2014. squawk box begins right now. >> live from new york where business never sleeps, this is squawk box. >> i like this song. good morning, welcome to squawk box on cnbc. i'm becky quick with joe and andrew. a city with charming streets. lots of open space. bath paths everywhere and a coffee shop on every corner. does that sound good to you? that's how one consultant firm describes vienna. we'll bringing you more along with a story about why multinational companies care. >> let's walk you through some of the big stories we're watching this morning. india central bank cutting repo rates by 25 basis points. it's citing the weak state of the economy there. also china central bank reportedly cutting interest rate on its short-term lending facility for its local branches

and nearly tripling the funds available under the program. this all part of an attempt to bring down financing costs. pay attention to brazil at this hour. about 7:00 eastern time that's when the central bank there is expected to hike rates again as inflation surges. we'll watch them when we get to 7:00. >> the adp report is due at 8:00 a.m. eastern. it's supposed to show the economy added 215 private jobs last month and there's a lot of fed speak on the docket today. we'll hear from the president of the chicago, kansas city dallas and new york fed branches branches. in washington they'll start to consider obamacare. focus is on how to determine the law. it allows premiums to be

subsidized in states that set up exchanges. if the court agrees the money won't be allowed to go to residents and states using a federally operated exchange and there's an interesting piece in the new york times today that so much posturing but that the obama administration at this point is saying there's no way if there's an adverse ruling that we're going to be able to deal with this. >> at least not immediately. >> it says 7.5 million people would immediately lose coverage. it would effect those people. >> as a result premium skyrocket. >> they said there's no way we can deal with this so there's no way you can come to that decision. they're basically saying we're not even going to consider the possibility of dealing with this. that's the thrust of the new york times piece. >> that must be what they're saying in public but that cannot be -- >> they supposedly don't. i've never been.

>> i haven't been there either. >> like munich is on the list. zurich is number five. don't we fly in there. >> i've only been very briefly there. >> i like it. >> but we're also there in january. >> right. >> land at the airport and drive to davos. >> you go straight? >> no there's nothing in zurich that would make me think it's number five. it's just the road to davos. >> we're also there in january which is not a fairway of weighing in. >> i know it's not but i need to maybe spend a little more time in zurich. i don't know the city but from what i have seen i didn't know if it was number five. >> you'll love it. even in the winter. >> we should also tell you this morning about a number of stocks on the move. shares of bob evans getting crushed. the food producer missing the mark on earnings and revenue and it's saying it will not split it's restaurant and grocery businesses. check out that stock. i saw it down as much as 25% at

one point. right now it's down by 25%. smith and wesson beating the street on the top and bottom lines. shares rallying on that news. that stock looks like it's up by 10%. watch target shares today. it will be eliminating several thousand jobs. it plans to cut $2 billion in costs the next two years. >> i don't know if you saw the comments from fed chair janet yellen. she lashed out at the banks saying the firms poor value might undermine safety. here's what she had to say last night. >> within recent years bankers at large institutions have not done so. sometimes brazenly. these incidents both individually and in their totality raise legitimate questions of whether there may be persuasive shortcomings in the values of large financial firms that might undermine their safety and soundness. >> yellen arguing the fed ex

pekt pekts banks pekt -- expects banks to follow the law. >> follow the law and act ethically? come on. seriously. >> she has not come out this strongly or publicly on this issue thus far. >> this is a reaction though. i think this is a reaction to what elizabeth warren has been saying where they called bob dudl dudley and said either you change practices there or we will find someone that will. they have to respond to the criticisms. >> there is this on going topic where people are very concerned that regulators rntd pushingaren't pushing back. >> i found myself reading the entire section of the new york times today. >> that's a great thing. i have not looked as closely as the journal today. number one, the hilary thing is back on the front page and i'm trying to figure this out.

>> all the staffers. all the staffers have their own personal e-mail addresses and they're using it for personal business and whatnot. >> i'm starting to think, though, that this might be a vast conspiracy. >> they have the vast right wing conspiracy. i'm trying to figure this out though. is it an he liz belgelizabeth warren. >> it's called news. >> it's called the new york times. >> it's called investigative reporting. >> it's called the new york times. >> colin powell was saying she had a private e-mail address. >> it wasn't a law. >> you kanlt get -- there's a lot that investigators have been under able to get. >> having the archive material and whatever freedom of information act issues you want

it's the other issue as the secretary of state, there's a security issue. is your stuff incrypted, are you on? >> i'm with you. >> some countries are figuring it out. >> the other thing that i did was watching prime minister netanyahu and i was just taken aback by the democratic response to the speech. and the new york times wrote a lead editorial on the speech. and maybe i read tom friedman. nancy pelosi looked like she was going to cry and called it an insult that he was here. it was an inspirational speech i thought. and it was weird to see the democrats put into a position where it almost looked like they had to take sides and the side

was iran rather than israel. it was a very strange dynamic. >> democratic positions on israel are complicated. >> i'm dumb in terms of -- iran is the leading sponsor of terror across the entire world. the guy that runs around still tweets about israel. things aren't black and white always but they are. >> it puts them in a position of saying are we listening to netanyahu and believe what he is saying then why are we bothering to try this negotiation with iran. >> but we have been lulled into the idea that negotiating with iran -- >> i'm not arguing their point. >> do you remember when before -- it was more than six years ago because i think the president was still a candidate. at that point he said we might even talk to people like iran. it was like how could you

possibly -- but we have been lulled for six years into thinking that we sort of all accept it. so i think we're in a different position. but also we have -- i feel like a global citizen or sort of a citizen of the un in this country now where as netanyahu very clearly has his country and israeli interests completely so residence lut in his-- resolute in his own country. he thinks israel is exceptional and watching islamic terror being called islamic terror so clearly. there's all of these contrasts. it is so different. >> it's his backyard and all of his neighbors he's talking about too. >> the world is pretty small now. we're all in the same backyard. but anyway i think it's going to be tough to get a deal through congress now. i think it's going to be very tough at this point and the reason the new york times i commend them. it was an atmosphere -- they

call it an atmosphere reminiscent of a state of the union address but more electric. >> from the clips i saw. i didn't see it live. >> cnbc the networks didn't take it. why would they? but cnbc we took the whole thing. it was unbelievable as they entered the chamber and each -- so many standing ovations. that's what was weird. so much applause. and then to see the democrats come out with this glum looks on their faces afterwards it was very weird for me to see. netanyahu said the enemy of your enemy is your enemy in this case. i don't think -- the democrat -- he was talking about isis and iran. >> but i think boehner put one over. i think he pianogeon holed the democrat here. if you're friend of iran -- it put thelda in a weird position. i'm done. i read friedman so i'm trying to

understand the nuisances. >> and tom has talked all along about this being used as a political scoring point for netanyahu who is facing election in two weeks. >> but i don't think he was thinking that watching him yesterday and knowing netanyahu's history -- i don't think that's his -- >> this entire thing has been bizarre from the outside. the entire situation has been a bit bizarre to watch netanyahu treated as -- >> i know but i think it's insulting to question netanyahu's motives given what he has been through and what israel has been through and what israel is facing. someone said yesterday it's about his survival as a candidate rather than the survival of israel -- >> my point has been netanyahu was invited with boehner. if you have a problem with this you should have a problem with boehner not asking the white house. >> boehner does a lot of things but this one looked pretty -- i don't know, put you guys in a

weird position andrew. >> why don't we take a look at the markets this morning and see where things stand right now. if you want to check out the futures we saw a pull back in stocks. dow was down about 85 points. s&p off by 9.5 points. by the way, the worst day the nasdaq and s&p 500 had since january this year. dow had the worst day since february 9th. you see the red arrows continuing with the dow down another 65 points. s&p futures down by nine points. if you're taking a look at what's been happening at the early trade in europe similar story there. biggest decline probably coming the ftse and dax are down by by .3%. overnight in asia you'll see that the nikkei was down by .6%. the shanghai was up by .5%. oil prices look like they're up about 26 cents. checking out the bond market

looks like right now it's yielding 2.29%. the dollar is where things are getting really interesting. yesterday the dollar index hit an 11.5 year high. the dollar is up once again against the euro at 11119. gold prices barely budged. >> moves by big institutional investors attend to lead retail investors by 12 to 24 months. look who is back. >> hi joe. >> how do you get away with the jeans, eric? >> because it's under the table. >> no one would see it unless some idiot calls i had up. >> i have a jacket. i'm the only one here with a jacket. >> you are. >> first look on data on the most bond sold stocks by the big institutional players. this is good for you because it has a sports angle almost

doesn't it? >> it has a bit of a sports angle in terms of predicting it going forward. we had warren buffet on the show this week. america's most famous value investor. we get to see what the rest of the community is doing and according today at a from investment they tend to predict what retail is going to do another 1 to 2 years out. if you look at the five big stocks that they increased allocations to in the last quarter. we have tesoro las vegas sands, walmart, morgan stanley and squen rahal general dynamics. >> they're late on morgan stanley. >> that was the fourth quarter. these stocks got a 5% increase in new allocations. on the flip side if you want to look at five names that lost 5% of the community got out of these names. phillips 66 and haliburton. look at those three energy names. look at what's happening with retail with macy's.

so you're seeing a little bit of a rotation there and what's interesting is because this is where there's still moves to happen. this is things that the institutional community has done but retail hasn't caught up yet. there's -- >> i would argue with energy that's been such a clearly tell telegraphed move that maybe the individual ones have gotten that message. >> maybe. it's a 12 to 24 month type of trend. you don't want to run and buy the stocks. you don't want to be too late to the game or running against where the players are going because obviously you have people thinking about this all the time where the retail guys might be trying to catch up and make a mistake in that one. it's interesting to see the data. investment breaks down the top 20 stocks so it's something to consider. they're not warren buffet but everyone trying to be warren buffet. >> no warren was interesting

yesterday, or two days ago. >> we'll see. he was along with that. exxon mobil sold out $6 billion. >> do you think there was a group thing that goes on? how does this happen? >> there's a group thing that goes on. >> is it a group thing that you think is talking to each other they all react to that. macy's has been problematic. the interesting part is if you look at the 20 biggest, the most widely held stocks obviously google apple, microsoft they have been the same three going for awhile but if you look at the other names there, they made a move there. comcast has been a big mover. everyone got into comcast but got out of verizon so when it comes to the big names you're also seeing certain themes there as well that reflect back to news but makes you wonder again

if institutional does have this eye into the future. did they want to follow them or take the contrarian view. >> comcast was above 60. i saw that yesterday. >> why are you watching that? that's good. >> they moved up from the 13th. >> cmcsa. >> they were the 13th most widely held stock in the end of q-3 they became the 8th most widely held in q-4. that was the biggest of anything in the top 20. >> good fact there, eric. good com fact. >> parent company of the network. got to say. >> thank you for coming. >> thank you. >> when we return former chesapeake energy ceo is no stranger to bold moves and plenty of controversy. now he is at it again raising $15 million for a new venture. that story, next.

