2015 and squawk box begins right now. ♪ >> live from new york where business never sleeps this is squawk box. >> good morning, everybody. welcome to squawk box here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin. iran the u.s. and five other world powers reaching a deal. promising to curb it's nuclear program. economic sanctions will be eased. here's how iran's foreign minister described the deal in a news conference about an hour ago. >> i believe this is a historic moment. we're reaching an agreement that's not perfect for anybody. but it is what we could accomplish and it is an important achievement for all of us. >> the agreement itself runs more than 80 pages in length. it limits iran's nuclear

production for ten years and access to nuclear fuel and equipment for 15 years. iran has to approve to the international international energy agency that it met it under the terms of a deal. take a look at what's happening with oil prices. they're down by about 2%. this is coming because iran's oil is expected to be coming back to the market. that's putting wti at 5118. not everyone is happy about today's news. officials are condemning the deal. benjamin netanyahu says it gives iran a surepath to nuclear weapons. here in the united states congress now has to approve the deal and it's expected to be a tough sale with many lawmakers saying they date of birthon't think it's close enough. president obama will make a statement on iran from the white house. that's coming up at 7:00 a.m. eastern time and we will bring that to you live when it

happens. our chief washington correspondent joining us on set to talk about all of this. this is a deal that's a long time coming. many people thought it would not happen and we saw several deadlines missed along the way. how good of a deal or bad of a deal is this and how do we enforce it? >> most observers agree it's not a great deal. the question is compared to what? if you don't have a deal iran is relatively close to break out capacity for achieving nuclear weapons. this tries to slow that down. the alternative is to either allow that to happen or have a military confrontation, third option would be continuing sanctions for a longer period of time but the -- this president believes this is a chance to change the trajectory of this relationship and have a longer lasting effect on iran's nuclear

capacity with this. the interesting thing about congressional approval is they can stop it but they would have to override his veto. if they say no he could veto that measure. they would have to override that veto to stop the deal. so his odds are pretty good. >> an override is 2/3rds. >> how many? >> 290 in the house. so his odds of sustaining the deal are pretty good but he wants to get an affirmative vote which is going to be tough. >> do you ever think -- i don't know if anyone thought the deal -- did you ever think it wasn't going to get done? >> it's quite obvious. the president kept trying to win over cynics saying i will walk away from a bad deal. then he said 50/50 and then under 50/50. >> but that's the language. nothing is a bad deal. >> i agree with you. he wants this badly so that's actually a burden for him in

selling it if people look at this and say we know he wanted this so badly. >> there were reports that iran was cheating trying to get access to differ materials for nuclear issues as recently as a month ago. if that's the case why should any american feel secure with a deal like this? not just americans but our partners in the region? >> i cannot touch for the verification procedures in the deal. first of all i don't understand them but i don't know what they are. but he has said unless this deal can be verified in it's capacity to limit -- prevenn iran during the window to get a nuclear weapon and slow it down afterwards. >> can you explain to the extent you understand how it works? what the ten year window is and five year window is and what can be done during that period? >> iran is not destroying it's nuclear facilities. >> right.

>> what it's doing is moth balling them. dismantling some components so they can't get further toward achieving a nuclear weapon during a ten year weapon. in return sanctions are going to be lifted on oil and financial sanctions. the administration says that if the verification procedures for seeing these facilities are moth balled are are violated they can snap back the sanctions. that's a challenge. we don't know whether that's actually going to be achievable? either the verification part or snap back part but that's part of how the administration is going to try to get these to congress. >> how quickly can we pull back from all of this if we get anxious that we're not getting what we want? >> we can put back quickly. >> is it just our decision or with the european partners? >> that's the other dynamic. pushing the president toward embracing the deal. their argument is -- if the argument is no deal means

continued sanctions indefinitely, their argument is you cannot do that because you have is too many people that want to do business with iran that are going to back out of sanctions. that are going to stop supporting sanctions so you can't sustain that regime. that's part of their argument. >> but the iranian people have had good thoughts at least the younger generations toward america. do you think that's the case? how long does it take before those younger generations are in the positions? >> that's part of the hope of the administration. this is a president that came to office saying what he wanted to do was have a different approach to diplomacy. the bush administration had 8 years. they didn't stop the nuclear program. the question was on the table, pushed especially by vice president chaney do we have a military confrontation with iran? this one said no we're going to engage and negotiate. he changed relationship with cuba and now he is trying to do this in a durable way with iran.

stakes are higher. this is a more dangerous region and a more dangerous particular situation and we'll see whether he can persuade people. >> what happens is not only right now with the rest of this administration but what happened with the new administration whether the tone or tener changes and what that means. >> it's an executive agreement. but there's people that said we cannot enforce what we can already do on issues. someone else comes in and has tougher thoughts on these things it could change the entire tenner. >> a new president could with draw from this deal. so it is -- is it durable enough to out last his presidency. is it too hard for somebody else to say differ approach to iran than president obama struck. that's all of that is on the table and that's what this summer will be about. >> thank you very much. >> are you sticking around? >> i am sticking around.

i got some political news for you. >> i hope so. are you going to talk about the speech yesterday? >> i will talk about the speech but i'm really talking about john kasik who is the new entrant to the republican race next week. scott walker was yesterday. john from ohio very intriguing politician, spent time in washington. spent time as a television host on fox. worked for lehman brothers. >> i know. >> now into the race. >> are you going to do a deep dive on all 19. gives you something to do right? >> it does. >> that's good. everybody needs something to do. >> some of them are more serious than others. >> how do you know? you have 19. >> i'm looking at jeb, walker rubio. >> you have a lower bar than the debate -- >> then i can look at jim gilmore, the former irs commissioner who is running. >> jim gilmore?

>> i can make some -- >> that's what you call them right? >> no that's not true. >> contrary to what i have been watching on some of these -- who have you said no to? >> i haven't gone through the list yet but have not scheduled one with donald trump. >> he's number two. >> he's in second place. >> he's the one guy i would. >> and you won't put him on your best seller list either. that's cruz. i'm confused. have you done cruz already. >> i did cruz. >> great one with cruz. >> i remember. let's check on the markets this morning. last i saw they were down fractionally. that's what we're seeing right now. down about 7 or 8 points. yesterday was interesting in that we maintained a 200 point up move even though everybody is saying wednesday is not a done

deal with greece although it's so weird that the austerity measures are worse than what tsipras initially rejected but he might have to go across the aisle which we never do in this country anymore but go across the aisle to get the deal done. we'll see if it happens tomorrow. giving back a little bit after a nice move as well yesterday. probably will refocus at some point to see what starts happening over in china again. a lot of interesting pieces today that i have seen that this really does kind of have a lot of people questioning whether everything is is going as well as he hoped. this is a blot on what's happening in china. here's what's happening with iran today with the deal being done. threatening that at some point. we'll see. but 51 today. take a look at the ten year and get through these quickly and move on. ten year 243.

it was interesting that the yields started heading higher after greece got settled because it won't give the fed an excuse to delay again in september. even though some of the members obviously, just act like there's a nice disagreement and discussion so we'll think they arrived at the right decision when they finally do. and 1153 and gold hasn't done much. it's two years at least on that. a rise that everyone forecasted at 2000. took a wrong turn at some point. we're still down. much closer to 1,002,000. >> let's talk about the big corporate story of the morning. china's state owned unigroup is reportedly planning to make a bid for the u.s. chip maker micron. the wall street journal with the offer price at $21 a share. that's $23 billion in total. it would be the biggest chinese takeover of a u.s. company.

previous record a $7 billion takeover of smithfield foods. tsinghua is the largest chip design company. it had a majority stake in the chinese server and technology unit and news of a planned bid for micron came hours after david einhorn augusted that micron would be worth more than netflix. he has been a fan for at least two or three years. >> but he is not a fan of netflix. >> he said something like red ink is the new black. >> but he did an interview with scott -- he was on the micron band wagon for quite sometime if i remember. >> other global market news greece remains front and center. michelle joins us from athens this morning and the front page of the financial times this morning is raising questions about this. it says tsipras faces rebellion

in athens after accepting that 86 billion euro bailout. what's the mood there? >> he faces rebellion within his party and he will have to reshuffle his cabinet but he's still going to get the votes. the opposition is going to go along with him. he'll lose a parliamentary majority but all paths lead back to him and to passage even if it gets messy. the other story with a lot of attention is the former finance minister, he is back in the news because of an interview he came to a magazine called new statesman in which he admits he had a plan for grexit ready to go and he was ready to print iou's and hair cut the ecb and seize the sennal bank here and he was saying in the article

that this was about getting an even better deal out of the negotiators and creditors when a lot of people read that and think, gosh we would have been going to grexit more than a week ago. if that plan had put in place it wouldn't have lead to a better deal from the creditors. it would have pushed greece into the abyss in terms of leaving the euro. >> michelle just in terms of what he is now recommending people do tsipras is now coming back and saying this is the deal we have to take. the rhetoric is gone. he is saying this is the best possible situation after calling them blackmailers just a few days ago. is he on board with that at this point or is he stoking these names? >> hard to tell because this interview was done before the

deal finally done over the weekend. i can tell you that on the ground it's mixed. the people that voted no and wanted no and wanted to leave the euro still want greece to leave the euro. there's a couple of sound bite where is they said wow, these guys pushed it as hard as they could and this is all they've got. there must not be a better deal to be had. so tomorrow is when the vote is going to happen. there's going to be a protest in front of the parliament. how big it gets who is involved, that's going to tell us to what degree there's really a sense of unrest that could happen as a result of putting in place all of these reforms that they have fought off against for so long here for the last five years in greece. >> it's still -- your best guesstimate that this is passed by wednesday? these changes ask from

parliament by then? >> they'll get them passed. they'll pass probably the implementation law that's going to be required and that will be probably good enough so that when all the finance ministers get together on thursday and the ecb gets together as well that there's some kind of positive signaling so they can come up with intermediate funding so that way the ecb can get paid on monday. that's everybody's goal right now. how do you get more than 3 billion euros in payments to the ecb so greece doesn't default on them as well as the imf? that's the immediate goal. after that greece has all of these other steps to do and meet before they'll get one red cent that helps them fund the government. the only money in the short-term is to help pay the ecb so there isn't a default on that debt. >> it does look like the support will be there for the banks to reopen though? >> so you think of opening banks as a continuum, right?

