has to be answered. >> we've got to run. does amex have jetblue in i saw a tweet pop by that says they may not have them too, is that right? >> i think jetblue announced they're going with barclays a lesser impact. >> all of the airlines they wrote. thank you for coming in. "squawk on the street" begins right now. ♪ good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer david faber at the new york stock exchange. the dow is six points shy of a record close this morning, as we prep for fed minutes this afternoon. a bunch of earnings reports that greece will ask for that loan extension tomorrow. oil's giving back still comfortably above $50 at 52.307 the ten-year 2.12 that's just about the high for the year. road map begins with the

markets. stocks mixed in premarket, dow looks to make historic thousand-point gain in the month of february. >> warren buffett announcing he's exiting an investment worth more than $3.5 billion. yeah. which one? we'll tell you. the ceo of monthdelez, sitting down with sara eisen. talking about the state of the consumer later this hour. first up futures moving lower after the s&p closed wednesday's session at a record high. january ppi fell .8 showed unexpected decline of .1 when you take out food and energy. housing starts came in below forecast, down 2% last month. markets waiting for the release of the fed minutes. a lot going on. some of the macro data, jim, worryisome worrisome, single-family down 6.7, the biggest drop since last january. >> yeah. i think that these were surprising numbers. when i say surprising numbers i don't think you take action on them because they seem uneven.

housing starts -- >> weather. it's cold. >> because if you look at housing etf, ever since horton announced that numbers have been terrific, only guy that was outlier wasn't that good was kb homes, lennar's been great. it'sed a odd what the home builders are telling you. thing aga gate numbers don't add up with components retail housing starts inflation even. i'm saying, grain of salt grain of salt grain of salt. >> how about the markets here? i mean we may start talking nasdaq 5000 soon but yesterday was the third lightest volume of the year. do you trust where we're at? >> dom chu did a remarkable piece about microsoft cisco now and then. the most thoughtful piece i've watched or read about the notion of are we overvalued versus then? all of the companies are selling at 12 13 14 15 times earnings because we've hated tech for a

long time. i did a piece about how semiconductor stocks have been up, up up but look at valuations they really aren't, anything stretched. i'm okay with the exception of if you want to play the fashion, it's fashion week play the fashion of cyberarc and fireeye, you're out there, they do well when headlines are, there was a new breach. other than those, i'm comfortable. >> when you talk about valuation of the market and you're comfortable with it speaking of somebody about this very topic, s&p trading at let's call it 17 type times forward, 17.5% earnings growth if you exclude energy and currency. if you add them back in or account for them the way they normally would be you get to a reasonable multiple. but the question is how many excuses should we keep making for the market? are we right to say we can't count energy and the dollar's

strong? >> i see europe, companies report better numbers. even this fossil europe is very good for them. kind of extraordinary. used to be europe was bad for them. but europe is good. talk to companies all the time europe is getting better. second half of the year's the breakthrough of where you start seeing energy pay off. a lot of companies hedged energy ahead. you're using 110 on the euro maybe you get a little surprise. i like the way the second half is setting up even as i understand that right now if you have to x out this at a certain point -- >> how many excuses do you make? >> i like your philosophy. short term think year ahead of ourselves. year-end, where we're goal to be q3 q4 -- >> you think the dollar's peaking green chutes in europe all of this is of a piece, i guess. >> it's hard to listen to a fossil call. first of all the call was hard to listen to. >> first miss in ten years. >> i was going to save it for

"mad dash." there was a question that was asked in the first q&a, are you doing so bad wholesale because of the stores clearing space for apple iwatch they affiliate themselves with intel, google. you know what? it wasn't answered effectively. i think the rest of the call no one listens. yeah because they represent nearly 50% of the under $1,000 watch and that is i think, where apple is going to dominate. suddenly retailers may not want to take the kors and maybe more interested in the cook and ive and that kind of thing. i think that apple is part of the story. in general, europe being so strong, took my breath away. i'm so used to europe being the reason nobody makes numbers. >> looking at it right there, of course, the stock's going to be down sharply. >> forecasting 7.5% sales decline for the quarter. >> terrible quarter. >> the kate spade partnership not enough to lift the stock

afterhours. >> mentioned intel and google wearables, what is it the -- they did the eyeglasses. >> goggles. haven't you heard? oggl. oggles. always made sense from the way google goggles. >> you can't drop google and intel when you know the stock's going to be down. you don't go through it people read in the fossil that's great, that's great, then one line says we're disappointed and you see the negative numbers u.s. whole sale and you say to yourself, got to be a reason. i'm coming back and saying stores are making room for apple. >> that's what i'm saying. >> that's 15% for the stock, for this company off the bat. >> the quarter was just -- look you can't -- europe can't be your bright spot. regulatory filings meantime revealing that warren buffett's berkshire hathaway sold its entire stake in exxon mobil, 41 million shares. berkshire increasing its bet on big blue adding 6.5 million shares to ibm.

berkshire disclosing 5% stake in de. r deer. >> i'm expecting them to say we don't make the numbers. ag is terrible. but it's a value play. ibm -- there were so many hedge funds, when you see the disclosure, no one told me he dumped exxon. services and guesses of what buffett's doing are completely worthless. i find that deer if someone chases it today, they do report. so they tend to be saturnine in the way that they handle things. ibm, amazing. when you talk about ibm, they say we're giving shareholders what they want beat buyback. but you know what? -- >> but shareholders -- >> what is that?

you want a stock that says at 210 instead of 210 to 160. >> you're calling for higher stock prices? >> i think that's the kind of return that shareholders really like. >> you know he has -- >> a lot of people -- >> he always likes tech and energy. >> hasn't embraces buybacks but in this case averaging down. >> yes. >> bring cost basis down. >> ibm -- >> unexpected as you say, people had been looking for a buffett exit on ibm would have been a danger point, many would argue, for the company's management. >> exactly. >> if going the other way, you can argue more of an endorse endorsement, though he's said nothing. nothing. >> look they have a quarter of the business is good. >> sure. >> 3/4 of the business is not. they can flip that somehow, and i think that mr. buffett's buying will be right, maybe at analysts meeting they'll trace that out. >> exxon, we can see why that

happened but still a lot of oil exposure in rails. about also buying 4.7 million shares of fox a, interesting. >> 160 million bucks, not huge. look at guys who bought over 1 billion at fox and buying more as a much more significant shareholder. interesting to note mr. buffett's getting into that a little bit. >> a lot of people bought exxon. so now a lot of people selling oak exxon. do your work. is that the way it works? >> we made the point, following mr. buffett is not always -- i mean -- he gets the best deal. during the crease siscrisis decided go after goldman and ge. incredible security with 10%, in the money on the preferred with 10% convertible but you can't get that. >> right. >> b of a, probably decent entry point when they got in and got

that deal. >> that was great. i think those -- betting on his -- i mean that exxon stake was outsized. exxon has done quite well versus the group on a relevant basis. ibm is a shocker to me that he keeps buying if only because the turns is not a hit. i'd like to think it is but i don't see it. >> right. >> i don't think -- i think they are spending a lot of time buying back stock and a lot of time making the numbers and not blowing out the growth. >> although they did, as we mentioned many time dispatch with the five-year plan at ibm. >> smart. >> they are, they claim, investing a great deal in r&d and focus on all of those things you want to hear about, whether mobile and cloud, data. >> totally. i think that's why, if you're warren buffett, and if they execute, it's going to be great. they have to execute. >> on the oil front finally, how about soros going the other way, betting on devon and transocean?