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factors including political stability, crime, censorship availability of international schools and public transportation transportation. they use information like this to help set compensation for workers on international assignments. if you go somewhere good you get paid less. >> is media censorship do you want to have media censorship? so it's bad -- >> i see beijing in your future. >> people want censorship -- >> >> vancouver is nice. >> i like it. i don't know what factors go into these things. euro centric crap that goes into it. vancouver is great but i'll take san francisco any day. all right you want to argue with that? >> no i like san francisco a lot. >> where's paris?

was paris there? they don't have enough starbucks on the corner? where's rome? >> they have a nice -- >> they were there. >> and new jersey gets a bad -- >> it's okay. we like it. we don't want people there anyway. >> exactly. aubrey is raising money for a new venture. kate kelly is working on the story and has details bright and early. you live here don't you? >> yeah i live in brooklyn. >> you live in brooklyn. >> brooklyn now the least affordable part of new york city. >> you're a hipster. >> if you live in queens you're a hipster. >> the people's republic of brooklyn. i'm a proud resident. >> exactly. it's a little more left wing than china. >> i guess so. so should we talk aweubrey

mcclendon. he partnered in 1989 and gathering $15 billion for his new venture american energy partners. from respected backers like the energy and minerals group, first reserve and black stone's gps capital unit. that was a year and a half but it would appear that 15 billion isn't enough in this area of $50 oil where drilling profitably can be tough so he's out there again in a far less hospitable climate. he has spoken with banks about proposed new drilling investments including in california. also for $250 million purposes and even a pool of permanent capital funded by investors. bonds tied are trading at well below par and investors aren't that hospitable. one recent problem, a lawsuit filed accusing mcclendon of

having stolen trade secrets before he left in 2013 so start his new business. they promised to file counter claims but the heat was enough that city group that had been handling this $200 million spack backed away from it. in terms of operating and at times being overleveraged, a real concern for people. >> i guess you look at where oil prices are right now. what's happened in an energy complex and how much you would value some of those skills changes a little bit. >> there's some debate over whether it was economic. some have said on our air it can be profitable. others think that's a stretch. i don't know what the operating costs are. so people tend to think highly of what they have invested in

but again, 50 billion dollars, 18 months and he's out there again it's a cash intensive proposition. >> it's an interesting dynamic because we were told peak oil was coming and we had the notion that it's going to get harder and harder and more expensive to get oil out of the ground. in contrast we know about technology and even in drilling we know how as we move forward we get better and better at doing things and the free market gets people to be even more competitive. >> here's the thing. >> those are opposing forces. one it's harder to get but two the technology you can make money at 50. >> on shore you can do it cost effectively. we see oil pricing at a higher level, it's got to be more expensive if you're going to go to the deep water, arctic gulf

or siberia in the harder to drill regions. >> people have that bet on that view of any mineral or anything in the ground any resource, it seems like the technology has progresses more than people thought which neutralizes a lot of the fears. >> well it's basically been discredited. >> that's an understatement. >> he finally said -- >> yeah he got mad. >> he got mad at us. >> i remember that. it was crazy. >> he did. >> kate kelly. thank you. >> thank you. >> we'll switch gears and go to defendant c. for the moment. yale university holding a major summit in washington this week bringing together titans of business and politics. a key theme, how corporate america can hope to thrive and compete on a global stage. joining us to tell us what they're buzzing about, the senior associate for executive

programs at the yale school of management. he put together a huge day in washington. i see steve miller from aig is on your list. chris dodd all sorts of people. what do you think, if there was one topic you think is going to be on the tips of everybody's tongue it is what jeff? >> we began yesterday afternoon but it was a major deviedivide. the positive attitude was from the business community. but you know richard. there's a good sense of enthusiasm. we had senator mccain, senator murphy, there's where a sense of dispair and it was remarkably different.

in fact at one point he got mad at me. truly mad at me over the conference theme. the theme was the return of the american century and he asked me, what are you talking about? what rock have you been sleeping under? they laugh but they're quite euphoric. of course we challenge some of the statistics and things but the growth numbers are well ahead of where we thought the economy would be right now and this whole theme was a yale derived term. it was henry that founded time magazine had a cover story called the american century from the mid to last century to the middle of 1900s. >> do you get any sense that any ceos are talk about real reform or tax reform? when you've done these historically usually you talk about all the things that all the ceos think needs to happen

in washington for businesses to get better. sounds like you glossed over that part this time around. is it just that the economy is now to a point -- go ahead. >> no, you're raising a very good point is we did talk about it there was a sense of concern in the past where we had a lot of business leaders with us and i pushed them hard as you were pushing me right now on their sense that we could get stuff done and through this congress they still felt we could and the net neutrality discussions and things like that in the past and it didn't turn out the way we thought and they're looking at the next few years. on trade issues they're not that optimistic. going to get something done on immigration. we talked about this in the past they always thought we were going to have some progress on immigration. there's real concern about that. in fact all of these records,

grover is coming up in a little bit here. work with your friends in the conservative movement to try to make progress on immigration reform but similarly taking a look at the transcanada pipeline is the way that's been used and held hostage as a political toy it's crazy. there's a lot of concern about that. but in fact most of the room voted this is the china century despite all the backlash about the politics in china and the saber rattling on security issues rather than the american century. it's about 60-40. >> before we go i have to ask you about this front page of the wall street journal today on the bottom under the fold slips on oil. you know him well. you know ge well. really talks about how the company, after they move addway post financial crisis from the

financial world moved more toward the industrial world and are now getting killed as a result of it. from a governance perspective. what do you make of that? >> it's been a lower moving time. the stock is down through this period where he took over. hard to judge it on those standards. the company went through a dramatic transformation and i think not to be too spiritual about this but since he referred to moses yesterday as prime minister netanyahu spoke before the congress moses had his people wandering through the dessert for 40 years it takes awhile to work through a major transformation and jeff has been a transformational leader putting them in a large way and trying to understand where they are in energy and in major industrial areas and moving out of industries they shouldn't have been in. some of the other businesses

that had they stayed in those businesses things could have been disasterous. it's a much cleaner business but ge capital was covering for a lot of the industrial businesses. and it was time for a change. and they're moving toward a leadership very soon. >> congratulations. we look forward to seeing you very soon. thanks. >> thank you very much. >> all right. >> we heard from warren. he was funny about it. did you see this this was in the post new york post -- >> you heard from elizabeth warren or warren buffet. >> about something else. about the ice cream and stuff like that. wow, i think he was taken aback. he may have gotten push back on that from her people or o something. i don't know. >> he hears from a lot of people. >> i'm not trying to out him on

anything but they mentioned cnbc squawk box. the guy on morning money called us morning squawk. >> we got picked up a lot. >> yeah and it would be more effective if you were less angry. >> and then there was always -- >> this piece is saying there's a method to her madness. that there's a reason she pretends to be so angry about everything. >> i actually thought it was a big critique from women about this comment. about anger? >> no. >> you didn't see the people complaining that men -- i have been criticized for this too because i said that she was angry at one point and that if you say -- >> that was probably justified. >> let's go to commercial. >> you have to be careful about getting pigeon holed with the words you use. >> that's clearly a case -- that's not good. >> it didn't resinate with me. >> it didn't resinate with me either. >> not at all. >> now i'm angry.

>> you look a little angry. >> now i am angry. we go right to gender on this? still to come she hasn't been sort of outspoken -- is outspoken okay? i don't know if that has any gender specific meaning to it that i don't know about. still to come in the next half hour new york's killer rats. sounds like a band. why the rodents could be much more than just a nuisance in the city that never sleeps. first as we head to break here's yesterday's s&p 500 winners and losers. ♪

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the best cities to live in in the entire world. new york didn't make the list. not even in the top 20. it's no secret new york residents are often forced to deal with a rat problem but there's a story in today's daily news that takes this issue to a new level. the story is about new york's killer rats is what they're calling it. they stick on and talk about germ warfare as well. apparently fleas carry deadly diseases have been living it up here in new york city area. a study of 133 new york city rats found that 6,000, 500500 fleas,

and lice were on them carrying bacteria. they found things like oriental rat flea which is spread the plague. it only takes one bite from one of these fleas because they regurgitate the rats infected blood in your system and that's how you get infected. >> that's what happens a lot of times when you get bitten. they are throwing up into your skin. >> and the rats infected blood. >> this is something that -- with your sort of feelings towards this i don't know why you delve to deeply into the details of this. >> because i must know. >> because you have seen microscopic. >> bed bugs. >> yeah. >> but no the frightening thing is you think that the city has gotten cleaner and cleaner but if you take these results and compare them to a 1925 study it

turns out there's way more fleas on the rats here today. >> what about telling you have ten times as many bacteria in your body as cells. >> i'm okay with that. >> ten times as many. >> i know you try and gross me out on a daily basis and usually it works. >> you're a walking bacteria. >> i'm okay with that but fleas biting me and regurgitating rat blood in my skin -- >> you don't have anything to talk about today. >> no we're out of time. we're supposed to go to commercial. >> we have been blabbing too much. >> it's a right of passage for any republican running for higher office but could grover norquist be ready to lighten the load on presidential hopefuls? we'll ask the man himself and see if we can get him to say what he really means.