rather than this or that so they might get more cash which would mean maybe you could get more money out of the atms. fully opening the banks at this point you'll probably have to recapitalize them. in the plan there's money set aside that if they pass all of the hurdles, they'll throw billions into the banks. that would mean they have enough confidence to go back to the bank and not take all their money out the second that it opens. that's what they want to avoid. the impliations of that are people that will end up dill lututed. if they don't comply with all of those hurdles so they can actually get the money for the recapitalization of the banks, you end up with cyprus and you

have to hair cut depositors. you have those that put millions there. here there are very few depositors left above 50,000 euros here. they would have to really squeeze the poor people that left their money in the bank unknowingly. >> michelle, thank you. we'll check in with you later this morning. >> in the meantime we have been watching the market. the dow edging positive for the year rallying amid relief of a greece deal. joining us now with more on where the markets are headed is nancy, senior vice president and thanks for being here this morning. >> thank you becky. >> anybody that was looking for gains in the market like we have seen in recent years has been sharply disappointed this year. do you think they're in for more of the same in the second half or there is something where the market is setting up for a rally? >> the latter. earnings are starting to strengthen. we'll see that in the second

half. this season will be very important. i'm looking at top line more than focus on bottom line just due to the financial engineering that we have experienced in recent years but i do think that things are starting to get better. next year looks better. the rate of change on the dollar should slow and that will help the multinationals and oil is a benefit to big chunks of the market. >> that's certainly something a lot of people are are hoping for but there's always the third scenario which is the market takes a big correction that comes in. based on what's happening geopolitically. how do you weigh the two factors of where earnings are headed and what happened with the other scenarios? >> i think the fed is in the market to a certain extent. i'm not as concerned about that. it's the event that is troubling and potentially what gets you. so i'm concerned about that of course. our themes are that volatility

will continue. it's with us for the foreseeable future. so volatility is difficult to manage against and in but the volume continues at a rapid pace. that provide ace floor and valuation is important. i'm not arguing that it's a straight up from here. i think we have a lot of difficulty ahead but i think that the trend is up. >> we do get earnings from the big financials today including jp morgan and wells fargo. that's a sector you like why? >> valuation is one. there's a lot of pent up dividend growth opportunity. i like that a great deal and if we do get even actually a fed hike that's beneficial to the bottom lines but from a valuation standpoint there's attractive opportunities. >> do you look at either of those stocks in particular? jp morgan or wells fargo? >> we own them both. we're keen on the report. >> what are the takeaways we

should be looking for this morning? mortgage originations across the board? >> that. i think managing to the employee base. we really need to see continued cuts in some areas and i think you have to look at the investment banking activity and how dominant it is. >> nancy, thank you for joining us this morning. >> coming up much more on the iran nuclear deal plus scott walker officially throwing his hat into the 2016 presidential race. it welcome likeooks like -- have you ever been to a hockey gail with the hat trick? everybody throws their hat on the ice. >> they call that a carli lloyd. >> from jersey by the way. i forgot that. gop field getting more crowded by the day. we'll hear from another possible

candidate. next. but first we'll head to break. here's a look back at this date in history. ♪ when you get up to 50% off thousands of hotels with travelocity it means you can also afford to get up to 50% romantic-er romantic sunsets. making it the place to find a place for summer escapes. go and smell the roses.

good morning, if you're just

waking upright now, news iran the u.s. and five other world powers reached a deal. teheran promising to curb it's nuclear program. in return economic sanctions will be eased. you can take a look now at oil prices moving as a result of this. they are down. wti crude by 51.14. they'll get on to the market. in the meantime president obama will make a statement on this deal from the white house. it's 7:00 eastern tile and of course we will bring that to you live when it happens. >> we have a special treat today. you've already seen him. one helping. the first course. probably even an appetizer but here with a special treat, john harwood. we had that written before. >> stuff just changes in live television all the time. >> and he actual hily recently sat

down with ohio governor john casik. i think we have known he was going to run for awhile. >> how long was he on fox? he sat in for o'reilly. >> he had his own show as well. during the first decade of this century he had served in congress for about 20 years. chaired the budget committee and negotiated the balance budget deal with president clinton during the 1990s. he also worked for lehman brothers. that's a mixed bag. although john kasich wasn't steering that ship. he ran a two-person office and got back into politics as the governor of ohio in 2010. reelected in 2014.

he told me that having run in 2000 when i covered his campaign, it lasted briefly. he was swamped by george w. bush, he said everybody told me like what you got but come back in a few years and now he says i'm back. so take a look. we talked to jan kasich about his time at lehman brothers. >> it was a fantastic experience to see the way ceos think. the way the boards of directors work. i wasn't in that to do politics. >> sure. >> i was there to try to add value to the teams of people trying to add values to companies. >> what did that experience tell you about what's right and wrong in the american economy? how does it inform your reaction when you hear people condemning wall street and the financial industry? >> well i think there's an element of greed on wall street that is not good but when you look at the banking industry now with dodd frank one of the big problems we have in the country is that banks can't loan money

anymore. >> one of the things that has come up the issue of misconduct in the financial crisis and some people made the point that no big wall street bankers went to jail. does that strike you as wrong? >> if there's something to prosecute for somebody you prosecute them. just because you do something that's greedy that can end in failure doesn't mean you committed a crime but the fact that you didn't commit a crime here there's a judgment that comes later about how many people get hurt and frankly that's a pretty tough judgment in my opinion. >> john kasich raising the prospect of that for people that are on wall street. he holds his regular bible study. someone bringing a strong element of faith into this race and i think he will be a factor. he is somebody that the other mainstream candidates are going to have to pay attention to.

>> single digits. >> sure, everybody is single digits. nobody is doing too well. >> does somebody have to make a misstep for someone like that to get in or is this about their own -- >> there's so many missteps being made constantly because there's so many candidates. scott walker who formally got in yesterday built he has campaign around the idea that he'll win in iowa. john kasich will win in new hampshire. jeb bush needs to win in new hampshire. >> when does that list get wittel widelled down? by the end of the summer? >> it's a terrific question. nobody knows the answer. traditionally money has done

that. by the time you get to christmas some people have been weeded out by events like the iowa straw poll. that was eliminated. so now you have debates. will people not on sage for the fox debates, the cnn debate our debate, are they going to find it difficult to raise money? remember if you have one superwealthy backer right now you can stay in. so i believe that the debates are going to perform some of that function and the field will shrink a little bit but i don't think it's going to shrink a ton and then we'll get iowa new hampshire and have the more conventional way. >> only two former fox news hosts, huckabee and kasich. >> don forget an nbc guy. >> we talked to john kasich about his time at fox. we'll have more throughout the

day on cnbc. >> he was brave to say i learned at the feet of ceos. >> he was talking about the companies. >> oh okay. >> john thank you. >> you bet. >> when we come back amazon trading near record highs ahead of a big prime promotion this week. why are some calling for an antitrust investigation into the company. that story next. first take a look at yesterday's s&p 500 winners and losers. ♪

>> it's a big week for cincinnati. the major league baseball all-star game will take place there tonight and a hometown boy started things off right. he was the runner up last year and under a popular new format frazier beat dodger rookie peterson plus with 15 long balls in the contest, final round, the last coming in bonus time. the first derby contestant to win at his own ballpark since rye january sandberg did it in 1990. he's the one when i do look to see how the reds are doing, they're like 9 or 10 games below

500 and i look at all the stats that has -- the only name on the stats is frazier. second with home runs for the year but i think pete rose is going to be there as well. he is not allowed in baseball but i think he'll be there. >> do you think he'll make it into the hall of fame? >> it's easy to say guys that did steroids denied it the entire time and they're eligible at this point. he has never really come clean. that's what they all say about that. >> do you need to come clean? >> it's the black sox and just the trying to keep organized crime -- it's to keep organized crime out of sports. >> right and we haven't had cheating or at least we don't think there's been cheating since. >> a different type of cheating. >> you see step remember

basketball a couple of years ago, there's a lot of places where it seemed like it would be easier to affect the than what rose was able to do and for awhile they said he only bet on the reds but other people aren't sure whether he beat against the reds. >> there's the unknowns that are still out there. >> if you come clean and then apologize. >> but you have a guy like jeter or look at the great hitters and they're still hundreds and hundreds of hits away. it was like 200 hits a year for like 20 years. >> eventually he will be there. it's whether he's alive or not. >> there's a pete rose wing in cincinnati. >> it's a good idea to wait. >> a story that caught my attention this morning is on the front of business day. the business day section of the new york times. amazon stock hit another all

time high yesterday. we're talking about the 20th anniversary of the company's first sale and in all of this there's a new story. thousands of them will be combining together and asking the department of justice. their concern they're saying is not about themselves of course but they're saying that they're worried that the company has done things. used it's dominance in ways that they think armed the interest of america readers and impede the free flow of ideas in our society. >> i'll take the other side of that. >> i think the whole case is ridiculous. i think that amazon has done a great service for authors. now it's created it's own inequality to some degree in the world where you have best

sellers and everything else but also created the long tail so books that weren't sitting on book shelves for years and years and years they're still available and there's still an opportunity for those authors. >> do you still get a lot of sales of too big to fail. >> absolutely. >> years after the fact anybody can get this book. >> and by the way you can sell -- there's a lot more opportunity -- now do they have more dominance than barnes & noble used to have? of course they do. >> did you get apple music? music is a tough one too. >> i have it on my phone. still on spotify too though. >> those things i don't understand. >> we have to do that. >> do we have time for me to tell you about the other story. we're going to do it later i was told. i thought you would agree. >> we don't have time for it now. we have to wait until after a commercial. >> we've got to find basically we have to find a way to reign it in.

it could be bigger. and they could make even more and -- >> let's do this real quick. >> might be counter productive to what we're trying to do is have people make less money. >> to the extent you believe that in dodd frank you believe there were clawbacks but now to corporate america when it comes to restatements -- and that had nothing to do with the financial crisis. it was another politically thrown in things. to the sense that you believe there was a rule trying to reign in executive pay, the point was to say guess what boys and girls it's not doing that at all. >> they give you more up front. >> now what you're doing is -- >> they have different ways of getting around this to the greedy. >> let me just explain to the viewer that hasn't read the column the point is that you're now sending up a -- finding a

three year window where corporate america, every publicly traded company we talk about, any executive, it's called a no vault rule. it could be something somebody else's fault at the company. anybody at a company is going to be subject to the clawback. what's going to happen as a result of that? the executives. not just senior executives. any type of incentive pay that's related to the metrics of the company are going to be subject to the claw backs so you're going to say you know what don't do that actually. give me a bigger base pay. that will change the dynamic. >> what am i going to do? watching hilary's speech there must be some way you feel positive or negative about it. that would have been my thing. >> i watched hilary's speech thinking maybe there was a column in there. >> that's what i would have done

but you didn't. >> do you know why -- >> but i thought about you and i said but no that would never happen. i would have written a column on that. >> what would you have written. >> we don't even have time for me to start. >> you can do the oral version. >> coming up the man behind the notorious and anonymous twitter account gs elevator describes himself as running a site that in his word aggregates commentary that's supposed to embody the 1%. i thought the new york times said it was a huge yawn. >> the wall street journal had views. >> this was your idea? >> it's his idea. he wrote the book. he'll join us when squawk box comes back.