>> you know what? devon, another one of the companies, they're doing okay. look, we go -- there's a company called rice energy that announced this morning and they reported a tremendous tremendous expansion in production and predicting big numbers for 2015 and cutting their capital expenditures dramatically. a lot of oil companies have that profile. they've cut back cost. i get it no one wants to call the bottom and devon has fallen precipitously. i think the problem is if you're at home every time that the futures tick down off of an inventory, you'll see, where's buffett now? where is soros now? >> i do want to make a point on soros versus buffett, buffett when you hear berkshire bought or sold he's close to the portfolio. soros' name is on the door but doing different things and not as close to the portfolio and making decisions.

that is not george soros making those decisions. >> right. >> those are people who work for him and his family office making those decisions. i think it's an important distinction if people think it's his acumen applied to the stock market. it's not often the case any longer. >> that is very different. there's no way that warren buffett bought more ibm without -- >> that's his position. >> when we come back sara eisen's exclusive with ceo irene rosenfeld. what is the head of the next giant saying about the state of the consumer? tomorrow, after walmart's numbers, we'll have an exclusive interview with doug mcmillon, live from arkansas. take one more look at futures. dow's up 882 points this month, only two times in history has it logged 1,000 points in a single month. more "squawk on the street" from post 9 in a minute. hey, girl. is it crazy that your soccer trophy is talking to you right now? it kinda is. it's as crazy as you not rolling over your old 401k. cue the horns... just harness the confidence

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welcome back to "squawk on the street." rick santelli here live on the floor of the cme group. breaking news january industrial production capacity utilization, utilization dips down to 79.4. well it'sen changed of the last month released 79.7. dropped done on revision to 79.47 unchanged. give you historics for november. we had a number of 80 best since march of 2008. on the utilization rates, up .2%, half of what we're

expecting last month, unrevised. back to you. >> from oreo to cadbury and other brands mondelez one of the dominant players in the snack world. sara eisen spoke with the ceo of mondelez. good morning, sara. >> good morning. we don't hear from irene rosenfeld too often. this is a young company, fairly young, over than 2 years old since its spin-off from craft. you've seen it in the share price, snacks now, slowing category. also it's very internationally exposed. not a great time to have 80% of revenues come from overseas with the strong dollar. but it is trying to keep up with some of the consumer trends. it just started the week by buying enjoy life foods one of the healthy, organic allergen free type snack brands. i asked irene whether we were going to expect more acquisitions from her along these lines. here's what she said.

>> our focus is -- will remain on tack-on acquisitions. i feel very good about the overall portfolio, about the categories in which we compete. we will look for selective opportunities in the emerging markets to expand our footprint and distribution capabilities. we saw the opportunity in enjoy life as an opportunity to just benefit from the growth of a consumer trend and interest and free from foods. >> so there you go. i know jim talks about this all the time the shift toward healthy, organic, good for you type snacks. she's on top of. she's looking for more so-called tack-on acquisitions. also staying with the growth focus on emerging markets where they have 40% of total sales, that's where they see growth. just now it's a bumpy period. the challenging macro environment, something you're hearing a lot of from the big multinational consumer companies. i thought that was a good one for you guys with david's focus on mergers and acquisitions

jim's focus on the healthy consumer. in the next hour i'll bring you more from our conversation what she said about the state of the u.s. consumer whether cheap gas prices helping at the grocery, what she said about europe and emerging markets. and i asked her about her newly elected board member nelson pelts. back to you. >> talk to you in a few minutes. jim, for the 12 months stocks appreciation half what the s&p has done. >> yeah this is again, the world is changing rapidly. you look at -- you go to the website, look at what they sell, and you say, you know what this is out of sync with the times. you look at what white wave sells and plant-based foods, earth bound, which wouldn't strong but you understand where you're going is to the future. packaged foods rund ss underfire everywhere. the big thing internationally, right now you can still see that

they like some of the stuff. they, too, are getting savvy. the web is changing people's views. they don't associate the food that this company makes with healthy. >> no. i would make the point when it comes to these healthier brands you're often talking about a higher-end product as well. there are not the vast majority of people cannot afford to buy them on a regular basis. >> if you go to kroger i was in a kroger recently, i was surprised how recently priced natural or beganic and whole food -- they're very good operators. >> becoming more competitive. >> and you'll find also whole foods, talking to them tonight, "mad money" they've been able to get prices down. kroger's the one to watch. that's the best stock. that's been an amazing stock. >> it has. >> i went to see it for myself with my inclined natural organic daughter. i was like holy cow i can't see the price difference. it's really good. it's really an amazing operator. wow! they're good. >> hear more from irene in a

little bit with sara. we'll get cramer's "mad dash," count down to the opening bell. one more look at premarket. got that record high on the russell yesterday. still looking for dow confirmation. 56 points shy of an intraday high. back in a minute. you, my friend are a master of diversification. who would have thought three cheese lasagna would go with chocolate cake and ceviche? the same guy who thought that small caps and bond funds would go with a merging markets. it's a masterpiece. thanks. clearly you are type e. you made it phil. welcome home. now what's our strategy with the fondue? diversifying your portfolio? e*trade gives you the tools and resources to get it right.

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♪ ♪ all right. time for "mad dash." on this wednesday, want to start off with something good and something bad. the good jack in the box.

>> do you know jack? >> sometimes. some would say i don't. >> this is a company that -- this is a turn both in the burger side which i find quite good, but more importantly the quedoba side they've turned the numbers around. comp store sales fabulous. remarkable quarter, hitting on all cylinders. you can split this company up, goes to 110 immediately. they have a vegetarian burrito i've been trying to jam on the menu i can't. you can't imitate what they're doing. >> really? vegetarian burrito. >> it's so good david. yesterday a piece in "the new york times" how the calories of chipotle. these guys are really good operators. remodeling, doing it right, and i'm excited this stock keeps going higher. we've been recommending it for ever, not because i just like burgers. this is shake shack on steroids.

this is like all systems go now, david, let's hit the other side. >> very different here. >> century link. >> trend tri link. >> goldman sachs goes from hold to sell, talking about deteriorating cash flow. frontier not buy similar assets to century link has? >> this is right, the old telecommunications. >> used to call it pot. >> the dividend a key here jim. >> i know. >> for these guys. that's always -- if that's a question in any way, that will get investors concerned. >> exactly. pot is not pot it's plain old telephone. this was a note that took my breath away. centurylink the highest yielding stock in the s&p. >> in other words, the questioning of the sustainability of the dividend at least -- >> you've taught me when you see questions about ebitda don't buy, run. and there's ebitda questions. >> right. you know got to run a leveraged

billion balance sheet to a certain extent. >> be careful. goldman doesn't go to a sell lightly. >> watch it today. centurylink shares down. we'll keep an eye on other stocks. "squawk on the street" and opening bell coming up after this. female announcer: presidents' day is over, but the savings go on at sleep train. through sunday, save up to $300 on beautyrest and posturepedic. even get three years interest-free financing on tempur-pedic. plus, free delivery, set up and removal of your old set. and sleep train's 100-day money back guarantee. keep more presidents in your wallet. sleep train's presidents' day sale ends sunday. ...guaranteed! ♪ sleep train ♪ ♪ your ticket to a better night's sleep ♪