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for reintegration and adjustment issues big, small and everything in between, visit easter seals dixon center.org. jo nes. zero, three, two, six. here to make a deposit. [bell chime] ting >> read my lips. no new taxes. >> that's the scary thing about video, isn't it? >> you got it forever. >> i know. that was former president george bush promising no new taxes after signing the americans for tax reform pledge and that was a promise that he couldn't keep. his son, governor jeb bush is refusing to sign the same pledge ahead of his possible run for the white house. which prompted a tweet from the head of the americans for tax

reform. grover norquist. the tweet as you can see it there, if my dad threw away a perfectly good presidency i would honor him -- my way of honoring him would be by learning to avoid that mistake. grover norquist joins us at the site of this caucus. that is harsh, isn't it? >> no, look, the modern republican party has explained itself and said we're the party that won't raise your taxes. but when come to a problem we're going to reform government, not raise taxes to paper over problems in the past. we're going to reform government like the ryan budget plan and other entitlement reform and all of the other candidates 95% of republicans in the house and senate made that commitment to the american people. and jeb bush has said he'll

raise taxes on the american people if he feels like it. >> that's not exactly what he is saying. that's not exactly fair. he's not saying i'll raise it if i feel like. most people that refuse to sign this say i'm not going to box myself into a corner and make promises when i don't know what the future will bring and will make sure that i govern from what i see and what i sympathy best given the circumstances of the day. >> well after six years of hope and change and trust me the american people have come to i elect and reelect a republican house and senate where the leadership and the entire membership made a commitment they're not raising taxes. so the next republican president isn't going to have an opportunity to raise taxes. the republican house and senate would never send hill onem one. we had a big standoff with

obama. the republicans who all signed the pledge to the american people. not to me as president obama and harry reid sometimes say, but they promised the american people they would reform the government. that's how we got a spending drop from what obama planned to spend. spending dropped from 24% to 20% because the republicans said taxes are off the table. if you put taxes on the table, as bush's dad did in 1990 he got no spending cuts. none, none none. it was all tax increases. the idea you can put tax increases on the table and along with spending cuts they cheated reagan they cheated bush tax increases are what politicians do instead of reforming government and i think it's wise for elected officials to say i'm going to reform government and not raise taxes.

i hope at some point candidate bush will do that. he said he would be in favor of a contract which is the promise to the american people. that's a good step forward. >> grover what i think and what the turn of the 20th century i think government spending was like 7% of gdp or something. so it grows to 18 or 20. it was at 24 as you point out. i can see what you're saying. unless we want to turn into a 50% gdp style europe. it's got 50 over there but higher than here. so there should be an upper limit. but let's say jeb decided i'm going to zero on the corporate tax rate but i'm going to make that up somewhere else. does that point as raising taxes? >> no, the pledge is very clear. i created the pledge ronald reagan asked me to run americans for tax reform which he actually

organized and the goal was to pass the 1986 bill. the pledge was designed to make it possible to pass a revenue neutral tax reform because without the pledge no one trusted that the deal would be revenue neutral. revenue neutral is fine. >> we told me i had to wrap. i don't understand. the american public has gotten -- i don't know if it's social media or what but we seem to go back and forth every two years on which path we should talk because the public elected house and senate republican. i'm not sure what 2016 is ready to bring as fickle as things are? do you think the republicans ought to run someone that's signed your pledge or the notion is that we don't need people that can talk to the choir. we need people that can bring in converts. so maybe we don't need people at a talk to your base. maybe we need someone that can bring in the independents. who should the republicans run?

>> sure. well you should run somebody who speaks on principle which brings in the republican vote but speaks in a way that independent people can understand. the pledge doesn't win republican votes. votes. you know the republican is already going to vote for the republican. the pledge wins independent votes because they don't trust republicans unless they see it in writing. that's why you nut writing to the american people. to independents hey, i'm not going to raise your taxes. that's how you went. >> okay. revenue neutral is okay with you. i think we should do something like that. >> that lower is even better. >> okay good. 18 is good. i don't see why we can't live with 18%. we used to anyway thank you. >> 17. >> 17. >> when we come back this morning, plummeting crude prices have pressured broader energy names. first solar ceo will join us next to talk about it. ameriprise asked people a simple question: in retirement, will you have enough money to live life on your terms?

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♪ ♪ welcome to new york welcome to new york ♪ i don't know about that song but i think we should start with that video. every top and bottom -- you know what i mean? >> yeah. >> the name in lights -- did you

ever -- well you did think, actually, from an early age. >> i know. >> and it's just go -- >> on the marquee. >> right. >> why did i not think that -- >> it's sad. >> it's just going to go up from here. it's almost the top of the hour. we need to get important news out there. let's check on the markets this morning. and the future is down 53. yesterday it looked like it was going to be the first 100-point loss in a while. i don't think we had had one in february. >> right. yesterday, even though it was a 85-point decline it was still the biggest decline since january 3rd. >> it shows how good february was. in contrast -- something is better -- >> that's it. there it is. down 53 points down 7. i feel bad for the nasdaq.

doggone it. and we didn't get pictures of carl -- remember with the hair. >> it took me back. >> he looked like he started as a freshman in high school. >> in fact i think he did. >> and we'll see what happens with the markets today. there's a lot of fed-speak. you see a lot of fed guys. >> as "the wall street journal," take a look at this story because it's pretty interesting. banks are seeing a growing number of fraud cases on apple pay. the paper says the bank tightening the process to include safety. the whole part of apple pay was that it was going to be relatively hacker-safe. so a big question of that. also a parade of corporate leaders that will be joining us later on "squawk box." we've got automation ceo mike jackson. carmakers are posting

disappointing sales numbers. we'll hear what the nation's top auto retailer has to say about that. and building on a recovery. about housing. stay tuned. back in a moment.

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here's why this week's jobs report could be a huge market mover. and the timing of rate hikes. and what is expected ahead of the adp report. plus janet yellen putting big banks on blast. the beef with bankers straight ahead. and it's the poster child of the dotcom bubble. ♪ what goes up -- >> try to get it ♪

must come down ♪ >> the pets.com sock puppet became the symbol of the rise and fall of startups. the ceo is here to try to take us to the bop of the next tech boom. the next hour of "squawk box" starts right now. ♪ somebody that you used to know ♪ >> announcer: live from the beating heart of new york city this is "squawk box." >> welcome back to "squawk box" everyone. this is cnbc. i'm becky quick along with joe kernin an andrew ross sorkin. among the top stories we'll be getting an early read ron the jobs report. that's when we get the adp payroll report. this time around it is expected to show an increase of 215,000 private sector jobs. the february jobs report will be heavily watched because it will give us some clues potentially on whether the u.s. economy is strong enough for the fed to actually become less patient this month.

a surprise rate cut in india. lowering rates by 25% citing the weak state of parts of economy. and pimco still reeling from the departure of west last month. that markings the 22nd straight month of withdrawals. >> and we've got some breaking news right now on auto loans. and phil has got that data for us. phil, good morning. >> good morning, andrew. this data comes from experian. this is fourth-quarter data. the consumer continues to spend more and take out record loans. the record high for the amount borrowed now topping $28,000. at 28,381. where's the growth coming from when people go into the dealership? it's the six-plus years loans.

six-plus i should point out because the real surge has been in seven years. according to experian you're looking at 12% to 14% of all auto loans now having a term of at least seven years. those 84-month loans have become particularly popular with certain brands. suvs and trucks because of the popularity, because of the demand. and because people are adding more content to those suvs and trucks that's pushing the up the amount of money they're borrowing. i know we're going to have mike jackson on in just a little bit. take a look at group one automotive. both of these largest chains in the country they've had nice runs in part because people are coming in. they're in the heart of the cycle right now. i know you'll talk more with mike and auto sales yesterday. even when you look at fourth quarter data people are take out bigger auto loans right now. >> thank you for that. as you mentioned we're going to

talk more with the ceo mike jackson. i have to say, steve before we get to janet yellen this make please a little nervous. >> six and seven-year loans? >> six and seven-year loans. >> i don't think it's anything like the subprime we had before. but a hint of it is nerve-racking. fed chair janet yellen lashing out at wall street and the banks in the speech last night. she raised concerns about wall street's culture and ethics. steve liesman joins us. >> it's interesting i don't think i've seen her that outspoken. >> she has not been. and the fed has not been. you had bill dudley make remarks about this and the federal reserve governor made remarks about this. but janet yellen last night made a step forward in amping up the

rhetoric. here's what she said in a speech in new york city last night. >> we expect the firms we oversee to follow the law and to operate in an ethical manner. too often in recent years, bafrgers at large institutions have not done so sometimes, brazenly. these incidents both individually and in their totality, raise legitimate questions of whether there may be persuasive shortcomings in the values of large financial firms that might undermine their safety and soundness. >> so that's big right there. pervasive shortcomings in the values of the banks. the question is why does this matter? why could it matter to the banks? well, there are four things out there that the fed could do. if it starts to feel like, you know what we need to do more because of what's going on. that's big from the fed. the fed could -- by the way with

the speech that dan tarullo gave back in november. there are individual dismissals and individual industry bans or prohibitions from coming back. as you know, andy we've seen that in the last three orders credit suisse and bnp. >> she also addressed the issue of regulatory capture. >> yes. >> which has been a big issue, especially with the new york fed. i thought it was interesting. why do you think now? what was it about this speech and right now that she decided to do this? >> well let's put it in context. it comes after the testimony in congress. there's a new republican-led congress right now with a different agenda. the banking and the federal reservers i know are trying to figure out what priorities are going to be in there. there's a lot of criticism from the left especially when it comes to the issue of regulatory

capture. and there's also criticism from the right, by the way that dodd frank has gone too far. dowd frank is going to be a live issue in the congress. >> when you look at the senate richard shelby who is in charge of that committee is going to be teaming up with elizabeth warren and i believe near democrat, they may follow issues that are heavily critical and exert more power. >> those are strange bedfellows. if shelby and warren are together on something i'm going to be happy to be a reporter covering that. >> it sounds like they're already moving. >> i will say i thought the senate was tame with regards to yell will be. certainly with regards to the house much more up in arms about the fed. its very existence, its policy and all sorts of things. there's a lot of things going on. it's probably the most partisan questioning i've seen of a chair in how many years i've been doing this. i don't know that i understand what shelby's agenda is yet, becky. that's the one i'll be watching

