack is not going anywhere. >> we'll talk to jack more about -- >> you said costanza for president. when we come back miami is one of the hottest real estate places in the country. that's what richard frac told us about. at the top. hour, a first on cnbc interview with terry lundgren on macy's earnings. stick around, "squawk box" will be right back.

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♪ oh freak out la freak shea chic ♪ ♪ oh freak out ♪ real estate titan richard lefrak putting his money to wok.

he recently committed to a new 15-year project in miami. he's had also about to open a major development next month that will include a hotel and homes in south beach. and here in new york he's working on a new commercial tower, just around the corner from our new studios. commercial tower. okay. >> that's good to know. >> yeah. >> with us -- >> that's another way of saying actually i don't know what i'm doing here. >> with us on set to give us a pulse on real estate richard lefrak, president of lefrak organization. richard, it's good to see you. we're neighbors now. and that's closer to come here. >> yes, much easier. the trip across the bridge at 5:30 in the morning is unattractive. >> when did you get here this morning? >> i got here at 7:15. >> you've been watching welch? >> yes, i did say, we talked about the measles outbreak.

icesis horrible behavior and now new york city. which most people think is -- >> yeah equally painful. rent's very high and sustainable high with the economy? >> rents are high and probably going up because, you don't just -- we just don't have enough apartments at this point. >> that's amazing. >> it's a multifamily business. so underserved. >> we talked about domestically this is where it's at right, in the globe? this the big major city in the most powerful country. >> except foreigners have a little less fresh cash. >> that's true. >> the currency is the opposite. >> right. >> that may affect -- >> miami, maybe. >> and some of these super high condos that you see in new york where many of the buyers are, it's foreign capital, maybe not looking so much for a home but a home for their money.

>> yeah. so would you be selling more now or buying more? >> i'm always in developing mode. which is a little different than either one of those modes because everything that we do, it's kind of like a farmer you have to plant the seed and you have to watch it grow. society lead time when we do any big project, you know it's years. you just don't decide on monday you're going to build something. and build it on tuesday. so we have to really be involved with long-term demographic trends. any kind of trend, trying to foretell which markets will be let's say, ripe in the future. and there are, you know very good old stand byes like new york city. that's always going to be good. >> and are the economics the same? i was going to say the mayor, mayor de blasio is now pushing more affordable housing. would you be developing some of that? >> you know that's a very good goal and well needed and also a very good sandbag, but it's easy

to say and hard to do jock i noticed yesterday he trotted out in the sunny side yards. that's a project that we actually trotted out of 40 years ago. the only problem is there was a railroad there. >> and governor cuomo said two hours, forget it nta has that space. >> right, it's strategy yount out underutilized. they need it for the railroad. when you say you're going to do something like that it sourchds good. >> do you find it harder to develop in the city now with the current mayor than the mayor before? >> i don't want to blame the politics politics. i mean, there's a shortage of land here. every community has a lot to say about -- >> i mean he's doing business here. >> i know, that's why i asked the question. >> no i don't want to blame the

politicians. the whole environment here is very difficult to get anything done because we have local community boards that have say in what you can do and how you can do it. real estate is always very controversial. if you put up a one-family home in astoria, your next door neighbor is screaming at you. that's the way it is here. that's why it's so valuable. if it was easy to do we wouldn't have this problem. but the environment is the environment. that's the way you look at it. >> it's a zip line isn't it? >> miami is still a strong market today. >> that's why you've got all your stuff down there? >> i'm excited for long-term reasons. for short-term reasons we've been building this hotel for years it's really beautiful and great. it's going to open we hope march 13th. i hope you guys will come down and take a look. >> maybe you can get a look. >> he's busy up in palm beach playing golf. >> he is. >> march 13th that's a friday?

>> my anniversary. >> yeah. >> any moron can sell a hotel in march in miami. we're not taking that much risk. >> how much is the risk? >> the rate? >> no to develop it. i saw some 1.4. >> it's about 600,000. >> 1,000 a ski. what's the overnight rate? >> the rack rate will probably be $850 $900. >> yours will be $1200. >> for you, a deal. a deal. >> i mean guns & roses leaves it cleaner. >> i'll leave a big tip. >> miami is still a strong market right now. and we put a lot of tlc in this property. we're anxious to expose it to the public. i think it will be a big success. >> richard, thank you. the one and only richard lefrak.

