free cones? >> yeah. >> is there a dairy queen on the island? >> i don't know if there is. there's two by us. >> there's two in new jersey. another reason. >> to live in jersey? >> two youngsters that would like to see trees. >> and get free dairy queen. >> exactly. >> anyway, that does it for us. we'll see you tomorrow. right now it's time for "squawk on the street." god monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange. david faber is off today. the fed meeting, israeli elections. the market looking pretty steady. futures are up. oil did hit 43.57 this morning, a new six-year low. ten years right around 209 on a weak empire survey. our road map begins with the markets. volatility set to continue as oil, the euro, and the fed compete for attention this week. netflix shares slipping pre-market. we'll take a look at that

downgrade, and disney cinderella casts a spell at the box office, but btig stepping in the role of the evil stepmother cutting to neutral after a volatile week on wall street the euro near 12-year lows. a lot going on. a lot to watch. >> yeah. i was kind of hoping that this would be a non-entity week because there's not a lot of companies reporting. but the companies that do report tend to be very big, like nike fedex. fedex giving you a view of the economy on the same day that the fed speaks. and oil trading at levels that are worrisome to some, not me. but it just turns out there's just no quiet weeks anymore. and we start off with a rally, it looks like that is like from where? from where? i don't know. the dollar for 30 seconds didn't go down? i mean, didn't go up against the euro? the euro carl it trades erratically in the middle of the night. >> yes. right off the bat last night. fell straight below 44. >> and i just find myself riveted because it must be so

thin. and the dollar shoots up on nothing. i mean the currency guys -- i don't know how much real liquidity there is on the largest market in the world. >> well, we knew over the weekend -- i mean you could walk around this floor on friday afternoon and get all kinds of rue rumors of putin. we finally do get a picture of him today. better than the alternative, not knowing where he is yet again? >> i felt that when we had another dictator go in venezuela things would get better. who knew there was someone worse. there's always someone worse at the bad places always someone better at the good places. >> some pictures here with the president of kyrgyzstan. some are trying to argue he looked a little puffy, looked a little sickly. >> oh my. let's put him under a sun lamp and make him look great? i mean honestly, the guy's around. ukraine seems to be getting worse economically. i think that we have to stay focused on russia but really stay focused on brazil where they had a million people turn

out. and that government's got to fall. i mean that government -- there was a list of 50 -- it was like mccarthy. 57 people who we know are corrupt. that country is on the day-to-day. >> yeah, she's got some issues to deal with. >> yeah, she's got some issues. she doesn't look as good as putin. >> meantime, this fed meeting begins tomorrow. they're going to look past the weakness and set a path for june, do you agree? >> i think that they are so data dependent that they literally can do -- i think they'll just stick with it. this whole idea of patient, non-patient. saying maybe they come up with a new language. in the end, february was weak. it was just weak. so, i mean the idea of taking action if you looked at the february data is kind of not -- if the february data were strong, it would be a very big difference. but there wasn't a number that i could pick out other than employment. terrible.

i mean terrible. >> and empire. more of that today including new orders. >> we had the weakest month of the developed countries. meantime, some downgrades today. share of netflix falling in the pre-market. a sell rating reducing its target from 450 down to 380. what it perceives to be an intensifying competitive environment for netflix, as amazon hulu, snap chat discover -- all find ways to get content. >> i have trouble with this because this was an analyst who was not recommending on the way up. had one of the absolute great runs. now the competition -- obviously it's a sign-up situation. if you missed it this is a new thing i see analysts doing. we missed it let's go to a sell. you know what? you missed it just say you missed it. i find that some of the times the analysts are best to say hey, you know what? i sat this one out and it's really gotten too far. i'm going to stick with the

hold. maybe it comes down. when you go to the sell what you are now saying to guys like me is hey, i got it wrong, i got it wrong. you're not getting away with it there. it's kind of like our role. >> evercore has had a neutral for a while. >> that was unhelpful. that was kind of like if you're watching the ncaa and the bracketology, you're saying hey, you know what i really put everything on unc getting the first seed and i'm sorry i was wrong. now i'm taking unc. >> do you disagree with the fundamental analysis? >> yes i do. i think netflix is in the capper seat. i always say the same thing, which is this is netflix driving it. they do have the right programming. they are taking the world by storm. i think netflix could raise its price dramatically like amazon prime, like costco. it wouldn't matter. >> a lot of discussion about sony selling the rights to seinfeld. i mean are we at some sort of inflection point where someone's

going to pay too much more than they should? >> i think that could happen. but worried about the balance sheet, they could sell like 50 million shares and people would snap it up. i'm just not a bear on netflix because of the sign-ups. it's an international sign-up story and it's a very compelling offering at these prices. and that's why the bear -- you know the bears keep losing. i don't like it on an earnings basis. it's one of the cult stocks. amazon, netflix, tesla. there's a tweet today about a meeting. and that tweet -- that stock could go up ten points. a tweet about a meeting where they're basically saying listen we'll tell you when your battery life ends and the stock will go up 20 on that. i mean colts, stay colts. that's what colts do. >> we're going to talk about that tesla meeting on thursday in a few moments. but if you didn't like the netflix downgrade, you're going to love the disney downgrade, of course ruling that north america box office over the weekend, "cinderella" took in

$70 million. shares are near full value based on very robust expectations over the next couple of years. >> here's the problem with that. it's had a big run. i could understand that someone might say it's fair value. but what are you supposed to do? unless you're a hedge funds, which goes forward today because the fed does something wrong. well, how do you get back in? is that worth doing? if you're someone at home and have a long-term horizon, what are you going to do get back in at 101? while you're at work, going to call your husband or wife and say where's disney oh yeah let's go back in? you can't. it's too cute by half. the last disney downgrade that we had was 89 going to 82 because of ebola. i caution people that you can't really trade disney. i just doesn't work. and by the way, the company is in there every time you do trade it buying stock. you saw "cinderella." i did not get to see it this weekend. >> i did see it. >> everyone's going to see it within the next four weeks. >> i've got young daughters, as you know. we don't have a choice, we saw

it. as i was saying to you before the show there are movies you take your kids to that you can ignore and movies that sort of make you watch. >> it's like immunization. some people are going to choose not to be immunized. they're not going to go to "cinderella." we worry about those. we don't want our kids with the people who don't see "cinderella "cinderella." we don't want some sort of immunelogical problem. >> you will admit things are going right for disney. >> all you want is each quarter to have something big. last week at the meeting, bob iger basically said listen we're going to stage this this this, this this. and he gives you another "frozen." gives you an expanded "star wars" schedule. a bunch of things you wouldn't even know about. by 2017 we're just going to use our apple watch and go right through. >> last week you and david had nelson pelts here on the floor, as you know, getting a tweet this morning from carl icahn. which reads like this. for those interested in corporate governance issues the

pelts interview with david faber and jim cramer is a much watch. great points made. and it includes a link to that video. >> we were very proud of that. subsequently, when you go speak with the people involved. obviously, david did the lion's share of that. talking about what would happen if nelson pelts were to leave. i think just say defeated or go. i thought it was very interesting to see the merrill lynch note on dupont which is they go buy to sell at merrill. so what happens, if pelts loses, does he take his bat and ball and go home? if that happens, you have a $72 stock. which is not what you want. i'm saying that peltz creates value. >> there's a look at peltz as he came to the floor and answered criticisms that he has targeted female ceos and a lot more. >> i know. and he found fault with our charting.

which i thought was a new level of -- >> directing? >> do i get a kick out of nelson peltz? absolutely. do i think he's done terrific things for investors? definitely. if you bought stock after he announces you made money and dupont is probably the best evidence of that's the case. carl, thank you. we all come out as professionals. if someone who you respect says hey listen you did a good job it's like hey, that's a pro telling you that you did okay. i like it. >> absolutely. icahn, it's not his first rodeo. >> no it's not. when we come back greece's prime minister feels the heat and walks away from a cnbc interview. you've got to see this exchange. later on we'll go to south by southwest, talk with walter isaacson. the dax this morning got above 12,000 for the first time. pre-market here looks pretty robust. more "squawk on the street" from post nine at the nyse when we return.