most carefully. i think i know what warren's is. >> thanks guys. >> i'll be back -- >> sorry, joe, thanks for the warning. >> 8:15. >> do you think people are going to tune in because they know i'm coming back. >> that's not joe's thinking. >> you don't know that i think that for sure. >> i think you think that. fed watch. monitoring the jobs report. it could offer clues about the timing of rate hikes. ahead of the adp report joining us now brian ballsky, chief strategist a long-term bull market guy. you had a great month in february. i was worried about you in january. do you think we get the pauses this year 10%, 10%, 20% or not? >> 10%, 20%, i think that's a

little aggressive but i do think -- >>dy listen to me do you think we get the pause that refreshes 10-20% correction. do you think we finally get that 10% correction, or just forever, it's a bull market like you've talked about? >> i don't think we're anywhere near a control/alt/delete reset, joe. with the increase in volatility especially when you hear the statements from the fed. and indecision with respect to the fed. i can't tell you, joe, how much over the last two weeks, when i'm in with institutional clients, they're trying to talk me out of being bullish and trying to talk me into leading the u.s. -- >> they said don't tell me that? >> well it's a way of saying it, joe. a lot of people are starting to worry more about the u.s. market and the ascent that we've had. and then these comments from the fed only accentuate kind of the

confidence problem with financials overall. i don't know. is it 2015 now, joe? is it? i think it is. so why is the fed talking like it's 2008 2009 still? >> i didn't say anything about that either brian. i don't know maybe they think -- it sounded like a -- i was annoyed. it sounds kind of like a lecture. you've got dodd-frank. and you have a lot of things that have definitely -- the pendulum swung pretty far. i don't know if this is the time to go back and start lecturing and cajoling and everything else again. capital markets are important. and if anything credit is still too tight, you know given the amount of oversight and everything else that the financial sector is experiencing right now. >> absolutely. it's like a parent. sometimes, you have church. i have children. we have to overcorrect our children. we've way overcorrected. and money supply is tight. we need to open that up a little bit. i'm not saying open up the

coffers and let anybody get a loan. but the u.s. stock market and the economy has proved it can go alone for a while. the fed now is dangerous to actually becoming behind the curve. and ultimately, we still think that the united states stock market and economy is the most pristine and stable in the world. now, the fed kind of needs to get on board with that. so we still think the second half of the year we are going to seat fed move interest rates higher. >> you know brian i was actually thinking let's see, my last speech was about income inequality which is still in a bone to the entire left. i agree it's something we need to focus on. a little 4% growth believe me. then we did that. and then we did this. the fed is supposed to stay nonpartisan and not be biased. i don't know it just seems to me she's showing her hand a little bit. i would be more at being at zero for the next six years and the

what the repercussions. physician heal thy self. figure out this strategy here. you've got this dual mandate that makes it difficult to do your job. i'd focus on that. i don't think i'd try to talk about bio-tech stocks being overvalued. or bankers being sleazy. i don't need to hear that. do your job. zbliengt other thing is the financial system in new york america is dramatically different than 2008 and 2009 and bio-tech technology is completely different than years ago. >> she's shutting the barn door and the animal has all right left. the next crisis probably isn't going to be -- from what she's talking about it's going to be from staying at zero for so long. >> well, you know the next crisis could be something, clearly, we don't know. i think the biggest thing that people have to kind of get into

grips with is that we're heading into an environment where the positive correlation trade with the dollar being positively correlated with stocks and earnings and the economy week kind of back in the '80s and '90s. the problem is joe, many people running portfolios weren't around in the '80s and '90s. we've become so internationally focused, we forget we have the best companies right near america. we have to come back to that. and heave heard statements like last night, that really reinforcing the negativity in the cloud and lack of cough difference in u.s. stocks. >> you've seen snow like this your whole life. you laugh at people that complain about these little dustings we have don't you? >> this is nothing. sunday when i was running around in new york city in my goulashes, people were going to puddle to puddle it was beautiful. >> they need to see fargo and minnesota, right? they need to get an idea what a

whiteout is really like right? >> that's exactly like. >> brian, thank you. >> thank you. >> teach you to speak minnesotan. beautiful lake. >> he does it better than you. >> you and your new york accent. >> that's my cincinnati accent. >> no you were confusing it. >> you make me want to barf when you say that. sales numbers from the nation. we'll check in on the auto industry. and we'll get a read on spring housing what's been happeninging with the early season. ceo of leonard tells us if real estate will pick up. and the former ceo of pets.com. lessons on the internet bubble. stick around, "squawk box" will be right back.

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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. welcome back everybody. experian releasing new auto loan numbers a few minutes ago. the average loan amount surging. 1 in 4 buyers in recent years. mike, good morning. >> becky, good morning, how are you today? >> we're doing great. what happened in february? >> well we had a very good month here at auto nation retailing just under 24,000 vehicles plus 8% with strength in premium, luxury california

and particularly in trucks. the story is trucks trucks trucks. look at the entire industry. the entire increase for the month of february was all in trucks, plus 12%. and car sales were actually down. and i can tell you, the whole supply chain for our truck, was at its strength at its absolute limit. whether supplies going into the factories. the factories working three ships. and there's simply not enough railcars to deliver to dealerships of this size. quite frankly, trucks until we get back to $3.50 a gallon i don't see it mitigating at all. so it's trucks trucks trucks. >> and you title that directly so the drop in gas prices at the pump. mike, let's talk about a couple other stories that we've seen recently, too. you've been hearing about wells fargo pulling out of the subprime loans when it comes to

car loans. they say they're doing this because they're a little concerned about where things have gotten. what do you think? >> well you know i'm listening to this whole narrative about car sales being inflated. or supported by loose lending or subprime lending. and i really don't see it. let me give you a few facts here. in the last ten year the auto industry has originated $3.5 trillion worth of loans. to finance its sales. and the outstanding balance, becky, has only increased by $100 billion. think about that $3.5 trillion in sales. outstanding balance 20 from $800 billion to $900 billion. the point being people pay pour loans. >> that means the bad loans, mike? >> no the total loans owed on all vehicles in america. >> i see. >> is $900 billion. and the value of all vehicles on

the road in america is probably something just over $2 trillion. as far as the term on loans, well i'm no fan of extremely long term loans. but you're only looking at part of the picture. the total financing picture as well. what we look at including leasing. the actual term loans have actually decreased from 57 months to 56 months when you include financing and leasing. >> but if you're just looking at a seven-year loan. is that a good idea for you, phil was just telling us it's something like an increase of 14%. just in seven-year loans. >> yeah -- what we tell our customers is if you're looking to get a lower payment, you'd be better off to lease, rather than sign up for a seven-year loan. because then you have the option to do something else in three or four or five years. >> right. >> and the finance company has

taken the risk on the residual. now, when it comes to subprime. first of all, wells fargo is a great company. they're one of our biggest lenders. but if we sell 100 cars less than 1% is financed by subprime loans through wells fargo. if i look at all our new vehicle sales last year less than 5% were financed by subprime loans. and in total, it's 8% of our business subprime loans. and if i talk to some of our major lenders what the delinquency rate is on subprime it's about 5%. on the subprime. and about 3.4% on the total. the point being, people continue to pay their loans. so i think the anecdotal stories you hear about subprime in certain lenders, i think that's -- if you go to a $5,000 or $10,000 vehicle and a super subprime customer you're going to get extremely high rates. and you're going to have other

stories about much higher. but as far as that being a big part of the auto industry it simply is not. >> so just to clarify, mike not just what happens at autonation, you're not concerned about the trends that you see in the auto industry at large? >> absolutely not. you know this has been a theme. and i think the ultimate litmus test as way a late 9 and 10. the first payment that american people make is their car payment, before their children's education before they pay for their house, before they pay their credit card. i'm not making a moral judgment whether that's right or wrong. >> no you need your car to work. >> i'm simply stating the facts. if you want to worry about something, student loan defaults delinquencies well into double digits. credit cards are high. single digits. by the time you get to auto loans it's only $900 billion on

2 trillion of cars out there. and delinquency at 90 days is like 3.5%. >> mike you're a thought leader, please don't let this happen, don't make me ride in something that looks like that, please. give him a monitor. >> he doesn't know what it is. >> that's the google car! >> i can't! i'm not at disneyland. >> that's not a real -- that's not going to be the car that you drive around in. >> mike didn't you tell me that people still like emotional -- like sort of -- they have an emotional attachment to their car? you know the prius was bad enough, can't you help here as a thought leader? we've got to stop this. nip this in the bud. i will not ride in that i don't care. >> joe, you can sleep well at night. first, the autonomous car is on the way. and phil has done many great stories about it. and i feel it's the ends of

today and manufacture of today that will step-by-step bring autonomous cars to the marketplace. and it will be a tremendous benefit for both safety. >> he's looking over at it. he should have said get that piece of crap out of my sight. you should have said go back to the drawing board i think. >> no it's a different kind of -- >> you're defending that? >> it's limited to 25 miles per hour maximum speed. >> and with a ceiling -- >> it's a roof. that's what it is. >> yeah. >> i think you're fortunate. it's safe joe. >> you're fine. >> mike great to see you, thank you. >> great seeing you this morning, becky. >> a mustang or camaro. >> there will be a mustang. but you have to get there. >> you promise? >> i promise, if you can hang out another 20 years. coming up though we'll talk about another -- it's not a vehicle. but it's a boat. a battleship on the bottom of

the sea for more than 70 years. we've got details next. later, the former ceo of pets.com is going to join us on set to talk about the current tech rally and big changes in e-commerce. i don't know if she's bringing a sock puppet or not. we're back in a moment.

welcome back to "squawk box." morning. take a look at shares of lumber liquidateor liquidators. that company coming under fire after a huge negative report that happened over the weekend on "60 minutes" on sunday night. in the meantime listen to this. microsoft co-founder paul allen saying he's found a battleship. specifically, he said the japanese navy's biggest warship. 70 years after u.s. forces sank it. allen tweeting out a photo on twitter saying he located the ship on the bottom of the sea in the philippines, using his luxury yacht/exploration ship. the battleship that he found back in apparently 1944. interesting little project. >> yep.

coming up spring housing season is right around the corner. the ceo of lennar joining. up 10%, year to date. stuart miller will join us. at ally bank no branches equals great rates. it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda.