>> i'll pay extra to stay there. >> great to see you. coming up when we return, a trip inside the numbers for gm. the cfo of the automatic toy giant. right now, gm slayers on sat. right now, gm slayers on s right now, gm slayers on shares on the screen. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets

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now with the xfinity tv go app, you can watch live tv anytime. it's never been easier with so many networks all in one place. get live tv whenever you want. the xfinity tv go app. now with live tv on the go. enjoy over wifi or on verizon wireless 4g lte. plus enjoy special savings when you purchase any new verizon wireless smartphone or tablet from comcast. visit comcast.com/wireless to learn more. gm out with earnings earlier this morning. let's get to phil with the special guest. is this the first time we've

done this with chuck, isn't it ammann just left this year. >> we've been here a few other time. >> but not as cfo. >> no i think we've had him on as cfo. these quarters all run together. let's bring in chuck stevens, the cfo of general motors joining us in detroit. chuck, to the main question this morning. $1.19 a share. excluding items well above what the street was expecting, 83 cents a share. what did the street miss or what do you did vice them with that people were not expecting? >> yeah phil i think when you look at our core performance in 2014 and the fourth quarter, very strong performance overall, adjusted at $2.4 billion which is consistently higher than consensus, i think that's one of the big the drivers in the difference in eps. importantly that captured a very strong 2014 from a performance perspective, really led by the two most important markets,

north america and china. >> and obviously, had you had lower tax expenses related to the recall issues. you're planning to ask the board to raise the dividend by 20%. up to 36 cents a share, raising the dividend yield to 4.3%. how much of that is because you were hearing from activist investors, hey, free up some of the $25 billion in cash? >> our plan in increase in dividend is very consistent with our stated objective which has been to have a growing and sustained dividend underpinned by strong business performance. and announcing it today in conjunction with our strong 2014 performance, as well as our expectations of better performance in 2015 including improved profitability. in all four automotive regions is consistent with that objective. so nothing has really changed. >> chuck your shares are up premarket. almost 4%. there's a lot of debate about whether or not this business cycle for the auto industry is different than in the past.

because typically four years into an up-market, you would not be buying the primary automakers at this point in the cycle. do you think this cycle is different? and if so how much longer do we have to go in terms of seeing it expended? >> yeah i think the cycle in the u.s. the expansion cycle in the u.s. has some room to run. there's still a lot of available credit. interest rates remain low. there's a lot of pent-up demand. when we look at external views, ihs or otherwise, i think this has some room to run. >> chuck stevens, cfo of general motors joining us this morning. first on cnbc on the gm headquarters. andrew on a morning where gm is getting a lot of attention because it's raising its dividend or plans to raise its dividend up 26 centers a share. >> phil thank you for that interview. when we come back it's jobs reporting. on the payroll report.

because mark zandi is going to join us on set. plus macy's ceo terry lundgren is going to join us and the talk to us about the retail which macy's just bought.

beauty is in the eyes of terry lundgren the ceo of macy's talks about this acquisition of bluemercury on a first on cnbc interview. jobs front and center. the adp payroll data set to be released. we have the reaction from the report's creator mark zandi. and foursquare plans to talk to mark crowley about how he plans to keep his plan relevant in a very crowded room. as the "squawk box" continues right now. ozzie, take it away. >> announcer: live from the most powerfulle city in the word this is "squawk box." wow, welcome back to "squawk box" here on cnbc.

i'm joe kernin along with andrew ross sorkin and becky quick. futures at this hour have pulled back a little bit after a big two-day rally of about 500 points on the dow. when you least expect it the dow down 44 today but we can deal with that. some of that is probably milk i guess, which sharply lowered its revenue forecast for next year. it will be down compared to this year. 2.6 billion of it in the shortfall is florence. jack always wanted g.e. to say domestic with oil and gas. that's it. >> i hated being globalized. >> in hindsight, what were you doing this weekend? >> what a jerk i was with the pie charts 40%, 50%. >> what were you thinking? >> andrew. >> let's tell you about the top stories at the top of the hour

the revenues with the drug giants warning it will a 27 cent per share negative impact in foreign exchange this year. also we should tell you this morning, staples buying office depot for $11 a share. jack you're calling at just regulators on this right? >> it's interesting to see what they say about it. >> total equity value $6.3 billion. and china cutting its bank reserves today. the central bank pushing stimulus measures in attempt to keep the economy stable. macy's buying beauty products maker bluemercury for $202 million in cash. it's the retailers first acquisition in ten years. joining us is terry lundgren the chairman and ceo of macy's. and also mara beck. welcome. why bluemercury and why now? >> well it wasn't because we