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jim mentioned tesla shares on the rise this morning thanks to some news that elon musk announced using his personal twitter handle. about to end range anxiety via

ota software update. affects entire model s fleet. so that leaves the rest of us to figure out how a software update is going to end your range anxiety. >> well, anything i guess that shows a more accurate -- you know something that goes off or something. look, he's a shrewd stock manager. the stock has been drifting down and it's time to give the stock a battery jolt. i think that's what it will do. kind of get in the way of the shorts. i think he really likes that. plays the game better than most. i still think they need to do a gigantic financing. each day, he'll give us a new tweet. stay tuned, stay tuned stay tuned. he is a tweet per share guy. >> yes. same guy, though, who called the price expensive not too long ago. >> he said chinese sales were going to be 30% not that long ago and turns out they sold ten. i mean the guy is the master. when you say something bad about

tesla -- i love the car. that's what i'm saying right now. until i hear what he has to say, i'll say i love the car. deflect. a politician. what do you think of the stock? i love the car. i'll be like frank. frank underwood. you laugh -- i love the car. >> let's get industrial production and go to rick santelli. hey, rick. >> hi carl. february industrial production up .1, but here's the fly in the ointment. january originally up .2 now down .3. that's a half of 1% swing. let's look at utilization rates. 78.9 so we lost the 79 handle. 79 was expected. 79.5. but we still retained it last month. 79.4 does turn into 79.1. these numbers are a bit disappointing, but once again, they're still in the hunt they're just not in the hunt on

the aggressive meter. we're slipping below 210 in somewhat quiet trade as we get ready for the fed meeting and everybody beginning to continue to monitor what's going on in the euro and in crude. carl, back to you. >> thank you very much. meantime the outspoken greek prime minister in the middle of a fire storm. he is facing criticism for a spread in french publication paris match, which shows varoufakis in a rather comfortable lifestyle while a lot of greeks are struggling. our julie chatterly questioned him over the weekend and here's what happened. >> are you a liability, though for this government because you are trying to promote a serious message and these things are distracting? >> are you a liable for your channel? >> i try not to be. >> so do i. >> are you a liability for your channel? >> interview jason statham, you get a jason statham answer. people don't understand this guy. when he wants to be tough, he can be tough. when he wants to be funny, he can be funnier than anybody. you go against him you're going

against a guy who's really an idol. i think he's been heading this thing very right. he's got the germans on the run. he's got the greeks being able to get their way. he's the man in the middle. he's doing a pretty darn good job. and this shows you don't take me on. what he's saying is don't take him on. we don't want to take him on because that seems wrong. >> when you say the germans are on the run how do you mean? everyone's complaining that the process is a logistical waste of time right now. >> well because the germans were supposed to cram them down. and there he is. he's still out there. saying stuff. and the germans did not come after him. we all felt that the germans had this -- basically said listen, you're not going to get any more money and they're giving them the money. at the end, they'll get 35 40 50 years to pay off what they want. and this all goes away and we should really be focusing on other areas. because i think this guy is the master. he's the master. >> he has proven to be politically savvier than a lot of people. >> does it with a smile.

stilettos. i have been so impressed with this guy. i know that initially people felt he was a bit of a cartoonish character. i think the germans don't know what to make of him. why? because he's crazy. and, you know there's nothing worse than an opponent who is crazy. >> meantime the euro did hit $1.457. we talked about perry last week. >> 90. >> really? >> i just think they want it back to where it was when they started. the germans are just making so much. the germans -- you know they may not have played greece right, but the germans are just making fortunes. this is great for their cars great for the industrials. they're the big winner once again. the germans keep winning. at a certain point, i think they'll have to show a little more largess. the german stock market is on fire. >> look at that 12,087. i remember when getting over 10,000 was a big deal just a couple of months ago. >> they have raising numbers,

every german company, maybe with the exception of basf. i don't know. these german companies are on fire. and their numbers are all way too low. volkswagen is doing very well. it's very impressive. you're in the german stock market, you're just making a fortune. >> one company with a lot of exposure to europe is microsoft. nadella is speaking at the convergence conference this morning. he's announced i'm told office 2016. also has announced skype for business. which he is previewing right now. earlier on in the morning, russell wilson onstage talking tablets. >> really? >> believe it or not. >> does he mention why? does he say why? we want to hear why didn't you give it to marshawn? >> ubs does cud numbers this morning on microsoft. on weak pc demand. >> yeah pass. honestly i think microsoft is not going to make the numbers. they need to do something. look intel, hewlett-packard, they're telling you that the

most recent microsoft generation isn't doing that well. microsoft is an inexpensive stock, but i think it's a bit of a value trap. it's not going to be skype for business. they need to break the company up. you are not -- it's simply not their time. and i find that this -- that he came in with a blaze of glory and made a deal with a lot of people. like sales force. that was something that ballmer refused to do. >> apple. >> yes. now it's stalled. instead what we're stuck with is the numbers and that's the worst thing to be stuck with. because they're not going to make them. the number cut that we got is still way too high versus the street. people have to come down and they have to come down now. i'm waiting for a lot. i'm waiting for goldman to cut numbers big. i'm waiting for some of the major firms to come out and say listen i'm not going to make it. i think those would all make sense. >> any other headlines from nadella, we'll pass them on to you. >> he's not a showman. i mean, tim cook is a song and dance man compared to this guy.

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you're free to focus on growing your business. centurylink. your link to what's next. i know you're watching biotechs. >> yes, that's very important. they presented some new anti-cholesterol class drugs.

showed tremendous success. it's a class. i don't want to say one's worse than the other. this stock is breaking out and remains my favorite in the group. regeneron last week. so i like both of those. collision avoidance in your car. it's very interesting. goldman went hold the buy last week. goldman's the lead manager in the 14.5 million shares and goldman is also sharing shares. it's a very goldman day. >> yes. >> isn't that terrific? >> speaking of being in your car, we should mention garrman. >> you know you love your garman, but now you hook up your iphone it tells you pretty much what garman is going to tell you. >> this cardiology conference.

met >> he knows better than anyone. they have a device that makes you not have to crack open the chest cavity. it's going to keep winning. edwards has been the real winner. their scientific editor. ew you're not going to go wrong. i think eventually e.w. gets acquired. it is such an amazing company. i really love these guys. they've been on they are terrific. they're the technological leader. the doctors love them. and they're great guys. >> yeah all the action around heart valves this week. >> and then cardiology is going to save lives. it's really terrific. as you get older, more and more people are having heart surgery and they can't tolerate the chest crack. >> all right. we'll get a lot more after the break. and of course the opening bell on this monday. don't go away.

