them to increase their ability to fund deposits so to speak, is not being offered by the ecb. they're staying where they are. how does this week play out? >> i think there's been a turn that took a couple of weeks ago. they're saying i'm not going to play your game anymore. we were not elected in order to be able to continue to pay your rates. we're not elected to owe you anything. we're elected to default and come up with a plan b. we will come up with a plan b when we want to and not before then. they're not threatening drachmas but i think this is a false dichotomy. they want to stay in the euro or not. that's not the case.

they're either going to stay in the euro and pay which they've said they're not going to do. or they're going to default. there was an interesting similar referendum that took place in ireland a couple of years ago. this is the exact opposite. the government wanted to stay in the euro. this government doesn't want to. the way it plays out to me is you get rid of a weak country and the euro goes up. not first. the euro without greece is a stronger euro. >> there was always concern about periphery, what do they pick off. >> nothing is happening in the bonds. >> nothing is happening in the bond markets. >> all the things we were told. >> but we aren't there yet either but you're right. there were lines at the banks. you're talking about an economy with 11 million people. the gdp is down 30%. it has a lot less of an impact. the question is still what about the euro. we're not there yet.

and there are any different number of things that have to happen even after a default where you would get to a point where they exit the euro. >> i keep waiting to see that the russians and chinese are doing some short term credit for greece which could scare everybody because that means greece leaves nato nature that would be fabulous for greece to say cut our debt by two-thirds or we're leaving nato. >> the gee owe political risks would seem to be significant. one can imagine the amount of money that would have to be spent if things go on this way. why not pony up something now and help everybody out, germany. >> and that's exactly what the greek government is saying and that's what should happen. that's the logical conclusion. >> pretty close last week too. >> they were close but i think -- >> they couldn't sell it though, to the parliament.

it's a pretty left-wing government. >> yeah. >> let's -- if there were real communists left in the world, they would be united. that's why i say this is the venezuela of the world. the russians and the chinese are bailing out venezuela. who would buy them? the same coalition as venezuela. that is threatening to germany, and then germany is known as the country to lost greece to the east so it's easier to write a check to the greeks. and right now merkel doesn't want to write a check. how does this impact bristol meyers a couple of days. >> the question was the dollar but we're not seeing a move. >> i was most concerned about that. i look at the fxe. i thought it was about 107. that meant we were down two, three. it's not. when i looked at the futures,

they were down 40 ticks. i turned to the wife and said shoot, that's a bummer. when i woke up it was down 21 ticks. i think we can revisit. everybody wants to buy the opening. i'm like give me something. this is where it was tuesday. i want a price break. i'm not saying listen it's time to buy ambarella at 98. maybe it is but how about 4 rather than 2. >> jpmorgan up a bugck and a half. >> maybe that should be the reaction given what would be a limited verb ration. let's go to the ground on greece. michelle, what can you tell us in terms of the expectations as this week moves along, certain certainly? >> reporter: well, it's going to be day by day, because everything has been so surprising already.

the referendum announcement late the other night took everyone by surprise. that's why the bank run happened in the middle of the night because of the prime minister's announcement on television. that's what really upset the european union. jim was comparing greece to ireland. the ire risch government wanted to people to vote for the deal. let me show you the official newspaper of the party here. this isn't the government newspaper but it is the newspaper of the party which is the prime minister on the cover. it says oxi. that means no. it says no to you would mate ims, no to austerity, no to the agreement. this government has told people that it wants them to vote no to this deal that's being offered by the european commission so it's a completely different situation and i'm told that is at ultimately pushed the european commission and the european union to the edge the

fact that the government came out and said don't vote out for this deal and led others to come out and say, even if the greeks say they want the deal we don't trust this government to put it into place. everything is just a major unknown at this point. what we do know for sure and what you highlight second-degree the banks are shut down. the ecb has tapped the emergency liquidity to the bangs. they haven't increased the haircut. that could be the death. that would mean it's over but it's really raise the crisis to a different level where we're seriously acting okay. if we cover this a couple of different ways, we get closer to greece leaving the euro. we're not there yet. we're closer than we've ever been. presumably that's not what the people want but we'll watch the events unfold and see how they tolerate the fact that in a cash-based economy they can't get that much cash just 60

euros a day. >> great report. >> we'll be checking in with you throughout the morning and the week. it's going to be a busy one. >> they want the money, and they don't want to make concessions. that's what the vote is for. david, if i put a vote up and said do you want flavor fleeree, they would go for it. >> they are willing for concessions. they were fairly close to a deal so that indicates there was electricalness on willingness on their part to give. >> the germans are about punishment and the greeks are about forgiveness and another east it's different. they did a compromise for years. it failed. it's been a huge failure. >> it has. >> and it's failed. >> i want to move onto another balance sheet story about in

this case it's not a country. what is peteruerto rico? >> a commonwealth. >> we get greece and puerto rico this morning. benchmark bonds are dropping. the island governor has concluded the commonwealth cannot pay it's $72 billion worth of debt. in an interview senior members of the staff said they will probably seek help. the governor is quoted as saying the debt is not payable. there's no other option. this is not politics. this is math. >> here's the math. >> 3.5 people high unemployment rate. people exiting the commonwealth and coming here. the question becomes does the u.s. bail them out. >> right now, we can inspire panic or we can actually give

the numbers. the general obligations are down between six and even percent. you can get a 70 bid on a piece of paper that everybody follows. it was at 78 last week. you can see that's a big hit but the important thing, not geeos are disasters. we need to know where the greek debt is. we want to know who owns this debt, and remember there's always these big items about unknowns. >> a lot of the big muny funds. >> you'll get $73 on the if you wait long enough. >> but puerto rico winds up in a lot of portfolios because it's a name they can own broadly. a lot of hedge funds who want in there. a lot of them short. in greece they were long. >> the euro started at 94.

down to 70. what i think is most interesting and why i don't necessarily want to buy the first dip is if it hedges in puerto rico we would be down today. it was a surprise. >> people have been monitoring it closely, monitoring the utility to pay its bills, and different things in the commonwealth. this have been questions about their ability to repay for quite some time especially given the demographic issues but you're right. it kind of came out of nowhere. >> and the bare market in china. >> these are things that you can wake up and say the market is down about three-quarters of a percent. that makes sense but we also have greece. i haven't liked the setup. i haven't liked the market a little cheaper. we have thin trading because people take off. >> we're going to stay on top -- >> we're not going anywhere. >> we're not going anywhere.

no vacation for you. we'll be watching greece and also the live interview with jean claude free shea. >> and digital and broadcasting today broadcasts as an independent company. we have the guest later in the company. more "squawk on the street" right after this. there's a difference when you trade with fidelity.