weren't looking for something to acquire in the last ten years. it's just because we didn't find the right fit for us. and bluemercury is perfect for us. it's a core business for us. we're very strong at the beauty business. it's in the front door of all macy's stores. what marla and barry have created it's a service model, very different. high-end luxury brands and very service-oriented. and i think that's a new level of opportunity for us. and, of course we're not in the freestanding specialty store business. this is a new avenue for macy's. >> is this a vote that we have to be other plays besides just traditional malls and anchor stores? >> yeah, i think we made a vote several years ago, we couldn't just be in traditional stores. they became one of the omni channel leaders in the world. it's been a huge success. we've grown in the lat five years because of the omni

channel in the beauty business. and it's the next leg in the store. and another one three or four years. we can't just sit still. >> marla what will this mean for bluemercury, how will it be different or the same? >> actually we'll separate the same. macy's omni channel is amazing. they're the seventh largest commercial plan in the u.s. most people don't know that. >> how did the deal come about? >> you know the usual. we had tons of offers and the best one was macy's? >> was this an auction scenario where you were out there, or did he come to you several years ago and you guys started tow well give us a back story. >> you want the back story. >> yeah. >> we actually have private equity investors in this and weight watchers. we had goldman because we were getting so many offers inbound. and honestly the best pick was

macy's, given their resources and their vision and their expertise in retail. >> and did they promise never to bother you, his hr department won't be down beating on you, all of that? >> jack, you know this. i actually had to protect marla because the guys wanted to take apart, 30 people in the corporate office. >> yeah. it's going to report to me. this is how it's going to work. you got a problem, you come to me. we've actually developed a very good rapport. as i've said we've had other acquisitions even recently that we've passed on because the if it wasn't right. the personalities weren't right. the trust wasn't there. this is completely the opposite of these things when i met marla and her husband. it's a solid, great rapport. and we feel good about what we can do together. >> marla, how many stores right now and how many store douses do you see down the road? >> we have 60 stores right now.

we think we can be a 500-store retail. we've only hired full-time employees. we have shifted the retail model about being about experts and full-time staff. your clients come and see the same people over and over again. it's not just abcout transactions, it's about loyalty. >> you go to the chanel counter for the estee lauder count they're going to sell you that. you go to bluemercury, they're going to look at you and say what's the opportunities? there's no counter. >> right. you don't look at this as any opportunity to canal liez your business? in terms of -- if she wins you don't lose? >> no she's capturing a customer that i don't get, actually. there's definite a freestanding customer cha we don't get. >> do you see an opportunity of transitioning her customer to you for other types of products?

>> there may be. >> this is brand new for us. >> yeah we're both kind of late night e-mailers and texters, we're kind of exchanging a lot of thoughts and ideas. we've talked about loyalty program exchanges. so we don't know exactly what we're going to do but we've got a thousand ideas. >> what about the comp plans in your program, you have full-time employees? >> yes. >> and you've got bonus plans, compared to the aisles that are all over macy's? with those individual comp plans does that cause a problem with employees? >> i don't think so. this guy is asking hard questions. >> well, he knows. >> their plan is they want a really good business. we're going to run that business the way they run that business. marla and barry and her team are staying in place. and they're going to keep running it. i don't know this. this is not my expertise. they do. they're staying with to us run this business. so we're going to keep the lines separated for as long as it makes sense.

>> can we ask a question is there a role for you are you going to be there for the duration? >> i've been with bluemercury for 16 years. i'm not going anywhere. >> i wouldn't want to go in and ask what you'd do for me i'd need a surgeon rather than makeup. as technology becomes more sophisticated in terms of measures with medicine and pharmaceuticals, would you tell somebody she need botox? you can do it that way? >> you know we've stayed out offed medi-spa business. for a purpose. we actually have our own propriety plan m-61. >> you're looking at me telling about m-61 what does it do reduce wrinkles? >> absolutely. did reduces wrinkles.