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stories. endo saying we wish salix all the best, continued success. >> and there it goes. exactly what david said on friday. foregone conclusion. i think the value goes higher on this. people love these combinations because of the inversion rules. what can i say? that's the way it works. >> meantime we just mentioned your interview with nelson, and now we have a new letter to dupont. >> yeah, tea leaves here. this is a letter that says after having met with stockholders of dupont over the last few weeks, believe in having a a trian compromise. he said over and over it's got to be peltz. it's not going to be john meyer. they're willing to have john but this has got to be nelson. and if that's changed, there will be a deal. but that sure wasn't what we said last week. >> let's get ready here for the opening bell on this monday. get a look at the s&p at the top of your screen.

down here at the big board, it's csop asset management celebrating a launch of its ftse china. therapeutics focusing on neurological disorders, celebrateing its 20th anniversary. you know what struck me this morning, jim and we covered some of these, but these downgrades come in waves. and today it is a garmin netflix, disney and win downgrade kind of day. >> winn makes so much downgrade. 50% situation. very tough to own that stock. disney i think again that's just kind of like all right, i want to call a top. that's been a real bad idea. microsoft, got to be really careful there. if microsoft does come out and say listen we can't make the numbers, the stock's going to go to 35 36. >> the wing call by the way, morgan stanley, which cuts it to equal weight doesn't expect a market recovery until 2019.

more structural loss demand than we've bought. >> yeah. you can't fight the fact that the communist party seems to really crack down on these things and that's just very important. on the dupont downgrade, you know what's going to happen peltz is going to lose. i think that's what people have to recognize. john myers would be a terrific addition. that's the guy from ge capital. but apparently that's not been enough because i know that ms. coleman has basically said that's okay. this one is going to end badly if some deal isn't made. >> dupont is by far the worst dow component and it's the worst s&p component. >> all the tellchemical stocks are doing badly except for that one. the ag business isn't that good. a lot of the core businesses in dupont are just okay.

but that has to do with the fact that it's just okay. every one of these companies, they're not that good. >> ge's in the green along with a lot of other dow components. >> the letter comes out today. i was hoping to get a hold of that earlier. i would have loved to have seen it in time. >> maybe later on today. >> a consortium led by krr. $6 billion. >> you always try to figure out how far flung is ge. turns out they've got a gigantic business. you know, in the meantime the last two big acquisitions, which is energy-related infrastructure it's got some other. but that was not so good. an oil patch play. this company is widely perceived as it sells anything it's more and more an oil company and oil service companies, when you see schlumberger, and haliburton that's not where you want to be. >> let's get bid on the record.

tad smith leaving. >> he's so great. that guy is a very, very smart guy. everybody loves tad. he's just a remarkable guy. he is going to help sotheby's. >> robert frank arguing that the art world needs to get to know him. >> they'll know him and love him. he's just a smart man. >> on oil, the u.s. may soon run out of storage, and when that happens, do you still see 42 holding? >> look, that is the big issue. the refineries are running full out. could use all the gasoline that they make. it has to do with the backup of cushing. there's no real place to put it. really putting a lot of this crude from canada that we thought was going to come through keystone it's going right through ambridge. there's so much from actual mexico coming in. it is a case of storage.

watch the day rates for the shipping companies because they're trying to put it on big ships, too. it's anywhere we can place it. we can't export because of the rules. there are real issues. real issues with oil. because it just turns out you can't refine enough of it fast enough. running like the northern canada refineries are running flat-out. you can't run refineries at the pace they're running without something going wrong. these are dangerous places. so be aware. >> and once again, delta and southwest, it's like clock work in the top 15 s&p gainers. >> they can raise prices. and their biggest swing is going down. it doesn't get better than that for those guys. they are raising prices at will because there's very little competition. >> bp investing $12 billion in a project in egypt that will produce the equivalent of 3 billion barrels of oil. >> bp's got to get out of the oil business. they are trouble. all of these companies are in the same boat which is the big ones, they do not have the oil that does well.

remember, if you have an eog, they've lowered the break even cost big. bp, exxon, these guys have gigantic projects. really very expensive. chevron, very expensive projects. they basically go to the different drilling companies to say hey listen pal, you cut your rates. we know you have a lot of extra capacity, so we're going to start drilling make $29,000 a day go to $20,000 a day. could be eight days. they're going to make a lot of money. there's no cessation yet. there was no bottom in growth. permian and balken. balken is the expensive. >> mike santoli had a great point. the s&p year to date is flat-ish. but think of all the markets that have had wild changes, the enten-year the euro oil, gold europe japan.

how does that work? all these crazy things going on and yet we're basically making up for a weak january, strong february. >> i think that there's a couple of very big cap stocks that are getting the money in and retail does very well. restaurant does very well. but the international companies. technology is a gigantic partner in the s&p. technology is not doing well unless you sell into cell phones. the banks are doing well but not doing so much. finance is a big part of the s&p. there's too many parts of the s&p that are questionable here. and the big problem is the internationals. you know coca-cola. like where is the upside in coca-cola? the strong dollar headwinds. i was doing work on avon. i mean they have 12% headwinds. >> they beat latin america. >> if you sell overseas and you sell on countries like venezuela, you're just losing money every day. that's a terrible terrible thing. >> you know what's the biggest gainer? edward. >> they got a better mouse trap. wow, you know what? i've been waiting and waiting.

all the cardiologists tell me over and over again, this is the company that's got the silver bullet. st. jude had some good stuff. i'm never going to sleight medtronic. people are so slow to recognize that someone's come up with something better to save lives. you cannot perform that kind of surgery with people in their 80s without the edwards. it's just too dangerous. edwards has got a solution. there's baby boomers -- this is the baby boomer heart device coming. it's fantastic. again, great guys. totally non-hyped. i've had them on i want them to say this is the greatest thing since sliced bread. they won't go there. they just won't go there. they're conservative people. and nice people. >> 6% gain does the speaking for them. and it's followed up by bsx right behind, almost 3.5%. >> these device companies are very very good. they all tend to be good by the way. st. jude is a great company.

it's really one of the best things we do is medical science. we don't get enough. these are great technology numbers. >> we are in a golden age, as some might argue. right now, a pretty nice gain for the dow. let's get to bob pisani on the floor. >> happy monday everybody. i'm a little encouraged by today, because it's true the weak sectors not surprisingly are energy and materials. and put up the major sectors, you can see that. but oil hit a new low. and on that new low, i was anticipating that we would be heading towards new low for many of the big energy names out there. i'm watching some of the big names like eog, for example, big exploration production company. that's just hovering just above its 52-week lows. and yet, it started negative and went positive today. i think that's very encouraging that we hit a benchmark, new lows on west texas, and we are not seeing corresponding

declines in the exploration and production names. so keep an eye on that. overall, very bullish start to the week. meantime, speaking of bullish you see what happened in shanghai? if you doubt the effect that stimulus has on stocks did you hear what the premier said over the weekend? china was prepared to take action to stimulate the economy. the government had a host of policy instruments. as close as you could get to mario draghi's whatever it takes statement. and this is from the premier of china. that's a new high in shanghai sitting up towards multi-year highs. europe is also rallying. take a look at that, the weakness in the euro. but the euro today rallied. 106 or so. the stimulus being provided by the european central banks. look, it's another new high over in germany. we're at seven-year highs in france. four-year highs in italy. you get the idea. if you have any doubts that the stimulus talk is helping european equities just take a look at fun flows. this was one-- fund flows. european equity $35 billion in

inflows. u.s. equity funds, 35 billion in outflows. exact mirror opposite of each other. you can't blame everybody. everybody's just following the money. i think you guys were referencing this just a couple of minutes ago. look at the returns for the year. this is one of the strangest quarters i have ever seen for global equities. germany's up 23% for the year. france is up 18%. japan's up 10%. china's up 7%. the s&p is flat. down 0.3%. that is a very very strange mix. and of course the key element there is all of them are involved in stimulus or qe of 1.4. last week, another week of relative outperformance for the small cap russell 2000. the outperformance on the month. russell is flat s&p is down and on the year. here you see the russell up 2.3%. s&p down. so it's not so much go long europe and sort the u.s. it's partly that but it's