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people really thought this twitter account initially was from goldman. >> if anybody thought this was about conversations in electrical say to in goldman sachs i would say they're an idiot. >> but you do know that at the tile goldman sachs thought that there was somebody inside their institution who was telling stories out of school. >> well initially i think a lot of the tweets did kind of capture that because i tweeted about specific people. i tweeted about specific deals. i tweeted about you know banks and it evolved from there but i think it is no surprise that perhaps people thought that. >> before we get to the book one other issue though you had done several interviews. journalists reached out to you without knowing who you were and in truth, you did not tell the truth to them. not only did you not tell the truth to them you told them you worked at goldman sachs.

>> well gl elevator works at goldman sachs. gs elevator works at morgan stanley and jp morgan. it's a fictional character. >> but when you're writing these e-mails back and forth do you say to yourself have to lie to the guy because otherwise the gid isgi gig is up? >> not at all. when i talked to the new york times hi 2,000 followers. >> you now have 700,000 plus followers. >> yeah. and the success of the account didn't have anything to do with whether people thought i was actually in an elevator at goldman sachs. >> so then let's just fast forward. we write the article. come on this program and talk about who you actually are in reality and then your book deal gets pulled. >> again, we always anticipated my identity coming out. if you read the book you know that it's poimimpossible to tell the

stories without my identity coming out. >> you knew it was going to happen. >> we expected it. we planned on it. >> when i called you, you did not want me to call you. >> that's not necessarily true. again it's impossible to tell these stories without an identity coming out so we anticipated it and wanted it to happen. >> but the publisher din clearly and then the question is did you tell the truth to the publisher? because the publisher ended up pulling the deal. >> they supported it. you outed me. >> right. >> which again was part of the plan and then they supported me. >> it wasn't the plan in that nobody called me. it took me three months to figure out who you were. >> there were journalists that knew who i was going back a year. it was a terribly kept secret. >> why did the publisher pull the book? >> ask them. i have no idea. >> so you turned around and got a new deal. >> the next day. >> and this was the book straight to hell. >> which was the book we invisioned from the beginning.

>> what's the story you're telling here? >> it is in my opinion, about illuminating wall street culture in a way that hasn't been done before. you talk about wolf of wall street or liars poker, i'm saying wolf of wall street is about scum bags who dropped out of community college and went to long island and commit kiemcrimes and party like rock stars. a lot of the man fesifestaions, what they do you see in the best and the broithest. the brightest. >> do you like wall street or not? part of you seems to revel in this and part of you seems to condemn it. >> i think writing kind of a -- one of the cliches is having the

epiphany. so i said these are my experiences i have no apologies for them and you can read them and draw your own conclusion. >> thank you for coming in. your book is called straight to hell. we appreciate it very, very much. >> thank you for having me. >> iran and six world powers reach a landmark nuclear deal. stay tuned. squawk box will be right back.

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can a business have a spirit? can a business have a soul? can a business be...alive? oil prices trading lower

this morning on an iran nuclear deal. joining us now ian davis. are you getting signals for what's going to happen near term and immediate term with oil? >> yes. we think oil is going to go a little bit lower. we'd say most of the bad news a priced in but the outlook has gotten worse. we downgraded oil in may because opec has been producing a lot more oil than they originally were in february by 4 million barrels. and the global economy has turned somewhat sour. that has changed our outlook for oil. we think iran is just going to make things worse. >> over the past five years, ten years even. how much of oil would you say the price has been dictated by pure supply and demand and how much by other factors like fast money or financial money investments, hedge funds, momentum trades things like that?

>> well we run a statistic, we find china has almost a 50% correlation to the price of oil. >> 50%. >> people overly focus on supply and demand and truth is it's the economy that drives the price of oil. >> so then it's demand not supply. >> it's mostly demand and the outlook for demand. >> giving you the signal to what's going to happen now. >> it's a double whammy. it's not just that supply is moving up more than it should but the demand is for the worst of both worlds. >> all right. anyway, we appreciate it. thank you. coming up quarter results from jpmorgan. then we've got the president. president obama ready to speak on iran. "squawk box" returns in just a moment. visibility into your business, it can quickly become the only thing you think about. that's where at&t can help.

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breaking this morning, negotiators have reached a deal to curb iran's nuclear program. president obama set to speak moments from now. we'll bring you his comments live plus reaction from "the wall street journal" bureau chief. johnson & johnson set to report this hour. we'll have the numbers from wall street. and the chinese firm preparing a bid for micron. it could be the largest takeover by a chinese company over a u.s. company in history. the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york city, this is "squawk box." >> welcome back to "squawk box" here on cnbc first in business worldwide. i'm here with joe kernen and becky quick.

the latest quarter earnings from jpmorgan are out. let me tell you what's going on in the mean time. we have a couple of big stories topping the agenda this morning. iran and five world powers have reached a deal that will curb their nuclear program in exchange for sanction relief. president obama is set to begin a press conference any minute now. we'll bring you that statement live. then we have bureau chief bill spindel. take a look now at the price of oil because it is dropping now. expectation that some of that oil from iran will come on the market. wti crude down to about $51.13. also a deal in the works this morning. china's xinhua looking for a bid for micron technology. that would be a bid of $21 per share. it's a 19.3% premium to yesterday's close. it would be the biggest chinese

takeover of a u.s. company in history. reuters reporting it could come as soon as tomorrow. and david einhorn wrote that micron would be worth more than netflix in the next few years. in the meantime let's get a check on the markets see how things are setting themselves up given this deal in iran this morning and other news of the morning. i'd call it flat across the board. dow marginally up. take a look at what's going on with the euro as we also awade what's going to be going on in greece this week. you can see the euro now at 1.10 and the yen at 123.35. guys? jpmorgan is getting a bounce immediately from this number that was just posted. $1.54 was 10 cents ahead of

expectations. 24.49 or so is what the company was forecast to do in revenue. but -- >> -- has achieved something that decades of animosity has not. a comprehensive long-term deal with iran will prevent it from obtaining a nuclear weapon. this deal demonstrates that american diplomacy can bring about real and meaningful change. change that makes our country and the world safer and more secure. this deal is also in line with a tradition of american leadership. it's now more than 50 years since president kennedy stood before the american people and said let us never negotiate out of fear but let us never fear to negotiate. he was speaking then about the need for discussions between the united states and the soviet union which led to efforts to restrict the spread of nuclear weapons.

in those days the risk was a catastrophic nuclear war between two superpowers. in our time the risk is that nuclear weapons will spread to more and more countries, particularly in the middle east. the most volatile region in our world. today because america negotiated from a position of strength and principleeipaleiple principle, we have stopped the spread in this region. because of this deal the international community will be able to verify the islamic republic of iran will not develop a nuclear weapon. this deal meets every single one of the bottom lines we established when we achieved a framework earlier this spring. every pathway to a nuclear weapon is cut off. and the inspection and transparency regime necessary to verify that objective will be put in place. because of this deal iran will not produce the highly enriched

uranium and plutonium that form the raw materials necessary for a nuclear bomb. because of this deal iran will remove two-thirds of its installed centrifuge the machines necessary to produce highly enriched uranium for a bomb and store them under constant supervision. iran will not use the centrifuges to produce uranium for the next decade. iran will also get rid of 98% of its stockpile of enriched uranium. to put that in perspective, iran currently has a stockpile that could produce up to ten nuclear weapons. because of this deal that stockpile will be reduced to a fraction of what would be required for a single weapon. this stockpile will last for 15 years. because of this deal iran will modify the core of its reactor in iran so it will not produce weapons grade plutonium.

and it has agreed to ship the spent fuel out of the reactor for the lifetime of the reactor. for at least the next 15 years, iran will not build any new reactors. because of this deal we will for the first time be in a position to verify all of these commitments. that means this deal is not built on trust. it is built on verification. inspectors will have 24/7 access to iran's key nuclear facilities. iran will have access to iran's entire nuclear supply chain, its uranium mines and mills conversion facility and centrifuge manufacturing and storage facilities. this ensures that iran will not be able to divert materials from known facilities to covert facilities. some of these transparency measures will be in place for 25 years. because of this deal inspectors will also be able to access any

suspicious location. put simply the iaea will have access where necessary when necessary. that arrangement is permanent. an the iaea has also reached an agreement with iran to get access it needs into the iran past nuclear research. finally iran is permanently prohibited from pursuing a nuclear weapon under the proliferation treaty. which provided the basis for the efforts to apply pressure on iran. as iran takes steps to implement this deal it will receive relief from the sanctions that we put in place because of iran's nuclear program. both america's own sanctions and sanctions imposed by the united nations security council. this relief will be phased in. iran must complete key nuclear steps before it begins to receive new sanctions relief.

and over the course of the next decade iran must abide by the deal before additional sanctions are lifted. including five years for restrictions related to arms and eight years for restrictions related to ballistic missiles. all of this will be memorialized and endorsed in a new united nations security council resolution. and if iran violates the deal all these sanctions will snap back into place. so there's a clear incentive for iran to follow through. and there are very real consequences for a violation. that's the deal. it has the full backing of the international community. congress will now have an opportunity to review the details. to provide extensive briefings on how this will move forward. as the american people and congress will review the deal it will be important to consider the alternative. consider what happens in a world without this deal.