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china's stock market has turned into bare market territory. sliding more than 3% despite news of a quarter% cut over the weekend and man, as you said earlier, jim, up a lot and then down a lot. >> bare market is really odd when it's 66%. >> i know. there are some who say greece not expected in some ways. puerto rico out of nowhere but look at the balance sheet but the china news may have more of an impact than any on global markets. >> a lot of it is for the market for ipos. you have to be big accounts.

so what they've done in china is margin. they use bank margin. they are very irresponsible because they're first time people and they're learning if you use borrowed money and the stock market goes down you're margined out. to get margined out of a bank loan is different. that's your house. not that they really have big homes. chinese aren't allowed to do that. >> square footage, small spaces. >> their houses are less than their watches that they bought. i wish i were kidding. >> they are dealing with a market that's now 22% from the high in a very short amount of time. >> if you came in at say, march of 2000 in our country, you didn't take into account the fact that we've gone from one1,000

to 5,000 on the nasdaq. >> you name it they're all trading stocks. that may have been going on in china? >> sure. a million new accounts a week. that's the most roughly, the average. do you think those people do a lot of pe analysis and sit back and guy graham anded to suggest that we use book value? no. there was an ipo boom like 1999. if you got in on the deal and you didn't flip and you borrowed money, it was a bad day for you. >> my only experience years ago walking into a place that was like off track betting. they would trade stocks in a particular location and watch on a television screen as though it was a horse race. >> well materiality came in last and they are about materials now. >> up next cramer's mad dash. we'll count down to the opening bell and former ecb president.

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as you can see, we are set up for a lower open. let's call it between 1.5 and 3%. not a big impact on the dollar from greece. and our ten-year around 2.34. >> the seculation is who is giving the credit line. is it the russians or the

chinese? >> that news just crossing again that the banks will reopen thursday. that's a bit earlier than anticipated. they thought they were going to be closed all week. we'll see where they're getting the money. >> from venezuela, china and russia? >> our viewers want to know what weather you're going on today's mad dash. >> there's something we go back and forth on, deutsche bank goes buy not to hold but to sell. macy's they're saying forget about the real estate issues. they have real issues on earnings. i find this shocking because you know that there was a darden like chatter going on here and it looks like that's over. >> well, there are a lot of activists -- a lot of hedge funds talking it up. nobody made the move but macy's was worried about it. they came out on a defense of why they should not move to a reit structure.

the idea being they have a lot of valuable real estate including here on 34th street and policewomaningblooming dales in manhattan and others. this is about the overall business though? >> and how interesting is it that i had the ceo of finish line. macy's seeded that to finish line. he said the stores are booming. this is a quarter where i'm tempted to want to buy it except for the fact that it might have been down this much just on greece. >> but are you concerned at all about the execution of the core business there? >> yeah because the strong dollar has dropped tourism in new york but the ceo of finish line says that the new york store is strong. i find it confusing. i mean i think buy to hold would have been better than buy to sell. >> that's an interesting call. >> i don't think that terra is

going -- the ceo of maycy's is wanting to have a talk. >> you'd think, will the empire be snook no. credit suites comes out and says this is the cheapest tesla has been. they're using a fiscal year $6 for -- this is ridiculous, for 2017. >> all right. $6 for two years out. and. >> and they raised the price target from $290 to $325. this is a well-timed report. no mention of how much better it is than priced bread but i'll throw that in. >> i saw one on the road which you don't see too often on the east coast here. >> many of my wealthier friends from teslas. and my aunt has a tesla charging station. >> i'm aware of that. a lot to cover. we'll hear from jean-claude

trichet and get you covered on everything. more coming up after this.

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you're watching squawk on the street. we are live from the financial capital of the world. the opening bell ringing in about a minute. this is when i turn to you when it's the two of us and ask you a question about our days together years ago. what is the key to this market? >> i'm going to say it's the banks. they have two cross currents particularly the international banks nature are they exposed to europe? we were coming from the earnings period believing that numbers could go higher because of the interest margin. we don't want that to go away but that's the key and jpmorgan is the most important thing. i see merkel seeing they received a generous offer. i'm not sure a person on greece feels that way. >> willing to talk further without the referendum. what does that mean? if they have a referendum and

say we're not -- we want out, what are you talking about? >> but maybe that's why they opened the banks thursday? maybe there's a little forgiveness here. maybe they're worried about greece going to the east? >> maybe. geo politics can play an interesting role. a lower open. hence a lot more red on the board. here at the big board, titanium dioxide manufacturer a spin off of dupont. over at the nasdaq, the fisherman's conservation dade the honors. >> you have to throw them back. people who don't throw tobaccoback the stripers, shame on you. >> and remember tio 2, our

tooth paste is white because of that. >> we have not discussed dupont since it won the battle and i'm curious. the spinoff, we've known this was coming. they wanted it sooner than it might be but there it is. c skr what you're cc is what you're buying that stock under. >> i wonder if nelson is happy with the performance and whether he doesn't try again. >> he could try again. they did not sell. some people thought they would. that was their threat in a way. interesting how that all went down with the index funds all voting in favor of dupont despite the recommendation to not do so by the proxy advisory firms. duh dupont was $80 not that long

ago. it's now $65. >> the core business has been tough. when i talk about the dollar it's what i worry about, number kutss. you had nike tradeing on friday. that was remarkable. they did not use the weak euro. the strong dollar didn't hurt them. there are some companies that can transcend it. dupont can't. they don't have the product portfolio to do it. >> when i walked in this morning and got home yesterday let's call it later in the day, i anticipated you might hear something on consolidation amongst the hmos, particularly at humana. nothing. nothing at all. >> that goes down today. >> sundays, you check your phone and make calls. nothing. don't know where things stand there in terms of except there had been something of an expectation amongst even people

close to the situation that you might get a deal. >> are there people who say we really shouldn't do this until greece? >> no. i don't think greece figures that prominently into it. you always want to pick a great day for the stock and inquirer so an up market helps. anti-trust does in the minds of humana right now given that wall street journal story today about how the anti-trust regulators are already looking or thinking about coming consolidation amongst the hmos. i pointed out if you get two deals, five to three, they will consider them together. >> yeah. >> not separately. humana shares are down as you might imagine. the entire group is down. the broader market is too. anthem still out there with the bid for cigna. we'll see what happens there. >> this is a market where it's just not that bad. my problem with not that bad is it's at long day.

