"squawk box" begins right now. live from new york, where business never sleeps, this is "squawk box." good morning, everyone. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. we'll get to the super tuesday results in just a moment. first, let's take a quick check on the markets. in asia overnight, moody's downgrading its outlook on chinese government debt to negative from stable. the ratings agency cites uncertainty over economic reforms, rising government debt, and falling reserves. however, stocks there shrugging off that news, rallying on the back of yesterday's strong session on wall street. chinese equities turning in their best day in four months. the hang seng was up by 3%. the shanghai composite up by 4.25%. the nikkei also ended up by just over 4%. let's take a look at the u.s.

equity futures again after that big day on wall street yesterday. you can see they're giving back a little bit of ground this morning. dow futures down by about 43 points. the s&p futures down by 3 1/2. the nasdaq off by one. in the early trading this morning in europe, looks like the dax is relatively flat. cac is up by about 0.25%. ftse is flat. italy and spain, stocks are trading higher. >> a couple big stories we're watching this morning. here's what's going on. oil prices to start with. the weekly eis oil data -- eia, rather, is due at 10:30 eastern time. later today, industry numbers from ati showed a huge rise in stockpiles. a quick look at wti. 33.67. also each keep an eye on natural gas, now trading at 17-year lows. also a couple other items of note. the adp employment report at 8:15 a.m. eastern time. it's expected to show another

solid increase in private payrolls last month. forecasts call for a rise of 185,000. that's smaller than january. at 2:00 p.m., the fed releases its monthly beige book, which tracks conditions in the fed's 12 districts. san francisco fed president john williams will be speaking about the economy this morning. we'll have to hear what he's got to say. adult beverage maker brown-forman and abercrombie & fitch report before the open, while costco is out after the close. then the news that joe was referring to earlier, former chesapeake energy ceo aubrey mcclendon has now been indicted on charges of conspireing to rig bids for oil and natural gas leases. the justice department alleging that mcclendon orchestrated deals between two large energy companies to not bid against each other for certain land leases in oklahoma. those charges follow a nearly four-year probe sparked by a reuters report that chesapeake had discussed how to suppress lease prices in michigan. chesapeake was not named in the

indictment itself. says it's been working with the government. that's big news, i thought. >> indicted. horrible word, isn't it? >> it's a bad word. something we don't want to happen to us. >> presumption of innocence. >> until proven guilty. >> sometimes, right? >> implying this is the first of many to come. >> well, i hope we have a justice department that looks around and looks at possible violations of federal law and decides to pursue cases. i just hope that they're consistent, right? >> i know exactly where you're going with that. >> i could be going a lot of places. >> no, not really. >> speaking of which, big win for the front runners. donald trump and hillary clinton on super tuesday. but not a clean sweep. pretty darn clean though. cnbc's chief washington -- i'm

going to call you chief washington correspond john harwood. correspondent is always too long for the prompter. have you thought about -- that sounds -- >> kind of like t. boone. >> t. john harwood. last night everything happened that was supposed to happen in the ncaa. that's all. every single team that was favored won, and it was like it was the first time it's happened because i'm totally at a loss to try to call any games at this point. there's a million dollars on it, if i can get it right. >> million dollars a year year. >> from buffett. if i can get the first 48 games right. that's all i have to do to get a million dollars. >> you're choking already. >> i'm choking already. >> perhaps ditch super tuesday and go to march madness? >> that came out exactly like it was supposed to come out. i think so did last night, actually. pretty close to what you were saying, john. almost exactly. >> well, i think you put it right in the intro, joe.