without this deal there is no scenario where the world joins us in sanctioning iran until it completely dismantles its nuclear program. nothing we know about the iranian government suggests it will simply capitulate under that kind of pressure. and the world would not support an effort to permanently sanction iran into submission. we put sanctions in place to get a diplomatic resolution. and that is what we have done. without this deal there would be no agreed upon limitations for the iranian nuclear program. iran could produce, operate, and test more and more centrifuges. we would not have any of the inspections that would allow us to detect a covert nuclear weapons program. in other words, no lasting constraints on iran's nuclear program. such a scenario would make it more likely that other countries

in the region compelled to have their own nuclear programs. threatening a nuclear arms race in the most volatile region in the world. provide the u.s. with fewer options to prevent iran from obtaining a nuclear weapon. i've been president and commander in chief for over six years now. time and again i have faced decisions about whether or not to use military force. it's the gravest decision any american has to make. many times in multiple countries i have decided to use force. i will never hesitate to do so when it was in our national security interest. i strongly believe that our national security interests now depends upon preventing iran from obtaining a nuclear weapon. which means that without a diplomatic resolution either i or a future u.s. president would face a decision on whether or not to allow iran to obtain a

nuclear weapon or whether to use our military to stop it. put simply no deal means a greater chance of more war in the middle east. moreover we give nothing up by testing whether or not this problem can be solved peacefully. if in a worst case scenario iran violates the deal the same options that are available to me today will be available to any u.s. president in the future. and i have no doubt that 10 or 15 years from now the person who holds this office will be in a far stronger position with iran further away from a weapon and with the inspections and transparency that allow us to monitor the iranian program. for this reason i believe it would be irresponsible to walk away. but on such a tough issue, it is important that the american people and representatives in

congress get a full opportunity to review the deal. after all, the details matter. we've had some of the finest nuclear scientists in the world working through those details. and we're dealing with a country, iran that has been a sworn adversary of the united states for over 35 years. so i welcome a robust debate in congress on this issue and i welcome scrutiny of the details of this agreement. but i will remind congress that you don't make deals like this with your friends. we negotiated arms control agreements with the soviet union when that nation was looking for our destruction. and those agreements ultimately made us safer. i am confident that this deal will meet the national security interests of the united states and our allies. so i will veto any legislation that prevents the successful implementation of this deal. we do not have to accept an

inevitable spiral into conflict. we certainly shouldn't seek it. precisely because the stakes are so high, this is not the time for politics or posture. tough talk from washington does not solve problems. diplomacy, leadership that has united the world's major powers offers a more effective way to verify that iran is not pursuing a nuclear weapon. now, that doesn't mean this deal will resolve all of our differences with iran. we share the concerns expressed by many of our friends in the middle east including israel and the gulf states about iran's support for terrorism and its use of proxies to destabilize the region. but that is precisely why we are taking this step. because an iran armed with a nuclear weapon would be far more destabilizing and more dangerous to our friends and to the world.

meanwhile we will maintain for terrorism, ballistic missiles program, and human rights violations. we will continue our unprecedented effort to strengthen israel's security. efforts that go beyond what any administration has done before. and we will continue the work we began at camp david. to elevate our partnership with the gulf states to strengthen their capabilities to counter threats from iran or terrorist groups like isil. however, i believe that we must continue to test whether or not this region that has known so much suffering, so much blood shed can move in a different direction. time and again i have made clear to the iranian people we will always be open to engagement on the basis of mutual interest and mutual respect. our differences are real. and the difficult history between nations cannot be ignored. but it is possible to change.

the path of violence and rigid ideology threats to attack neighbors or eradicate israel it's a dead end. a different path. one of tolerance and peaceful resolution of conflict leads to more integration into the global economy, more engagement with the international community, and the ability of the iranian people to prosper and thrive. this deal offers an opportunity to move in a new direction. we should seize it. we have come a long way to reach this point. decades of a nuclear program, many years of sanctions, and many months of intense negotiation. today i want to thank the members of congress from both parties who helped us put in place the sanctions that have proven so effective as well as the other countries who joined us in that effort. i want to thank our negotiating partners, the united kingdom,

france germany, russia china, as well as the european union for our unity in this effort which showed the world can do remarkable things when we share a vision of peacefully addressing conflicts. we showed what we can do when we do not spread apart. and finally i want to thank the american negotiating team. we had a team of experts working for several weeks straight on this including our secretary of energy. and i want to particularly thank john kerry, our secretary of state who began his service to this country more than four decades ago when he put on our uniform and went off to war. he's now making this country safer through his commitment through strong diplomacy. history shows that america must lead not just with our might but with our principles. it shows we are stronger not when we are alone but when we bring the world together.

today's announcement marks one more chapter in this pursuit of a safer and more helpful, more hopeful world. thank you. god bless and god bless the united states of america. >> that was president obama outlining the deal reached to curb iran's nuclear program. here with some reaction right now bill spindel who just returned from a trip to iran. give us a little bit of just historical perspective here you heard what the president had to say. >> i think it's pretty important. you can see the most immediate acute is you've seen prices fall. it's straightforward there. more deal would mean more oil as fast as they can pump it. on the political side the implications are harder to read and extend farther into the

future. you've got really a sense that where things would go from here. >> you know, it was interesting to hear the president lay it out. he put a lot on the table in terms of saying he thinks this is in the best interest. he says he will veto congress if they don't approve this deal. he also pointed out the reasons he was pushed to the table. one is that the world would not support or allow sanctions to bring about the end of the regime. that this was done to get to a diplomatic point and that he thinks down the road things will change. the next president may be empowered down the road. but there are questions that remain whether we can verify any of the stuff in this agreement. >> there's going to be a big fight in congress. i think at the end of the day he'll definitely get it through for sure on the veto. and if not with a larger vote of support. yeah the question becomes then as you go into the future this doesn't amount in any way diplomatic recognition but it

does acknowledge in a way america has never done before, the republic will have a legitimate role within the region. you've heard him talk about hopeful outcomes of that. the telling thing i could see recently was interestingly both the hard liners and reformers are behind a deal because they both think they can make it work for them. >> what does it mean to our relationship with israel who is not happy about this? >> they're going to be unhappy. the saudis are going to be unhappy. >> the uae. >> traditionally all those eyes will be unhappy partly because what's going on here is a process of acknowledging what iran's role will be in the future and that's a difficult adjustment. >> mostly because of the bad behavior that they are continuing to undertake in the region. we are underselling it. we are talking about massive actions.

those are things that are going to -- obviously are profoundly disturbing to america, to the europeans, to america's allies there. and the question is can they -- is this really going to be the beginning of something or the end of something? is it just the end of a nuclear negotiation and then things stop there and return to an antagonistic relationship. >> we never had the same threat from iran that the local neighbors have had. saying our problem. suddenly since they're not as immediate in terms of threatening us and our border suddenly it's like hey, in our interest to do this. we're sorry about -- you know we're sorry. but it's a much bigger deal for you than for us. >> which a huge adjustment for them. they're worried they'll have to

make. >> what does that say about our commitments -- our previous commitments of standing by our allies in the region? >> i think the u.s. is feeling more self-sufficient on the energy front, on the oil front which gives up more flexibility. although they'll hardly remove themselves from the region. but there's complicated problems going on in the middle east. they're looking to resolve -- >> a lot of who we're allied with. at least our interests are with iran. that factors in. >> and what these countries see is really in some ways at though they're not talking or directly coordinating they are definitely maneuvering jointly within iraq and syria to deal with this problem. that too, makes everybody nervous. >> what do you think having spent time there and watching this play out? is this a good thing or a bad

thing over the next five years? >> it opened up possibilities in a relationship that had been very stuck. does that mean things are going to get better? >> i don't know. for them this deal is all about reveem preservation. >> the question is what is the downside? what is the nightmare scenario that results from something like this? >> that iran takes the -- >> takes advantage of this. >> takes advantage of this. takes the money. >> and exexpands. >> really quick on oil, how quickly do you think all this is going to open up and how is saudi arabia going to react? >> open up in what? oh, in the oil market. yeah. i think they have 20 to 40 million barrels in floating

storage. that can be sold off pretty much immediately. within another six months they claim they can bring another half a million barrels on and maybe six months after that by opening up new wells. if they want to bring another million barrels per day on the market within a year. there's skepticism they can do that, but that's the goal. >> thank you for joining us from "the wall street journal." appreciate it. >> thanks for being here. before we head to a break, let's get a recap of the results from jpmorgan. they posted better than expected earnings and revenue. earnings per share came in at $1.54. revenue came in line. that was just about in line with what the street had been expecting. jpmorgan did benefit from a drop in legal expenses. that stock is up by close to a dplar. it's a gain of 1.3%. >> and almost at an all-time high. got to get above 69.82 to be at

an all-time high. up next much more on jpmorgan. we'll dig through the report with david hilder. and still to come this morning, results from wells fargo and johnson & johnson. assion.