>> what are the samples? >> terry, you've raised your guidance. you're looking at 4.35 to 4.47. the last time we talked to you, you said that the lower gas prices were kind of slowly and gradually working their way in. are you seeing more and more of that? >> i am. it's still slow. they keep on buying cars apparently. i'm happy for the car industry but i'd like them to slow down the car industry and start buying more apparel and cosmetics. i've definitely seen some of that in early december. that's continuing on. >> you're entirely in the sweet spot. your buying should be cheaper. >> yes. >> and your customers be more affluent now. >> right. >> why are you in a sweet spot? >> we've estimated -- not me, but the fed has estimated something like 50 and $70 billion being put back in the consumer's pocket. you were spending $60 to fill up

your tank. you're now spending $35. that's material when that happens multiple times in a month. >> what happens to your sourcing class? they must be great? >> yeah they should be. i haven't seen that yet. but we're definitely coddling -- >> i'm sure there are discussions from chats. >> what about those fields turned into lower costs in goods yet. >> i'm sure that becomes a focus in terms of what's happening with the consumer from what you see here. your guidance for the full year raised. and if we continue with the lower fuel rates, that should happen from here. >> should be positive. there's been a lot we've been bouncing around the last couple of days. typically, when fuel makes a big move like it has, it should stay down for a while. that should be good for consumers, there good for us. >> terry, what does worry you? >> today, i'm not really that worried. you know, i really -- i'm always

worried. i'm always thinking about how we can get growth. like i said we've had five really good years. six really good years of earnings in a row. i'm thinking about, that's great. fantastic. that's over. what's next. how do we keep going. all of the things are about the future. >> are you ever where you want to be and are there places where you wish you went? are you finished with that? >> no no not everything is completely done. >> are you in ghost malls and places where you definitely want to be? >> i've got 775 macy's stores. bloomingdales is five. i've got 37. yes, i'm going to have some in the wrong places. what happens is i said this last time the fact i could talk to him about that but there's a mall here that's been here for 50 years. all of a sudden a new mall decides to come next door. that old mall's not going to work over time. that's going to continue. that's going to continue to happen. >> jack was suggesting build all

the macy's malls near the oil and gas states. >> that was your idea right? >> should investors expect you to pick up more specialty-time stores? i mean you said the next four years maybe. but would you look at lululemon which people have talked about? or something that's totally in a different line that you haven't thought of? >> i'd look at anything. you know it took us ten years to do this one. don't expect anything from us. >> terry and marla, thank you very much. >> congratulations. nice going. financial noise financial noise financial noise

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raking news from adp. adp reports from the month of january the private sector created 200,000 jobs that is less than the expectation. they did revise up the prior month, now 253 from 241. that's plus 12,000. probably the best number plus 31,000 on goods which is 18,000 on construction. and 14,000 on manufacturing. otherwise, no big stand outs. kind of a broad-base growth. different size of industry. >> don't we have zandi here.

you're giving his numbers before we go to -- >> i thought we would go through it. and let zandi do it. >> he woke up early. >> i can't believe you sold this -- you need to be cut out of this area. >> i mean what exactly that you're exactly providing? do you have any data? >> these are your numbers. you're here to intro him. >> i was just about to that. >> becky had told me. >> joining me now is mark zandi after spending a minute and a half of our three minutes that we have on joe. >> i'm all for steve doing that. >> yeah. >> i would definitely botch it. >> yeah. >> mark zandi, what do you make of the number? >> it's a good number. anything over 200 k is say solid

number we annualize that. the growth would be 5%. it's on the side of expectations it's still good. >> that's what john williams just told me 5% unemployment rate by the end of the year. does that mean the fed is behind the curfew, mark? >> no because wage growth remains -- got another reading on that last week 2%-ish. that's inflation expectations. inflation is low. we got the core pce -- yesterday or the day before -- no last week. a little bit of a blur. that was 1.3%. >> is there anything in these numbers that tells you about the quality of jobs being created, you have the construction jobs manufacturing jobs, those tend to be better-paying jobs? >> jobs creation is low-based. no doubt, retailers. and now it's across the board. the it's really everything. still low paying yes, high paying, middle paying, everything. >> mark the data has been a

little soft. we had had the isms understand expectations. another one today. the durables the capital spending numbers come in lower than expectations. are we settling down. we had a couple of really good quarters. now it looks like we're doing 2.5 in the first quarter. >> it's a 3% roll. you have to extract from the clearly ups and downs and data. 200 k job growth is existent with 3% gdp growth. >> what do you make of this chart i used earlier this morning, total u.s. employment versus texas employment? the u.s. is -- it's a d.o.s. number. >> yeah here's a factoid for you. last year u.s. economy created 3 million jobs. texas created 400,000 of those jobs. dallas alone created 123,000. >> are you going to ga him about