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production, also signs of modest manufacturing growth. >> not at levels the fed should worry about. greenspan worried about industrial production. if you're the fed, you're faced with some big macro data numbers that indicate there's no need to do anything. it's not a strong number. >> see how that colors the debate when the fed minutes hit at 2:00. not expecting surprises? >> no. but guys who take action -- >> hear from williams and lockhart trying to make that turn. >> they're going to tighten at some point but it's a low level. i'm not frightened by. you keep getting data which says, be careful, fed. that -- that utilization number industrial production number rose .2%. >> yes. >> come on. >> consensus .4. we weren't looking for much more but more. >> this is really not that strong. >> no. meantime, we have a lot of hospitality earnings hilton hyatt, cruise lines as well already mentioned jack and we

haven't gotten to potbelly yet. >> actually, potbelly let me go there, potbelly that's -- that's not thin belly, that's potbelly. they had numbers up. that's gasoline issue. i think there's more money. >> 3.7 out of potbelly a surprise, yes. >> big disappointer hotels i don't know, uneven. can you believe they broomed fritz van paaschen? that was like a weekend. in on friday and gone on sunday. >> in on friday and out on friday. in on friday out on friday. this hotel group can be -- you're hit or miss. if you're hitting it you are making fortunes right now. let's keep that in mind [ bell ringing ] >> a look at the opening bell and s&p at the top of the screen. at the big board this morning, etf provider, global x funds and nasdaq consul general of the

peep's republic of china, celebration of chinese new year. >> people saying that the reason that you've seen a slowdown there, obviously the freight's terrible wondering how much this port slowdown is impacting, it's big. >> one estimate's going to cost the retail industry $7 billion. 34 ships unable to dock. >> we saw perry ellis, talking yesterday about the pain 23 million. yesterday i had david steiner on best performing stock in the s&p waste management he's saying potential disaster. we talked about the idea that the president has to seize these ports. is it possible? they didn't go there. obviously that's what president truman did in 1950. this slowdown's beginning to impact numbers both sides i'm done trust the commodity numbers i'm seeing out of china. we're not able to export a lot of stuff, our commodities.

this is a real issue, this port issue. and it's hurting companies. the downgrade of williamson nome ma piper jaffe intimates. this is finally hitting, it's no joke. >> talking about last week we said matter when it matters. does it matter now? >> it really does. guys -- if you're fedex, you're sweating. i do i think you're sweating this. this is not -- it's a small group of people average guy makes 170,000 -- i'm for everybody -- >> the dock workers. >> i'm for everybody doing better but not for shutdown. perry ellis trying to get goods to the east. imagine how expensive it is? thought to ship to l.a. or san francisco now try to get to the east coast? this is a real issue. the president, labor secretary's out there. but there's got to be give on both sides. this thing's got to stop or we'll start cutting numbers, currency, we'll cut numbers. >> sure. >> energy, cutting numbers. .

port, to a certain point i'm with you david, can't keep cutting numbers everything. cutting numbers, a-rod. >> whoa a-rod's writing letters of apology. >> isn't that something? >> cutting numbers? pete carroll. >> i think he's had a night where he hasn't slept terribly yet? >> not a chance. every night's tough night for that guy. i like that guy. >> even thinking about it makes me -- >> but so many different reason people are cutting numbers. at a certain point we're not going to have -- i want to raise numbers on starbucks. right here right now because the collapse in coffee prices is something no one was thinking. a total collapse -- >> a collapse in coffee prices? >> they've been coming down for a while. >> 1.58 a pound. in october 2.20. everybody cutting numbers. cutting numbers starbucks. they didn't hedge. it's a windfall. >> what accounts for this? >> rain in brazil.

>> not in sawo paulo. >> all-time high on starbucks, 92.41. >> i remember when howard shut came on coffee will come down. he said -- this is like his 47th coffee rodeo. i've got to tell you, it's not done. it's not done going down. he's not hedged on his coffee. this is huge for starbucks. they're not talking about it. why? talking about what the customer likes, right offerings, right hours, food experience technology, but it's still a windfall. >> carnival going to be a huge gainer on the s&p. nclh earnings that was a beat. guidance was soft. for the year above consensus. >> carnival's a remarkable comeback. think about in october the low off of ebola and the belief this

was the ebola epicenter and that got a lot of people short. you can look at the chart and see whering everybody got short. hedge funds took so much action on carnival. three, four cruise to the oblivion shorting carnival. obviously disaster that we know in the past. cruise business, people love it. >> pricing's held up. yesterday referred to insider selling at google. i think i characterized it as being aggressive. that was probably not fair. they are selling 4.4 billion in stock. it's an extension of a previous plan that expired earlier in the year. they're going to sell 8 million shares between them. collectively after that they will own 41 millions shares 41 million shares of c. >> i think it was aggressive. it's a big number certainly as a percentage you point out of -- >> they ain't buying. >> -- holdings and net worth not as large. the number itself quite large. >> you like to see that when a stock's outperforming and you

forgive. when a stock's underperforming, it's like, wow, don't you believe more? that was the costello problem. the stock's not doing well you're in our face but people have reasons. i sold stock, they get furious furious -- >> it doesn't rise to the level, the ceo of viacom who sold -- exercised options that had three years to go. >> right. >> sold a lot of stock. >> that's different. >> a lot of people noticed that and the stock went down after although viacom creeping back lately. that's different. probably worthy of noting at the time, but i'm noting it now. >> plans can get canceled if you think the stock's come down too much. reasons why you might decide that you're done selling. maybe business is better. but this is a continuum of selling and a company google that many people feel is not focused on making money. the fossil wearable. >> right.

>> what does that tell you? you know what that tells you? the time. >> maybe they need to buy snapchat for $19 billion. >> a bargain at any price. >> josh brown pointed out, valuation, reported valuation on the snapchat raise worth two news corp.s and nine "new york times" times". >> what kind of year did they have in babe ruth talking about herbert hoover. >> garmin have you gotten to garmin? 77 cents, misses about a penny, guiding to 3.10. street at 3.24. how about the smartphone effect on garmin? in able to dodge it for a long time because they have other products. i think periodically it does catch up. i did what the heck how can this be up? if you have a boat i've got a 17-foot boston whaler you've got to have garmin. other reasons, other places for garmin. but you know did they miss? are they like fitbit wearable? should have bought fitbit when it was the gleam of an eye of

some venture capitalist. garmin, they come back, it's got a good yield. i'm not fretting it. >> we had kevin durant here. >> tall fellow. >> we asked about under armour versus nike. he went with nike. darren rovell reporting that under armour is expected to announce it's signed muhammad ali, believe it or not. that would be -- that's a get, as we say. >> he's a -- greatest of all time. i think he patented g.o.a.t. >> did he? >> kevin plank is incredible. he's the most aggressive -- you met him. you don't want to be in his -- now you bring a knife to that guy, that guy's got my chemical weapon thing laid out. he's aggressive. he has stephen curry lethal from the outside. lethal from a lot of places on the court. >> a lot of places. a like plank, he's a fighter.