it wasn't a clean sweep, but it was clean enough. take a look at this map with the democratic race. hillary clinton, no, she didn't win in minnesota. she didn't win in vermont. she didn't win in oklahoma or colorado. but look at these big states she won. texas, virginia. she won in massachusetts. all of those were very important for her campaign. the african-american vote in southern states lifted her, and she pivoted her attention in the post-results remarks to go after not bernie sanders but corporate america. take a listen. >> now, i'm not interested in condemning whole categories of people or businesses. i'm just interested in making things right. so let there be no doubt. if you cheat your employees, exploit consumers, pollute our environment, or rip off the taxpayers, we're going to hold you accountable. [ cheers and applause ] >> now, similar situation both

rhetorically and in results on the republican side. donald trump had a very good night. didn't win everywhere. ted cruz won his home state of texas. he needed that to stay alive. ted cruz also won in oklahoma and alaska. marco rubio got his first win in the minnesota caucuses, but that wasn't very much for marco rubio. donald trump did very well across the south. he did well in the northeast. he won in vermont. he won in massachusetts. donald trump in his victory speech trying to turn to the general election as well, went after apple. >> i'm going to get apple to start making their computers and their iphones on our land, not in china. how does it help us when they make it in china? >> the question going forward is we've got two weeks until the big march 15th primaries winner take all contests in ohio and florida. john kasich and marco rubio want to stay in the race in order to win their home states and try to deny donald trump a majority.

because of the wins he had last night, ted cruz appealed to other republicans to make way for him to emerge as donald trump's challenger. >> for those who have supported other candidates, we welcome you on our team standing united as one. [ cheers and applause ] that is the only way to beat donald trump. >> and guys, ted cruz said he was asking other candidates to prayerfully consider making way for him. you can bet they're not going to do that today. we still have five candidates in this race. ben carson, john kasich, and marco rubio do not appear to be leaving and making way for anybody, and that makes it easier for donald trump to win states and win a majority of delegates. >> well, i just wish, john -- because i don't remember you predicting or telling me that ted cruz was going to be the

more reasonable alternative in any type of gop primary. i mean, all we hear -- the only way we form opinions is from mainstream media. i understand this. but the way ted cruz has been sort of reported on for the past two or three years, think about that. and he's the reasonable alternative to the front runner. >> and the one having the most success. >> the most success, but you still have divisions. our friends tony said yesterday our party will never unite behind donald trump or ted cruz, ever. >> but that's such a huge amount of vote at this time. >> how about stewart stevens? how's your strategy working? oh, that's right. you're the strategist from four years ago. tell us what to do this year, stewart. >> well, that's exactly the message of the election, which is that the establishment simply

doesn't have control, doesn't have the power. in fact, lindsay graham, who's been seen as somebody, a quasi establishment figure. when he got out of the race, he backed jeb bush. that didn't work out. last night, he said we may need to unite around ted cruz to stop donald trump. i don't think other people are going to follow that, but fascinating. >> where did alice go? a rabbit hole or something? this is some weird alternate universe. the other thing that struck me last night, did you watch rubio's victory speech? i was watching it, and it was like, where have i seen this before? the only guy i could come up with was baghdad bob. we have the americans on the run. they're at our gates, but they're headed the other way. we've been working on this strategy and it's working. it was like, what are you talking about? what world are you in? does that help? >> marco rubio had success among

late-breaking voters. the problem is there just weren't enough of them. so i think the story of marco rubio's campaign so far has been always on the cusp of a breakthrough but never quite getting there. >> he won a state. people said he'd never win one. is that the same one mondale won? he won one. wasn't it minnesota? >> yeah, but here's the question. we got a two-week sprint. >> jesse ventura. >> most people in the party who don't like donald trump want all the candidates to stay in because that maximizes the chances of denying him a convention majority. so john kasich has been running behind trump but not terribly far behind. marco rubio has been running substantially behind donald trump in florida, but we have the word that super pac z are going to go hard after donald trump in florida. we'll see whether they can close that gap. if, in fact, donald trump can hold a lead in florida, you

know, there were all those sorts of rumors flying around last night about rick scott the governor endorsing trump, which would be another christie-like move on the verge of that primary. if donald trump can breakthrough, he's not going to be stopped, period. >> you're not even talking about a brokered convention. you're talking about him winning flat out before you even get to that. >> if donald trump wins both ohio and florida two weeks from now, the thing is flat over. the only way you could conceivably argue that it might not be over is if both kasich and rubio win. we'll see. >> all right. see, i told you it was much easier to figure out the brackets than to figure this out this year. but sometimes i look at it, john, and an eyebrow does go up. people just say things for spin. i guess we should have known that. politics, spin, right? it seems even more ridiculous,