the gallup? i send this to jack yesterday. >> from the gallup. >> big lie, 5.6% unemployment. >> that's the whole thing. but why is it a lie? all of the other data -- >> i'm asking you that. >> all of the other data in his article comes from the government. we reported. the fed knows about it. it's not like there's a big secret. >> but u-6, u-6 reflects that premise. >> but from an investment standpoint, i think people are looking at this sick ways to sunday. there's no added information in terms of the trajectory of jobs or the slack just looking at the other numbers as well. because they're all coming down pretty much in line with the way the unemployment rate goes. >> but there's a lot of slack, right? >> yeah. >> and that's why the wage is out. >> jack what should the fed do then? do you think the fed ought to take that slack in consideration

and not raise rates here? that's the conundrum they're dealing with. >> i think it's crazy with the volume where it is. and it would be insane to raise it now. >> that's awesome. >> wow. >> but it's a fairly important one. the official unemployment rate overlooks that. >> we have more in just a moment.

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merck earnings topping estimate but the drug giant warning it will a 20% negative impact from the foreign strange. and we have long timer pharma watcher barbara ryan joining us on the cnbc "squawk." normally, we need five or ten minutes on the milk report. is it the aim as florex this time. >> yeah it's ahead of the currency obviously people expect that for 2015. the numbers, the guidance that the company has given is below the street. as you mentioned, a hit on currency, so it remains to be seen how people will receive that. i think the real story for merck going squarely at the pipeline i think we talked about this

before, ken frazier, the ceo has stayed the course investing in innovation. the company has had six new products to move in the united states over the past year one of which is the first therapy for advanced melanoma. just yesterday, the company announce they're launching a drug for insomnia. they've enhanced three of their franchises hgd and oncology over the last year. i think people will be looking for updates on cubeis. there's an advisory meeting in the first quarter for gridion which had an advance from neuromuscular blockage from surgery. and there's new products for people to focus on. certainly, the numbers were a

little bit of a disappointment, certainly, the currency can't be a surprise to people. >> you can say on some level, too, barbara, a look at the stock price, do you take any credit for that? it's gone from 30 to up to where it is now? >> i can take zero credit for that actually other than than say i've been extremely supportive of ken frazier and the team and their strategy. and i think they've stuck to their guns as we talked about before when it wasn't easy when pfizer came out and said they were going to cut their r & d budget by 40%. ken frazier said we're not going to do that. that was not well received at the time from the street. but i think six new products in 2015 speaks for telephone. >> what is the eventual size of that market do you think? >> oh gosh lots of people are trying to predict that.

that's not really my job anymore. people are talking about certainly 5le to $10 billion. >> unbelievable. >> it's very exciting. and pfizer just got approval for pembro for a drug for breast cancer. i's a very exciting time no question. >> all right barbara. a quick snapshot of merck. thanks. when we return foursquare ceo joins us to discuss his vision of the social app company and how he's looking to take on wealth. we'll see if he's checked in here on foursquare. we'll take a break. the dow set to open about 38 points off. nasdaq off about 15 points and the s&p 500 down about 6 points. back in a moment. financial noise

financial noise financial noise

♪ welcome back to "squawk box." take a look at some stocks to watch this more than. kohl's shares rising increased 3.7% during the fourth quarter.

raised it's guidance above the street estimates. and ralph lauren's profits came in below estimates but the dividends increased to 50 cents per here. and sony shares jumped. better than expected sales of playstation video came console. you're laughing about that. >> lose less. stock goes up you lose less. >> jack i want to talk about something that you just mentioned in last break. i don't know everybody caught what you said. you said the fed would be raze to raise rates right now because of where the dollar is. >> well if you want a 3% gdp, your exports would fall off the take even more. the dollar would strengthen. it does nothing at all for the u.s. economy to whack it now, with everybody around the world,

easing easing easing. >> i said that they're going to fold like a cheap deck of cards in july. >> you call it folding -- >> folding means they won't raise. >> i know. because they should eventually. we've got to get ammo -- >> not right now, though. >> i know. and they won't. but they're still talking like they're going to, why. >> you guys know them better than i do. i have watched them on the show. >> you guys are using them now because he knows all of them. >> but i think it would be ludicrous to raise them right now with the situation that we have. we've got oil problems. and in the u.s. we got a wealth of fracked oil that we don't talk about now which is broader than oil. it's a strong dollar. >> they think they're going to raise. isn't it already in the dollar that they're going to raise? maybe if they didn't raise, the dollar wouldn't be as strong as it would be. i think that's part of it isn't it? >> you don't realize the magnitude of what they've done