really go long small cap, and stay short big caps. so that's the important thing. finally, tomorrow is st. patrick's day. those of us who have suffered through another weekend, please know -- how does everybody do on st. patrick's day? no surprise, anheuser-busch is up 1.1% in the next four days. every single time since 2005. 100% of the time. maybe not that surprising. others like boston beer company also up almost 90% of the time. so a little bit of move on st. patrick's day. right now the dow up 102 points. >> thanks a lot, bob pisani. rick santelli at the cme. good morning, rick. >> good morning, carl. today we're looking at a parallel shift on the curve. those are always interesting. we have a four basis point drive in fives, sevens tens 30s. usually when there's no curve implications at a time when

there's tremendous potential for curve movement and a two-day fed movement, most likely everybody is somewhat thinking the same. at this point it's you know don't fight the notion that interest rates have a lot of sponsorship and a lot of scarcity, even though the fed may be talking about raising rates. as you look you can see yields are down. down from significant levels of major importance, whether it be settlement of last year or some of the areas that we experience trading right around the december holidays. december 1st charts for the next several. you can see on the ten-year. here's an interesting one. ten-year jgbs. they're actually at 42 basis points. kind of interesting. this is why you don't use percentages for yields. up 100% like three four weeks. they were 20 basis points. basically kept the same low yield as bund rates. not necessarily exactly the same day, but darn close. want to pay attention to this. there's a lot of talk the japanese are going to be buying a boat load of treasuries the grab some yield. we've heard that song before. here's bunds starting on december 1st.

you could continue to see yes. but many thought the lead-in to lower rates on the ecb's quantitative easing program would be the first chapter. it's looking like half the book at this point. if we look at what's going on in the spread between our bunds, we shaved ten basis points on that distance. it was at 190, now it's at 180. many believe we're going to test 200. maybe we'll get down 170, 175 before we do. if we switch gears to currencies, euro versus dollar it's actually having a bounce. as a matter of fact, every single currency, major currency on the landscape is doing better against green back, but the dollar index did reach 100 on friday. if we look at the big picture, of course, friday we are flirting with the -- in terms of the euro the best level of the dollar against that currency, going all the way back to january of 2003. and of course with that fed meeting, there's been a lot of talk about what may or may not happen with things like the

yield curve and short rates spiking up. but i will continue to tell you, whether you look at tens minus twos as your template, it's actually been widening or steepening so we need to continue the look for all of those. not as to what the fed is going to do, but what the market will do as the fed tries to normalize. carl, back to you. >> all right, rick thank you very much. oil meantime trying to recover after hitting 43 and change. let's get to bertha coombs at the nymex. >> we are back near the lows of the morning, here below $44, a six-year low on oil. and it's interesting, we've got opec coming out with its monthly report saying they don't see producers really cutting production until the end of the year. they think that's when it's going to catch up. it could be opec talking its book, not wanting to have to do some sort of emergency meeting before they meet in june. but one of the interesting things is that the international benchmark, the brent benchmark, has held up a bit better than the wti nymex crude because of

these concerns of a glut of oil in storage already and that the u.s. could get tapped out as far as its storage capacity. that has made the brent premium really jump over the last couple of months double from a sense of being at par with wti and brent, and now it's $10 above. and that actually is spurring more of a carry trade. some folks in the stock market are seeing it worthwhile to take our oil and ship it all the way to asia and compete on price with opec to try to sell to those customers there. very interesting die. thattics in the oil market these days. back to you. >> we'll come back to you later bertha coombs. when we return jack ma gets in your face. we'll explain that. also ahead, the co-founder of comecore. dow hanging on to a 110-point

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♪ forget your mobile payments alibaba's jack ma says you may soon be paying with your face. speaking in germany last night, he demonstrated a payment system that uses facial recognition for security. ma called the technology the future of buying things online and used the demonstration to bay a buy a gift for the mayor of hanover. interesting. although stock hasn't been above the 200 level since january. >> i continue to like yahoo. you're seeing yahoo valued at almost less than nothing now. i just feel like that what happens is they will give you their -- they'll off load their alibaba and what's left is a very inexpensive company. if you do want to play alibaba,

please buy yahoo. >> are you interested at all in what their ambitions may be outside of china state side? >> no i just find china -- i know that there was some squawking this weekend. they're determined to keep the growth rate high. but i don't want to be levered to either china, the domestic or the export. just not a great place to be levered to. their stock market has been red-hot, but i just think when you start buying these companies based on fundamentals, it doesn't hold up. >> yeah, especially now that they're starting to off load some steel. >> i spoke with dan demico, used to run new corps talked about how we are being wiped out. the steel companies are just -- there's just endless dumping of steel and our government does not stand up for it. >> maybe that will change. we'll find out. we'll get stock trading with jim. dow up 158. don't go away.

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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. back and forth, back and forth. the dow and the s&p positive for the year after losing their gains over the past few weeks. >> well here's two that i think are terrific. haynes brands added to the s&p, they just did a 4 for 1 split. this company, i know the chart

looks a little daunting. do not be put off that the stock can go higher. they are an amazing manufacturer. they have their own plants, by the way. don't worry about sweat shotps, at least according to them. i'm a big backer of harman. this is auto infotainment. those are both big winners. >> you've liked that one for a while. >> oh yeah. did amazing things. a lot of people say we want to get into cars. they are the cyber security car. they are the most forward looking company in the space. they are not just great sound systems. they are the connectivity king. they have the biggest intellectual property in a car right now. >> i look at the action jim. dow's got your attention, up 172. but the transports are raising some eyebrows, too. we haven't had the new high since december. >> we need to.

absolutely right. what happens tomorrow the euro is weak we'll give up everything here. people say jeez we knew that that was going to happen because the transports didn't confirm. this is all about the euro. the euro is weak tomorrow what you see on your screen bye-bye. it's really unfortunate, but that's where we are. >> i think we did get an upgrade of unp. >> yeah, there was a unp upgrade. i thought it was a weak upgrade. there's a lot of things going on in the energy space. and union pacific has a lot of fracking sand. that's why people are tepid on union pacific. norfolk southern and coal. coal was going down. these are all happening at once. there's a gigantic pipeline that's opening natural gas to the chicago area and that's going to really hurt coal. one of the few pockets of coal still being used is the midwest. >> what's up tonight? >> we're handicapping. we're going to do some -- everyone else is doing the ncaa. we've got it.

we've got your brackets. you're going to love it. it's going to blow your mind. >> i'm going against that. if you go with kentucky, what's the point? everyone has kentucky. it's like going to the racetrack to get $2.10. not for me. stay tuned. >> can't wait, jim. we'll see you tonight at 6:00 p.m. eastern time. when we come back, breaking news on home builder sentiment. don't go away.

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good monday morning. welcome back to "squawk on the street." i'm carl quintanilla. stocks are green for 2015 once again, as we have a nice rally under way. dow is up 166 points. oil, though, continues to be a sore spot breaking below 44 as some renewed pressure takes place.