midday there will be worry. we'll find hedge funds poorly positioned. another might be taking advantage and banging it out. >> the concern about greece is contagion. it's not about the economy of a country with 11 million inhabitants. >> it's for the bond markets and for those who own the bonds. i was speaking with people who do a lot of international work and i said is duch bankeutsche bank not the tell? down bad but not terrible. jpmorgan not great, not bad. i mean but there is down $0.98 for jpmorgan is kind of nothing. it's nothing. >> although we have the ten-year down in yield. there was an expectation again to your point, safe haven, you probably get the yields moving up. >> 2.25 for --

>> maybe you missed the goldman rally to occurs because it turns out that things aren't so bad. i like to wait. it's just a long, long day. >> and i meant obviously yield moving down with the price up if in fact that safe haven thing had come into play but hasn't that much. discovery had an announcement this morning. zroer shares up. that stock has been down sharply. a lot of the options are under water, mr. zaslav. >> should we be crying? he was one of the highest paid executives in the world. number one. >> it's always good to be number one. >> it is. it's good to be the king. >> it is good to be the king too. >> they announced a deal an important deal with the ioc to air the olympics on euro sport for 1820, 22, and 24. the ioc announcing a tv

multibroadcasting rights for the olympic games for discovery. when you think about disney and the power it has with the cable operators because of espn same kind of thing. you get leverage with the distributors when you have a lot of sports programming. they've been going down that road. internationally, a huge an important component of this overall company. we think about some of the channels here but international is more than 50%. i wonder if they'll try to split the business. >> would fox have been in the running for this? >> i don't know. >> i know that ge -- >> $1.8 billion. that's not a small amount of money. >> nbc is fabulous. it's been a great way -- that and sunday night football have

been fabulous. we work for comcast. >> yes. and sales there continue unabated that is from ge in terms of winding down the operations of the ge capital unite. that stock also town. >> are you surprised at how much the different units are worth? >> i'm not really surprised but i think they knew that there was that kind of value and that market doesn't seem to be particularly surprised but the speed with which they are disposing of them i think is extraordinary. >> it seems like almost every other week there's something. at a certain point that's going to add up to being a fantastic buy back. >> we're relying on a $30 million buyback or more that aannounced? >> yeah. and you also have the big plunge into oil. oil is having a big plunge. >> yeah. >> how could tesla be the blue

chip today? >> i don't know. >> merck, pfizer and tesla? >> i have it down a little bit. >> down a little. the rocket some people are saying -- >> why should it? >> it's just the empire. it's the empire. would the empire suffer? >> solar city? >> i think that was fach use, but i think the credit suite piece is a well-timed piece. the market can bounce back because we're not that reted to greece but let's find out where the debt is. get a little more info. there's no hurry. i wish that those hmos had made that deal. that would have made me feel like it was more imperative. i'm looking for deals in the oil patch right now. >> i know in energy and nothing says we're not going to get the announcements in hmo land. the question will be anti-trust. >> we have the broader market. everything on my screen is red. the s&p down less than 1%.

.84 % is what i have. what's the view from the floor this morning? >> the early indications is there's mild concern about contagion. it's important to watch the peripheral countries. let's put it up. this is not nothing. 3% or 4 % is notable but it's not a sign of panic at all. germany is down about 2%. the youreuropean banks, 4 %, 5% some of them down. there's the big names. you see the peripheral banks a little bit more down to the downside. and i wouldn't call it a panic yet. euro is only down.04%. gold is up 0.4 % as i was coming on the floor. it's basically unchanged as you can see here. not much of a move here.

s&p futures, weaker overnight but getting progressively better throughout the morning. this is s&p futures on friday and overnight as you can see, we've been moving up since the lows which were early this morning. in terms of sectors. nine out of ten lower but only fractionally. tech, maybe financials materials, all a little bit low lower. that's the worst i'm putting up. i think what's interesting is just how optimistic people are. these are the same people who were optimistic that we'd get the kick the can solution the next week. now you get a yes on the referendum national unity government, and then at this point, you make a deal with the creditors before the next big date which is july 20th date when you have the ecb payment. this is remarkably optimistic. i don't know how anybody thinks this is going to get done. i keep asking but everybody seems to think something can be done. i don't know how you negotiate

it before july 209s get a new government and a new deal with negotiators. it seems undoable at this point but the market seems to be saying some deal will be done. let's talk about puerto rico. what you want to look at is the obvious ones. you look at the financial guarantors mbia is notably down. mbi has 4 $.5 billion of exposure. assured guaranty as exposures. i know this morning we got a downgrade in bdit but those are down. and you have to look at whether there's all this general risk off feeling on puerto rico and you turn to the banks. popular is popular. there's a little bit broader concerns, and in a sense some people mentioned this this morning.

puerto rico may be an important water shed maybe more important than greece at this point. for china, the one thing i would add is that there was a lot of talk over the weekend from regulators or calling on regular you layers to suspend ipos. last week there was a flood of mu ipos and this was at least partly blamed for the decline in china. there's apparently some meetings with the chinese regulatory authorities sounding them out about that particular idea. also margin debt continuing to be a major issue. right now the dow jones industrial average down 139 off the lows. >> let's go to the pits now. rick. >> well, even extending and pretending seems to have an ending whether it's puerto rico

or greece and china, well keeps on trying to stimulate all this of course, creating an interesting blew but one thing is for sure. if you're looking for huge moves, you're disapointed, at least this far. big yes, huge large no. let's look at a two-day chart of tens. we're down a little shy of ten basis points. let's look at bunds. about the same thing and in the last eight trading days you can find lower closing yields. let's look at what's going on in the southern economies. look at italy. you can see their ten-year rate is up. 2.32. it's been higher. recently. same for spain. are they getting toward crucial high yields? yes, but in the grand scheme of things, six months ago they were higher. foreign exchange side in this is the side many traders on this floor say is where the tupt is. but opportunity is knocking at this point in time.