some of the contentions people make. anyway, let's turn to democratic strategist steve mcmahon and republican strategist phil musser. you want to trash a few democrats first, or you want me to get steve to trash a few republicans? where do you want to start? >> wherever you want to start is great, joe. >> it's hard to figure out who's who a lot of times. let me start with you. you're the republican, right? >> i'm the democrat. >> you're the democrat? you were nodding and listening like i knew what was going on. >> steve's a good guy. >> john is brilliant. his analysis is spot on. this is all over but the tears, although you're now starting to see a lot of tears. it's a little late. >> i thought you were laughing off camera when hillary was talking about the rule of law. >> i was actually laughing at your cynicism. >> i'm so happy she's pushing the rule of law. >> democrats believe in the rule of law, joe. >> the laws they consider

important. okay. phil, kasich and rubio and take your pick. we have john kasich on today. what should i ask him? should i say, hang in there, buddy? people giving him money, is this helpful? who is it helpful for? >> i think you've got to ask him just kind of what the viable path forward is. i mean, harwood set it up really well. but the results last night were, you know -- there was a little glimmer of hope for marco rubio with these late-breaking voters. the messaging last week wasn't particularly good for trump. >> steve is laughing again. >> i think you've got to ask him the path. his plan is to bank it all on ohio. >> couldn't with ask rubio the same question? >> i don't know that's a plausible -- i don't know if that's a plausible scenario at this point in time. >> phil, do you remember that movie "monty python" where the guy is standing in the ravine with his two legs and two arms

cut off saying, it's just a flesh wound. seems like that's what's going on with your party right now. ted cruz and marco rubio saying it's just a flesh wound, we're going on. you look at what's happening with donald trump, and it doesn't look like anyone is going on very much further. >> ben carson is still in. >> carson needs to go. there's no rationale. on the democratic side, this thing has some gas in it too. hillary's comments last night were aimed at the populist left, not at the center of the election. that's because bernie sanders still has got energy and the ability to tap a button and raise $3 million or $4 million a pop. as long as he's there, his cash on hand may be higher in april than that of hillary clinton. that's a lesson from 2008 i'm sure she hasn't forgotten with barack obama. >> you said it, joe. bernie sanders has money. >> as long as you have money -- >> it used to be that party primaries were a whittling

process so people who lost, they lost support, lost money, and lost momentum. if you have enough people giving $27 on the internet, you can go on forever. that's kind of what's going on here. >> joe, that's what you should actually ask kasich. how is his dough? i think carson has been able to raise money. rubio is raising money. a lot of money going into marco rubio's super pac. there's a ton of early vote already banked in florida. it's the seminole decision point in this race. over 300,000 republicans have voted. so florida and ohio are the pivot points in this race. in the next two weeks, there are a bunch of states like kansas and maine and puerto rico, which may sound not significant, but it has 23 delegates. marco rubio could win there. that matters for the i-4 corridor vote in florida. they could reset a little bit of the narrative of this race. there are three guys out of here to watch. it's hard for kasich to make the

case he's the fourth. >> it's fun to run for president, i think. >> oh, man. it's hard. >> i'll never forget the correspondents' dinner. kim kardashian was at the front table. photographers everywhere. rick santorum walked up, and the place went wild. he got to go up and meet kim kardashian. i thought this was fitting. but it's fun. you're a big star. who was rick santorum? he lost the last senate race. >> he's running again. or he was until recently. >> it's for them. it's not for the country. it's not for the party half the time. >> looks good on your obituary that you were a former presidential candidate. >> anyone who puts themself through this process, you have to say thanks for serving this country. it really sucks. it's not easy. it's really hard. >> jeb bush, they talked about how classy and dignified it was