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♪ welcome back to "squawk box," everyone. in technology news this morning, apple is exploring a settlement in a lawsuit brought by an electric car battery makes. a-123 systems accused apple of building its own battery division. sony plans to launch a reality headset next year. and ally lyalibaba is hosting a cloud hub. the first run since outside of

china. oil prices pose the world's biggest political risk. russia iraq venezuela and libya will face more pressure in coming months. i don't know if i have enough blood for my heart to bleed for this. can we go over those four again? let me just go over that. russia iraq venezuela and libya -- yeah yeah. okay. i don't have enough in there -- how are you going to be all right? >> crocodile. >> you might cry, according to a filing in a divorce billionaire hedge fund manager ken griffin's monthly income after taxes, guys averages more than $68 million. that's right. so he makes $68 million per month. that's according to a filing from his ex-wife and that works

out to more than $2.2 million per day. more than $90,000 a an hour. of course all of this is because his wife is seeking -- >> she wants a bigger chunk. >> yes. >> there's a prenup. >> there is a prenup. he said she's worth $50 billion. there was a whole debate. what was she going to spend -- $600,000 a month on groceries. >> groceries, right. >> and another huge number for eating out. talking about numbers that i can't wrap my head around. >> they went on a vacation i think it's like $160,000 a month for travel. >> she wanted to take the kid on vacation. i think it was a $45,000 vacation, instead of $200,000. we're getting into the personal lives, that's too much. in the meantime the spring housing season is right around the corner. and with home prices rising at the at a faster clip you may be

wondering just what this means to home sales. our next guest run lennar the nation's second highest home builder. and stocks currently trading on levels not seen since the financial crisis. joining us from the yale summit. he is the ceo of lennar. stuart, when you look at the stock, as the ceo, as a ceo, i know you're not supposed to look at the stock price. when you look at the stock price when you see the actual housing and economy market is do you feel comfortable? do you think that we are out over our skis where are we? >> well i think what you're seeing in the stock prices is the fact that the housing market continues to improve at a fairly slow and steady pace but looks like there's a lot of runway out ahead of us. if you look at the primary driver for housing right now, you're basically looking at a production deficit that's been building up over the past years.

and that production deficit is going to have to be made up. at some point, we're going to see a more vertical improvement in housing. but until we start to see that vertical improvement, it looks like we've got a lot of runway out ahead. so i don't think that the stock is really reflecting out over our skis. it seems like we've got a ways to go. >> and in terms of fed policy rate hike that's of course a big question. how sensitive do you think your business is to that what do you think is going to happen? and when? >> well the way i will say it i'm quite sure that as soon as the fed starts moving interest rates, the first thing that's going to happen, we're going to see a stock pullback on the home builders because that's the knee jerk reaction. but the reality is the fed rate hike is likely to reflect an improvement in the employment market. and an improvement in wages as well. and when you start to see those

elements start to improve, it general portends good things for housing, given the production deficit. that we -- that we already have as a tailwind. it seems that even with an increase in interest rates, the housing market is going to continue along its steady improvement trajectory. >> given that you have a remarkable view of the country, geographically, where do you see the most promise? where do you see the most challenges? >> well you know we stand right now kind of getting to the edge of winter. as you can see around me we haven't started the spring selling season quite yet. so as we look at markets across the country right now, we've been impacted by weather, certainly in the northeast. it's been a long tough winter as you guys know all too well. of course i'm from south beach. south miami beach, down in florida and out in california we've seen you know, weather

patterns not affecting us quite as much. so we're going to have to kind of wait and see how the spring selling season comes along. but as we sit right now, given the weather patterns certainly the sunnier side of the country is look a little bit brighter. and i think we'll see the rest of the country come along as spring comes on. >> most challenged area though? i mean taking the weather out of the situation, just sort of looking at the economy more broadly? >> well listen the way that we have seen the markets across the country, you know housing is a very locally driven business. but because of the yourn turn was so nationally with basically the finance market driving the downturn we're seeing improvement pretty much across the country. and most markets look like there's good reason to see improvement. of course questions have been raised about the oil patch. a lot of questions about

houston. but to date, we've still seen a strong housing market within the market. and given consumer confidence more wage improvement we're going to see a robust market. >> thank you for joining us this morning, appreciate it very much. >> thanks for having me. when we come back we're going to talk about pets.com and the puppet that became the symbol for the dotcom stocks that burst back in 2000. it's been a long road back for the nasdaq. we're going to ask the former ceo about the rise and fall of that company. we'll be back in a minute. building aircraft, the likes of which the world has never seen. this is what we do. ♪ that's the value of performance.

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confident retirement today. and now al and katie, here is one pooch who is a vip, one very important pet. furnished by pets.com. you may have seen -- >> it has become the symbol of the pets.com. the sock. you you puppet. he was at the height of his popularity in the macy's day parade. it was a quick start for

pets.com. it was founded in 1998. the company went public in 2000 at $11 a share. the stock went high at $14. then it was all over. the dom calm bubble burst and it would take 15 years for the nasdaq to get back to 5,000. talking about the evolution of the commerce on the internet juli wainwright she's currently the founder and kraef of the real wheel. a website with more than $100 million in sales last year. julie, thank you for being here. >> thanks for having me. >> i think we all look back at pets.com. the sock puppet was a huge part to recognize part of the entire thing that happened. i know you think everything has been reported incorrectly since that time. why don't you tell us just what did happen? >> right around this time we got our deal done. and the window was starting to close for financing. right around this time also amazon had reported they'd lost

close to a billion dollars. >> about 15 years ago? >> about 15 years ago. at least in a market that was the beginning of the puppet markets not funding companies that have profitability. so that was the beginning of okay, we've had enough. and at that time businesses were getting funded on the possible, not the predictable. so it was a different world then. >> so you think looking back looking back at what was happening before that time was the money too easy were people just too exuberant about funding anything? >> oh i don't think so. these are professional funders. it was a feeding frenzy. let's take netflix that made it through the desert of financing. netflix is a multibillion dollar brand now. there are brands that were funded that actually continued. and there were some companies that were maybe a little too far in the future. everything that was funded during that time or most things

financed you are seeing coming to now. web van, they were funded to the tune of over $1 billion in capital. they crashed and burn what do you have amazon groceries. >> was it too early were there things that you look back now and think, if i just had done those things i could still be here today? >> too early, no. it required the public markets or the private markets to fund losses in companies that have possibilities. so pets.com was a well-run company. there were a lot of pet stores online. when you look at things like box. fast forward what's happening now. box, unprofitable company. predictably unprofitable. public markets funding. they may or may not, if the markets tie up they had may or may not make it. does it mean it was a bad business? no, it means it needed more capital to get to profitability. >> let's talk about what you're

doing today. what is realreal. >> it's luxury online. men's fashions women's fashions. art, jewelry, watches. last year we did $100 million. this year we'll hit $200 million. >> what's different in this versus pets.com. >> obviously.time. when pets.com started internet was new, commerce was new. now most people want to shop online. that's a huge difference. and consequently it's easier to get to profitability with an idea. what is really different, though when you started brands in 1999 and 1998 you didn't have brand clutter, so if you could be first, you had a chance to keep going. >> you mean like owning pets.com, the first to buy? >> right. the category netflix launching

today, they would have made much more sense and so much competition and so much brand. the difference in starting a company now you have to come up with an idea that's really unique and figure out a way to brand it in a way that makes sense in a lot of brand clutter. >> julie are what i will say, because there was such a flurry a feeding frenzy because there was such a rush to create a brand back then i think some of the practices of companies not just pets.com some of the companies across the board were a little different. you guys sold dog food at half price to try to get people in the door. i can't imagine that you'd do that today? >> lost leaders a known tactic. >> what you have today? >> well it's a custom acquisition strategy. what's the cost of getting a customer can you get them to repeat? what's the normal on the brand? it's a normal process. >> but it did feel to me on the internet it was such a great day to be a consumer if you actually

were shopping on the internet you could get a lot of stuff for free to take advantage of all the companies trying to lure you in? >> pets selling dog food to get a customer that repeats for ten years not necessarily a bad strategy. >> but consumers, at the time i was shopping around for deals. if you really tried to take advantage of it, you could hop from site to site and get great deals. i think it was the environment of the day. it was a great time to be on the internet. >> a few years ago, groupon, the same idea after the crash. these things cycle through. >> would you buy a super bowl ad again? >> it depends on my business. for the realreal it's not a match for the audience. >> you've got 5 million to drop on 30 seconds right now at the super bowl with realreal? >> i said it's not a match. >> you say it's not a match. >> to my audience. >> are you at a point that you

could do that if you decide to do it? your advertising is budget is hundreds of millions of dollars yard l already? >> my advertising budget is going to be $200 million. >> for the averages budget? >> new york the budget is 10% of that. we're actually a fairly large company. so we have $20 million to generate. and we're that way every year. >> it's got to be a good commercial to blow it on 30 seconds. >> back then it wasn't. you know it's like you guys -- it's a false equivalency here. >> you got to have profit maybe that would work. >> you are. that says it was a damn good brand. there you go. >> it was a damn good brand. thank you. >> sure. million dollar homes is back. up next we're going show you three homes. you have to guess which one is listed for a million bucks. as we head to a break, take a look at shares of tivo. they're getting a beat. beat the street by higher

prescriptions. tom rodgers doing well today. we're back in a moment. every day, our teams collaborate around the world to actively uncover, discuss and debate investment opportunities. which leads to better decisions for our clients. it's a uniquely collaborative approach you won't find anywhere else. put our global active management expertise to work for you. mfs. there is no expertise without collaboration.

can it make a dentist appointment when my teeth are ready? ♪ ♪ can it tell the doctor how long you have to wear this thing? ♪ ♪ can it tell the flight attendant to please not wake me this time? ♪ ♪ the answer is yes, it can. so, the question your customers are really asking is can your business deliver?