we still have a 1.11 handle. or look at the mirror image. the dollar index is mostly euro. maybe the one currency that not many are thinking about, i think bill gross gave it a shout out at the last fed meeting is the pay sayeso peso. but the dollar is about ready to violate significant historical highs. at this point in time it's orderly. the ending shouldn't be a surprise. what will happen in the referendum? my vote is they'll vote not to leave. will the banks open quickly? that's the tough call. back to you. >> that's right. referendum, of course, july fifth. let's get a closer look at oil prices. >> good morning. oil prices under pressure this morning along with the rest of the financial markets. down about a dollar right now. our morning is low. 58.04. that is the low side of the

trading range that it appears we've been stuck in. greece a potential blow to the financial markets. the confidence out there concerns oil traders. expect volatility also this week because of the iranian nuclear talks that are ongoing. if there were to be a deal we wouldn't see iranian oil come on for quite some time but they would brace for that down the line. lund berg survey saying gas prices are taking a breather. the national average at $2.86 if seasonally is very unusual. but also traders looking at the weather forecast. we are expecting to see rain and so potentially maybe some of the consumers are not going to hit the road. we'll see if weaker gas prices help them. >> lowe's corp. is up. you'll see kroger probably up. it looks like -- >> gas prices? >> yeah. what you're getting is that people want to buy.

they're saying that the home cycle is big. >> right. >> and the home cycle is big. the home cycle is the big story of 2015. household formation, going from 500,000 to 2 million over the course of about two years. people having kids. that's related to very clearly to employment, and people want to own anything that goes into the home and i think that that's a very positive trend for the market. some people say that will be kill bid higher rates. i don't think so. watch the term you're seeing in the hospitals because of the consolidation and in american retail. those are doing quite well. biotech does well because they have a deflationary environment. people are saying i'm going to pick my spots. if this market is up today, which anything is happening, that might be a good opportunity to sell not because of greece but i feel that if we get a strong employment number on thursdays, you're going to hear fed saying we may use the to the

end of july because it looks like greece isn't that big at all. >> there are plenty of things to worry about. the market not -- >> this weekend. >> it looked beautiful. it looked beautiful. >> did you like that? thank you. you, surrounded by the green. it was so tall. >> it's not marijuana. it's beefsteak tomatoes. >> right. sure. sure it is. sure. yeah. >> we have the ceo of tegna coming off. cars.com there she is. she'll be joining us for an interview later in the program. first you'll hear with christine lagarde told people about the crisis in greece. and here is a look at the markets as we head to break. we'll be back right after this.

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>> negotiations with europe the prime minister will resign. so even in the markets best case scenario here, we are potentially talking about a significant increase in political instability here in greece. people here hoping for a deal but it's tough to see where it comes from. >> joining us from athens. stay tuned with a live interview with jean claude trichet. that will be in the next hour. as for the end of our hour, it's going to be stop trading with jim. "squawk on the street" will be right back. e me cargo, same size, same power. which one arrives first? hint: it's not the one on the left. the speedy guy on the right is part of an intelligent system that creates the optimal trip profile for all trains on the line. and the one on the left? uh, looks like it'll be counting cows for awhile. so maybe the same things aren't quite the same. ge software.

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keep going up. >> rbc says things are better. watch this stock was apple when numbers go higher, the stocks should go higher but this is an am on the watch isn't selling that well. it's an iphone story. i think the watch is selling as well as it can given the fact it doesn't have loofta lot of features yet. >> my favorite is a granny

smith. that's kind of sour. i love that kind of apple. what's on mad money tonight? >> i'm going a greek game plan, and i have greecestocks that work that will shock you about what to buy off of greece. >> love it. mad money tonight. jim back here tomorrow morning with me. coming up jean claude trichet. he'll have his thoughts on the greek crisis. keep it here. new onsibilities? one thing can't tell you, but the right combination can. universities are using ibm analytics to understand pressures in and out of the classroom- some expect to cut dropout rates by twenty-five percent. ibm analytics is working to make education smarter every day. ♪ i built my business with passion. but i keep it growing by making every dollar count.

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good morning and welcome back to "squawk on the street." as far as the markets are concerned, down 132 points on the dow. greece front and center and puerto rico. we are off the lows. >> breaking u.s. economic data. let's go to washington with breaking news on pending home sales. >> pending home sales up 0.9% in may, month to month and april's reading was revised down. the street was looking for a little over 1% without the revision. the index of signed contracts to

buy existing homes is up 10.4% since the highest level of april of 2006. sales may have been affected by a jump in interest rates. the rate went from about 3.4% to just over 4 3k9 from mid april to june and while that doesn't seem like a huge jump, it hurts affordable affordability affordability. in the northeast it's audiotape 10.8%. up 7.8% from last year in the south, they fell 0.8%. up 10.6 over last year in the west sales rose 2.2% and are 13% higher than one year ago. closed sales in may for higher than expected but those represent contracts in march and april before rates moved higher. if you'd like to hear more from realtors n it's online.

>> thank you. let's get back to greece. in the dead of night, an announcement that the greek banks will be closed. our chief international correspondent is live with more in athens. consider here we go. that's one way to put it for sure. we want to bring some clarity to headlines that have broken in the last half an hour or so. there were reports that the greek banks were going to reopen an thursday. it could be that the doors will physically open on thursday, but it's only to pay pensioners. it's not to be able to get your money out if you're a greek citizen. the capital controls will remain in place. things could change. the ecb is going to meet on wednesday to decide what they're going to do and by then they'll know two things for sure one way or the other. did the greeks pay or not or did they get an extension on the i

agreement. right now both of those things look unlikely. we have to get through those days to find out. banksing opening on thursday, doesn't mean the capital controls will go away. we're seeing already an impact on tourism. tourism is a huge, huge business here in greece. it was $16 billion worth of receipts in 2013 for an economy that's only $242 billion. a fairly large percentage. the tourism association put out a statement today saying it is having immediate real negative consequences on the tourism. they are urging the government to come to a deal. so there's not an effect on the

tourism. >> we will talk to the head of the chambers of commerce in about 15 minutes on the program. michelle, what is your sense as to what the prime minister is now doing? is he still acting in good faith and this is in his eyes, a form of negotiation still with the rest of the creditors, or is it something different? we should remind ourselves this is a left-wing prime minister, arguably part of the party is from the hard left. what is going on? >> reporter: do i think the prime minister thinks he's still negotiating at this point in absolutely. i think he saw the referendum as a negotiating tactic and he says the petition to get an extension from the ecb or some kind of an extension on the agreement as a negotiating tactic. the whole thing -- through this whole process, the europeans have set false deadlines.