that stalk'sock's stalled lately. >> flattish action on the dow. let's get to bob pisani on the floor. >> to the downside carl some of this because oil to the downside predictably energy is the leader on yountdownside. financials, materials, consumer discretionary on the downside. but not that big overall here. as for europe well greece the government there says they're going to seek an extension on the loan agreement. i think the problem's simple. they made it clear they might agree on an expense on the bailout package but don't agree on the prior conditions that came with the aid package. they're going to agree to an extension but under different terms. it's a very hard negotiation. europe doesn't seem to be that concerned about. global markets are doing better. japan's nikkei hit its highest levels since 2007. did you see the front page article in "the new york times"

today on indy? the lead article's on india, how india's economy is growing, how india may overtake china as new growth leader. surprised to see it as the lead story. india, by the way, off of historic highs. a notable breakout going on here. but i don't see any signs of profit taking i'm kept waiting yesterday for the market to nosedive a little bit and somebody to take profits. didn't happen. we ends up again, and it's a 5% month. this is very rare to see. the nasdaq, s&p dow industrials, russell 2000 up 5% major indices at historic highs and it's been quite a month. but there's no signs of any selling pressure nobody's taking profits. and so the technicians are saying hey, trend remains to the upside until we see signs of real selling. let's me move on and talk about fossil, as you've been talking about it all morning here. apple iwatch a big concern. a suspect watch buyers made have

been holding back in anticipation of the apple watch coming. but other things that are out there as well. come back to me. i want to show you something. the watch that i wear. this is a shinola watch, founded by the founder of fossil run out of detroit. it's a beautiful watch. it's $550 made from swiss components but assembled in the united states. it's been a huge hit. $550. a great watch. this is also taking market share away. i think there's a lot of not just apple watch but a lot of growing competition in the under $1,000 fashion category. jim you mentioned 50% of the market. they've got a lot going on. comments from the analysts here. my favorite from stern agree, fossil between a clock and a hard place. i like that. big issues for them. let me point out what's going on with the hotels because numbers have been great for the hotel

business. hilton was a slight miss but revenue per available room up 6.6%, that was good. they only went public at the end of 2013. global expected up 5% to 7%. hyatt even better number. revenue per available room up 5.1%. u.s. revpar up 7.3% great numbers here. stepping up the buybacks. you know guys hyatt bought back 5% of its shares last year. that's one of the most aggressive buybacks out there. that had a positive impact on the stock price. the dow down 37 points. back to you. >> thanks very much. bob pisani. speaking of hotels at least, another story making rounds yesterday, in fact i'm not saying a credible story enhanced by the fact the ceo of the company spoke about it mgm gaming company, but of course awful lot of hotel rooms as well. and at least its consideration of potentially pursuing reit

structure, so-called split into an operating company and a property company, and the idea being that you would conceivably create more value as a result of that. talking about a company that owns mirage, caliber, mandalay bay. real estate not just las vegas but properties in mississippi and of course also has middle of the road macao has well. it was given voice an a call with analysts and as well as our fast money program. here's the ceo. >> a lot of real estate embedded in casino hotel companies which is why a lot of companies looking at it. we've been looking at it as well. >> that does not say or mean that they are going to necessarily do it. whenever i see these situations one wonders whether in fact there's potentially an activist we haven't heard from oftentimes you'll see a company

perhaps consider doing something. and i don't know here by the way, but consider doing something because in fact there's an activist there or assume there may be one, jim. this is the world we live in when it comes to these transactions. for their part analysts a mixed reaction. here's i think we've got one side of it saying we find likelihood of such a move is low, price target contemplates fundamental drivers whereas wells fargo says they're evaluating it they believe the current portfolio of asset is is undervalued. we believe regional asset sales to reit could be value accretive. kind of got difficulting opinions stock up. >> murin from wall street. >> kirk cur corian.

still alive. >> the plan. >> owns 18%. >> remarkable. >> when you look at ten-year which we may have put up for you, obviously it's claws its way back from bottoms it saw after the crisis but a rough road, to say the least, for mgm. >> they've done a lot of right things. remember interview which was spectacular, talked about junkets, macao, how the communist party chosen to get communist. last thing you want the communist party to -- >> that's a concern. >> throwback. wearing throwback jerseys there? >> corruption. a lawless country. >> well -- >> trying to change that. >> they are. a lot of what we're seeing not to be -- the communists have decided to crack down on what i regard as being flash. you know people saying look we're going to go after the rich people, to some degree and cutting back smoking at the

casinos in macao. smoking has been a hand in glove with gambling. >> all right. let's move from that to this. rick santelli at the cme group in chicago. good morning, david. write down these numbers, viewers. 1.65, 2.17 2.75 where last year's close were in 5s, 10s, 30s. year to date of 5s you can see, 1.61 unchanged. year-to-date on tens gotten up to 2.16. close to the 2.17. if you consider the notion that on the 30th of january, these ten-year rates close to 50 basis points lower, as were 30-year rates on the 30th, 2.22 now at basically 2.71. has been a big move. and anyone who tells you where we closed last year is light resistance, well i don't think they're actively trading. that's what every trader i'm talking to is going to pay

attention to especially on closing basis. two day of tens we've come off. today's been data-light. if we look at year-to-date -- 24 hour i should start for bunds, notice high yield today, 40 basis points. go back to that long-term chart. start at the day before the ecb meeting january 22nd. we have bumped up but have nerve of closed 40 basis points or above. so this is their major pivot level to pay close attention to as well. what is the spread doing? wow, if you look at our ten-year minus ten-year bunds, close to 1.75. haven't been at these levels in 26 years. year-to-date of the euro currency versus dollar talk about volatility unplugged, certainly is unplugged. unplugged well off the low levels. here's one we don't look at often. dollar versus chinese currency listen it's bumping 6.25 in favor of the dollar and a lot of talk in today's journal, about

depreciating currency. let's watch this chart carefully. carl, back to you. >> thank you very much. talk to you soon. rick santelli in chicago. when we come back more of sara eisen's exclusive with irene rosen fell chairman and ceo of mondelez. how is the company navigating higher input costs. tomorrow doug mcmillon live from arkansas after the company reports their earnings. dow's down 29 points and the s&p down 3. back in a second. what does it mean to have an unlimited mileage warranty on a certified pre-owned mercedes-benz? what does it mean to drive as far as you want... for up to three years... and be covered? it means your odometer... is there to record... the memories. during the mercedes-benz

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♪ welcome back. oil's made quite a nice move to the upside in the past oh 50 minutes or so. beth that coombs. >> nice move from the lows of january, back up over 30%. this morning seeing profit taking ahead of the inventory

numbers. we are expecting to see another build in inventories of more than 3 million barrels according to analysts surveyed which is astounding when you consider that all of the producers have cut back on their rig count. the problem is they are cutting back on their less productive rigs and their rigs still in operation are so productive we're still producing over 1 million barrels more than we were last year between the permian basin and the other shale place here according to platz. we'll get numbers in an hour or so. expecting another build in crude, even as we are at all-time highs for storage. and nat gas has been between in and out after having been negative yesterday although expecting another arctic blast. even niagara falls on the u.s. side has frozen over it's so cold. back to you. >> bertha coombs.

>> watching what buffett's done regarding oil-related securities. is that forming a floor? >> if you look at the charts oil stocks bottomed december 15th. we don't know when mr. buffett took imagine. imagine if you're a broker selling that stock look at december 15th bottom it's not in sync with what happened with oil. it's in sync of what happened with trading of stocks. it looks like coincidence there. december 15 bottom, why? i've been waiting to figure out. >> "stop trading" with jim in a moment. can data help cure a disease? the right treatment for you is out there. the problem is some of it's in this lab. some of it is in her head. some of it's in this new journal. and the rest of it is in your personal medical history.