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. seems the popular million dollar homes series is back. we've got a twist. this time around we're taking you inside three homes in the same city. only one is listed for $1 million. the other two are priced either higher or lower. and we're going to try to guess which one is the true million dollar home. and we've got a snapshot of the

housing market in the feature city. los angeles this time. diana. >> that's right, los angeles has always had some of the most glamorous homes in the nation but those come with a star-studded price tag. for closures were just rampant. now, los angeles is back but plagued by the same trouble as the rest of the nation short supply. giving the shift in value street to street and the market the million-dollar guess will be a tough one. let's look at the stat it's in market. median home price, $529,600. let's take a look at the euro price chain. up 2%. supply chains looks good. finally unemployment rate 6.7%. that's well above the national average. but let's take a look at what's on the market in los angeles. >> this brand-new home built into the hillside is 1800 square feet. three sunny bedrooms. 2 1/2 bathrooms including a

large master suite. gourmet kitchen. two terraces all with the city and mountain views. >> recently remodeled this contemporary home sits on a quarter acre. 2700 square feet. hardwood floors crown molding and new windows. five bedrooms three bathrooms. and a modern kitchen and three-car garage. the family room overlooks the yard with pool and patio. on this quarter of an acre a midcentury single-level home. 2,000 square feet custom built-ins and gourmet kitchen with stainless steel counters. walls of windows and a wraparound deck with panoramic views. >> which of those houses is the actual million-dollar home. >> what do you we think of the houses it's l.a. >> what you're telling me is location, location, location.

>> i like the second one. >> the second one, too. >> which one is -- you think the last one is more? >> the second one. the first one was a quarter acre, of course that's big in l.a. five bedrooms and 2700 square feet which means in your living room you're like this. how do you have five bedrooms. >> in all of these homes -- >> yeah that could be -- you don't know where it is. >> exactly. that's the key. it's always going to be location first, likely view second. then layout you know. >> third one had nice views. >> yes great views. >> yeah which do you think the million-dollar home? >> and a quarter acre too. jacuzzi. >> i'm thinking the middle or the first. >> is the middle or last. >> midcentury home. >> yep. >> which one is that the middle one? >> the last. >> that's what's funny, right. we're looking at the largest home not being the most expensive. >> right. >> it's always interesting, every market is so different. and you're remember everything

is about the location. >> and the views were beautiful. >> exactly, the views were beautiful. by the way, it sold overask, with multiple bidders. >> in l.a. it's even more important than a city like new york because of traffic concerns. in new york, you can get in the subway and get somewhere. >> one was 35 minutes, the least expensive one. the $750,000 the least expensive. >> middle one? >> yeah. right outside of l.a. 35 minutes is a long commute in l.a. >> because it's three miles. >> yeah depending on the day. >> dolly, thank you for coming in. >> thank you. >> i know you're going to be on "squawk on the street." >> exactly. coming up early read on february job numbers. adp private payroll less than 20 minutes away. we'll have the analysis from the man himself mark zandi.

wall street on data watch. as futures point to a lower open the adp private payroll numbers are just minutes away. is the rally's future all time

to jobs jobs jobs? we'll debate that straight ahead. plus estee lauder turning to kim's younger sister with kindle and what he's seeing in the beauty business. and the war against mosquitos going high-tech. we're talking lasers that can shoot them out of midair. the final 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," everybody. this is cnbc first in business worldwide. i'm becky quick along with joe kernin along with andrew ross sorkin. well we are melting away some snow here in new york city and getting ready for more snow tonight, here's a heart-melting story for you. an unusual marriage proposal played not an aquarium in tempe, arizona with the help of fellow fish keepers. one of the employees at the

ayeah come proposed to his girlfriend as he swam in the shark and stingray tank. are you kidding me sharks people. no word on when the couple plans to tie the knot. >> let's take a look at headlines. 15 minutes away from the a difficult p report. expected to show the economy 200 jobs. the number of peep filing for mortgagesal rising 0.1%. and global banks india, cutting the repo rate by 25 basis points citing the weak state of parts of the economy. this is the second intermeeting cut this year. and in washington, the supreme court is going to start considering obamacare again. opponents say that the law allows premiums to be subsidized in states that set up exchanges. if the court agrees they won't

about allowed to go to subsidies that offer a federally moved exchange. probably not going to hear anything from june or july before we actually get a ruling on this. a lot of times, the questions -- but you can never tell. the questions that you hear the different justices asking you try to figure out. >> i think this one will be a little more opaque than usual. it will be harder to call because a lot of people got it wrong to the last time. >> it comes down to the same two guys. >> roberts is the one who really -- >> roberts and kennedy. >> roberts last time wants to keep it nonpartisan and got a lot of flak. every other ruling was in line people thought they were getting when bush appointed him, except for that one. i don't know how he reacted to -- he was embraced by the left the last time because he saved obamacare. i don't know because he was

pillaring from the right. >> i'm going to give this the benefit of the doubt, though i don't think they're listening to what's. happening on the outside. i think they're going to look at the law. >> they're getting hammered by the media. every day i read 7.5 million lives are hanging in the balance. >> it problem becomes you can't look toe moment. you need to recognize that any ruling that is made will be then had be taken as precedent and will have much broader implications. >> the letter wait it's written, if they were to do it based on contextual decisions, if they look at the spirit. but then if you look at the spirit, it was supposedly designed in a way for force states that gets them into the exchanges which it didn't work. >> i think it's difficult for the justices to start looking at intent. the legislation can always come back and change a ruling and do it. >> maybe the reason they had to do it this way is because they lost kennedy and scott brown and everything else. and they had to do reconciliation.

if they were to fully decide on wait it's written, it's not being enforced correctly. a few stocks in the news abercrombie meets assessments. and you see the comp stores down 10%, abercrombie, try to figure out what happened there. how do you go down 10%? you mess up on what you put in the stores don't you? >> pretty much. >> you've been to new york where there's a line outside the abercrombie. >> there's a line outside the one here. >> is there? >> how long did it take for you to get in? an hour? do you have one of those midriff shirts? >> they don't have the models by the way, any more. >> you said this the last time it's a lot of literation for the

lumber liquidators holding a conference call march 12th. the company is under fire after a negative report on "60 minutes" the other down. and the food producer missing the mark on earnings and revenues. and it says it won't split its restaurant and grocery business. all you've got to say is on "60 minutes" and it carries connotations, doesn't it? >> uh-huh. >> think about, 10 20 million people. and the impact -- >> homer once said to his father, if you don't shape up i'm going to put new a nursing home. >> you're talking homer simpson? >> homer simpson. i don't want to go to a nursing home -- >> you say homer, i'm thinking "the ill iad. "". >> and the fed's beige book

coming out this afternoon. stocks, of course pulling back after the nasdaq breached the 5-k mark. the dow jones was down as much as 150 points before closing 85 points. meanwhile, israeli prime minister benjamin netanyahu comments raising concerns. to dive into more of these issues. from delihi investments. >> good morning. >> can we do netanyahu first, that's going to have a huge impact on oil, your take? >> my understanding is if the sanctions ease there may be more oil flowing but not until 2016. but there's a question how much. i don't think it's an immediate, you know impact on the oil market. but it's something that could marginally make a difference down the road.

>> anastasia, do you care what they're saying on this issue? >> i do and i don't. the reality is the oil market has a far bigger issue than iran right now. if iran over time ramps up production, that's fine. but the fact that the u.s. has grown its production about 17% so far this year i think that's the supply that the market has to grapple with. yes, iran matters, iraq matters in this a lot less than the united states, obviously. >> we're making a lot of the nasdaq 5,000. that's the talking point of the week. i don't know whether it should be. i don't know whether everybody thinks about the valuations. and given the spike in vix i don't know what that means, jurrien. >> the last time the trailing adp was 48. and today, it's 15.

and then 6 and 2. took a whole year to go back to 5,000. but i wouldn't read any more into it than that. it is interesting that later this week will be the sixth anniversary of the bull market which began in march '09, and we're good for a 218% price gain since that time. so we have two milestones actually. >> so where are we going? >> i think we're going higher. >> going higher with any correction in sight in between, or no? >> i think volatility will be here. you know this year around the start of the fed liftoff, you know, towards normalization. >> right. >> you know do we go in june september? i think the market at this point has given it a free pass to go ease. then it's a question of how quickly do they go. there have been volatility remember the odds of 10% corrections are 1 in 3. it comes with land scape. >> anastasia. >> to pick up on the volatility

discussion, i think in the short term there are some events that could cause volatility. and some of the those events is the liftoff that we're expecting in perhaps as early as june. but i want to say another thing for volatility. we've grown accustomed to this risk-on and risk-up type environment. yeah spikes in volatility but overall, i think it's a much calmer environment than the one. >> you just said mid to late in the cycle. are you convinced that's exactly where we are right now? >> i am convince -- >> we will not be taking anything off the table? >> well i think you're absolutely right. that you know with being in mid to late cycle, it does have some ramifications that we have moved quite far. and we should temper expectations going forward. so one of the things, and we're talking to investors about right now is you're not probably going to see double-digit gains for the s&p 500.

and the diversified portfolio that was comprised of u.s. stocks, international stocks let's just call it what it is, it hasn't worked out great last year. but we think this year is different. this year the greatest opportunities may actually lie in the european stocks and japanese stocks versus those in the united states. so we do expect the upside but we do not expect the same degree of it like we have seen. >> i guess the question i'm wondering is whether you actually need a little cash on the sidelines. because both of you seem to be expecting that there's going to be some pullback sometime this year, which is not a bad bet to be had. the question is what we're supposed to do about it right now. jurrien. >> i would remind the audience that last year we had had a brief 9.8% correction on an interlude basis. it lasted about three seconds and before we knew it we were back at new highs. so, for the typical investor these things can happen fairly

quickly especially if we're in a second-year bull market which we don't know if queer in. with the correction, it involves volatility around the fed. otherwise, the fed is in a do-no-harm mode and won't allow the market to do what it is will do basically. i agree with anastasia while the u.s.s. in midcycle i think europe is actually more in an early cycle mode with qe coming down the pike in march. >> thank you. appreciate it. >> thank you. "washington post" -- >> what's in "the washington post" -- white house said clinton did not heed policy. >> it makes me uncomfortable. it looks like you're on your own there, there, hillary. there's a way of saying blah, blah, blah.