when he saw that it wasn't going to happen. jeb bush had three times the number of some of these guys or more. he had a lot more money. he had a lot of reason to stay in. he had the class to exit when it was time. these guys are hanging on too long. >> look, trump's got super luxury. he doesn't have to raise any dough. he's got two 757s. he flies back to new york city to sleep every night. that's a nice formula for a presidential candidate because most presidential candidates i've worked for and steve's worked for, it's a lot of holiday inns in pella, iowa, and crappy hotels. totally different world we're in. >> i have one hillary-bernie question. assuming hillary gets the nomination, does bernie ultimately step in line, not only endorse her but somehow get this pack of people to really authentically actually vote for her? or does that not happen? >> no, i think he will. one of the things you see on our

side a little more than on the republican side is it's not quite as vitriolic. bernie sanders is running a campaign on the issues that bernie sanders cares about, but he's not really attacking hillary that much. >> they'll all go to hillary, but the excitement gap is the other thing. >> there has been about a 25% decline in democratic turnout. >> they may move to her, but they may not vote. >> the most excitement gap filling thing in this race might not be hillary clinton or bernie sanders. it might be donald trump. if you think about who the voters are that hillary needs to turn out, she needs to turn out african-american and hispanic voters and young voters. >> donald trump or scalia might be the most exciting. >> scalia is a very exciting thing for democrats. >> listen to other people once in a while. did you hear what we just said? >> i did, yeah. i was going to give you two cents on just what i think sanders gets out of this. at the end of the day, i think he's going to ask for something at the convention, and he's going to ask for a couple things

on the platform that will pull the party leftward. steve's point that i think you're going to have a fully engaged, fully mobilized, highly motivated general election, whether it's hillary clinton or bernie sanders, is a fact of life. i suspect that the people that are motivated for sanders will ultimately transfer to clinton at the end of the day. >> you're going to have republicans walking away from donald trump and voting for hillary clinton. there's going to be enthusiasm. >> there's an anybody but clinton side and an anybody but trump side. we'll see how it works itself out. thanks, steve and phil. i know it's hard on a remote. >> sorry about that. >> no, that's okay. it's hard for you to get in. it's your right to. we all interrupt each other. believe me. that's all i hear about. anyway, thank you. >> thanks, man. >> coming up when we return in just a moment, we have a big lineup to talk politics this morning. it all starts at 7:00 a.m. eastern time. you do not want to miss this. we have gop candidate john kasich. he's going to join us with two of his biggest supporters from

the business community. home depot founder ken langone will join us. lots to talk with all three gentlemen about. first, stocks in asia building on yesterday's rally on wall street. the morning strategy session right after the break. "squawk" returns in a moment. actions speak louder. something we'll show you. through small things. big things. and spur of the moment things. sheraton. ♪ ngo to ziprecruiter.com and post your job to over one hundred of the web's leading job boards with a single click. then simply select the best candidates from one easy to review list. and now you can use zip recruiter for free. go to ziprecruiter.com.

whetheri in-- welcome back "squawk box." march came in like a lion. major indices closing at their highest levels in more than two months. shanghai composite closing more than 4% higher. we're joined by steve weidman and chris bennett. good morning to both of you. coming off the political conversation, i'm curious if anybody has a view. the market has not moved necessarily based a the all on the election. do you think there will be a moment at which it will, and is there a candidate you think could be more or less attractive for the market? >> the market is coming out of a state of shock. this election is not the

scariest thing in the world. when you come into the year expecting financial shocks from china, from the petroleum sector, from all of these things. so this is not even a focus. we'll be focusing on brexit before we're focusing really on the u.s. election and whether it can make a difference for the u.s. economy. you know, if we had the extremes of both parties, let's say bernie sanders wins, you know, markets will start paying attention then. >> i agree 100%. there are so many other factors being focused on. the election is taking a backseat. you have china, brexit, other factors we need to consider prior to the election even being a big issue. >> how do you know what the market is moving on? you're looking for the market to sell off based on this crazy election. how do you know it wasn't up 350 points yesterday on either hillary clinton vanquishing bernie sanders or someone thinks donald trump would be good? we don't know. you say it hasn't moved yet. how do we know yesterday's move wasn't? you never know cause and effect. >> broad equities across the