25% productivity that are coming in, like siemens picks up in the morning. you can't get 25% productivity in six months. there's no way to do it. so and another thing, the global market this is a bitch of a problem with this dollar. currency right now. now, i've been saying the dollar, i've been one-on-one for 15 years wrong. >> compared to the euro you mean? >> yeah. >> and it actually happened at this point. >> it actually happened 15 years later. >> if you look at their quantitative easing the only thing they can hope is they weaken their currency because you're not going to get rates. the only way they can do if the fed doesn't raise rates, does that put a halt on that whole part of the plan? and does that hurt europe as a result? >> no i think these guys they've got what they wanted. they got 20% or so. and that puts exports in a much

better position. now, they still have the problem north and south europe. >> right. >> that's incredible structure there. but i'm not sure they can save the euro. >> but they saved by dwriedingividing it. >> when they made this deal with greece it better be be a sweetheart deal. >> it's a breeze for europe. >> spain is be looking at a much bigger number what are they doing for greece okay? so if greece goes, spain will pay up. if greece gets a lot of sweetheart deals, spain is going to be tough, no question. >> that's like a lehman analogy. >> in a way. >> the eeb here with the euro in currency in ten years? >> if i had had to bet, i'm not an expert by any means, i'd bet no. this is just structurally the

dislocation that's have to occur. >> i like people now that say, i wouldn't have done it to start because it wouldn't have worked but now that they've come this far, we have to keep it. >> and that's an argument. you know but structurally how do you possibly -- >> but you bet it actually -- you're saying ten years from now, it doesn't exist? >> some form of northern/southern currencies might exist. i'm not sure how you can take southern currencies like greece -- >> remember switzerland was using -- basically was tied to the euro. and swiss frans. >> what the end game is -- >> germany acts like they hate it. they're lucky to have currency cheap, right? they're selling all of this southern currency that their yelling at they're selling all of this stuff. i don't know.

people wonder about the skeptics and the rise. >> there's a guy in spain to the left of the guy in greece waiting in the wings and austerity they hate. and that band is going to keep playing. >> hey, jack let's switch gears and talk a little bit about entrepreneurialism in this country. we celebrate it. we think it's huge but there was recently an article in "the wall street journal" that suggested that millennials and younger people are not taking the tens to create their own businesses like we assumed. >> you know this is a shock to me. i have one of my favorite charts here which is business startups. they've been declining since 1977. and they've taken the steepest decline from 2007 to now, business startups. and yet, it's a surprise for me to see the data. my view is entrepreneurship is in the air. box one day foursquare another

day, and deal after deal. but if you look in total at this chart which shows -- >> yeah. i'll hold it up. >> which actually shows a decline. i don't fully understand that chart. but it's a d.o.s. chart. it's authoritative. it must be small restaurants a lot of stuff that families are doing together. >> i think can think. two thing, one is it's tougher to get a business loan. one is the mentality, being afraid and being shocked and seeing things go so wrong. >> yes, but there was a theory when the big layoffs occurred that i'm never going to work for the man again. i'm going to go and start my own game. >> right. >> and that doesn't bear on any of these numbers. >> right. >> which is it's counterintuitive to what you read what you hear when you

have "squawk" on the street, 11:00 to 12:00. >> he's teasing the shows. it's great. >> you talk to aaron leavy, he's got ideas about terminal stories. it's wild, you know. >> that's why it's important to go back and look at the data too. it tells you what's really happening in trading. >> that's why i like data. >> jack is our guest today. we'll have more with him in just a little bit. when we come back you won't believe who is starring in rihanna's new music video. we'll have a sneak peek. and foursquare. jack just talked about foursquare. finding a table at your favorite restaurant and a company that's transforming itself into two different apps. first check out other major currencies. china central bank looking to

reduce the reserves that the bank is required to hold. just happened about 2 1/2 hours ago. check it up, the dollar is up against the dollar 1.1448 up against the yen. "squawk box" will be right back. one-second trade execution. guaranteed. did you see it? in one second, he made a trade we looked for the best price and the trade went through. do the other guys guarantee that? didn't think so. open an account and find more of the expertise you need to be a better investor.