blah, blah, blah. it's our policy but we blah, blah, blah. and they don't. i think they're saying that i think elizabeth warren is a better -- >> i agree but i want to read the statement from the white house itself. >> if you think this is some of kind of elizabeth warren conspiracy -- >> we have adp. we'll be here for that. we'll be right back. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

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shares of american eagle getting a boost. topping wall street investments. we also heard the getter is not doing so well on the other side. we've got adp numbers coming out, steve liesman is here. >> payroll grew by 220,000. adp revised up 250,000, up by 37,000. the february number almost ran in line with the estimate of 215,000. goods producing up by 31,000. if you can scroll ahead. services up 181. the payroll estimate for friday is 240,000 so i don't think we're going to get a revision upward. adp has been running behind the bms report for the past several months including one massive missed year.

the 31,000 pretty strong numbers. manufacturing ticking down to 3,000. trade, transportation and utilities up by 31,000. finance activities not too bad. up 20,000. and there's professional business services. let's bring in mark zandi right at this moment here. mark you've been trailing -- >> massive? that's a strong word massive. >> did i use massive? >> you did. >> significant. >> constant. 40 k. >> a big hit. missing by 140 is a big number. >> okay that's big. >> that's massive. >> it irons out. >> what's going on? why are you guys trailing behind what bms private sector is doing? >> well there is a technical reason why it could be the case. >> oh don't. >> do we know what the reason is? no, we don't. here's the reality. the reality is the company is creating roughly 250,000 jobs per month.

february wassen 0 the soft side. on average, the 250 k. that's 3 million per annum. that's what we created last year. everything indicates that's what we're going to create this year. >> you have some other data which suggests wages are doing better than the additional data. don't bore with with the technique technicallies. >> this is also adp data. we have very good records from adp. it indicates that wage growth for individual is actually salary. what's happening is you have a lot of older workers, boomers who are retired. that are high-paid. and then you have a lot of millennials coming in, young, low paid. and it's driving down the average which is what you observe in the bls aggregate. but when you look at individuals their wages are much stronger and accelerate >> does that tell you that the fed is further behind the curve than some believe?

>> no the labor market is right on track. this job, the job growth coming at full employment in a year and a half. wage growth will move. and if everything sticks to script the fed will raise the interest rates later this year. >> lower gas prices. just talked about all the jobs that have been created. where's the spending? what's going on? >> yeah patience patience. >> i have no patience. >> this doesn't magically appear in your checking account. this savings builds up over time right. in month one, after prices decline, you get 50 extra bucks in your checking account. then a hundred bucks. after three, four five six months, you'll have enough money in your checking account where you say, oh i've got money to spend. it's just a matter of time. the next couple months we're going to see a lot stronger retail sales numbers in my view. >> one other mystery that's out

there. we had had a come down from the strong growth of the second and third quarters last year. about 2%. maybe 2.8%. it feels like the job market is stronger than the overall growth numbers. do you side -- which way do you side? terms what's telling the better story or the right story of the economy? >> well i think they're both telling a story. i think that productivity growth. see the difference between growth and output gdp and jobs is productivity growth. and because gdp grows relative to jobs productivity growth has been slow. i think that's a reality, productivity growth has been slow. but that's not a big deal now when we're trying to observe all the unemployed workers. talking about this a year and a half from now, this is going to be an issue if gdp growth doesn't pick up. that's key. that's long-term growth. >> you look younger. you left the set -- >> you left the set.

>> i left the set -- >> not botox. i tried two week to have had time for a hair cut. i got a hair cut. >> that's bizarre. i've never done that. >> what's more bizarre, i actually have hair to cut. >> you don't? >> i do. there was hair on the floor. ipso facto with hair to cut. i don't feel totally comfortable. >> i know you don't. go with it. >> it's cool it's hip. it's happening. get a fu man chu or something. >> i'll have to go with facial hair. >> i'm guaranteeing you that when sandy put this show together he did not build in time to walk about my relative baldness. >> no, he said he did. >> he did? >> yeah he said go ahead rib steve on the bald thing. >> i'm not ribbing you.

>> i'm tired of it too. mark 3% gdp growth possible or not? >> in the cake. >> in the cake? >> in the cake. coming up -- >> baked in the cake. >> baked in the cake. >> who needs bug spray when you can have lasers shooting mosquitos right out of the air? but what if you hit something else? i don't know. that story and the science behind it is next. and it's subtle science. check out the futures. we'll be right back.

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for details. ♪ at mfs, we believe in the power of active management. every day, our teams collaborate around the world to actively uncover, discuss and debate investment opportunities. which leads to better decisions for our clients. it's a uniquely collaborative approach you won't find anywhere else. put our global active management expertise to work for you. mfs. there is no expertise without collaboration.

welcome back everybody. dow component exxonmobil has announced it's 2015 spending plans like its competitors it's cutting that spending in nation of lower oil prices. cutting by $4.5 billion down $34 billion. this comes from a presentation of analysts scheduled for later this morning. in fact, i'll be sitting down with rex tillerson. the ceo of exxonmobil later today. and we'll bring you that later on "squawk box." and a machine that shoots mosquitos out of the air. it is science colliding with high-tech and king 5 has filed this report. >> reporter: this insecretary is

a killer. they kill more than a million people with transferring mill layeria. this device say weapon in the fight. >> sending right down the room. >> reporter: the vice president for intellectual venters, jeff dean has a good take on this job. but his mission is serious. and the machine gun analogy is appropriate. >> as mosquitos are coming across the field of view it's able to pick one mosquito out at a time. determine it's a mosquito and kill it. >> reporter: it takes high-tech equipment to do that called the photonic fence. >> we're using that to determine a good insect and a bad insect. that no one has done before. >> reporter: and the super slo mo shows what's happening. watch it. they want to use just enough energy to get the job done. >> we want to minimize how much

energy we use per kill. >> reporter: mosquitos literally shot right out of the air. >> what's interesting for mosquitos, their properties and how they fly. they have a certain size and wings and flock their wings at a certain frequency. >> reporter: it's a florida company that will produce and distribute it. while the most important mission is controlling the mosquitos that spread malaria, it can be used to shoot down pests that destroy crops. coming up things about to get ugly for the beauty industry. with the headwinds with the esteye lauder company. the president and congress have a deal with iran paving the way for nuclear weapons for the country. my friends, for over a year we've been told that no deal is better than a bad deal.

well, is this a bad deal. it's a very bad deal. we're better off without it. >> we're going to hear the president's reaction. talk iran relations right after the break.

♪

welcome back to "squawk box," everyone. citigroup and mastercard signing a new ten-year agreement. citigroup will be shifting to the mastercard globally although it will continue to work with other providers in co-brand and commercial cards. the two already have an exclusive agreement in the united states. among the stocks we're watching, brown-forman earnings. getting a boost. and the dollar hurting its sales growth. and smith & wesson beating in the street on the top and bottom lines. shares rallying on that news. and gamestop raising its quarterly dividend 9% to $36 a share. israeli prime minister benjamin netanyahu warning congress about a proposed agreement between world powers and iran. and president obama was quick to respond. >> let's wait until there's

actually a deal on the table that iran has agreed to. at which point everybody can evaluate we don't have to speculate. and what i can guarantee is if it's a deal i've signed off on, i will be able to prove that it is the best way for us to prevent iran from getting a nuclear weapon. >> joining us is dan sonar, co-founder of foreign policy initiative. because you yelled at me last time when i said one nice thing about rudy giuliani or scott walker, i'm not going to get involveded in a debate with you this time. how many times you have been to israel? >> wow, i go to israel about every other quarter. traveling about there 30 years. >> 30 years. and you wrote a book start upnation about israel. i'm going to defer to you about how i should view this. i watched the whole thing at home, i'm going to tell you there were times i felt a little

teary-eyed patriotic, almost pass i was living in israel. and i guess it was the electric environment of the chamber, as even pointed out in "the new york times." it was like a state of the union address, even more electric. and the thunderous applause. so when i watched the democrats afterwards it was like -- it was -- >> it was crazy. >> it was surreal. >> so i was sitting two or three rows behind rizelle. and the idea that ali rizelle who has chronicled what it's been like for the jewish people throughout history to live the threats of genocide and here we have a country making genocide. and he pointed to him in the gallery, it's quite moving. keep in mind president obama tried to get the democrats en masse to boycott the speech.

it failed. something like 80% of the democrats showed up. the only ones that didn't show up are extreme hard left pretty anti-israel types. in the front row you had harry reid, chuck schumer. nancy pelosi was there. she wasn't terribly happy but she was there. the democrats tried to divide is by netanyahu. even if they didn't like the diplomatic chime that was broken in the process. but that press conference after where the senator from kentucky said prime minister netanyahu basically wants to go to disneyland glp disneyland. >> did you see axelrod's tweets? >> what did he say? >> it was pointed out how bizarre and shrill. >> but the deal that's being

considered would leave iran's nuclear infrastructure in a very robust way in place. the deal would have a ten -- ten years unconditionally, the restrictions end. >> let's just wait. one democratic commentary afterwards that i did hear was dianne feinstein. he had a very good point, she said while i'm emfapathetic to do and i hear this what we didn't here is what is netanyahu's response. >> since 2013 president obama has repeatedly said that no deal is better than a bad deal. meaning he recognized like the israeli leadership and many throughout the west that conduct a bad deal is actually a worse scenario than no deal at all. what the prime minister tried to do is just lay out why this is a bad deal. you, mr. president, has said that no deal is better than a

bad deal. then i think in a very surgical and calm way he laid out why it was a bad deal. for the president to now say, bebe, what's your plan. that's a separate issue. for one, he made the point that tough sanctions against iran strangled the iranian economy and brought them to the negotiating table when oil was $100 a barrel. today, oil is $50 a barrel. >> a lot can happen in six years. and we've been rolled into this weird place in a lot of different policy issues in my view. one is there was a time when the president even built the possibility of negotiating with iran. it was like you're kidding, right? and netanyahu pointed out every area of the world where iran continues to sponsor horrific terrorism. where the leaders in this regime continue to tweet that israel needs to be annihilated. now, why do you try to negotiate or --