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time for cramer and "stop trading." >> carl, i was going to talk about now northrop grewman, a rare opportunity to buy it. zillow announced 350 job cuts in the merger with trulia in that sense the stock flying. spencer is on the goodwill tour conference call going on. people feel like you get number one and two together maybe he owns the space, the housing start number -- you get the housing sales number they're not in sync. a find spencer fascinating. part of the new breed of guys that likes to go out on twitter talk about his company and a lot of sound ideas about how he's going to destroy trulia and decided buy them can't beat them, join them. fascinating guy. and owns this industry and that's important. >> impressive board as well. >> look my hat's off to spencer, as i know he wants my job. >> yes. >> he wants my job. david, i'm not giving him my

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can your business deliver? ♪ good wednesday morning. welcome back to "squawk on the street" i'm carl quintanilla with simon hobbs, david faber. sara eisen live at consumer analyst conference in florida, bringing exclusive with the chairman and ceo of mondelez. markets, again modest losses to kick things off. back to 2095 on the s&p. oil is lower, but off of the low of the morning. we'll get inventory numbers tomorrow instead of today

because of the holiday. >> here's our road map for the next 60 minutes. netflix taking top spot opt nasdaq 100 so far this year. netflix is up 37%. beating out amazon and apple. more gains to come? consumer company jarden, hitting a one-year high. sara eisen will sit down with the ceo for an interview later on. warren buffett dumping hedge funds following suit. when putting their money to work instead. >> as we said, in a few moments irene rosen fell of mondelez doesn't do a lot of interviews, you should probably know this. when she tends speak she says a lot about the consumer and headwinds mondelez is facing. that's coming up. european markets hitting a seven-year high ahead of the ecb meeting and the greeks delaying offer of an extension until tomorrow. here in the united states

entering a crucial period where of course the fed will publish its minutes this afternoon and then janet yellen will give testimony on tuesday wednesday of next week as we prepare for a change in the language of the march meeting and rate rise in june. joining us morgan stanley's chief european economist. do you feel that the fed is now ready to drop the language of patience at its next meeting potentially hike rates in june or july? >> we're thinking that they probably do end up possibly raising rates in june or september and if that's kind of their plan as it stands now, that's what recent fed commentary suggested and they probably drop the patient language in coming months. yeah, it seems like they seem for the most part focused on the u.s. looking at unemployment numbers and going we should do better on the margin. >> i think you've got three voting members of the fomc

saying june would be a good time for lift-off or thereabouts. are the markets prepared for this? that's the biggest question. >> you know i think markets probably still are looking at some of the recent you know u.s. economic data which disappointed around the edges, and probably going maybe the fed's lifting off a little bit early. said it enough times where markets are prepared for some rate hikes this year but that being said if they were to do something, you know aggressive i think that might catch markets off guard. i think at this point, june or september's baked into where consensus is. >> would you agree you believe that the fed will raise rates in the summer, in june what do you think the market reaction to that will be? >> no actually we think that the fed might be on hold for much longer. in fact most likely for all of 2015. what we are watching in particular is the fact that the fed has inserted the term international developments at the last statement and that

could, of course, refer to many different things but most likely refer to the developments in the u.s. dollar. and so we think that international relmentdevelopments including various things going on in europe might be giving the fed further reason to pause and actually be on hold longer than what the market is pricing in at the moment. >> you see, that's a very interesting point. suggesting it could be until summer 2016 before they move. with so many in the market fearing that could happen, do you think there could be a bigger adverse reaction than you might expect were there to be rate rises as you expect? >> i think there could be further volatility because obviously you have you know some different cross currents going on. i think the fed would, you know obviously tipped their hat to what's go on internationally but seen the improvement on the economic front in the euro area. i think it's probably a balancing, i think. june's a little ways away even the march meeting is a few weeks

away. we'll have some clarity around greece by then. obviously they'll factor into the decisions. but i think if greece does come to some kind of agreement, i think the fed probably stays the course. >> as you mentioned greece pick up the subject of greece. it hasn't really moved the markets in a major way. elga importantly, the greeks are apparently coming back to the rest of the eurozone with a proposal for an extension to loans. earlier today it looked like whatever they were going to propose was likely what's on the table on monday and simply wouldn't fly. now they've said they'll delay what they're going to do until thursday. do you think the greeks want to do a deal that is acceptable to europe here or do you think they're actually playing with fire? we might miss the deadline at the end of next week for them to renew their bailout? >> i think we are indeed running on a very tight time line and are potentially running out of time. i think there's still time to come to an agreement. but importantly, from what the

greeks have said today they will be asking for an extension of the loan agreement rather than of the bailout agreement. and i'm afraid that's probably not going to be acceptable to the other finance ministers in the euro area. >> because they rejected -- let's -- they not only rejected that on monday they wrapped up meeting early, the dutch chairman was so furious of what was going on. why do the greeks not understand in they may not be able to push this through and the rest of europe will walk away? do you think that europe will walk away and leave greece to fall out of the eurozone? because those banks are teetering on the edge of ecb cash. >> yeah i think the rest of the euro area will not push greece out of the euro but what might happen, if there is no agreement and if the ecb is no longer comfortable with extending quite a high amount of ela to the

greek banks in a situation where they are no longer under a program and potentially are running out of cash is that you need to look at whether to impose deposit controls and capital controls in the greek economy so effectively, suspending full membership of the euro and putting the country into a quarantine so you can figure out what to do next. >> in a word for american investors, invested in this economy, can they broadly ignore what's happening with the greeks as white noise and carry on? >> i don't think they can ignore it but it's a buying opportunity if it causes weakness. >> we'll leave it right there. thank you. thank you both. might interest you to know netflix the top performing stock on the nasdaq 100. the company's up more than 37%, since the beginning of the year. it's outperforming companies

like apple and amazon which are also both up significantly this year. why are internet stocks surging? joining us with more this morning, what we like to call the ax bob peck at suntrust robinson humphrey. >> thanks for having me again. >> they built on that quarter, last earnings release, hasn't looked back since then. why? >> we've seen a couple of things explosion of video content, cutting of the cord from traditional tv and cable companies and a lot of companies go after netflix doing particularly well with "house of cards" moving further into the movie theaters with "crouching tiger" and orange is the new black. great content taking the younger demographics and having them to come to netflix versus signing up for cable. >> people skeptic on the stock, what about the third quarter miss? that was puzzling, in your words. any risk of that happening again? >> yeah, there is. rolling out the international markets, the big focus here 17

million subs out there, that could be as big as u.s. size of markets going north of 30 million subs 40 million subs. anytime allowed new markets could be hiccups or bumps. that's what spooked people in the third quarter. the fourth quarter beat on the domestic side as well as international side. seems content's resonating with consumers. >> you've got a neutral. price target nudged up but it's at 410. is that because of the cost associated with going to europe and japan and wherever else? >> they're going to spend $3 billion of content to put na in perspective, that's 1.5 billion for amazon. but the reason is valuation. stock trades 50 times ebitda or so, top line growing around 25%. we love the story. we love the opportunity. we love the yununderlying trends. we'd like a better entry point to get into the stock. >> taking nothing away from netflix, which has done a great job building business competition is increasing, whether amazon and award-winning shows or one in particular or

hbo go still waiting to see what the actual streaming service looks like. but my point is competition's coming. it's here. aren't they going to conceivably have to suffer a bit as a result? >> well, it's funny, talking about this in in the calls as well, you're going to see multiple points of services used. because you use netflix doesn't mean you're not going to use hbo go or amazon prime video streaming services. i think you'll see consumers continue to use several different services. our recent surveys a lot of cross ownership or usage. really where that's coming from that time is coming from from the cable company, who used to be locked into a certain package. seeing that cutting of the cord which is enabling several services to flourish. >> i don't want to overstate cutting of the cord. i know it's happening and cord shaving as well. still talking about 100 million people who subscribe to cable tv in the country which may be an