world, transportation companies, health care companies, suddenly 80% correlated with the price of crude oil. we haven't been in that situation since the heart of the crisis of '08, '09. so those sorts of signals tell us that we are in a really disoriented state, and -- >> if the market continues to move higher and hillary maintains that lead over trump in the general and the market moves higher, people are going to say, we're anticipating a return to the clinton prosperity. he's going to be there, she's going to govern from the middle. i'm making it for you now. >> i'll agree. but remember -- >> the market will be down 4,000 points on trump. >> if you remember four years ago, the narrative for almost 12 months prior to the election, before even romney was the -- >> before romney was going to help. >> there was a question about what romney was going to do, where the country was going to

go, whether it was fixable. we needed to actually restart. every time it's the restart. businesses would say, we can't do anything. we need to wait to figure out whether there's going to be tax reform. these were some of the questions. but back to where we are today. you mentioned -- both of you mentioned brexit. the question is, is that actually a real issue to you? >> look, if it's polling and it seems to be a low probability risk, the markets are in the going to focus on it much. if we find that there's a great big campaign and, you know, it gets very, very close, then it's going to have significant impact in both the u.k. and the eurozone. >> the last poll i saw was pro-brexit. >> got much closer even in the last two days. >> a point ahead. >> so this is an issue that could resurface again when we come out of this state of shock. the expectation for the world economy gets clobbered if, you know, we're down 15% in the month, if there are all sorts of -- you know, there's a vacuum of expectations about central banks.

all of these anticipated shocks that haven't materialized, we can rebound from all of that then face new political issues. >> that poll has a lot of people undecided too. >> i mean, we've seen the record of the european union over the past ten years. i don't think -- you know, the mainstream opinion is that it's working and it would be very disruptive. there are other people that think it was flawed from the start and the sooner that i get rid of this jury-rigged system -- there's still 13 different currencies in the eu. there's not a single financial, you know -- >> well, staying out of the politics and any of the long-run gains and things you want to think about with this particular issue, you know, 13% of u.k. gdp is exported to the european union. this is not going to be, you know, a short-term, easy issue if there is a substantial, you know, shock there. >> before we let you go, would either of you put money or allocate more money into the hedge fund space right now? the reason i ask is if you look at the large cap -- i don't know if you want to call it large-cap

hedge funds, but they wialmost e these days, that have done historically well for the most part, the question therefore then becomes would you do that? >> i think you need to take -- >> or do you think there's a shift going on? who did we have on yesterday? phil falcone said he thought the whole business was a mess. >> well, i love the passive space. if the shift is going on, it's nice. but i think you have to take each individual risk into play and say sort of where are we going and where do you think the markets are going and who do you have more exposure to. i don't think it's necessarily a broad macro theme as much as it's where do we think it's going and where do you want exposure to. >> there are a minority of hedge funds -- for example, they're measured up against equities when they're not even equities traders in terms of relative performance. but there are a minority of hedge funds that are essentially long volatility that have strong returns when markets dislocate. if you add that to a portfolio, that happens to be long all

these other risks, then you get a very different outcome that can actually dampen volatility in a portfolio. if that's the way you're using hedge funds, that's very different from, you know, shooting for the fences with a particular fund on equities. >> okay. fair enough. we're going to leave it there. thank you, guys. >> coming up, directv owner at&t is ditching the satellite dish, at least for some customers. those details straight ahead. plus, new performance data on bill ackman's pershing square. it isn't pretty. as we head to break, a look at yesterday's s&p 500 winners and losers. at mfs investment management, we believe in the power of active management. by debating our research to find the best investments. by looking at global and local insights

to benefit from different points of view. and by consistently breaking apart risk to focus on long-term value. we actively manage with expertise and conviction. so you can invest with more certainty. mfs. that's the power of active management.