>> right. >> it just seems clear to me the options that you're left with. >> well wait what netanyahu has said the president has tried to set up a strawman if you're not for his plan you're for war. and what the prime minister said basically yesterday, if you read between the lines, i would prefer no negotiations right now. but it doesn't mean any negotiated deal at a minimum should require that before the restrictions are lifted over the next decade iran has to change its behavior in terms of its threats to its neighbors. these countries that quote, it's gobbling up like lebanon and syria and yemen and gaza. and must end its threats against the annihilation of israel. if the behavior is not going to change how you can lift the restriction? he's not saying no deal it's got to be a deal with teeth. >> i felt a sense of relief a couple times when he clearly talked about islamic-sponsored -- islamists' influence on terrorism.

and that sponsor. and it's because it sets stark contrast on this had weird -- i don't know who decided -- it has to do with not messing up negotiations with iran. by talking about something that could anger iran. >> i think that's part of it. >> did you think that when you heard him talk about that? >> yes. >> and it very clear turns into moral clarity. but the other thing, the white house completely handed the lead up to the netanyahu speech. >> they got played. >> far be it from me to give them advice. >> right. >> but i would have said minimize it. instead, obama said that biden is not going to attend. kerry is not going to attend. i think they were hoping for netanyahu to not showing up. >> that's how most americans actually learned about it. >> that completely elevated it. i've been to two previous netanyahu addresses to congress in 2011 and 1996.

i've been doing a number of these israeli leader speeches. congress no one has paid attention. this one, the world was watching. there's one person to thank you his name is president obama. >> do you think around president obama you can really thank for that decision? >> i don't know. look i think foreign policy in this administration is tightly controlled in the white house. i think there's such personal animus between netanyahu and obama that obama was going to do everything he could to personalize this. and hopefully try to intimidate netanyahu. >> the thing is -- gordon gekko. it's like the falcon became a falcon. boehner as silly as he's looked -- put the -- suddenly they looked like him in his group which has been they couldn't shoot straight on certain issues. they got played here. >> right. >> and it's just weird to be put in a position where you're defending iran or trying to

enable iran against one of our strongest -- >> you're saying iran could become a reasonable actor in the international system. you and i talked earlier, 2010 at the white house's urging the computer council passed a resolution saying iranian missile program should end. apparently to the deal that's being discussed, continued with the building of the program, continuing with uranium enrichment. there are people in the u.s. and world flipped out. faisal in the middle east basically said, it pains me to say this yesterday in the column, but i agree with everything netanyahu said that the arab world is saying that netanyahu, leaders through persian gulf countries are saying what netanyahu laid out is an accurate assessment of iran. >> and then you've also got, you

know nobel laureate ali rozel, to question to say this is political expediency to get you reelected -- >> the white house said the timing is political. now, it is true that israel has an election in two weeks. that is true. it was debatable leading up to the speech whether or not this speech would help or hurt politically. but it's also true that march 25th was the deadline that john kerry agreed to for the final deal to be cut. so when was netanyahu supposed to come? they say he came now because it's political. he came now because he's trying to shape the process. to wait would be to concede the deal. >> well kerry said hey, netanyahu, he agreed with the united states. what about this guy - the irony, john kerry, joe

biden, hillary clinton, they all had -- >> and then again, where did he end up for it or against it? nobody knows. >> i don't know. >> but they all voted the way that netanyahu was moving. >> yeah. >> to disparage him for backing the united states as an ally -- >> a vote all of these democrats in the senior administration positions voted. >> i think this is -- i've been lulled into complacency on a lot of issues that was stark to me yesterday. >> dan, thank you. >> we're going to defer to you. >> you never say anything. when we come back this morning, kindle jenner is the latest face for estee lauder but can her face help the beauty giant? we'll have right after this.

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welcome back everybody. the business of beauty is really paying off or estee lauder. the stock if you haven't seen it recently, check it out. it's trading at an all-time high. up over 800% since it's debut. the company is mean mega brands like clinique and meta. and origins.

let's ask the check tiff mareexecutive chairman. thanks for coming in. >> thanks for having me. >> how would you describe the business right now? >> you know our business is very good. some some places it's very good. actually everywhere in the world we'd also like it to be better. we've gut head wind including currency and moderating consumer demand. one of the things we find the diversity of our portfolio in one narrow space which is prestige beauty. we reached consumers in a number of different brands and products. whether it's online or retail retail with perfumeries in department stores. we find as she's shifting we're shifting with places she likes to stop. >> you mean she takes more away from the internet than department stores? >> not necessarily the internet. she's shifting from department

stores to what we call specialty multi. like a sephora. to online. we call her an omni channel consumer. she's walking through macy's she's going to pick it up. she's at home. i've run out of i'm going to order it online. she's walking through a neighborhood, goes through stores, she's familiar with the brand and knows the product she wants and gets the service she wants, she's shopping through that channel. >> let's break it down. how much department stores, how much specialty stores? how much online let's say now, versus five years ago? >> well market by market. it's very different. today -- let's go back. ten years ago, i would say 75% to 85% of our business globally was done through other retailers, other than ourselves. today, the single largest retailer of our brands is ourselves through online and our own stores around the world. >> wow. >> so we've made a major effort

major effort over the years. >> what's number two? >> number two would be macy's? >> what did you make of macy's purchase? >> macy's is recognizing that special store, 1200 1500 square foot store. offers a similar array of goods that blue mercury may have. and shopping in macy's which tends to be incorporated in shopping centers, regional centers. i can tell you strategically it's very interesting. >> does this squeeze you on price? is there a price issue? bluemercury is now attached to macy's. >> one of the reasons beauty is in one of the best real estate in these department stores because we offer some of the

best sustained margins on the top line and bottom line in any category. the result is we're in a sweetheart space. that whole margin squeeze of getting a couple points to make a difference is long gone. the big effort for both ourselves and macy's and other retailers how are we going to attract shoppers to motivate her to shop. >> you've said there's been moderating consumer demand in some areas. where does that play down? >> u.s. is pretty healthy. china is not quite as robust as it was. that has ripple effects not just in china travel popular. there's stall retail in the china retail corridors. brazilians have been big shoppers not only domestically but in the travel corridors with the weekend royale we're seeing brazilians moderating some. some of the european business is very good. some not as good. middle east is excellent.

actually really really excellent. africa is actually -- we've been investing in subsaharan africa. >> where's your biggest market there? >> dubai, saudi, kuwait. >> dubai is -- >> right. >> saudi women. they've got a lot of money to spend. they're not traveling nearly as much. the business isn't saudi proper -- >> it's good. we're doing a very nice business. and dubai is sort of like the king kong of the region. and a lot come to shop in dubai. >> if you were to guess, male makeup what percentage is that total makeup? >> very small. >> you and me andrew. i thought it might be growing. it's here. >> there are great opportunities in men's business it's

predominantly around skinwash shave, put something on afterwards to mitigate that. that's the core, from there expands. >> shave my whole body every day. >> that's tmi. >> thank you, william. >> you're working out. >> grease myself up. >> next ali baba down down 23% this year we'll ask jim cramer about it next. other men in makeup. tomorrow on "squawk box," hear from exxon ceo rex tillerson.t, ill yo have enough money to live life on your terms? i sure hope so. with healthcare costs, who knows. umm... everyone has retirement questions. so ameriprise created the exclusive confident retirement approach. now you and your ameripise advisor.... can get the real answers you need. start building your confident retirement today.

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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. let's get down to the new york stock exchange. alibaba, down 25% for the year so far. what do you make of it. >> it's interesting, you're listening to lauder who is so terrific he said china's weaker. a gigantic chinese consumer company. the consumer is picking up. i think that we now look back and say, alibaba, boy, did they ever nail the top in the chinese consumer. and obviously regulatory issues people weren't counting on and the high of it was christmas season, so to speak, that singles day.

it's never looked back. it's been a horror. i don't know i don't see the company doing anything na stems. it seems like china's in a big decline and they're caught up in it. >> abercrombie, american eagle. >> american eagle looks like they got it right. abercrombie getting it wrong. i'm shocked, american eagle, stock's acting better but nailed. retail, maybe it's kind of played out. we're rotating into retailers that we haven't looked at in a long time eagle, urban outfitters. >> with abercrombie a disaster does it come back? is it a about thor investment? >> the only reason i would say that aeo came back. otherwise, when you have minus double digit comp numbers you know how long it takes. look at jcpenney it's ling. retail done turn on a dime. cornell can't turn it on a dime. it can turn in a couple of years. >> see you in a couple of

minutes. when we come back it is home to more commercial oil tanks and storage than any other place in the united states. more nan 71 million barrels of storage capacity, we'll take you there after the break. the growing oil supplies and ripple effects on the oklahoma town. here's crude oil on this early morning. you can see now, up 16 cents to $50.68 a barrel. "squawk box" will be right back.

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low oil price have led energy companies and traders to store crude supplies rather than sell them. morgan brennan joins us from curbing, that's where the big storage facility is oklahoma where becky grew up crude is pouring into the air. good morning, morgan. >> good morning, joe. take a look at tanks behind mean these are owned by enbridge energy partners. each of the tanks can store up to 250,000 barrels of crude oil. there are dozens of these, different sizes, owned by different companies throughout cushing, a majority of them are full. according to the eia, working capacity for 71 million barrels of crude oil. as of february 20th, 49 million

barrels of crude were being stored here and that's expected to have increased when we get the weekly petroleum report this morning. genescape, forecasts at current build rate on track to see cushing reach full operating capacity next month, mid-april. how do we get here? take a look at futures market months out, future prices are higher than the current spot price for west texas intermediate. if you can secure storage, it's more profitable to store your oil in one of the tanks and wait to sell and realize the higher future prices. the problem if kucfills up what happens? >> once full 2.2 million barrels that we've seen going into storage since november re-enters the refinery supply market. >> reporter: more supply wti

prices could fall and according to some fall dra mastically $20, $30 a barrel more in the short term. back to you. >> morgan thank you. becky, it was broken arrow. >> broken arrow. >> got time join us tomorrow. "squawk on the street" is next. ♪ >> good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer david faber at new york stock exchange. premark weak again after the worst day for stocks since january. downgrade of alcoa today adding to sentiment. the european economy shows signs of improving. oil managing to hang on to a level above 50 at 50.6. the ten-year remains around