opportunity but not moving as quickly. when you put together services along with some sort of modest cable service gets you to a big number when you include broadband in there. >> very true. obviously the broadband's a part that's not going to go away. you need broadband to have netflix-type services. that's why the cable companies will be okay in that aspect. as far as time spent watching cable directly traditionally more of the time bleed into netflix and amazon. >> robert i understand why you're going to argue each of the cases on a fundamental baseis basis, that's your job, you're an analyst. when you see amazon and apple and netflix moving in this way, a lot of it has to do about broader market positioning. i wondered if you could give us color on what you believe -- where you believe that will take us. >> as far as positioning, i think it's about the premium content. i mean you've seen success of "house of cards," the success of orange is the new black and expanding further, going into the movie theaters with hidden dragon interesting where that

could go. i think the content will really drive the viewership and that's what will prove out the growth of these subscribers. >> for those who argue the last quarter's beat tax gimmick, did they have a point? >> no no. the top line beat is what you want to focus on here and that's more of the international subs that beat as well as domestic subs. pricing increases, growth on the domestic side that's where you want to focus as far as tune. >> bob peck from suntrust. the ceo of mondelez, she sat down with sara eisen. we'll find out how she plans to tacking the major headlines. dow down 43 points. back in a moment.

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61 degrees in boca. consumer company investors is ceos meeting at analyst consumer conference. sara eisen was there. sat down with a rare exclusive with the ceo of mondelez. sara? >> reporter: 61 and rainy, but i won't complain too much. mondelez which owns all sorts of household brands that you'd recognize, oreo cadbury, minute maid graham crackers the biggest snack company, $60

billion company but a young company, a little more than 2 years old. i started asking irene rosenfeld where she was in this journey. have a listen. we were able to bring together a lot of assets that people knew and loved but to try to put them together in a different way. we started off with a company that had 75% of its revenue in snacks which is a terrific place to be 40% of our revenue in emerging markets, and very strong footprint as well as very strong brand positions. but environment got quite challenging. >> talk about that. referring to snacks being challenging or talking about the macro? >> the macro environment. snacks, i love snacks. one of the reasons i chose to create a portfolio focused on snacks is that they're growing around the world, even when markets slow down a little bit. still growing faster than other food categories. they have nice margins, tend to be branded products not a lot of

private label in snacks. consumption is expandible, if you can find more places in the store or more outlets to sell you can increase consumers' consumption. for a bunch of reasons snacks is a terrific set of items in our portfolio. good news is that we love being in snacks. we've got an advantage set of snacks within our portfolio. but the macro environment has been quite challenging. >> tough to beat 80% of revenues outside the united states. is that the biggest headwind now, currencies. >> not just currencies. i would say input costs exceptlely volatile. we're the largest cocoa producer in the world. use a lot of cocoa and cocoa volatile input over the last 12 months. it's been a combination of rising input costs as well as currencies that have put a lot of pressure on our portfolio and has caused us to take some very aggressive pricing actions to cover our costs. >> will that continue into 2015 higher costs for the consumer

when it comes to items, especially chocolate? >> i think so. i think the consumer will continue to see higher prices. our focus making sure we provide adequate value for the prices that we're charging. in all cases, as we think of innovations, as we think about the products in the portfolio, our focus is making sure we have the right pack sizes for the consumer, that we're meeting some of her needs in terms of on the go and health and wellness and in doing that we believe that we're able to deliver good value to our consumers. >> when do you expect emerging markets, since your exposed, more so than any of the other companies, to turn around? when do you expect economics to be a growth driver? >> if i had that forecast i wouldn't be sitting here. i would say i do think -- i do expect that they certainly will turn around over the long term. in the short term, our focus, because we don't know what will happen in the macro environment, focus on controlling what we can control. that's been our focus on costs, on overhead costs as well as

supply chain costs, driving productivity, and making sure we're making necessary foundational investments in our brand so as the markets recover, we're prepared to capture that outside. >> the margin story impressive for analysts, wall street. that sounds like that is your key focus right now, cutting costs, boosting margins. >> well, cutting costs to provide fuel to either boost margins and/or reinvest in our chan fries franchises. we've made significant investments in our pow brands largest, highest margin brands typically growing at faster than the company average. those are the brands that we've chosen to invest in because we get a very good return for those investments. >> the cfo in the presentation talked about cutting travel and sg&a presentations. nelson peltz new board member for you, has he been pushing for anything on the acquisition, on the m&a front or also focused on the margin story? >> i think our board has been very supportive of our

strategies. they've watched the evolution of the company since its launch. and i believe that the program that we have laid out to control what we can control is very much -- has the support very much of our board because it is -- it allows us deliver regardless of the environment. >> what about the consumer overall? what's the mood right now? particularly in the united states with cheaper gas prices. >> i'd say the mood of the consumer around the world is kind of cautious. it varies a little bit from one geography to the other. certainly in the u.s. we are seeing a bit of an upturn but in a slow rate because i think consumers remain quite cautious. as we think about regions like europe, that's a tough place. and i think the mood there varies a little bit country by country but continuing to see a lot of cautious there. >> no sign of recovery in europe? >> we're not seeing much of a sign of recovery. i will say, again, i think our franchises have performed

exceptionally well even in that tough environment again by focusing on what we can control. but in the emerging markets, even though markets have slowed down, a little bit, we certainly are seeing continues consumption growth in our core categories. >> back to the consumer tastes for a while it reminded me of a conversation with the ceo of kroger who said what's working right now is what he calls in the perimeter of the grocery store, fresh, natural, prepared kind of food. when i think mondelez when i think snacks i think center of the groceries. how do you address that shift where it is in the store. >> snacks are a perimeter item. the key drivers of snacks' performance tens to be impulse displays in the perimeter of the store. the big geography the hot zone and that's the area near the cash register. and a lot of our gum products our candy products single-shev biscuits available in that real estate. it's prime real estate.

we have a dominant position there there's no question that the consumer is spending a little bit less time at traditional shelf, but our position within the store and of aisle and impulse positions, as well as immediate consumption channels, is a key source of our growth. >> launching red velvet oreos, we hear a s'more's oreo. >> we continue to see an opportunity of limited edition flavors. phenomenal success last year at thanksgiving time with pumpkin spice, red velvet oreos the rage. >> you're not going to give us a hint. >> i will not. it will be delicious, i promise you that, sara. all right. she wouldn't give hints about the next flavor which, by the way, sells 2.5 billion just in 2014 around the world. that is a growth brand. she also didn't give us a clue when it came to m&a.