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jpmorgan with better than expected earnings. here with his analysis is david hilder. the one thing that stands out is expenses were lower and that helped things flow to the bottom line so that expectations were beaten by 10 cents or so. other than just expenses are there positive things that went along with this in terms of net income? >> certainly. thanks, joe, for having me on this morning. trading revenues were very much as expected. total was down about 1% year over year. excludings other business exits. but equity trading was up 27%. investment banking fees were up 4%. loan growth was very strong.

i think you're seeing that there are a lot of positive revenue drivers. i should say there are few non-recurring items in that number of $1.54. if you make all the adjustments which include tax benefits and other items, the core number is more like $1.46. i think this is more in line with the consensus, not quite as far above consensus as the headline would indicate. >> initially it did trade sharply high her. now the gains have been tell pored to some extent. what do we know about just the way that banks do we have to wait for the fed to do that before they make any move? >> yes. there's not much change quarter

to quarter. there will be a benefit for the large banks including jpmorgan. but especially bank of america. once the fed funds rate is higher. and it's really tied more to the short end of the curve rather than the long end. >> as far as the deployment level at jpmorgan is there more that needs to be done there or everything's matched up to generate good results? >> you know jpmorgan obviously has been trimming some employees this year. they talked about in february. i think they're more or less around in a give or take a few thousand on a roughly 250,000 employee based. i think what is different today versus pre-crisis or certainly 20 or 30 years ago is that the banks view their employee base and their businesses as somewhat fluid. they will move people around from business to business. they will close branches and

open branches more or less at the same time. depending where they think they have the best growth prospects. >> okay. i thought there was one more thing that i wanted to ask. >> well one thing i would say is that jpmorgan is doing a good job of bringing down the size of the balance sheet. up to 11%. up from 10.6%. and their goal is to get to 11.5%. so they're moving in the right direction. both in shrinking the balance sheet a little bit while allowing for loan growth. >> what was it a year ago provisions for credit losses? >> it's really not very different from the credit loss. it was -- credit is generally getting better and they suggested that credit card losses which are a pretty --

siems a bit volatile will be lower through the second half of the year. >> thank you. >> appreciate it. when we return this morning with earnings underway a busy economic calendar this week and janet yellen set to testify on capitol hill tomorrow. we'll be talking about whether the markets will be thinking about all of these numbers we have to sif through. we'll talk strategy next. and another big event tomorrow. the delivering alpha conference. our leadership tomorrow includes larry fink and jamie dye nan. "squawk box" will be right back.

welcome back to "squawk box" this morning. among the stories front and center, iran and six world powers reaching a nuclear deal this morning. here's what president obama had to say about the agreement. >> today after two years of negotiations, the united states together with our international

partners has achieved something that decades of animosity has not. a comprehensive long-term deal with iran that will prevent it from obtaining a nuclear weapon. >> and oil prices are moving lower this morning as a result of that deal. wti crude right now at $51.49. couple other headlines. fanduel announcing today it has raised $275 million. partners include nbc sports ventures and comcast ventures. also google incorporating hiring and ways to run more efficiently. taking a stricter approach to its costs as it gets bigger and perhaps as a result of its new cfo who they say is a driving force behind those cost-cutting moves. it is a busy week for earnings and economic data. it's giving all of us on wall street something to think about. joining us barbara reinhart from

credit suisse private banking of the americas. and jeremy zieran. thank you both for being here today. obviously a lot of things have been happening. a lot of concerns headlines coming out from all around the globe. but barbara, you're still seeing the markets kind of hang in there. >> when we look at the all country world index, 7% are still in a 2 hurkds a day moving pattern which is optimistic for equities. >> you think we have gotten through a lot of these crises or is this just a situation where the market doesn't care until it does? >> there are a number of hurdles that the market has to overcome over the next couple of weeks. greece is going to take the deal to parliament tomorrow. it will then have to go onto six eu parliaments that have to be loaded on. so we're far from out of the woods. but i would say they're starting to see some progress which is what gave the markets a relief rally today. >> we are seeing pressure on crude oil this morning.

we just looked at that. most people who are watching this say is the dollar's not going to be dropping any time soon. that the euro's still going to be under pressure. when you take all those things into account, what are you telling clients right now? >> we're still favoring a risk on position. i still think some of the risk factors seem to be fading. seems like greece is headed towards a deal. doesn't look like the volatility we've seen in the chinese equities will have real economic implications. earnings season is upon us. we had a void where we didn't have a lot of economic data or corporate news. and earnings season should be decent. i mean, we're looking at relatively flat earnings year on year. more importantly that masks broader strength in the s&p 500 base because the only reason that the s&p 500 earnings are even going to be flat is because of the 60% decline in the equity sector. very similar growth rates to what we've seen over the last couple of years as markets

continue to gro higher. >> although you still like some of the cap better because of the stronger dollar scenario right? >> we do. they are a more direct play on u.s. consumption. you don't have a lot of you know currency translation affecting the smaller cap names relative to the large cap names. and weaker oil prices are certainly a net positive. and small caps are more exposed to that consumer. >> you still like europe better than the stocks? >> we do. we think european equities have a better tail wind at this point. you have some improvement in the economic data. and also don't forget a turn in the u.s. cycle also helps equities as well. data has gotten less bad out of europe. >> although the brinkmanship we've seen with greece and by the way this deal is not done yet. it's still got to get through the greek parliament approved by 17 other parliaments after germany. people have said that kind of

freezes business in the region. that that will have lasting impacts. >> the issue that we're looking at, though is what the european central bank has as well. they're engaged in a quantitative easing program. two and a half times of outstanding debt every month. they're fully committed to that program in september of 2016. and potentially beyond. that is a very powerful force. and one of the key indicators we look at is bank lending in europe. and after multi-year periods of falling, it's just starting to grow. so it's really just a whole kind of tail wind. and you're starting to see some improvement in some of the realtime data that we're looking at on global industrial production which is one of our leading indicators. >> if you had one sector or one area you'd be pointing investors as your best bet, what would it be? >> we agree over the equity market. for all the reasons barbara indicated as well. we haven't seen economic weakness or business investment

slow down during this anxiety over greece. i mean if you look at the pmis in europe they're still at post-cyclical highs. bank lending has picked up. one sector in the u.s. we like is technology. we continue to think that cap-x is going to build. and tech still trades as a multiple at a 15% to 20% freemium. i think you'll see faster earnings growth. perhaps not this quarter but over the next relative to the market. >> i want to thank you both. appreciate your time. >> thank you. when we come back this morning, currency headwinds and a chinese economy taking a toll on shares of apple. we'll speak to an analyst who says it is still time to buy.

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you'll love it, or we'll pay for you to go back. welcome back to "squawk box" this morning. will apple be the first to hit the cap milestone. currently doesn't see it hitting that just yet. i think i mangled your name. i apologize. >> just fine andrew. >> help us to understand how you get to this price and do we ever get to the trillion-dollar mark?

>> our price target is 150. that doesn't quite get you to a trillion dollars. but apple's selling at a 20% discount to the market multiple. we think there's still room for earnings. it's true the next product is not going to be as big as the six. but we think with 20% of users upgraded, there's room to grow there. china in particular i think still has upside. then some multiple expansion. i wouldn't go crazy but ultimately -- >> it's got to turn by two or three times. what kind of multiple are we talking about? >> certainly to get to a trillion dollars it has to be a market multiple. that's going to be at least three times improvement. so that might turn out to be a bit of a stretch. 20% discount to the market multiple here. there's room for improvement. >> right now apple is a phone company. the question is whether it needs to -- whether the watch you think ultimately needs to get to some place and whether it does and whether there's new products that need to emerge.

>> you're right. over two-thirds of profits come. it's building an ecosystem. it's becoming more of an annuity. the watch is financially important in the next year because we think the phone is relatively flat. going from zero to 12 billion in the watch is still a good inskremtin increment increment. in the meantime we'll probably see something on the tv side with over the top. and we still -- >> when do you think we're going to see that? this fall? >> depends when they get their contracts together. but i would hope by the end of the year. >> and when you think about the price tag, joe always talks about the trillion-dollar mark and can never get there. >> it's gone up. it's doubled. it's gone up. it's doubled. or, you know it happened so many times with apple. to double again it has to go to $1.5 billion. and you're just as happy about the stock right now. it's ignoring the law of large

numbers. i know it's cheap. it's also knowing that almost every person that loves the stock owns it. i mean you are not alone in saying it's undervalued and you like the stock. there's no one who doesn't, is there? >> that's true. we wouldn't argue for as much appreciation in the next 12. >> what about the next five years? a $3 trillion company? >> certainly trees don't grow to the sky in technology. 2000 we talked about what cisco would have to become. >> that's what i mean. google or microsoft or anything of them. but they better have an annuity in that phone. if they don't, what's their run rate on revenue right now? what did they do the last quarter? >> 50 billion. >> that's going to come in no matter what to a gadget make? $50 billion every quarter? >> long-term risk is something actually replaces the phone. >> that's what i mean. somebody makes a better phone. you know makes some type of technological leap we never anticipated with any of the

other companies in the past either. >> we talk about disruptive technology all the time. but i still think we're relatively early here. emerging markets, there's a lot of room for growth. >> or buys a different phone. >> you think about nokia, rim. those are the examples. >> there's a million of them. i can go back. >> the difference between apple and nokia is the ecosystem. the platform they created to some degree that lacks. saying the ecosystem isn't strong. they're killing in china. >> i never thought of -- i don't know what it is. but i did sign up for apple music. so that's the one thing that throws a wrench in my -- >> tell me this. is there any company out there right now that poses a threat to your analysis? >> as i say, it's got to be something pretty big deal. the internet assistant we think is going to become a big deal. siri hasn't improved from a voice recognition standpoint as

people want. there's a small company that's coming out with something that looks like it could leapfrog siri. they have demos on youtube. >> quickly can i interrupt and give the johnson & johnson numbers. out with better than expected numbers. 171 is what they came in with adjusted. street was looking for $1.67. also came in with revenues that was about in line. $17.8 billion versus $17.75 billion estimate. adjusting to $6.20. the street was already at $6.14. if you look at the currency impact here it is huge. what's what we've been seeing with a lot of the multinationals. they say the negative impact of currency was 7.9%. to put that into a bit of light for you, the international sales were up. >> they fell 14.3% but it was a

currency so they were up .5%. >> if you took out the currency effect, it was up .5%. instead they were down 14.3%. you should point out sales here in the united states domestic sales were also down. they were down by 2.5%. but it does look like that stock is trading slightly higher at this point. >> like a nickel. it's tough to say. 100.36. >> you were mentioning two companies that potentially could pose a challenge. do they become takeover targets? >> these are small private companies. i have no idea what happens to them. but you have to look for something that is a real leapfrog technology to hurt apple. at this point it's such a brand around the world that for now they're in great shape. >> thank you for coming in this morning. >> thank you. delivering alpha conference hosted by cnbc kicks off tomorrow in new york. and it's got a huge lineup. bill ackman carl icahn, larry

fink jaime dinan. promises to be a big event. kate kelly will join us with what more to expect in just a moment when "squawk box" returns. ♪ if you can't stand the heat, get off the test track. get the mercedes-benz you've been burning for at the summer event, going on now at your authorized mercedes-benz dealer. hurry, before this opportunity cools off. share your summer moments in your mercedes-benz with us. ♪ i built my business with passion. but i keep it growing by making every dollar count. that's why i have the spark cash card

from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands of dollars each year going back into my business... that's huge for my bottom line. what's in your wallet? music: etta james "at last" (plays throughout) sometimes, at last doesn't happen at first. ♪ your dad just kissed my mom. turning two worlds into one takes love. helping protect that world takes state farm. welcome back to "squawk box." some key activist hedge fund managers lining up for cnbc annual delivering alpha conference tomorrow. kate kelly is with us. she's got more on what to expect. good morning. >> good morning, andrew.