welcome back to "squawk box." time for the executive edge. at&t will start offering directv over the internet later this year. the new service would let users stream programming online without the need for a satellite dish. they also plan to sell a version for mobile device and a separate free ad-supported streaming service. this is a culmination of what that deal was all about. it's actually come sooner than what some would have expected. >> i remember very well, andrew, because i sold cable systems as a stockbroker. a three to one or five to one writeoff. everybody thought in the '80s, by 1990, satellite, blah, blah, blah. then came the internet and

everything else. don't you have the idea that satellite is not going to pre-empt everything at this point? it's going to be something else probably that does it. >> what's this 5g? >> yeah, the 5g stuff. it's amazing. >> but how does 5g work? >> 5g is effectively just the next generation of 4g over your cell phone. >> but it's used through the -- they don't have to put the wire directly into your home first, right? >> it's just like 4g. the issue, though, because we have a parent company in the cable business, is that 5g is so fast that you could download a movie -- right now if you were to download a movie on your u phone or ipad, it would take eight or ten minutes. you've probably tried to do this before. it would take five seconds. >> amazing. >> so all the sudden, the speeds, you know, start to morph and get closer. question is, if people start putting 4k and other sort of more intensive data, you might still need the pipe.

it's just a question. what are you laughing about? did i say something? >> you identify with that. things that sometimes take eight to ten minutes that happen in five seconds. that is much better for downloading. faster is better. >> the mind is a terrible thing to waste. >> this is the message you get for trying to sell. >> why waste time? >> efficiency, productivity. >> get it out of the way. >> that's what you get for selling. >> that's what i hear. >> all right. a new ranking of the super rich. "forbes" annual world billionaires list is out. bill gates remains at the top. mark zuckerberg had the best year, adding $11.2 billion. moving up to number 6 from 16. 221 billionaires got knocked off the list this time around. this is the most ex-billionaires since 2009 when the credit crisis knocked off 335 of them.

>> do you think bill gates could get a decent haircut by now? >> can i tell you, i think he looks great. >> you're nice. >> i do. you think the haircut is no good? >> no, i don't. nerdy. hard to take the nerd out of -- he invented microsoft when he was like 16. i probably shouldn't be throwing stoneses. bill ackman's fortunes moving in the wrong direction. sources say -- he should get this guy's barber. ackman's pershing square holdings down 19.9% this year. he told clients that the hedge fund lost nearly 10% in february. pershing has been hurt recently on bad bets by herbalife and valeant pharmaceuticals. >> you could be a billionaire and have a good haircut. >> you would be bill ackman.

is he still a billionaire? >> i'm sure he is, yeah. >> for now. >> your haircut -- >> and i'm not a billionaire. i'm working on it. >> it's free too. >> that's true. >> which makes it really good. >> people here at cnbc make sure we all look pretty, including you. >> thanks. >> and including her. >> it's a big job, but somebody's got to do it. coming up, a helping hand of gloom and doom. mark fauber says the fed's rate hike times was an error that may prove fatal for the economy. after the break, he'll tell us where he's looking for safe hains. right now, a quick check of what's happening in the european markets. relatively flat today. mixed performances. dax and cac both up. the ftse down. you're an at&t small business expert? sure am. my staff could use your help staying in touch with customers.

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welcome back. u.s. equity futures at this hour are giving back a little bit of those big gains we had yesterday. that was a nice session yesterday. at one point, up 350 points. it started slow. we were called higher 90, 100 points yesterday. by the time the session was over, oil helped out and moved higher. finally, the dow was up 350. january was down a lot. the first two weeks of february we were down. but then stabilization the last weeks of february. now march starting out pretty good. so it would be nice to know where we're going from here. >> talk more about that. right now, mark fauber is joining us from singapore. he's the editor and publisher of the gloom, boom, and doom report. mark, there are a lot of people who think, look, we've seen our