the last chance meeting is this. the last chance meeting is that. i don't think the dwreekgreeks ever thought the last moment was going to be until the 30th when they had to pay the imf and see if the agreement would be extended and this referendum was a ploy to get him three more days beyond the agreement and hopefully support from the ecb. he didn't count on how tough the europeans were going to be. >> good to have you on the ground. thank you. >> greece is front and center for markets around the world. stocks are falling. oil, the euro, all sliding all largely over fears of a grease default and possible exit from the eurozone. the dow down 115. let's bring in the city's director of european and global economics published over the weekend. you and your team led by someone we had on last week do not see a

grexit. why? because you see the greeks voting yes to the bailout to the euro? >> at this stage developments are fluid we can't be all this certain about the next likely developments but where we stand today, it would seem likely that at least the referendum will take a relatively benign outcome so the greek population would vote in favor. and that would lead to negotiations that could produce another agreement which would stave off the grexit for the rest of this year. but we've opened pandora's box at this stage. at every stage of the process there are fault lines. i think things might with go astray. >> lots of uncertainty. watching the euro, sharply off the lows of the session overnight. we dropped below 1010.

why do you think the euro is rebounding? is it about hopes about greece won't have to exit? >> i think people agreem. that the referendum is on a plan that does not exist after midnight tomorrow. and so it's not clear exactly how you go from a referendum to a greek exit. the weakness in this does seem to be the greek banks. a lot of money left in greek banks over the weekend and the ecb is not giving more assistance. that becomes the weakness. but i think they're many steps down the road. >> if the greeks do exit, who is decision will it be? will it be the european central bank or the greeks themselves in this referendum? >> i think at the end of the day it will be a decision by the greek government and to some degree the greek population at large work but i think of course the position they will be

put in would be very difficult. i think as was mentioned, the banks are already closed. liquidity will be increasingly tight starting from a position where it was already scarce and there's only so long a economy can survive under such conditions. i think if we don't see a move toward a more benign liquidity environment, then ultimately, i think a greek exit will be unavoidable. >> this is not something that people have not planned for or thought about. i know that the dutch and the german banks have said that they have systems and protocols in place. what is your considered view of what the european central bank will do in order to prevent any contagion to the likes of poert gull and pain.spain. >> will it left markets here? >> i think there's absolutely no doubt that the ecb will do whatever it takes to safeguard the remainder of the eurozone

but i don't think it will be preventative. i think it might well be reacting to signs of major contagion contagion. for what it's worth, i think this day in europe has shown that markets haven't panicked so far. and it might be because they think there been a relatively good resolution -- >> i'm sorry to press you on this. you guys have pretty clear ideas what you think will happen. that's your business. do they go directly financing the bond issue and solve spain an issue? what is the scenario that is likely in your view? what do people like about? >> i any terms of policy support, i think it will be an expanded use of lending to banks and the ecb has also widened collateral, and there's plenty of room and then there's different types of asset purchases. they can increase the size of

the qe if you like the macro picture that looks worse and it can create new programs. the european court of justice give the ecb a lot of discretion to design things that it deems consistent with the monetary mandate. there are a lot of things the ecb can do that we think could be realistic. >> the euro is about to go positive against the u.s. dollar. do you sell it? >> i'm not sure the ecb does come in. in order to trigger the omt the individual countries have to apply and get onto an aid package which does not seem like a good idea. i would look for the euro to firm up a little bit more. try to sell it earlier today. i think the euro over time will continue to erode and i will look for further selling ahead of thursday's u.s. jobs data and ahead of the referendum next

sunday. >> thank you, gentleman for weighing in on the euro. good to see you both. >> let's bring in the director of floor operations. the dow is only down 123 point and the price in itself is a wakeup call to those of us that were so concerned at the impact this could have here. >> i think what's happening is the dow is measuring what's happening in europe. the closer you are to greece, the more dramatic the event. and there's a couple of things going on here. we're in a great case of the theory of games. tsipras really needs markets to be destabilized. that will put pressure on brussels to say if these thing goes over the cliff things could get worse. he's caught between a rock and a hard place. but they haven't gone off a cliff. where are we?

secondarily, she'she's decided to call for a referendum so he can't get blamed. the difficulty, if they get a yes vote, he'll wind up resigning and i'll bet you will not find another person to take leadership of greece because nobody wants to commit political suicide. >> there will be a national government, come on. there are good people who will step up to the plate. >> i understand that but all of the current politicians believe it is suicide to put in an austerity program. >> but the point is this market will sail on unaffected. >> not spirely unaffected. they're looking and secondarily we have other things to worry about. as i remarked off camera, we have puerto rico and china. i'm more than a little concerned about china. they cut rates and sold off anyway. and today is the first anniversary of isis declaring

itself a caliphate. not just financial things. i'll be happy when today is over. >> given all the time we've been worrying and wondering about greece, doesn't today's action tell you that concerns about real contagion if the worse thing happens are overblown? >> it would appear that they are an extreme but to sara's point earlier, i think the euro is strengthening because people have come to believe that either way the euro does all right. with greece out of the currency, it is basically a stronger currency. and if they get a sigh of relief rally, it'll do all right anyway. >> not only that. i read about this. a chief economist made a point that never have the european politicians been so united as they are right now in fighting that what we called the voodoo economics of the greek government and there's the idea that if greece had to go, they

would add in further fire walls and strengthen the structure of the euro so it doesn't happen again. >> those fire walls have a rope off the rest of club med. you have to get portugal, spain and italy taken care of. >> i brought you a present. i brought you drachma which i have, actually, unbelievably, some drachma. >> to the broader point here. both failed because of runs of banks. and it's runs on banks in italy and spain not others that can do this. >> you're right. we had this discussion a couple of weeks ago when i said you'll see things are coming on greece when you see the run on the bank. we've gun to see it and if it spreads, that's contagion. >> great to see you. >> up next, hard to believe there are two trading days. and despite today's decline the

s&p is positive this year. what is ahead for the next six months? we'll talk about that and then later, you couldn't ask for a better day to have jean claude trae trichet. he's joining us live. the former president of the ecb. find out what he thinks will happen next.