i did ask about continues speculations and rumors around the next potential acquisition by 3g cap it'll and warren buffett. she remains focused on her business. the story right now with mondelez is what we talked about, that cost cutting, boosting margins. it's why most analysts here that are here for the conference do have a buy on the stock. but it's been an underperformer versus the s&p 500, part of that is macro environment. you talked about how tough that was. you're not seeing the kind of growth in snacks that she would like to see that they saw pack in say, 2011 when they were still part of kraft. that's going to be her biggest challenge, either growing by acquisitions after the cost cuts come in to place and start to really manifest themselves and also growing that top line in the emerging markets which has been a struggle. >> yeah. i think m&a, you keep trying to sell this to 3g but it's cost cutting, as you've said many

times. when do they expect that they're going to be through this round, if you will of really trying to take costs out of the business? you always do that but at least the time line they're talking about? >> yeah aggressively doing it throughout 2015. it's the story of 2015. and as i mentioned, analysts relatively optimistic. we've started to see expansion in margins because of the cost cuts. the cfo talking about cutting travel budgets. they're focuses on the cost cutting part of the story and that's why it's hard not to like the stock, at least from wall street's perspective. the question, beyond 2015 can they return to growth. >> she's confident snacking is a growth category. that, yes, we're not seeing kind of growth in cereals and in some of the traditional foods in carbohydrates. but as more americans eat in between meals and people around the world, they don't stick to the three meals a day that

should continue she says to drive snacking. she's going to continue to look for other small acquisitions especially in emerging markets that address the health concerns. >> new term as you hit the cash register the hot don't, very well represented. >> the hot zone. >> the hot zone. just by the cash register. >> it's important for mondelez because they own try dent and that's a soft patch, the gum. we talked about. she's committed to the category. but you're right, the hot zone not selling too hot when it comes to gum sales. >> we'll be back with you shortly. thriving in boca with jardens the next interview yeah. >> correct. 120 brands. good read on the consumer. >> see you in a moment. sara eisen in boca. coming up why so many hedge funds following buffett's lee and dumping energy or at least they were, and where are they putting that money instead? back after a quick break.

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welcome back to "squawk on the street." garmin down 9%. the maker of navigation devices saying revenue growth will slow thanks to stronger dollar and less demand for the company's car navigation products. full-year profit forecast below market estimates. did beat on the revenue line for the fourth quarter, with those sales coming 800 million. ceo saying in a news release challenges are ahead but he's happy with the accomplishments at garmin for 2014. carling back over to you. boxing great muhammad ali joining forces with under armour. ali's official twitter account tweeting this video, announcing the greatest of all has joined forces with the company ending with the hashtag, i'm a bad man.

quite a get for under armour which has been after obviously currently working athletes for a long time. i don't think we've gotten terms of the deal. some call it a cultural stretch. ali does not do a lot of endorsements. >> no, that is true. you wonder how many of the younger consumers and under armour's extraordinarily popular amongst that group, know who muhammad ali is. >> he's legend. >> i know iconic. but i still wonder -- i mean i guess my 12-year-old would know who he is. not sure matter whether he'd bought the under armour. >> when we come back consumer giant jarden setting a fresh, new one-year high. the company topping forecasts for the fourth quarter last week. what's the secret to jarden's success? the ceo will join sara eisen for an exclusive. let's get a cnbc update. >> what's happening this in hour. greece going to request an extension of the loan agreement

from its eurozone partners tomorrow morning. this according to a greek official. the greek government, as you know refuses to seek an extension of the bailout program in place. instead, looking for an extension on the agreement on the loans. blackberry has revived a legal battle against start-up co-founded by ryan seacrest saying that its iphone keyboard rips off the design from blackberry's own physical keyboard. you think you had a bad year? bank of america has cut brian moynihan's pay by 7% as the bank's profit fell by 58% on higher legal settlements. but don't feel too bad. moynihan still made $13 million last year. guess who's going to make an suv now? it's none other than luxury carmaker rolls-royce. no word on how much it's going to cost. but you can imagine you better get your checkbook out if you want one. coming up on "mad money" tonight, jim cramer talks to ceo

walter robb at 6:00 p.m. eastern time here on cnbc. and that is your cnbc news update this hour. more "squawk on the street" after this quick break.

another consumer play hitting an all-time high today as far as stock is concerned. back to sara in boca florida, swapped the snow for the rain.

sara? >> good to see you, simon. yes, that stock is jarden hitting an all-time high. here with the ceo, jim lilly. >> nice to be here. >> 120 brands in your portfolio. you make everything from mr. coffees to skis to baseball gloves. so, i would say you have a unique window into the state of the consumer right now especially in the united states. where are we? >> i think the consumer's pretty healthy. look at drop in oil prices look at the threat of unemployment being relatively low, think about 401(k) balances being relatively high the consumer has a lot to feel good about. >> seeing the gas price savings translate into increased discretionary consumer spending. >> growth in fourth quarter was almost 12%. we see consumers buying products every day, whether it's yankee candles, mr. coffee coffee pots sunbeam blenders oster air purifiers we saw the consumer out and about in stores buying

products. it wasn't because of sales or incentives but they had a real enthese entheseism and frugality fatigue. >> coming off of a strong quarter, double digit sales growth enviable among the companies here. can you keep that momentum going through 2015? >> it's a high-class problem try trying comp those numbers. a lot of growth planned for the back half of the year. today we'll talk about opportunities we have we think momentum can continue. >> opportunities for m&a adding more brands? >> always looking to be opportunistic about m&a. we've bought back our shares when we haven't had many opportunities. whether buying our own shares or shares of somebody else plenty of ways to deploy capital thoughtfully. >> it's interesting in the consumer right now, look at a proctor & gamble, for instance shedding brands almost 100. >> yeah. >> you're doing the opposite and adding brans what happen does that say where you fit.

>> someone at p&g said there's no such thing as a tired brand, just a tired brand manager. the brands that we've bought have been underinvested. we put more money into the brands, we view this as a marathon, not a sprint. happy to invest grow brands as you look in places like europe where the economy's not so good we view a down economy as a great opportunity to take market share. >> you're 40% exposed internationally. >> exactly. >> currencies aren't as big of a deal for you as other companies here. >> they're impactful but not as big for somebody who is 50/50. that's 60/40 split has been the way we've been last couple of years. we'll be that way for the next couple of years. we'd like to be more 50/50, but with that comes imfact of fx. >> is there perception on wall street? the stock's doing well off of quarter. is there some misperception your brans are so distinct and complex it's hard to deliver

consistency, especially with uncertain macro environment? >> i think unlike certain staples companies selling products in the market every day, look a detergent, our products are seasonal staples. so we go through the year until you hit winter and we start selling skis. in the spring we sell fishing equipment and baseball equipment. we don't have that consistency of being in the market every day. what i like about it is we're in the mark for 120, 150 days, we can pull products out, change pricing, change characteristics, and give the consumer something they're interested in owning the next year. >> a boost from the frigid weather? >> cold is good. >> selling skis and crock pots and all sorts of cold weather. >> comfort items. the nice thing about the cold weather is you don't get a lot of reorders in q1 for things like heaters and electric blankets but clears the decks for q3 q4 so we should have good load-in as we approach the back half of 2015.

>> doug mcmillon will be be on top. is it 20% of your product goes to wall mast. >> we're 16%. >> it's important. >> yeah. a great customer. >> are they back? have they turned the corner. >> every retailer goes through ebbs and flows. i think the new management structure at walmart's certainly going to help what's going on there a lot of new ideas, new vigor in the organization. it's a great industry leader. and i think you know obviously going to be around for a long time. we've got a great relationship with them. change is a good thing, i think. >> confident they can turn around u.s. sales. >> yeah i am. look, if you look at who their consumer is and consumers going to see that growth in income from oil, but also i think you're going to see real wage inflation this year, and that's going to benefit the consumer and ultimately should benefit walmart. >> thanks very much for your view. good to see you here. back to you in the studio. >> sara eisen, thank you very

much. back to sara later in the program. wanted to -- remember that marriott was a standout lodging stock, up over 60%? a stock that analysts think will lift off this year that's hilton. they've reported results. they've misses about a cent on the top line. the bigger question for hilton is what point, paying down debt start returning cash to shareholders and spin off properties as a reit. we'll be talking later in the program, an exclusive interview, actually "the halftime report." the big story the fact that they've sole the waldorf shy of $2 billion. for tax reasons had to buy five hotels immediately in order not to pay tax. they sold out at assets waldorf 32 times earnings and buying assets at 13 times earnings. smart play. we'll talk later on "the halftime report." >> guidance soft relative to