>> microsoft ceo unveiling new products for businesses at the company's conference in atlanta. find out what it means for microsoft's future. plus new info on how much money is being spent shopping on mobile devices and how the apple watch could boost it further. and tesla trading higher after a tweet from elon musk. he says he has the cure to the "range anxiety" surrounding the model s. we've got the details on that. >> let's get over to diana. >> reporter: home builder sentiment down two points in march to 53 on the national association of home builders monthly sentiment index. 50 is the line between positive and negative. we were at 46 a year ago in march. up to 59 in september. now declining for three straight months. again, to 53. the builder citing supply chain issues, law and labor shortages, and tight underwriting. of the three index components current sales conditions down

three points to 58. buyer traffic down two points to 37. that one still mired in the negative. and sales expectations were flat holding at 59. home builder sentiment was down. in the midwest, it increased, but in the west it dropped the sharpest, down seven points in march. again, for more, you can see all the numbers at realtytech.cnbc.com. we're now green for the year. ahead, of course of tomorrow's fed meeting and janet yellen's news conference on wednesday. crude continuing to slide with wti touching its lowest level since march of 2009. joining us now, funds strike global adviser's founder tom lee. good morning tom. >> good morning. >> there will be some people who have taken your bullishness hard, who will be disappointed that we haven't made better gains during the first three months of the year. >> i've been disappointed

myself. >> it's okay. >> you know because we've -- we're sort of flat for the start of the year. and what's happened is good news now is not really seen as good news in the u.s. because i think investors are worried that if things are too good, the fed's going to tighten. the dollar's been too strong. oil's been too weak. there's a lot of concentration. my positive take on all this is one, the u.s. economy is still short oil. we're not net long. so lower oil is still good for the s&p. but more importantly, the economy is a lot more levered to housing and investment activity than it is to energy. so i think people are sort of forgetting bigger picture. there's a bigger housing story taking place this year. >> right. >> obviously last week the dollar for many people was front and center. have you like others, taken down your earnings estimates for the year and therefore where you think the market should trade because of the strong dollar? >> well simon, it's another good point. if the dollar stays at this level, it's going to be a headwind for earnings for the

rest of the year. because we know there's a translation effect. and we know there's going to be an effect on inflation and gdp. one of the things that i think is uncertain right now is really where the dollar is six months from now. if investors think it's stronger, there is going to be a headwind. >> i've never heard you come on the platform with such doubt, tom. >> with doubt? >> with doubt at this level. >> well, i'm probably wearing the wrong tie today. am i riddled with doubt? i want to acknowledge the headwinds out there. but i'm very confident investors are overlooking the investment story in the u.s. i think there's a lot of evidence that there's pent up demand. even with a survey today on home builders, tight conditions is the reason why we're not seeing better numbers. i think these are going to ease over the course of the next couple of months. >> not to poke too many holes into the bullish story but the economic numbers are not going your way. we've seen so many misses. soggy data really on everything except for jobs. >> yes. >> doesn't that make you doubt that u.s. investment story and

the fact that the u.s. economy had been looking so strong coming into the year? >> and again, it is interesting. i mean i guess data doesn't improve in a straight line. what we have to keep in mind is if the data isn't improving linearly i think it does take pressure off the fed to necessarily move up its date. so it's not a necessarily bad thing to see data mixed. >> you think they're going to remove patient from the language on interest rates this week? >> you know, i'm not a fed watcher, so i think the key to watch is really does the fed seem to have more deliberate arguments to move forward. and i still think they're going to be patient. >> so let me pick that up. is it possible for the market to rally, if they remove patient from the statement, which we think they will. most people think they'll remove patient on interest rates from the statement. if the dots -- the speed at which they think they're going to raise interest rates perhaps is lower.

because of the lack of inflation. is it possible for the market -- i mean obviously there's going to be volatility. could it rally through that do you think possibly on the view that the fed isn't going to tighten as many times moving forward? >> well generally, i don't like to be short-term focused. >> but it's a story for the year in fairness. a year-long story. >> but here's the observation i'd make. the market's going to always be surprised, right? whatever people anticipate is going to be discounted. and i've heard many clients tell us they'd rather see the fed move forward because it's proof that the economy is strengthening. so i think in some ways, you could make the argument that if the fed is confident to alter language and the dots move it's a bullish signal. but more importantly, i just would say when i speak to clients, they're really focused on this europe on proxy trade, the opportunity that qe is taking place in europe. so i think there is money flowing into europe outside from

the u.s. >> are you suggesting that's what people should do invest in the eurozone over u.s. equities? >> well i principally focused on the u.s. i just -- i would say that a european rally, which we do see taking place, is not bad for u.s. stocks. i think investors shouldn't look at this is a tradeoff between u.s. and europe. i think equities are rallying. >> good to see you tom. >> tom lee there. >> as we mentioned, oil at the center of the action dropping to a six-year low. traders are eyeing u.s. production levels and also high-stakes talk this week with oil producer iran over its nuclear program. richard hastings is a strategist with global hunter securities focusing on oil. rita tsen is chief oil analyst. is that thiswhat this is about? we're focused on u.s. oversupply and stockpiling, which is also reaching very tall levels? >> yeah i think most of this is

to do with the u.s. stock levels. also remember this is seasonality. every year we get a really big drop in oil prices around this time of the year, and this year is no different. we've been saying for a few weeks that we do expect some downside in oil prices not just in the u.s. but also global brent prices. i think that is what you're starting to see now. i think there's more to go. >> just in today's action alone, we're seeing more than 2% declines on both wti and brent, richard. there was a report out of opec a monthly report that said that production levels in the u.s. are going to start to slow down in the second half of the year. that was completely ignored. so do you agree that the bias is to the downside further here? >> oh completely. completely agree. we're expecting that month over month production in the u.s. will start to decelerate to 0% growth on a month over month basis. if not in may 2015, then certainly by july of 2015.

and i don't think the market is looking at that. the other thing is that while we're all very focused on the bloat in crude oil production and then the storage hypothesis that there's so much crude oil in storage, there's only about 29 days of supply of crude oil in the united states. that's a month. i mean, this is a joke. gasoline is about a month supply. even if we go from about 450 million barrels of crude oil and you go to a hypothetical 650 million barrels of crude oil, you wind up having about 45 days of supply. so some of the idea that the market would be permanently oversupplied is nonsense. >> so what's going on? >> well these are just -- you know, they're consistent ir rorerrors in judgment and observation. the same thing we see in natural gas. i don't want to change the subject, but you're going to send the season at about 1.3 trillion cubic feet of storage and there's a maximum capacity of about 4.8 trillion cubic feet

of working capacity storage for natural gas in the united states. how does that describe an oversupplied market? so getting back to crude oil, there's the rig count hypothesis. there's the storage hypothesis. and one after the other, they don't hold up to scrutiny. we're going to start to flatten out in production sometime during the summer and then the market is going to start to wake up. >> interesting. amrita there was a note out saying that retail investors had been premature to boy into emfs, which is what we've been doing, and that we could see that money flowed back out, because people couldn't understand the lags in the system and the effect on inventory inventories. would you agree with goldman sachs? >> no i think that's exactly it. i don't disagree with what's just been said in terms of fundamentally the market is oversupplied, sure, but it's not that oversupplied. we should get like a 20% correction. but i do think that there are

two or three things going on at the moment. one being that inventories continue to build despite being already at pretty high levels. by no means am i saying that we're going to run out of storage space. there's lots and lots of storage space available, but it does mean they're still building molecules. second thing, the market positioning, like goldman said as well. etf buying has been very very high. these investors came in early on in late 2014 when the initial price drop happened. the thing is yes, we will see u.s. production fall. we are going to see other production fall as well, but it takes time and now this is -- again, we're going to see a pullback in prices. and when prices come off, these investors are going to look at their returns and realize hang on, we've actually not made money, but we are now losing money and you might see that exacerbate the downside. and the third thing which we tend to forget is the u.s. dollar. the dollar is strengthening tremendously, and that's putting further downside on oil prices. >> very quickly, what kind of level are you looking for now that we've taken out the january low on crude oil?