. >> the s&p airline sector has fallen. we're taking a look at it. >> good morning. intriguing question given the fact that last year airlines really you couldn't have found a better place to invest if you were out there looking to find the sector that was going to take off and it's been a struggle so far this year. the question is what can we expect in the second half of this year. you have to separate the investment in airlines versus the business of the airlines, because profitability is expected to remain strong in the second half of this year. bookings, demand they're at high levels. no falloff being seen at least for the next three or four months. the one question is will fares rise. they're expected to inch a little bit higher although many are expecting how much of a resistance there will be. take a look at the index. it was loved last year. it has not been loved in the first half of this year. in part it's a sell off after a

run off last year. also a question of whether or not this industry is hurting the revenue per available seat mile. take a look at the other interesting story in the second half of this year. it has to do with the open skies debate particularly when it comes to the middle east airlines. we're talking about emirates, qatar qatar, these airlines along with three u.s. airlines they're battling over the whether open skies should be changed in washington. the carriers are fighting back. the president of emirates will be in washington d.c. tomorrow with his response that the middle east are unfairly subsidized for billions of dollars and that affects the competition. they have been down over the last since months. let's see what happens in the

second half of that this year. >> we'll keep on eye on it. thank you very much. up next, banks remain closed in closed today. what does it mean? we'll talk to the president of the greek chamber of commerce when he come back. ery auto insurance policy has a number. but not every insurance company understands the life behind it. ♪ those who have served our nation have earned the very best service in return. ♪ usaa. we know what it means to serve. get an auto insurance quote and see why 92% of our members plan to stay for life.

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let's show you the action in stocks. lower across the board with the dow down 130 points at this hour. s&p down about eight tenths of a percent. heading back south. the nasdaq also down a little less than 1%. watching the euro off the worst session lows overnight. but it has come back lower just a bit. all of this, of course, on concerns that greece which was already a disaster took a turn for the worse over the weekend

with the referendum called and the ecb caps the liquidity assistance. >> you could see it's a muted response. straight ahead on the program the euro has dropped but what will happen if there really is a grexit and a live interview with the former president of the european ecb. what will the ecb do now and can you buy potentially more qe? can you tell what makes them so different? did you hear that sound? of course you didn't. you're not using ge software like the rig on the right. it's listening and learning how to prevent equipment failures, predict maintenance needs, and avoid problems before they happen. you don't even need a cerebral cortex to understand which is better. now, two things that are exactly the same have never been more different. ge software. get connected. get insights. get optimized.

good morning. here is your cnbc news update. the new york governor telling cnn the escaped new york convict that was shot has been downgraded to critical but stable condition. david sweat was shot and captured when he was seen a mile from the canadian border. secretary of state john kerri was tight lipped after meeting in vienna saying it was too early to say anything about the nuclear talks. egypt's news agency says the prosecutor general has died from a bomb attack. the attack came as security forces went on high alert on the eve of massive islamist

demonstrations. and the supreme court diving back into the fight over the use of race in add missions at the university of texas. that's the cnbc news update hour. back to you guys. >> more than 20 million tourists travel to greece each year. many of them from this country and many of them worried about the headlines they're seeing in athens. joining us from athens is con. before we talk about the practicalities of traveling to greece at the moment, what is the atmosphere on the ground with the banks closed and likely to remain closed all week in. >> this is an extremely negative development. we're all led to believe that by the end of last week or at least during the weekend there would be an agreement, a done deal, as

we say between the governments. instead, i think that everyone, not just in greece but also in bruszles and other european countries were negativity surprised by the prime minister's decision to take the country to a referendum this sunday, a referendum that in my mind is extremely difficult to be executed in the sense that there is very few days left and we don't even have the ballad papers or the paper perhaps to be printed on because we need at least 20 million ballad papers as the greek constitution stipulates should be at all ballad stations five days prior to the referendum date but we don't even have the question that's going to be put forward to the greek electorate. >> can you describe to us the conditions of doing business? right now 25% unemployment.

half of the youths in your country are without a job. if the banks are now shut down, how do your members continue to employ people? have they hoarded enough cash to do that? or do more people get laid off over the week? >> extremely difficult to operate a business in greece at the moment as you can imagine. the bank was deposited withdrawals is drawn out bank run over the last three and a half month. although there may be quite a few greek citizens holding cash either at home or any other secret place the problem is that the electronic, european electronic remittance system, the so-called target two which effects the relationship between foreign and local splooiupplies are not operating. and we're reliant on import trade. we need at least for main sectors of the economy such as

food items and pharmaceuticals to have the exemption that needs to be decided on by the ecb so that we don't have serious problems as far as food and pharmaceuticals are concerned in the coming days. >> in the meantime, what about tourism? i think it's crucial in these summer months. tourists are exempt, i understand from the 60 euro per day limit which applies to everybody else on the atms. is there any cash left in the atms as you can see it and will tourist credit cards work? >> for the next week, i don't envision any problem as far as the atms are concerned about the credit card system for tourists. you're right. tourist in greece is the heaviest industry that we have, and we need to support it at any cost, and this is the main reason they we'rewhy we're applying

for the exemption so we can supply the necessary food items which will -- not only just for local population but also for the visitors which are the moment are reaching a record level. if we didn't have the problem we were facing today we would be looking for a third consecutive record year for tourism, and i do hope that despite the temporary problem, at the end of the day we'll be able to achieve that at the end of the season. but it is important for the government to realize that even at this hour, they have to sit down with the european partners and lenders and try to strike a deal even at this last hour of greece. >> thank you for your time, sir. from the central union of greek chamber of commerce. >> my friend is on vacation in

greece right now. the big question is what happens with the euro. remember the famous i'll do whatever it takes speech. in the speech he said we think the euro is irresponsible.versibleirreversible. there are two key questions this morning when it comes to the euro. will greece leave and what happens if he does. plenty of notes to digest over the weekend. greece's referendum for all intents and purposes is a vote in and out of the euro. it looks like if greece leaves, it will be because they choose to not that they were kicked out. experts don't think it's probable but it seems possible now so what happens if greece does leave the euro? short-term pain. they told us it was irreversible irreversible. now greece may be proving it's not. no not to mention the precedent it would set. europe has a fair share of weaker members. watching in the bond market will be key. that's important because no matter how tiny greece is, the euro is massive.