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yep. see why speed matters, at aflac.com. welcome back to "squawk box," everybody. check this out. here is an interesting threesome, rihanna, paul mccartney and kanye are teaming

up. the first single from rihanna's upcoming album. her first release since 2012. the trio will perform at sunday's grammy awards as well. facebook is heading into foursquare territory. the social media giant has a new feature called place tips that will put in news feeds. foursquare has seen triple-digit growth. let's hear more about that in the app that split. they now have two of them. the ceo who checks in on swarm not on foursquare. >> i did. as soon as i got here, i checked into the studio to let people i was here and on tv. >> just explain about foursquare users, you split the app in two effectively, right, did you do that? >> yeah, we did that last year. the primary reason was we realized there were two main users. a lot using it for search and a lot to check in but very few

people were using both at the same time. i think the big trend is to move towards simplier lighter apps. that was really the thinking. >> so now that you've done the transition which app is more popular? >> it's interesting about a third of our existing user base is using foursquare exclusively. and third use swarm exclusively. about a third use them both. it justifies our thinking going back to that. >> when i teed up the segment i mentioned what facebook is doing. what do you make of what they're going to do and what that means in-to-your company in emergency rooms of competition? >> it's interesting. we've been around six years now. the fourth quarter last year is one of the biggest quarters we've ever had. in foursquare, we've seen facebook doing it many times, trying to copy the check-ins and the play tim that they're doing, the other thing that they're doing, we keep doing what we're passionate about which is helping people find the way to amazing local businesses. we've got a ton uses it for that

purpose? >> when you think of competition, do you think of facebook as the competition? do you think of google maps? or yelp? >> yeah, it's anyone that steers people towards local businesses. when we explain foursquare, we say, do you use the yelp? it's a much more personalized version of yelp. >> what's your end game? if you asked me i would thought you would sell to a facebook to a google to an apple probably two or three years ago. >> yeah. >> now, the world has moved in all sorts of different ways. where is your place in it? >> it's interesting, every year the company gets stronger. like we're generating more revenue this year than the year before. every year you see the path of how this whole thing works out. >> we're still talking about revenue growth. we haven't talked about profit growth. >> not yet. if you look at where facebook is, 11 years old. twitter, i think twitter is ten

years old. we're six years old. we've got a couple more years to get there. we can see the pieces coming together. >> jack, are you a four square user? >> no what is the model. >> one of the biggest one has been data licensing. see we've been licensing our play database to places like microsoft. we've got about 60,000 developers people that make the smaller app that come off our date database. >> when you look at these other companies what is keeping from you the public? >> well we're not there yet. six years, we still have a lot to prove. we have triple-digit revenue growth. >> how many years are you away from profitability? >> we normally don't discuss that stuff. but we'll talk to you in the

future. >> good answer. thank you for coming in. and checking in on swarm. people can find us. are we registered? is this studio on your -- you had to add us to your map? >> i did i set it up as nbc sky studio. >> when you do that does that register on the map forever? >> yes so anyone that comes in after here can check in. so if you guys want to check in on the break. >> great. congratulations. >> jack we wonder why you're not at the patriots parade. >> i was going to ask him. >> why aren't you at the patriots parade? >> too cold and too much snow. >> did you congratulate robert? >> no but i congratulated dale. up next gm plans to answer demands from major investors. plus jim cramer on the new

york stock exchange. and skikey earnings from drugmakers and macy's buying bluemercury.

welcome back to "squawk box." gm earning beating estimates. revenue falling short. the automaker will seek board approval to raise it's dividend

to 36 cents. carl bass called for it when he joined us in davos just a couple weeks ago. >> i think the company has too much cash on its balance sheet. i think with $27 billion in cash and doing $15 million a year. abe maybe $5 billion, 6le in cash flow they can afford to double the dividend if they pay another $1.6 billion. and i think gm, if she's really going to be shareholder focused, i think you can see a different capital allocation policy by the company. >> kyle bass ton. gm shares up 4%. >> he said double it. up 20% so -- >> yeah. but would you, with tesla, would you spend all of gm's money right now? i mean do you think they're all set, out of the woods, everything's great for gm? >> no but they've got it pretty

good. everybody tells me the president, did you meet him in davos? >> the cfo. >> the king him. i hear all kind of stuff about him. >> all right. let's get down to the new york stock exchange. jim cramer joins us now. also knows jack pretty well. what did you see today? i know you probably listened to jack. i told him he can talk about whatever he wants. i say that to you, too, jim. >> i loved his zeemen's comment. what? look, why don't we give all of our companies a gigantic handicap. start every game with the other team having 14 points and we have nothing. i take it to heart because it seems to be happening and no one in the government noticing we are handicapping our great american companies. i also think i share the optimism, i see a lot that is pretty good. earnings this morning pretty good. love your takeout on gm they

are overcapitalized. a much higher dividend like the old days in the '80s and early '90s when we used to see dividend go up and stock become income producers. i like what i see. >> that's good. merck, what happens, another one with forex but should have known? >> yeah, merck's got things in the pipeline people aren't talking about, including an alzheimer's drug they've hidden from everybody. kohl's having a huge guideup. and the disney warterquarter, remarkable. the consumer is spend, don't lose that these this with gasoline at 2.20 don't believe the naysayers, they're spending. >> hello, jack great to see you as always. >> great to see you. sorry about philadelphia. >> ow. >> that's not nice. next jack sounding off on other pieces of the day's news. and then later on "squawk on the street," staples' founder is going to be with them get his

take on the morning's big office supply store merger. back in a moment.