activism has been on a tear this year with those strategies rising. against an s&p that's been kind of dull really. and tomorrow at delivering alpha we'll have a lot to watch. bill ackman always a pace setter starts the day with a panel with nelson peltz. we'll see what they actually tell us. ackman recently took a 22% stake in nomad foods. that's a british acquisition company set to focus on the food business. but he's also been going big on another as yet unnamed investment that he says is costing up to 15% of his capital or roughly $3 billion. peltz has just loaded up on the valve maker pentair. but he hasn't elaborated on his his -- we'll also hear from keith myselfer and jeff smith as well as tom sandell and carl icahn who recently pulled out of

netflix. he considered doing that once before, you may recall but his son talked him out of it. he may tell us tomorrow what he was thinking in late june when he tweeted that he had gotten out of it. and david has questions about it too. >> yeah. david now saying i think his quip was that red ink is the new black. >> and the season three of "house of cards" was set to compete with ambien. but he makes an interesting point. he said this about pioneer resources in may. totally different company, obviously, but his view is there's some overvalued names out there where it feels the excitement of the story is far more significant than accountability. his example with netflix was they had a huge earnings miss in the first quarter. and the market just shrugged it off. >> i'm looking forward to carl icahn -- is he going to battle it out with larry fink? >> i think it's going to be about activist tactics. and they come from different polls when it comes to how to approach these situations. that should be a great

discussion. really looking forward to that. >> and does -- who is -- >> ackman and peltz. >> do they get along with each other? >> i don't know. they have such different styles that i would think -- >> peltz doesn't think he's in the same category. as he talks himself of being a constructivist. >> does he? is he a constructivist? >> well i think i had nelson on the stage a couple years ago when we talked about dupont and he -- >> he's a constructivist and then they go crazy on the company. >> we will see what he has to say. >> he has an option to become a bill ackman. >> all right. we will see you tomorrow over there at the hotel. becky is going to be doing a panel. i'm now doing a panel in the morning on u.s. global -- not u.s. can't be u.s. global macro. global macro. in the meantime coverage kicking off tomorrow of the delivering alpha conference. 6:00 a.m. eastern time.

here's our morning lineup. blackrock chairman larry fink. then york capital manager jamie dinan. and christopher allman. he's got news relating to pensions and whether all the yields can hold up. all this starts at 6:00 a.m. eastern time. coming up earnings alert from wells fargo. set to report the numbers and reaction in the street. plus squawk market master jeremy siegel says dow 20,000 still possible by the end of this year. he'll join us next. so you're a small business expert from at&t? yeah, give me a problem and i've got the solution. well, we have 30 years of customer records. our cloud can keep them safe and accessible anywhere. my drivers don't have time to fill out forms. tablets. keep them all digital. we're looking to double our deliveries. our fleet apps will find the fastest route. oh, and your boysenberyy apple scones smell about done.

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progress makers turn their ideas into reality. and the next great idea could be yours. breaking just this morning, iran and world powers striking a nuclear deal that will see sanctions on tehran ease. oil markets moving on the agreement. financial earnings in focus. jpmorgan has already reported. now we'll hear from wells fargo. the numbers are ahead. and a new view of pluto. nasa has big expectations.

as the final hour of "squawk box" takes off right now. ♪ from the most powerful city in the world, new york this is "squawk box." >> welcome back to "squawk box" right here on cnbc first in business worldwide. i'm andrew ross sorkin along with becky quick and joe kernen. the futures at this hour they're switching around a little bit across the board. check out europe right now as well. we've had a lot of news with the iran deal. of course questions about the future of greece also weighing on us. then we have some earnings report in as well. jpmorgan this morning and wallace fargo just reporting. in the european market things down across the board. wells is reporting. and i know you've been looking at that joe. >> 103. that is in line with expectations. the revenue number that wall

street was looking for was 21.695 and this might be light of that $21.32 billion is what the number if that's a clean number is. the stock at this point looks like it is down a little. initially traded higher. this one as you can see and i think j & j traded up too. out of the three we've done the knee jerk reaction at least at this point is down 24 cents or so. that number equates to $5.7 billion in net income. so it's interesting. the $292 billion market cap of wells fargo is well above $252

billion. even though jpmorgan is more profitable the market cap is actually quite a bit higher. i guess people think of it because of the quality holding return. one of the gentlemen said earlier he's going to get too arcane by talking about basel 3. well, i beg to differ. he's speaking my language there. and 10.5% was the basel. that's the only spice they break out for wells fargo for the tier 1. no rosemary thyme, or anything else. actually yeah. it was below expectations. total average deposits, $1.2 trillion. if you release a reserve of $350

million that would go into the $1.03, right? maybe this hit the number by reserves. we shouldn't say it's not real when they bring it back out. now the stock is actually down more than a percent. don't miss the cfo of wells fargo on "closing bell" this afternoon. he must be incoming cfo. haven't we had -- i don't know. maybe not. maybe he isn't. was the old cfo guy on council? >> yeah. anyway, let's get you caught up to date on other stories that investors will be talking about today. iran the u.s. and five other world powers reaching a nuclear deal. tehran promising to curb its nuclear program in return economic sanctions will be eased. the u.s. congress now has to approve the deal and has 60 days

to decide. many lawmakers saying they don't think this deal is enough. here's president obama in the last hour. >> i welcome scrutiny of the details of this agreement. but i will remind congress that you don't make deals like this with your friends. we negotiated arms control agreements with the soviet union when that nation was committed to our destruction. and those agreements ultimately made us safer. i am confident this deal will meet the national security interests of the united states and our allies. so i will veto any legislation that prevents the successful implementation of this deal. >> take a look at oil prices on this news. they had been down as much as 2% earlier. right now wti is only down about 7 cents. $52.13. maybe that's some people trying to figure out what the congress will do. but the president said he will veto any legislation that will

prevent this from being implemented so the bar is high at 67 votes in the senate. and we'll continue to watch this through the morning. again, wti down about 2% earlier on news of this deal. right now it's relatively flat. jpmorgan beating the street on both the top and bottom lines. a drop in legal expenses. we've been watching that stock and it looks like it is trading up about 11 cents right now. also deal talk for you this morning. china reportedly going to make a bid for micron. puts the offer price at $20 a share or $23 billion in total. if this goes through, it would be the biggest chinese takeover of a u.s. company. >> yeah. the previous was the bacon deal. the one that really raised some concerns about whether, you know computer chips keep 'em. but to hoard bacon over there and not allow us to have it

that's where you've got to have a hard time moving the rock up the hill. is that the same thing? >> no. >> you think cipisus is going to look at that? >> right. you want me to translate some latin for you. >> marco was writing something in latin on his page. i forwarded it to you. >> and i sent back farmers and i carry you carry we carry. i think. i'm not even sure. >> or i scream you scheme we all scream for ice ice cream. here to discuss where he thinks the market is headed jeremy siegel, finance professor at university of pennsylvania wharton school of business. i don't know jeremy. why does anyone ever take latin?

it was a dumb move. dan quayle told me there is no litini litinius. >> no spoken latin. that's one reason i didn't take it. but a lot of kids today really enjoy latin. the root of our language. >> it is. of all languages i think. unless it's greek. so jeremy you've been bullish. the market this year has just been churning. and it's given a lot of you know, fake signals one way or the other. is it a positive that we're basically flat right now with everything that's happened and is it a positive that that's been a rolling correction? or does it indicate that it's tired and long in the tooth? >> i think it's positive. when you look at the negatives in the economy, you know now that the last -- well we don't know if the last chapter in greece has been written or not.

but maybe if that subsides from the headlines, we'll get to the two things that the market should care about. one is interest rates and the other is earnings. and we're only going to have earnings above 2% last year. the slowest increase by far since the great recession. but what's important is the two important reasons for that poor performance is the decline in oil prices which has certainly hit the oil sector dramatically. and the tremendous rise in the dollar. and we had j & j about 15%. of the earnings because of the rising dollar. that was to cut perhaps $8 off of s&p earnings which are only up $2 to maybe $10. the good news is those two factors have stabilized. oil is down a little bit now, but if you think of it is 55 to

65 region the euro seems now happy at 1.10. we get stability there, we can go back to the organic increases in earnings that we have seen in some of the past years. it's my feeling once we get the first increase of the fed's rate out of the way which i still believe is going to be september, we're going to have a really good fourth quarter because the world's not going to end and everyone's going to say is this all it is? they're going to look for it and say earnings look pretty good in 2016. and i still think 20,000 is possible for the dow. >> even both of the factors you just mentioned, you can certainly find a lot of positive things about oil prices going down. and you can even -- >> oh yeah. >> you can even find some positive things about a strong dollar attracting money flows from abroad and everything else. so even though you point out it does make earnings look lower, number one you can see well that's -- you know there's

reasons that earnings aren't rising as much. number two, there are positive aspects. then sure the fed is going to raise eventually. maybe it is september, maybe not. but it's such a slow forecasted project projectry. and inflation stays so slow. the worst thing for financial assets, it just seems like it's not a problem at all. so it's almost like technically the market had to turn around just to wring out some of the complacency. >> you know you're absolutely right. first of all, the strong dollar is really good for the u.s. and lower oil prices. we're still in that importer of energy that's good for the u.s. it just hurts earnings because we have global companies in the short run. these are positive which will keep inflation very low, prevent the fed from going up very far. we're going to get some increases through 2016 but

they're not going to be anything that is going to be scary for the market. and we're just not going to end up anywhere near the interest rates at all that have experienced in the '60s '70s, '80s '90s. maybe we're going to get to 3% on the 10-year. maybe next year 3.5%. not much more. and fed funds, maybe 2%. bill gross has called that the new neutral. he thinks -- and i tend to agree with that. the world is different. inflation is lower. growth is lower. and that lowers interest rates. we have an older investing population that sticks with bonds despite their poor returns. and all that is going to keep interest rates down and keep valuations on the ie side for

the equity markets. >> yeah. once we get greece and china out of the way, it was those two situations i guess, that could have either one or together could have caused at least some type of you know maybe near-term problems for the scenario you just painted. but once you -- if you try to think of anything else that would present a big problem, it's hard to come up with anything. that's why we focus so much on those. so hopefully on wednesday, you know we kick the can a little bit further. we'll worry about it again in two to three years when we're trying to fund our government again. we'll have something to worry about. china might be longer term. china we might need -- we may be dealing with this for a couple of years as they try to shift into a different type of economy. >> joe, i think the important thing is greece is not the only country that's kicking the can down the road. >> yeah. >> the united states and most of the developed world is kicking the can down the road. >> that's what scares me.