>> i think for brent, we can go back down to the early 50s and low 40s. i don't necessarily think we're going to breakthrough the 40s on the lows that we've seen earlier, but wti is very possible that we go back down to the low 40s and maybe touch the late 30s. but again, that's unlikely. let's call it late 40s for brent and low 40s for wti. >> richard, your level? what's your low? very quickly. >> u.s. crude could break down to about 38 bucks per barrel later in the summer. could start to rally all over again. >> all right. thank you both for weighing in on the crude drop which we're seeing pretty much exacerbated. more than 2% declines on brent and wti. good to see you both. quickly focusing in on the worst performer in the dow this morning, that would be dupont. due to nelson peltz issuing yet another letter this morning to the company saying it's unfortunate that dupont has decided not settle the ongoing proxy contest.

he adds that his firm trian remains open to realistic solution. david faber and jim cramer spoke to peltz about his battle with dupont in an exclusive interview thursday. here's what he said. >> the most efficient way to get rid of the $2 billion to $4 billion of excess corporate overhead, and it's mathematical and i can show it to you. the most efficient way is to break up the company. but i said that we have an open mind. if management can convince the board, and you've got to convince the entire board that they can achieve the metrics of the stand alone comps, whether it be on sales growth or margin if they can achieve those metrics and keep the company together, we're all ears. >> both sides digging in their heels. another famous activist investor carl icahn took notice of interview. he tweeted, for those interested in corporate governance issues the peltz interview with david faber and jim cramer is a

must-watch. great points made. obviously you can find it on cnbc.com. >> yeah, carl actually gives you the link. very nice of him. when we come back, nadella bringing you a conference and we'll bring you the details on that. later on, after a lot of speculation, putin making his first public appearance in more than a week. but where exactly was he? we will get a live report from moscow when "squawk on the street" continues. barbara just bought a bike. she wrote a tweet about it. you can't learn much from that. but take data from millions of tweets combine that with your company's supply chain and sales data. apply ibm analytics and expertise, and all of a sudden, you can learn which bikes to build what to make them from, where to sell them. because barbara and the world just told you how to build a better bike. there's a new way to work and it's made with ibm.

microsoft ceo nadella addressing the business community at a conference in atlanta, outlining the company's new plans for data. josh lipton joins us with some details. good morning, josh. >> good morning, carl. nadella spoke before an audience of 12,000 people from 70 countries. his speech focusing on how big data and analytics are now transforming virtually every sector of the economy. >> the most interesting thing starts to happen once you have all this data. it is the transformation in the business model around these things.

what you are now going to start doing as the provider of that service, it could be insurance, it could be a manufacturer of a device. every one of these businesses now is going to become a software business. >> nadella announced the availability of a series of new products and services built by microsoft to help industries and organizations make better use of their data. but more broadly at this convention nadella is reminding business owners as well as microsoft investors that this tech giant is undergoing a big transformation. the company is moving to and capitalizing on faster growing areas such as mobile technology cloud software and yes, big data. nadella is telling businesses that when they look to spend money on big data tools and services, they should look to microsoft. for example, microsoft offers data products like its sequel server, which is already a $6 billion business.

now the question is whether nadella can keep winning over businesses as well as investors. back to you. >> and the cameo, of course by russell wilson. thank you, josh. microsoft shares meantime, are flat right now. up next new data about mobile shopping. find out just how much money people are spending from their phones and their tablets. plus how apple watch could be a complete game changer for mobile commerce. we're back after a quick break. ♪ sfx: engine sounds introducing the new can-am spyder f3. with a cruising riding position and the most advanced vehicle stability system in the industry... ...you'll ride with a feeling of complete freedom and confidence. visit your can-am spyder dealer and test drive one today.

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new data released to cnbc from comscore revealing mobile accounted for 60% of all online shopping. joining us in a cnbc exclusive is gian fulgoni, who joins us at post nine. good to see you back. >> thank you. >> we know it's growing. you're actually looking at just how much and through the prism of discretionary spending. what's it like? >> looks pretty strong. it was up about 33% in january, whereas desk top spending was up 9. if you look at total discretionary spending it was

up 3. so it's growing at a much more rapid clip. it's pretty clear that it's accelerating from brick-and-mortar stores. >> percentage of time spent versus the percentage of retail dollars spent? >> yeah there's a big difference there. it's not unusual to see that kind of a difference. we call it the montization gap. so if you look at the percentage of time now online, 60% of it is with a mobile device. but if you look at the spending it's 13% spending with a mobile device. so -- >> it doesn't argue for less time spent. >> no it doesn't. >> no, that's not going to happen. it's going to be more spending. and the reasons are interesting. because research that we've done shows there are two factors that are concerning people most with mobile device is the screen size and security. and the security issue seems to come along when they're off on a public wi-fi or a wireless connection. the screen size is interesting, though because with the iphone

6, apple in a sense is addressing that particular challenge. consumers are saying they can't see all of the product detail easily with that small screen. and so the bigger the screen the more likely that somebody's going to buy off a mobile device. >> i think security is the other -- >> security is the other issue, right. that's being driven by accessing content via some kind of a public connection generally in a store. and so i think a lot of people maybe while they're doing the showrooming in the store with a mobile device, they're waiting until they get home to bay off a desk top. and it's pretty clear, if you look at the unit price paid the higher the unit price, the greater the likelihood they're going to buy off of a desk top. >> so does that argue that the watch is in trouble because the screen space is so limited? >> that's a good question as to whether it's going to help m-commerce or mobile payments. we suspect it might be affecting mobile payments maybe more than it's going to be affecting

m-commerce buying. it's a lot easier to buy off of the apple watch than if you've got to take out your phone and switch it on and all of that. but another factor that comes into play there is where that communications technology is installed, and it looks like only about 10% of the retailers have it which might give samsung an advantage with the loop pay technology they bought which doesn't require nse communication. >> what are you seeing right now in terms of digital ads spent? because we hear that ads spent in general is still under pressure. >> it's growing at a pretty rapid clip. it's growing at about four to five times faster rate than total ad spending. should grow somewhere around 15% against this year. >> and mobile also? >> mobile is just on fire. it's growing at about 70%. and then you've got video on top of it. which is growing at about 20%.

>> we keep hearing about people wanting to get a better return on enterprise mobile. we were just hearing from nadella at microsoft. obviously you've got the apple-ibm partnership. over the weekend, i think it was blackberry making a lot of the partnership that they have with ibm. where does that leave you, if potentially we're using tablets more at work and presumably therefore that has a knock-on effect generally to how people will behave? >> yeah. it's interesting, if you look at tablets, in the fourth quarter of last year global tablet shipments dropped for the first time. so at the same time you've got still the phone installations if you will growing at a rapid clip. so it's going to be interesting to see what happens there. but we might have reached a kind of plateau with tablet where is the replacements are not coming in at anywhere near the rate that we're going with a phone or maybe now still with the laptop.

>> what's your sense on mobile payments? do you think that they're really being widely adopted here? do you guys track how many you're using now that apple pay started? >> yeah we used to say that it was a solution in search of a problem. at least in the u.s. because i think that the u.s. consumer is really used to paying with a credit card and there's a habit that has to be changed before mobile payments really become the norm. so it's beginning to be interesting to see what happens as we go forward here. >> chicken and egg. it's like chargers and electronic vehicles. >> exactly. >> you don't know which one to get first. good to see you. thank you. gian fulgoni. straight ahead, the storm dollar front and center. the euro losing 5% since the beginning of the month. parity with the dollar on the cards, but could the fed change that this week? we'll be right back.