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guest hoset, jack welch of the jack welch institute. you did other things besides jack welch? you've got -- i know you -- ge wasn't it for how many years. >> 21 years 20 years. >> first book was straight from the gut? >> yeah. >> the second one was -- >> winning." winning. you said that before charles. you always had tiger blood. now another one april 14th. >> yeah. >> big day. >> "the real life nba" the no bs. >> generally -- >> the no bs guide to winning the game building your team and your career. >> all three things. >> like the other book? did suze right this. >> more than ever. >> she's on the cover. and the book's are better when she writes them no question. >> we've noticed that. noticed that. >> everyone else does too. >> what's the book about? breaks it down? >> yeah in the first section, it -- there is no word of ge

it's my experience over the last 15 years with barry diller in the internet space and with my experience with private equity. and suze and i have spoken over 1 million people since that time and audiences around the world. so it's -- always q&a. we've got a lot of questions, a lot of input. first section's all about strategy, where are you going? how are you going, how you get there. all of the interesting techniques that you need to win the game. the second one is the second section, is all about building your team how you build great teams, because building great teams is the answer to winning the game. and the final section is all about growing your career. you know, the roadblocks, when you're stuck, how you behave when you're stuck, how you deal with boss whose are -- excuse

me. >> that's good. >> bad. >> cable. >> good for air. >> bad bosses. >> bad bosses. >> royal -- >> i apologize for that. >> you're allowed to say -- >> those are the three sections. we cover the game the team and your career. >> there you goep straight from the gut. >> part of career potential to get to nba. >> we're booming. >> the jack welch management institute up to 850 students. >> you see stories that people say they don't want mbas like the way they used to? what is going on. >> you pay $300,000 give up two years of your life get out of here. they do want ones where you pay $40,000. >> right. >> keep your job and you're growing in your job and double digit increase while you're there. we are -- our role not take you from one company to another

company. our job is to train you to grow in your company. and it's winning like crazy. i mean we're growing 40% a quarter and it's just -- the most exciting thing i've done in years. >> i wanted to bring up last time which book was out -- you were booked on "squawk box." >> awful day. >> terrible day. >> i was on the "today" show that morning. >> september 11 2001. >> and all of a sudden the book -- for a year september 11 2001 meant everything to me year of writing on it work on it, in that instant, it seemed stupid and trivial, why do it? the grief we felt that time unbelievable. >> you sell hundreds of thousands of bookbooks. >> over a million. >> who do you give it to. >> i've been giving it to charity. schools, my old school. my hometown. the boys and girls club. i've got tons of things in my

own town. we have scholarships in my own town from my parents, lots stuff like that. >> it's good. you work hard on the books and suze works hard. >> suze works harder than i do. i talk and she thinks it through. >> when you have the book coming out april 14th, will you come back with suze too. >> yes. she's on the cover. she has to be back. i can't show up by myself. >> guarantee she'll come in here? book her for us. >> i'll do that. >> you know somebody? >> i know somebody. i can work it out. >> i know suze. >> we've got -- you better ask -- >> projecting from your own -- >> i had a couple of thoughts. well, along with this dollar stuff i think china and i think the morning's move i was going to talk before the move is weaker than people think. this government 7.5% is a number that one would want to put -- >> 20 seconds left. >> and the other thing is cuba. this nonsense about cuba's going

to be economically beneficial. whether this is good for the people of cuba that's another question. but as far as u.s. business if they get $10 billion, it's less than half a percent. stop wasting time on discussing. every time you guys do it it drives me crazy. >> on that note we're out of time. jack, thank you. >> thank you so much. >> that does it for us. time for "squawk on the street." good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer david faber at the new york stock exchange. premarket a tad soft after yesterday's rally. stocks have best two days to start any month in about 4 1/2 years. oil, of course driver yesterday, highest volume in at least a year. and it is giving a little back now