what the street was looking for. looking for 5 to 7 for the year. >> one analyst described it a messy quarter, a lot of transacts and stock-based compensation, which is higher and tax effects on the top line as well. >> good one. waldorf, too, great deal. wow! $2 billion. >> and to -- >> for them to do the waldorf after everybody buy it we'll run it for 100 years, you can pay to do it um. >> incredible. >> meantime warren buffett dumping energy stocks as you know by now. hedge funds following suit. where's the money going now? kate kelly with more on that. >> carl right, warren buffett made waves yesterday for selling $4 billion position in exxon mobil as well as exiting conoco phillips and cutting a steak in barco. he wasn't the only one souring on energy as crude oil hit rock bottom prices last year. according to the figures, there was a rash of energy selling

during the fourth quarter. overall, analyzing the universe of 1,000 larger sizes hedge funds that filinged stock holdings with the s.e.c. symmetric found that anadarko, exxon, halliburton saw the most selling pressure with 90 anadarko, 78 selling exxon, and 77 selling halliburton. eog and chevron also made the list. stock names in favor of technology seems to be dominant. apple, google facebook saw 10% of the universe of hedge funds add positions during the fourth quarter followed by citi and allergan, the pharmaceutical company, soon to be acquired by actavis. among the best stock pickers, the media and technology trend played out as well. best performing hedge funds in terms of long equity load up on time warner cable, cbs, netflix. i should note a tough quarter to generate alpha, with symmetric

noting that 20% of the hedge funds surveyed through the s.e.c. filings were able to beat the benchmark with stock picks. of course we don't know what they're doing on the short side or what they might be doing in other products like bonds and rates but from the stock perspective, a tough climate beginning part of the year. >> layot of interesting narratives embedded in all of those. tomorrow, live from arkansas with the ceo of walmart. doug mcmillon, after the company reports earnings. you do not want to miss that. more "squawk on the street" after the break.

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♪ let's take a look at s&p telecom sector one of the worst performing in a market that's got the dow down 32 points.

dom chu has more back at hq. >> right now telecom stocks jockeying with energy as worst performing sector in the s&p. down a percent as a whole sector today. leading the way lower shares of centurylink after analysts at goldman sachs downgraded the shares to a sell from prior neutral rating. reduced price target to 33 bucks a share from prior 37. saying that profit margins could decline in the coming quarters. now frontier communications, wind stream holdings and at&t round ow the laggards. a tough day for the telecom stocks. over to the cme group. rick santelli, the santelli exchange. rick? >> good morning, carl. my guest, jim bianco. seem leaks tuesday but it is wednesday. all right, this morning we had professor shiller talk about break evens. last week we had charles evans, chicago fed president, talk about break evens. tell us what break evens are and why they're important or are we

using them incorrectly? >> they're tote name inflation break even treasure inflation protected security. subtract the yield of the ten year from yield of a ten year tip as they're called you get what the market thinks inflation rate will be. inflation expectations. officials have said the single most important variable in setting fed policy is inflation expectations and they use this instrument to figure out where it's going to go. the problem is it's not a good indicator of where it's going to go. historically it's been very poor. if you look at the things that drive inflation break evens, it's not economic indicators. it's things like the vix, the shape of the yield curve, the gold/silver ratio, level of interest rates. these are not things that professor shiller would use to predict inflation. >> do their models take into consideration their treasury holdings europeans, what they're going to do japanese quantitative, what's go on with markets, inflated prices like

stocks? unique times. the do the models take this or the same mod that looks at break evens before the credit crisis. >> same model. they come to the same conclusion that 100% of economists had for two years, rates go up and go down. >> a burper thing. because my weather vane. points north somebody should take time to see if it's rusted or not. what do you think's going to change with regard to the next fed meeting? many believe a tightening is coming. ? what's the statement going to have to have or not have. >> i don't think the fed's going to move. >> company there. >> yeah. the thing is we're going to get a clue this afternoon with the minutes. the word "paytience" means two meeting according to yellen. if they want to move in june they have to take the word out or redefine. they'd have to take it out at march meeting and give us a clue then. i'd look at word "international

development" maybe define what that means. is fed worried about the strong dollar? another reason not to move there many including yourself, have said we are 2-2-2 on 30-year bond at 164 on ten-year note less than a month ago. yields have moved. currently 2.127 as talking we'll put up the chart that shows up to december 11th. up to year the low yield for the year 2.13. look to october 1st of last year, 10 months what you see is the low yield 234. we sit at 2.11. 30-yaer bond rates at this level they're way up here because the fed is going to tighten how do we know how the market is going to respond. we don't know where interest rates will be without them. final word. >> that's true. there's an angering position going on in the market because rates are up in the last two weeks, seems like they're soaring but three weeks ago 2.11 would have been considered a low

rate. market is still pricing in the fed moving towards the end of the year more so than the middle of the year and so while that's coming in the market is always been of the opinion the fed is going to move a lot slower than the fed has said they're going to move. we've seen this in the past and the fetsds -- the market always turns out to be right. >> thanks jim bianco. simon, all yours. >> thank you very much. up next on the program looking at what some people in the retail industry are calling a catastrophic shutdown of america's supply chain. shipsagered offshore cargo stacked everywhere. getting the view from the water with jane wells on the west coast after this.

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. as you may know dozens of ships and their cargo are backed up off the l.a. and long beach ports because of the labor dispute. what does it all look like from the water? jane wells has a boat-side view of that situation. good morning, jane.

>> hey carl. this boat right behind me here it left china last month. it has been sitting here at port since february 9th. it cannot even get in. the one next to it has been sitting there since february 12th. look at all that cargo sitting there on those ships waiting, well in this case, nine days to try to get in. who knows when it will get in. there are by my account at least 30 ships here outside the port of long beach and l.a. and you can see these down to newport beach. the labor secretary continues to meet with both sides, described yesterday's negotiations as positive and productive. we are told both sides are close on bay but the big issue as we reported before remains arbitration, the union yon wants to fire the arbitrator which according to the ap david miller but the union says he has been unfair to them in arbitration and basically is appointed for

life. now they says usually 10% of goods from china go to the east coast. that is up to 30% at twice the cost and expect to see the word port in a lot of earnings reports. perry ellis blaming it for a shortfall and fourth quarter sales and eric garcetti says even if the thing ended today and everything was good it will take a long time to unclog the system. >> it's going to be 6 to weeks even when this is resolved to dig those boxes out. we have pretty much stopped exporting. imports are still coming in. that means our agriculture, that means that our raw materials that we're exporting out of the port of l.a. are not moving. >> reporter: now while some imports are still coming in it's not enough. honda has slowed down production at some u.s. plants though chris thornberg at beacon economics says we haven't seen much as a consumer yet. they're still stocked on the

shelves. some people report some items are missing. back to you. >> extraordinary pictures there. thank you. jane wells there, in california. well, he's back the good news in new york jon fortt, back from skiing and ready for the alley. >> hey, simon. yeah 3 billion isn't cool what's cool $19 billion. that's what whatsapp got from facebook, actually a little more a year ago and that's the valuation where snapchat is reportedly raising money. we'll dive into that. spencer ras cough, ceo of zillow fresh off his conquest. shake shack, he has a new one, coming up on "squawk alley." e financial noise financial noise financial noise

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