if you look in the short life span of 16 years, it now come surprises 22% of all currency reserves in the world. it's the second most important currency for trade and trading. but the long term impact, it could be stronger in the end. the euro could emerge unscathed maybe even stronger if greece has to leave and the ecb has proven it is a crisis fighters. it has the tool. it's not afraid to use it. that could put a stop to the contagion with or without greece. the bottom line is this. the risks are rising but there is good reason to believe that the euro could survive at this point, several years later a grexit and even thrive afterwards. >> wow. we'll see. >> it's sort of a compilation of a lot of research notes out there and a lot of the thoughts out there. academically on what happens

with the euro. not what happens one day to the next but the actual cohesion of the euro staying together when all the promises about the fact it was irreversible get walked back. >> up next, jean claude trichet will join us live for an interview when "squawk on the street" comes right back. if you qualify for a sittingham's card today i can offer you no interest for 24 months. thanks to the tools and help at experian.com, i know i have an 812 fico score, so i definitely qualify. so what else can you give me? same day delivery. the ottoman? thank you. fico scores are used in 90% of credit decisions. so get your credit swagger on. go to experian.com become a member of experian credit tracker and take charge of your score.

concerned about market valuations? well, on trading nation we'll show you which companies have had the biggest jump in valuation in the past year. go to trading nation online. more "squawk on the street" right after this.

let's get to rick santelli. an important guest for us. >> thank you simon. former president of the ecb, jean claude trichet. thank you for taking the time on

this most interesting day and of course, interesting is stretching that description. >> it's a pleasure. >> all right. you know, another jean claude over the weekend, jean claude juncker head of the eu said the following. i have always said we have to pay more attention to the social fairness of our programs. i don't imagine that any agreement can be made for the greek people through the political process of the structure of the eu without having the population of greece saying whether they are for or against it. your thought mr. trichet? >> well, i think that we have three political problems. one is the greek political problem which is of extreme importance. of course, we are speaking of

the adjustment program of greece. the second problem is the taxpayers of the other countries in europe which have helped greece up until now and then you have the political problem of the imf the international community, and the three political problems have to be solved. the three of them, and that is the difficulty of the case. >> with regard to the imf mr. trichet, it certainly seems as though the countries that contribute to the imf fund are certainly on the line and that a default by greece will not be found. did the imf go too far? >> nobody has any interest any stake in the imf going too far or in the greek or the european counsel going too far. it's a question of you know, having an agreement that would

be acceptable by all but fancy the dmif is gathering countries that have a standard of living much lower than greece, and have helped greece considerably. the same in europe. even the countries in europe that had difficulties made a enormous amount of loans to greece and as you said, you're right, we have the greek issue the greek problem, and the capacity of grease to go back to jobs. which means in any case, we need a good, credible plan, a plan which would be credible by every, i would say partner in the world. >> mr. trichet as i look@the markets. given that some are under pressure on the equity side, the most of the world seems fairly orderly. would you say that the reason we are orderly is because a yes

vote on the referendum to be held on july fifth is being priced into the marketplace? would you agree with that or is there another set of circumstances that would keep the euro close to unchanged and u.s. and some of the markets in asia somewhat less than responsive to what's going on in greece? >> first of all i trust that the euro as a currency has proved remarkable resilience in the worst crisis since world war ii of the advanced economy not only in europe but also in the u.s. and other countries. from that standpoint, i think the confidence in the euro is not touched at all. what is likely at this stage in any opinion my opinion is that most observers do not know and are not pricing in either yes or no. we really don't know exactly what is the political chemistry now in athens.

so in my opinion the reserving of the market today but it might change tomorrow and the day after, is all taken into account even if we are in the worst possible situation. it won't touch dramatically the euro area as a whole and that seems to me the main extra nation. . >> final question, sir. if i look at the ecb and the countries as the children, dealing with greece has big ramifications for portuga spain, italy is this, in your opinion, a big consideration should there be an exit by the greeks or actually a vote to stay in? either way do those countries and other southern european economies, will they become tougher to deal with? >> if you compare with the euro

ten and levin that i have known well myself as president you have all the other countries in a much better situation. they did all of them, very good work in adjusting reinforcing their economy and they are back to growth and job creation. so i think it's the main issue is that the other countries are more resilient, but i don't suggest at all that it would not have consequences and the main consequences for me, of 1993geo political nature because of the prax approximate immateriality and because of the strategic position that greece has eve. >> if you were still at the ecb and you sat around in the table in the governing counsel now and they said look, greece is going. let's say that greece is going how would you protect the rest of the eurozone from the

contagion? how would you prevent people in italy and spain and portugal from thinking that maybe they should withdraw their euros from their local bangks, perhaps at the next local election at their country? >> really, i don't think at all again, that the situation is the same. these countries have reinforced their own situation which is the key for everything. then you have the omf to the central bank and the action that have been justified by the threat of deflation but also, perhaps, useful in those circumstances, but all taken into account, i would say the main problem is a greek problem. it's not the problem of the other countries. both i would say politically and economically and financially. >> but don't you think that it would be a dangerous precedent to set that the euro once called

irreversible would no longer be so if things become worse in five or ten years that could be a precedent that is set by greece? >> i was told that from the very beginning when we created the euro in '99 when we had the start of the crisis with the sub prime, when we had lehman brothers and, and and until now. what happened? four new countries entered the euro area after lehman brothers. four new countries. so this idea that the euro is about to evaporate or collapse, which is in the air since the very beginning is wrong. and i am really absolutely convinced that we have a stress test to prove that. again, four new countries entered after lehman brothers. >> so mr. trichet what does the eurozone do with these countries or any country that can elect a

government that attempting to black male everybody else to use the words that i think angela merkel used with a threat of some form of contagion? do they need to make an example of those that actually threaten the fabric of european institutions? does greece need to be made an example of? do you have to see pain in order to prevent others from attempting to do the same? >> two comments. first, as i said, this is a problem which is very grave for the greek people first so anybody should not take advantage of the situation to expel greece. it would be a very bad move, first. second and that is, again the reason why your question is very good. it's true that until now europe has been both a multipartisan and a multinational endeavor.