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good morning, everyone. i'm sue herera. here's your cnbc news update. secretary of state john kerry and his iranian counterpart resumed talks in switzerland. there is a march deadline for political agreement. kerry has urged the iranians to make concessions that would allow the six world powers to reach a nuclear deal. boeing's production czar says the plane maker will not make the same mistakes as it prepares to lift output by 24%. back in 1997, it was forced to stop assembly of its 747 jumbo

jet due to parts shortages. a record in boston for snow that is. 2.9 inches fell in beantown making it the snowiest season ever, or at least since records started being kept in 1872. presently, 108.6 inches have fallen. and what's it like to crash? whoa, look at that. going 280 miles per hour? just ask the nhra's larry dixon. the three-time champ making a qualifying run at the gainsway florida raceway over the weekend. saw his car split in half there. the rear went airborne but dixon thankfully walked away from that crash. and that is your cnbc news update at this hour. back to you guys. the dow is up 163 points. dollar still pretty much going strong, especially against the euro, which hit a new low earlier in the session. a 12-year low. question of the week will the

federal reserve put the brakes on a surging dollar? let's bring in kathy lee. bet you were surprised at how fast we got to these levels. >> i have to admit, i'm very surprised by the velocity of the move. not the direction of the move. i think we're going to see another 5% move higher in the u.s. dollar which means we're be up higher than the euro. however, i think the fed is beginning to put the brakes on the dollar rally this week. >> you do? >> i do. >> and the reason for that -- >> being patient in? >> i actually think they're going to remove patience. but they're going to lower their expectations component. the most important thing to remember is there's three months between march and june. yellen's greatest fear right now is getting the market to think the rate hike in june is guaranteed. i think the stronger dollar makes the decision even more difficult. that's why i think she's going to take a back seat. a little bit more relaxed at the next meeting. >> in other words, she's going to remove patience but signal

patience? >> exactly. i think that's going to lead to a correction in the dollar. which i think will be a beautiful opportunity for traders to jump back in. >> because you see parity when? >> in the next three months. pretty much by the june meeting. >> going to have a pause here on the fed. and they're going the shoot up and go back down. >> exactly. it's just a matter of time. >> so calls for 90 cents, calls for 80 cents might be right but you think that's a longer term story? >> i think so. this week will be a fabulous opportunity to start getting back into the dollar for that type of move. >> what's your advice to companies -- we had i think it was utx on last week. saying i forgot what their forecasts were, but they were changing by the week and now they look ridiculous in retrospect. what is a corporate 4x treasurer supposed to do? >> i'm continually surprised by how corporates have had such a difficult time hedging. i think they have to be much more on top of this. i think everyone is talking

about the possibility of euro dollar moving to more parity. you have to be much more aggressive with your hedging these days. it's become much more important, even though you see these courtesy effects year after year, and quarter after quarter, they can't seem to get it right. i think it's just stop taking speculative bets on currencies and start hedging much more aggressively. >> in fairness to people in the market, they saw the euro far higher than a lot of people thought it should be for a very very long time. what changed that now it went into -- i don't want to say free fall, but it moved so rapidly? a lot of people were suggesting it was the asian central banks that for years were still diversifying away from their intervention straight into euros because that was how they should benchmark themselves. now that the ecb presumably has said effectively they'd like the euro lower, is that the trade that changed fundamentally? >> i think it's that. when you have such a significant move over a short period of time much more importantly, people hedging. they're selling into the move. the combination of so many

different factors, on of the of the overall theme. this huge divergence ofrealizing the dynamic has changed. >> as we see the sharp currency moves, more people are getting involved, asking about etfs. do you get client calls about some of these currency etfs where you can essentially buy them like a stock. do you recommend people do that? >> yes. because we're getting these large percentage moves, i think the etfs are much more interesting than in the past. but we're looking for a 5% move in the etf. that's sizable. i think that as a result, etfs are a nicer opportunity. >> are you really suggesting that retail investors should attempt to bet on currencyies? do you really think the retail investor should be in on currencies, with the experience that you have and your knowledge on how they turn around so rapidly?

>> i cannot prevent them from doing so. that's why i think the etfs are a safer vehicle than probably spot itself. >> where's the big opportunity beyond the euro? we've also got a big bank of japan meeting. the swiss bank is also meeting this week. >> i actually like the australian dollar lower, because it has minutes being released this week. they tell us the door is still open for another rate cut. i think if we do get a little bit of a tlardollar decline it may be a trade lower. >> how concerned about brazil before we let you go? >> brazil is always on my radar. i think we always have to be aware of possible additional action by the central banks. >> did this weekend do anything to make it markedly worse? i think it's definitely -- >> it's a mess? >> yeah it's a mess out there. >> kathy lien bk asset management. meantime vladimir putin has finally appeared in public this morning for the first time since march 5th. but there's still no explanation really for his absence.

cnbc's jeff cudmore is live in moscow with the latest. where do we think he was? >> reporter: that's a great question and it remains unanswered. for the last 11 days no one has seen him in public since he last met italy's prime minister on march 5th. so the speculation has been and one private tv station stated this that he's had some kind of illness, possibly flu. what we do know is he hasn't been seen until today, simon, and he did appear with the president of kyrgyzstan a very formal press event. he joked with the media about the speculation, which quite frankly, has been rife in the international media. he joked and said well the world will be boring wouldn't it, without gossip. but it hasn't got us any closer to knowing where exactly he's been for the last 11 days.

but clearly, he is alive and in relatively good health judging by the pictures. there are a few disturbing things, though simon, that have come out of the last 48 hours here in moscow. one is on sunday this documentary about ukraine where the president talked about his willingness to go to the nuclear option over crimea. if it had come to that. and the other is just hours before this press appearance today, we learned that the northern fleet is going on military maneuvers. that's a mobilization of 40,000 russian troops. nobody can quite understand why this is happening, but what we do at least know is that the president is now back in the public eye. watch the oil price though. it's a much more meaningful story to the ruble or to the market here than the president's absence has been. back to you, carl. >> geoff cutmore in moscow.

thanks so much. when we come back what elon musk said on twitter that's send tesla shares higher. later, walter isaacson will join us from south by southwest. the dow is up 163. don't go away.

go to cnbc.com for the online segments later today. catch the live action version 2:00 eastern time on power lunch. more "squawk on the street" back right after this. organic food stocks schwab can help. with a trading specialist just a tap away. what's on your mind lisa? i'd like to talk about a trade idea. let's hear it. [ male announcer ] see how schwab can help light a way forward. so you can make your move wherever you are. and start working on your next big idea. ♪ ♪

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elon musk used his personal twitter handle to announce some news. phil lebeau with that. >> you know how this works. elon musk sends out a tweet and people immediately start speculating, what is he up to? here's the tweet he sent out yesterday morning. immediately afterwards, you heard a lot of people on twitter as well as on the internet saying hmm, i wonder what this software update is. tesla press conference 9:00 a.m. pacific time thursday morning. about to end range anxiety of over-the-air software update, affects the entire model s fleet. so you might be asking yourself well what is the range of the model s right now, and how can they end this short of establishing a battery life that is longer for the vehicle? 285 miles is the current range. fully charged for a model s. the super charger network has been developing over the last several years to help people ease their concern about running out of juice when they're driving great distances. perhaps across the country. they're also testing out battery

swap stations. it's believed this announcement will not have news regarding battery swap stations. there's some speculation that tesla and the software upgrades that it's beginning to be announcing involve battery management software change. essentially allowing the car, the vehicle, for you to manage the energy that is coming out of the battery pack inside the tesla model s. how much that could extend that range beyond 285 miles remains to be seen but certainly people are going to be watching this closely, because the longer you can extend the range of not just the model s, but any electric vehicle, it really does remove the barriers to people saying okay, i'm ready to buy an electric car. the idea that they can get in there. so we'll hear about this thursday 9:00 a.m. pacific time. until then let the speculation begin. >> thanks a lot, phil. phil lebeau covering tesla for us this morning. let's get over to dominic chu.