because if -- you know we're in a great position right now, but if our contingent liabilities ever rear up and really stare us in the face, we've got some issues too. and i don't know. if the chinese are as mean to us as the germans -- >> fortunately not in the next two to three years. the budget deficits look manageable, then it's long-term. and you know as well as i do anything more than a few years out, hey. the market says just a minute i'm going to wait and see if anything really does happen. i also should mention i think it's important. china is not all that unreasonably valued today. 20 times earnings 18 to 20 times earnings on the shanghai composite for -- you know, i looked over the last 25 years and the average pe ratio was 30. often we had it in the 50s. yeah. we did have a bubble there, but

it was no -- >> it was also under higher growth times. >> yeah. >> under much higher gdp growth. >> under higher gdp growth yes. 8%, 9% 10%, that is definitely true. but still, 18 to 20 pe is for a country that's maybe even growing 5% 6% and not 7% the way china claims is not a crazy multiple. it may come down some more. the tech sector really did bubble up too much in china. but the rest of the market is closer to reasonable than we've seen in quite a while. >> okay. all right, jeremy. thank you. nice backdrop. you're a lucky man living in philadelphia home of comcast. isn't it something else too? city of comcast? >> brotherly love. >> yeah. that's the other name for philadelphia. >> not so good names too. >> there are. w.c. field.

i once spent a week there one friday afternoon. i don't know. could be worse, you could be in philadelphia. >> yeah. first prize is one week in philly and the second prize is two weeks. >> two weeks. that's right. all right. thanks, jeremy. see you around. when we come back this morning, financials in focus. jpmorgan ready to hold a call with investors after posting better than expected results earlier this morning. we'll get some details on what the company is expected to say about the quarter next. and later, could david herro be your market hero? he manages a fund that has returned 18% annually for the last three years. beating 90% of similar funds. his stock picks are coming up. "squawk box" will be right back. a new season brings a new look. a chance to try something different. this summer, challenge your preconceptions and experience a cadillac for yourself. ♪

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stocks to watch this morning. johnson & johnson. the stock as a result as you can see is up about 41 cents. coca-cola was upgraded from buy to neutral at ubs. the firm cites a probability of a breakout in the next year.

they think coke will benefit from pricing and productivity. intel was downgraded to underperform from market perform at bernstein. the analysts cite weakness in the data center business. but amazon at this price upgraded from neutral to buy at ubs. gopro upgraded at barclays to overweight from equal weight. the firm pointing to solid execution, new products, and brand strengthens. when we return iran and major powers reaching a deal. president obama speaking a short time agent what about what was agreed upon and what it means for the global economy. as we head to break, check out this futures after a couple of great sessions for the bulls. at ally bank no branches equals great rates. it's a fact. kind of like shopping hungry equals overshopping.

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open an account and find more of the expertise you need to be a better investor. ♪ i built my business with passion. but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands of dollars each year going back into my business... that's huge for my bottom line. what's in your wallet? at ally bank no branches equals great rates. it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda.

welcome back everyone. president obama heralding a nuclear deal with iran as an opportunity worth seizing. and warning the congress he would veto not implementing. the president spoke a short time ago. >> today after two years of negotiations, the united states together with our international partners has achieved something that decades of animosity has not. a comprehensive long-term deal

with iran that will prevent it from obtaining a nuclear weapon. >> we are joined right now. kareem, thank you for being here. >> thank you. >> what do you think about the deal on what you know right now? >> on a macro level, i think president obama has achieved two of his foreign policy objectives. one is to avert a nuclear iran and the other is overt a conflict in the middle east. so i think from now until january 2017 we can be very confident that those objectives will be achieved. and then the rest will be decided in the years to come. >> there have been a lot of questions about this deal, the president owned up to that in the speech. he said it will be a difficult time with congress. they will need to meet a i hooer bar to derail this. but those concerns and questions come in terms of how we can verify this.

how do we know -- we don't trust the iranians to tell the truth, how will we be able to independently verify any of it? >> that's why i said this will take many years to play out. certainly signing the deal was an important achievement. but verifying the deal and the intrusive inspections regime is something which is going to be extremely difficult. either with north korea or saddam hussein's iraq had shown. after a decade and a half of wars in iraq and afghanistan as a country the american public is very interested in moving on from conflict the the middle east. they certainly don't trust the iranian regime. i think as obama laid it out today, any alternative was less satisfactory than the status quo. >> certainly it seems like it may not have been possible for us to maintain the embargo.

that could have eventually been broken down. the way we did this left some of our long-term allies in the region feeling they were completely betrayed. israel the gulf states saudi arabia. didn't see this coming weren't given a heads up. so what does that mean in terms of our traditional alliances there? >> well, it just shows you how the middle east is. this is a day of happiness for tens of millions of iranians and a day of mourning for many israelis and sunni arabs particularly in the persian gulf. the reality is i think they are very unhappen pi right now. but i think in some ways only increases their reliance on the united states as a protector. so i don't see those two alliances, the u.s./israel

alliance or the u.s./gulf alliance really fraying in e the coming months and years. >> in terms of what this will mean for iran's actions around the region this is something the president alluded to as well saying they're hoping to go further and try and keep iran from sistering things up to fund terrorists. how hopeful are you that this is something we'll be able to achieve in the next several years? >> you know iran's policies in the region have been significant for four decades. i think one of the hopes of this deal is it could possibly empower more moderate powers in iran who want to put the power of ideology. i think that's a possibility over time.

but i think in the near term there is a valid concern that this simply enriches more radical actors in tehran. >> thank you very much for joining us this morning. >> thank you. when we come back june retail sales and import prices. then stock picking with an international flair. the manager of the oakmark international funds is here to make the bmw case. as we head to break, look at u.s. equity futures right now. we're back in a moment.

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xçó0 welcome back to "squawk box." breaking news. yes, june retail sales down .3% on headline. down .3% on headline. let's go to the internals. autos now down .1%. down .2% autos and gas. down .1% on the control group. we haven't had a negative control group number since february. so we want to pay attention to that. any revisions, you ask? a bit. if we look at the headline number last time it was strong on its original release. it's been down to up only 1%.

and that control group at up 1.. % remains unchanged. let's look at price index. input price we're looking up .1%. if we look at year over year they were down 10. that's pretty close to expectations. so we see that there's issues regarding energy that we will dig on throughout the day. a quick summary, this is the last retail sales of the second quarter in terms of the release. of course next month we'll get what's for july. but at this point, at this point we're going to continue to monitor atlanta gdp now. see if there's any changes, of course, as everybody tries to handicap not only the glide path of growth but the sequential slide path of growth when we look at the last several quarters. "squawk box" gang, back to you at the desk. >> all right. rick, thank you very much. we've also been watching a lot of stocks this morning. jpmorgan set to hold its

conference. kayla tausche joins us with details. >> that conference call is just about to get underway. but you can see jp mohr dan shares have actually been moving lower after being up as much as 2% on the earnings beat. that's because as people are working they way through this le release, it's apparent the beat is due to expense cuts. expenses were down more than 6% in the quarter as well as a lower effective tax rate for the company. that came down as well. if you want to look for growth it's hard to come by at jpmorgan. up slightly. and asset management. but those are two of the smaller units at jpmorgan. the bigger pillars, consumer banking, that revenue is down 4.5% largely due to mortgage banking. and that was due to lower fixed income trading. now, jpmorgan cfo were talking about some of the volatility

that led to that trading performance citing among other things a bond selloff in europe the middle east, and africa. volatility in greece, and uncertainty in china. speaking more specifically about some of those political flash points jamie dimon saying the european union is trying to instill some discipline in greece. they need to make sure not to make it discouraging for other members of the eurozone to actually stay in that block. on china damon saying china has the wherewithal to deal with anything it encounters. and china does not reflect the underlying economy. he says he thinks the chinese government actually has some fire power to combat any market weakness that they encounter. that is certainly a different viewpoint than we have heard on wall street. finally i want to take a look at what we've seen in crude oil.

one thing we're continuing to see is this building of reserves to cover loans that potentially could go bad in the oil and gas space as we see oil prices remain at these low levels. jpmorgan adding $252 million on the back of downgrades to some of these oil and gas loans. because we're seeing continued weakness there, they said they're keeping a watch on it. they need to be careful. but that is something jpmorgan as well as other banks will watch. we'll have more head lines from the call this morning. for now we'll send it back to you. >> okay. thank you for that. fed chair janet yellen is going to be testifying before the house and senate this week. among the many questions lawmakers are going to have when will rates head higher? joining us is austan goolsbee. he joins us now. and i think you're going to tell us that she shouldn't be raising and she's not going to tell us that she's raising, right? >> i think both of those, yeah. you're right. just look at the retail sales

numbers. look around the world and tell me you feel fully confident that we've turned the corner and we ought to raise rates. i don't think it's there. >> and when you say that i assume you're pointing to glooes and i assume you're talking to china or are you talking about our own economy in just terms of how we're doing to ourselves at the moment? >> i think all three. obviously china and greece are the scary side of the equation but even in the u.s. side you're seeing weakness the job market coming in. it's not bad, it's just not as good as what the fed was forecasting a year ago that it should be for them to raise rates. and so i think we're going to be in the similar die namic that we've been in for the last four years where they keep saying next year is the year. then next year comes and they say next year's the year. because the data is not strong enough. >> you're now talking 2016. we've had others talk about 2016, but now you're not even

talking about the fall. >> i think december. i've been saying december and i still think they so want to raise rates that i think they're going to put december on the table barring something getting even worse than the modest growth. >> austan if it's not bad, let's say we agree and we see you're right, it's not great but it's not bad. does not bad imply zero? that's what people are saying. that the benefits of zero are hard to pinpoint right now. other than the act of actually raising -- >> that's what i was going to say. in a normal time i agree with you. it wouldn't say zero. what you saw on sweden and what you're now seeing in the uk everyone talking in the uk about raising rates and they just got data to come out this morning saying the inflation rate has actually dropped to zero and they're teetering on the edge of deflation again. you don't want to have to move.