multipartisan, multinational, and it is clear in this special case of greece that there is an attempt to get out of the multipartisan multinational endeavor. but we will see again. >> mr. trichet last question. rick santelli, i truly believe that there's a form of political aggression by the leadership like merkel that seem to want to impart their will on countries that have their own sovereignty. i understand they accepted loan, but do you not believe that the greek people should have a say on how burdened are they have in the future. they should be able to chart their course if they're still a free country? your final thought? >> of course. in any democracy, the final say is to the people of that democracy. that's absolutely key.

that does not prevent the european endeavor. after world war ii to be based upon an endeavor which is both multinational and multipartisan. that being said also, don't forget you have the greek democracy which we are v to respect fully. you also have the 18 other democracies in europe and we have all the democracies and decision-makers of the world and we are speaking of an issue that puts around the table, the your world, europe, and greece. >> thank you former president of ecb jean-claude trichet. thank you very much. sara, back to you. >> more breaking news this hour from the supreme court this morning. we are live outside the high court with the latest on the rulings. >> reporter: a huge victory for

the electric utility. 5-4 ruling that the government and specifically the epa should have taken into account the impact of cost in pro-mullcreating greenhouse gases. the majority opinion from justice scalia saying in part the epa went well beyond the bounds in concluding that cost is not a factor relevant to the appropriateness of regulating power plants. he goes on to say, it is not a ration never mind appropriate to impose billions of dollars and economic costs in return for a few dollars in environmental benefits. also while that opinion 5-4, again, says the epa should have considered costs, it also says and that's according to the current law, it's up to the epa now to go back take a look at a regulation frankly that was due to go into effect next month and

now figure out how to account for those costs. as we said the supreme court wrapping up a historic term today, and that was the final case of this term. back to you. >> indeed it was, hampton. we're taking a look at some of the stocks in question which are benefiting certainly the co-producers which have been so beaten down and such low-priced stocks are up sharply. hampton pearson. ginnett is spinning in two. the new publishing company is keeping the gannett names and are now part of a new company or a company that is newly public called tegna. that is the spin from gannett. joining me is the president and ceo. nice to have you with us this morning.

you have 46 stations career.com, career builder. tell us about this new company. >> thank you very much. just one minor thing. we actually are trading up this morning about 5% from where we opened so we're very pleased with the difficult market that we are in fact advancing. with respect to our assets we have 46 tremendously placed television stations that will continue to see great growth going forward in 2016. we have an olympics and then an election year where we expect there to be record political advertising spent and we are incredibly well positioned in key states to really benefit from record political spending. on our digital side cars.com has relationships with over 20,000 dealerships across the country. there's a lot of tail winds behind automotive spending. we expect that to continue to be a strong double digit growth business as well as career

builder is pivoting its business more towards software as a service, and we see them reaching double digit growth rates in 2017 and well beyond. >> retransmission fees of course are an important part of your stream and contributor. you said last week i think, when were you making presentations on an investor day on the new company that as those come up for renegotiation you believe that there's a gap between the value of the content you provide at the local stations and what you're paid for that content. why do you think that gap continues? >> i think that originally frankly, we didn't get paid on appropriate value for the distribution and the value of our content, our local news content, and other programming that we provide. we have 90% of our subscribers coming up between now and the end of 2016. we believe that we will successfully, again, readjust

those fees upward to better reflect what we believe is a gap between the value of what we bring and the fees we are generating. we see other sports programming that actually achieve much higher fees with a much smaller audience. we believe that is going to continue to be reck at thistified over the coming years. >> people still watch the local news? why bother when you have the internet? >> our television local news is the most watched and the most consumed news across anyway of the platforms out there. and we have the ability through our strong local news content to continue to provide that. tv is really a very big megaphone, and we are also participating in all the other platforms. so those additional platforms, whether they be ott or whether they be social media or other

platforms just simply expands the audience that we are reaching with a great local content that we provide that engages consumers. >> right. you mentioned ott. of course the proliferation of these new streaming platforms seemingly every day we get. >> new one. how do you figure out how to get paid on those? do you get paid from your network partners? how does that evolve from the local stations? >> we'll work closely with our network partners particularly on technology and platforms. we will have to see how the economics of that are negotiated. i think the one thing for sure is that unlike what happened with the cable and mvpds where we lagged in the value of the content we were providing and the fees we received i think we were all focused on making sure that we collectively between the networks and ourselves, local tv stations, are appropriately paid for the value that we bring. and we are heartened when we see

an apple tv and sony and others. we talk about the fact they need not only network content but they also very much need our content. we think we provide a great combination of the two. >> yeah, well, it will be interesting to watch how that evolves. we have a big potential spectrum auction next year. doesn't get talked about as often. it's the local tv broadcast. you have the spectrum for free and you get to sell it for a lot more, but how is that going to figure into your overall capital plan? >> we did get the spectrum for free but there have been things that we do in return for that spectrum so we every year and every day provide a lot of public service content that makes that content not necessarily free. but, more importantly, i think with respect to the spectrum option, gannett stations are not in high demand areas like the i- 5 corridor on the east coast or

up and down the san francisco to l.a. border. we do however, believe that there are some finite opportunities for us both from the standpoint of the spectrum option but as well through channel sharing that i believe with the relaxation of some of the rules that were originally proposed by the fcc could lead to some good opportunities for the gannett television stations. >> a big day for you and of course for shareholders of gannett with the stock up as you pointed out. the ceo of tegna. thanks for taking the time. >> thank you. best performer right now gannett. let's send it over for what's coming up on "squawk alley." concerns about what will happen with greece. the s&p and dow both down less than 1%. china's ipos have been suspended. we'll look at why and also report that google's manipulating searchers in a way that's not so great for consumers. all that and more coming up.

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