>> they are on the rise by about 1.5%. that's after the analysts at macquarie cite valuation. they think the price target is now $132. it was $134. union pacific does remain their top pick in the u.s. rail universe era. back over to you guys. >> all right, thank you very much, dom. let's get to chicago. cme group. rick santelli's got the santelli exchange this morning. hey, rick. home run >> hi, sara. i'd like to welcome charles beaterman. thanks for taking the time. >> good to be here. >> just because we've been discussing this for years doesn't mean that anybody's going to pay any more attention. and of course i'm referring to the supply and demand of stocks. having such a huge influence in where they're pricing. maybe you can tell viewers why this is important as fed normalizes. >> well since the end of 2011,

the number of shares in the u.s. stock market has been shrinking, declining steadily primarily due to companies reducing the share count via buybacks and as important, cash takeovers of already public companies. it's equal -- both of them equal to reducing the share count. so what do investors do with the money they get because there's less shares? they have to reinvest in a smaller pool of shares outstanding. so more money chasing fewer shares. duh. the market's gone up dramatically and it has nothing to do with the economy. >> okay. now, charles, two different exits here. the first exit is the money that has gone into these programs for companies, where would that have gone if the economy was truly truly firing on all eight cylinders, question one. and question two, if and when the fed does normalize, what will the stock market valuations

and ultimate price of the indexes do to this dynamic? two questions. >> well one, if the final demand was actually increasing companies would much prefer to expand their operations and grow their businesses. but with final demand not really growing and actually slowing, the growth rate slowing, there's more and more stock buybacks occurring. because what else can they do zero interest rate policy means that the cash on the balance sheet is almost like an anchor. >> so on the second question does that have to unwind or can it be a condition that will remain even through a normalization of rates? >> well, at some point in the history of mankind, markets reverse. and when companies start selling more shares than they buy, that will happen. will higher interest rates or creating some economic value for sures stop the process?

could be. if, on the other hand what also could stop the process, if the u.s. economy does take a downturn and companies see that hey, maybe cash on the balance sheet is a plus given they're not sure about where future revenues are going to be coming from, that could also alter the buying pattern of reducing the share count. >> in the last five seconds, give me a simple answer does this make stocks more vulnerable? in other words, all things being equal, if interest rates double or triple from the current zero interest rates, and the dynamics of the economy remain exactly the same will stocks go up, sideways or down? final answer. >> probably down. >> all right. charles, i like one-word easy answers. thank you for being our guest this morning. one dow member that's moving up is procter & gamble. let's send it to dom for a quick market flash. >> in mid morning trading, you

can see the chart there. we are spiking, this on the heels of a bloomberg report that procter & gamble may be looking to either ipo or sell in a single transaction a number of its beauty products brands. those could include herbal essences shampoo as well as covergirl makeup products. they have been on a campaign to shore up brand position. it's shedding non-core brands. a bloomberg report. and that's what's sending these shares higher. they may be looking to sell some of these big beauty brand names. >> this is part of a strategy to sell off a number of brands. we saw it from duracell and others. the package, it's considered not just individual olay or herbal essences. >> crude oil what does it mean for the stocks moving forward? more on that when we come back. or stop to find a bathroom? cialis for daily use is approved to treat both

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u.s. crude benchmark slipping to its lowest level since march 2009 this morning as investors remain focused on the growing excess supply. meanwhile, oil stocks remain mixed despite crude's slide today. it's a continuation of a broader move. joining us now on the phone,

oppenheimer's managing director. what's going on here? is this that we're running out of storage capacity now? >> it's all an exaggeration. yes, we are close to being full in terms of storage, but that does not justify the crash in crude oil prices. this is a temporary effect that will definitely depress crude oil prices in the next couple of months. but people are exaggerating this move. some of the bets here is that we are going to see crude oil prices below $30, which i do not believe is more likely. >> there are some serious heavyweights who believe that that is achievable, though fadel. >> but unfortunately, some of the heavyweights, without mentioning names, the people who were betting in $200 oil in 2008. so two wrongs don't make right.

i mean it's exaggeration. it's obviously music to the ears of hedge funds and traders. but it's for people who are investing longer. >> there was a call to action for the gop over the weekend in an editorial in "the wall street journal" that said republicans really should be making more of the fact that 74,000 jobs have been lost in the industry since november. what would happen if the president were by executive order to reverse nixon's ban on exporting oil? what would happen to prices? what would happen to gasoline prices? >> well, a couple of things would happen. it would definitely bring gasoline prices much slower. because gasoline prices are basically determined by brent crude, not by our benchmark crude. because brent crude is the global marker. so gasoline prices in the u.s. or europe or anywhere will be reflecting the brent prices.

now, lifting the oil export ban it is really overdue. this is something that we took 42 years ago, it is not valid anymore and it is just exerting more pain on the domestic producer. but having said that oil prices have collapsed, and even lifting the sanction is not really going to revive oil prices. it's a global phenomenon and we cannot say that oil u.s. can dictate where oil prices will go. >> fadel, i just want to highlight the very important point that you're making here because this is key in that decision. if your professional opinion, if by executive order they end the ban, gasoline prices in this country would fall correct? >> correct. because the differential between wti, our benchmark, and brent, is basically exaggerated by the inability of domestic producers

to access the global market. that is not the case for gasoline. for example, we are now one of the largest exporters of gasoline but the government is deciding who wins and who loses by not allowing domestic reducer from accessing their smart market. which if they do that will basically bring more balance to -- instead of having wti at a ten dollar discount to brent, it might be only $4 or $5 and it's good for gasoline prices in the u.s. and obviously it's not going to -- i mean it will benefit the user because they will be able to access the global market. they will compete with higher crude prices. >> i want to ask about these companies that are selling off. some of them more sharply than others. these are the companies you cover. obviously the gut instinct on days like today is to sell on these sharply lower prices in oil. what is your strategy your

recommendation for the group, which many have said have been much more resilient than many people would have thought, seeing this price collapse in oil. >> correct. because oil companies will adapt very quickly to lower oil prices. many companies now are saying $70 oil will give them the same return as $90 oil. some companies more recently said $60 oil will be more profitable than $70 oil was say six months or eight months ago. >> thank you for your time fadel, it's good to talk to you. now let's send it over to kayla with a look at what's coming up next on "squawk alley." >> we are live from south by southwest in austin where walter isaac isaacson will join us to talk about whether a correction is needed in the private market and what to make of all these start-up valuations. we've got one eye on the equity markets. the dow up some 160 points as we have an eye on the fed meeting later this week.

what's in store when that statement comes out. and finally, meerkat has only been live for less than a month, but twitter has decided it doesn't much like it. how the starter founder responds to the social news giant. all that's next on "squawk alley."

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good morning. it is 10:00 a.m. at south by southwest in austin texas. 11:00 a.m. here in wall street. "squawk alley" is live. ♪ ♪ welcome to "squawk alley" for a monday morning. joining us from south by southwest in austin texas, is walter isaac son, ceo of the aspen institute. good morning to you, as always. john fort is out.