far worse than waiting an extra two months in my view would be raising and then saying uh-oh, it's not -- this thing just got worse. now we've got to lower it again. they're not sure at the fed, what's driving the economy or what the state of the economy is. >> what happened? why are we looking at retail sales that were worse than expected? what's impacting the economy? why are things down? >> look. my view is the economy's growing okay. it's not bad. it's not teetering on recession. but we never got some turn the corner liftoff because we had a bubble and consumers are not going to go back to the old days. and what's embodied in the fed's forecast is things are about to get back to normal. that now that house prices are going back up the stock market is high, we're going to have a wealth of that.

consumer spending back to the go go days. housing stargts are going to go back to the go go days. i don't think they ever are. so we're in this waiting that the consumers are going to come back and start leading us back to some v-shaped recovery. >> could still make the other argument though austan that what people are concerned with is that first price means they're raising rates or whatever. but given it's not that bad, zero is probably not the right number. >> what kind of argument is that? >> are you worried about the dollar is too strong. >> we've talked about that joe. >> right. but i wonder if that's what the fed should be worried about. but you don't worry about just by the act of pricing something where it wouldn't normally --

maybe it would be priced at zero. the artificial price of keeping them too low, somewhere there's a dislocation. >> i am worried about it. i think there are. it does look like there are dislocations. it's changing the price of risk. it's just i think the alternative is even worse. and the argument that we ought to raise the rates so that we will have something to do if it gets worse, i think it's going to make conditions worse. and then it would lead us to lower the rates. that's the dynamic i want to avoid. so if we wait another two months or four months before we start, i don't think that's a big problem. even into 70. there's no indication that any inflation at all. even wages, we've been trying to drive them up are up modestly. >> austan goolsbee lovely to see you.

>> great to see you. >> i think you're right. i think it's going to be '16 at this points. looking overseas for next? and later, why it's taken nine years to reach 3 billion miles and now a nasa spacecraft is going to make a historic fly by of pluto and its moons. much smaller than our moon. this is not a planet. it's expected to -- >> dwarf planet and it's much bigger than we thought it was. >> expected to see the first closeup images of a world unknown. a planet pro will join us in a minute. they got excited because they found it in the 20th century and they named a dog after it. "squawk box" will be ragt back. two streetlights. the only difference: that little blue thingy. you see it? that's a sensor. using ge software, the light can

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with the greek crisis maybe looming over the eurozone is now the right to place your bets? our guest says to take advantage of the share prices abroad. from harris associates where he manages the oakmark international fund. i was going to a ask you how can the average investor participate, but i guess oakmark is one answer. >> yes. oakmark.com. go to our website, open an account. >> and yours -- there is a way to go into specifically some of the names that you think are

cheap then you don't need to do all your due diligence. you can hand it over to you and you invest in europe for an investor. >> here's what we do. we utilize the value investment approach which really looks for companies which we view as being high in quality and low in price. and we go wherever they may be. doesn't matter whether it's europe or japan or latin america. we will go looking for companies that meet our specific value criteria. what's happening today in europe as a result of the greek crisis is people are scared to be on the continent of europe. they see what's happening with the volatility and disturbances and don't want to be part of it. our view is that these events impact share prices but not intrinsic value. this becomes an opportunity to increase our holdings in quality businesses. >> have to worry about the dollar? >> well the dollar right now being stronger there's two

impacts of this. first, when you're holding a foreign stock, that stronger dollar will clip your return. because total return is currency return and local market return. but there's a positive secondary effect. and that is most of these companies will benefit. most of these foreign companies will benefit from a weaker home currency as we've noticed that u.s. companies are being harmed by the strong dollar the converse is true for foreign companies especially those based in kind of export oriented countries like germany or france. >> let's look at your list of what we can buy. let's say we go in -- can a person call up his broker and buy these individual names? can we buy some richemont? and if i buy it in dollars, do i get hit if the euro gets weaker? >> in case of richemont, that's

in swiss francs. >> but it's based in switzerland. >> exactly. that's the company that owns cartier and mont blanc. >> in a word then you'll get hurt if you buy it in dollars. but you can make up some of that because they export more because of of their weaker currency. >> in the translation effects, exactly. >> but each of these i could call my broker and buy the individual names? they'll know how to do that? >> some of them trade as adrs and some do not. you'd have to buy them on local exchanges. this is why if you find a good manager whether it's us or anyone else who would sort through the world and look for companies that meet a sound investment criteria that is an approach as well.

>> on your 17%, 18% return over the last three years each year that's net of all fees net of all currency translations? i could have beat the s&p the last three years? >> that's exactly what the shareholder received. >> okay. very good. all right. thanks. >> okay. >> okay. see you later. >> thank you. when we come back this morning, jim cramer from the new york stock exchange on what to watch on the opening bell. after a big day yesterday you'll see things are relatively flat not helped out by the retail sales number that was depressing. stick around. "squawk box" will be right back. ated investing strategies. my technology can help you choose the right portfolio. monitor it. and automatically rebalance it. all without charging advisory fees, account service fees or commissions. that may be hard to compute.

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york stock exchange. jim cramer is standing by. jim, a lot of things to talk about today but why don't we start with what you've been concerned about. that's the strong dollar. j an j got hit hard by the impact of the strong dollar. >> i think the initial tech is right but when you see the numbers and you are just so -- you gasp. i mean there could be such a swing because of the currency.

the whole point i've said is the dollar is too strong and you're not going to like what you see and this is kind of what happened with peps sew. initially they said the dollar is so strong we don't like these numbers. two days later they came back to them. j and j could be higher in two days. when you read the press release, it's like are you kidding me? minus 14? no one is willing to accept it's normal currency. look. these companies are doing incredibly well but we've been saying over and over again on the network, the dollar is too strong. this is why when you get to earnings period people are just -- i think they're looking and saying it's impossible. there must be some reason the company isn't doing well. there is. it's the currency. jpmorgan, very good. i think j.p.pmorgan did a lot of

things right. the capital build was extraordinary. $6 billion quarterly earnings. that one should be higher. wells, not as good. but wells has other issues right now. i understand why the stock would be down. i think it's a stock that two days later bounced back and maybe back you talk to warren buffett and he says i was in there buying it because wells is not a quarter to quarter story. it's a long-term growth story. if rates go higher wells will move the most. i think these instant reactions were wrong, have been wrong and will remain wrong. >> jim, thank you so much. >> coming up pluto revealed and then another big event coming up on "squawk box" tomorrow. you're not going to want to miss this. the delivers alpha conference that kicks off in new york. we'll be there to get things

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and 3 billion miles, we are finally getting a sneak peek of pluto. revealing the first images of pluto. a veteran space journalist and the publisher of universe today joins us via skype and thank you for being here today. >> thanks for having me. >> how important is this? >> we're seeing pluto for the first time. this is amazing. and i'm just staring at the image right now. i hope you're seeing it too. this is financialphenomenal. >> we thought it was a planet then we didn't. do you think this mission will change that? >> i don't think it will change the planet hood of pluto but it's one of the largest classic example of the kiper belt which is a collection of icy objects

in the solar system. being able to fly by and study it this closely is going to tell us a ton about this group of on sects. >> i've been told we'll be able to tell what's going to break out of the kiper belt from this. just by flying by it we're going to somehow be able to determine the risk of becoming a comet and what isn't? >> no. it's more like what is it made of. how did these things form? a lot of the objects are so far away that we haven't had a chance to look at them closely. finally, new horizons is going to pass just around 8,000 miles above the surface of pluto. >> it already did, didn't it? i thought it did. >> it did it about an hour ago, yeah. >> we haven't gotten -- >> we're not going to be able to

see the closeup images for another half way. >> there are concerns about that. apparently it can't be taking impajs and inputting data and sending it at the same time. some people were concerned it would run into a speck of dust before we got the information back. sfwlo >> how long does it take to get back here? >> it takes about four and a half hours for-- nine and a half hours to get the information back here. >> what else are we going to learn? >> this is one of the mysteries. so whenever we go to any new object in the solar system there's not only the questions we're hoping to have answered. in this case there's all the new mysteries that pop up. no one was really expecting to see features like this. >> there's a heart on it? >> yeah. pluto loves us. >> it's a heart-shaped formation. >> that's what i said. >> close to what you said. >> one of the ideas is that

pluto has an atmosphere that freezes out depending on how close it is to the sun. this could be that the atmosphere on pluto is in this process of sort of falling -- like snow down to the surface of the planet or dwarf planet, sorry. i'm still stuck in which i learned as a child. it could very well be that pluto is in the process of changing from one stage to another as the atmosphere moves from sort of being an atmosphere to something that's more like snow on the surface. again, we're just in the early stages of this. we have no idea what we're seeing yet. >> isn't it little person planet phrasefrazier? >> dwarf planet. >> it's up to you. >> i thought we had kelsey grammar on today. >> i had the name first. >> you probably did. you were born with that name but he was just a character. >> yeah. i had it first. >> and i thought he was talking

about the difference between pluto and goofy. what is the difference between those? do you know? >> one is a dog and the other is a dog but one owns the other. i don't understand. it's not right. >> you can't answer any of these questions. >> i'm canadian. i can't help you with any of this stuff. >> thanks. that does it for us today. right now it's time for "squawk on the street." good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jamim cramer and carl faber. got some upgrades of coke sam zon and others but retail sales disappoint. down for the first time in four months.