volatility. things have bottomed out, and we're headed up from here. you think that what we got a taste of in the first six weeks of the year is just the beginning of more bad things to come, correct? >> yes, correct. however, i'd like to point out that the market in february became extremely oversold, and from this extremely oversold rally position we can have a relatively strong rally. first of all, a lot of momentum stocks, they got hit very hard in the first, say, four weeks of the year. they're oversold and can rebound. secondly, many stocks are down 25% to 30% from their highs in 2015. the oil sector could easily rebound by, say, 10%, 20%. so that could drive the market up to maybe around 2,050, but i

don't necessarily see new highs. if new highs happen, they'll happen with very few stocks participating. >> marc, let me clarify. you think that the selling as far as you were concerned was even overdone when it came to a lot of these stocks that you mentioned that were down 25%, 30%? >> yes, near term. but as you know, a bull market develops, stocks rising, correction rising. in '87, we had a huge correction, 40%. we can have now a decline where stocks become oversold, then a rally, then a further decline. that's what i would expect globally. the global economy is slowing down very considerably. >> global economy is slowing down, but what we've seen here

in the united states is the numbers have been coming in better than expected on a lot of different fronts. do you think the united states can kind of continue to hold off and maintain a better growth trajectory than the rest of the world? >> that i very much doubt because the world today is very connected, and when other countries are not doing well, the exports from the u.s., by the way, are down significantly close to 10% on an annualized basis. industrial production is basically flat to down. new orders are down. i don't see anything particularly good about the u.s. economy, which was driven again by a lot of credit growth that allowed people to borrow more money to buy cars and homes and so forth. >> except for wages have been rising and inflation has gotten quite a bit closer to the fed's target.

i guess that brings us to the question about the central bank and what you think they may or may not do. >> well, i think they'd be crazy to increase rates further whereby i have a negative view about central banks anyway. i don't think they should manipulate the cost of money. in other words, interest rates. i don't believe they should manipulate exchange rates, and i don't believe they should manipulate even stocks by intervening into the market and occasionally buying stocks to support the market as they've done in europe and also in japan. and probably also in the u.s. on very bad days. >> yeah, we've seen a whole lot of that over the last several years. any reason to think they're going to stop doing that? >> well, they will never stop, believe me. they're academics. they have the view that they know better than the market, that they know better than the capitalistic system, and that

the free market needs their guidance. they think the free market fails, but in fact the interventions have failed, and the monetary policies that should create economic and monetary stability have created a lot of instability. as you can see, the market has become very volatile. foreign exchange markets are extremely volatile. so we have a lot of instability, which is essentially negative for global economic growth. >> all right. marc, always great talking to you. thank you for joining us today. >> thank you very much for having me on your program. thank you. >> okay. coming up when we return, where do the super rich go when they want to drop eight figures on a mansion? well, we know the one guy who knows the answer. robert frank will join us next with a list of cities that give us the most mileage for your millions. we're back with that in a moment.

blal

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to so many. weathertech. proudly made in america. welcome back to "squawk box." tons of data on the rich and their real estate holdings. robert frank tells us where the

ultrarich are buying right now. >> wealth creation is expected to slow in the coming years and with it some luxury real estate markets according to the wealth report. real estate prices inched up 1.8% worldwide last year. vancouver had biggest price gains at 25%. among the worst, lagos. nearly a third are considering buying real estate for investment reasons and strongest markets are expected to be sydn sydney, new york and monaco. it gives you over 2,700 square feet in capetown. they are now 187,000 people in the world worth 30 million or more. that's down 3% from 2014. that population expected to grow

41% by '25. that's big. slower than 60% growth over the last ten years. new york had the largest number of those super rich residents with 5,600 followed by london. joining us to break it down, howard is here. you guys are in new york, aspen, l.a., miami, hamptons. what markets are strongest right now and where is it weak? >> those markets are strongest. that's why we decided to be there. it's where the same people trend amongst those markets. the markets in the city, if you look at new york city, it's reached historic highs way past the pre-recession highs. if you look 20 miles out or 30 miles out in the suburbs, they have not recovered from the 2007 highs. >> if you look globally, you have slowing global growth and problems in china, middle east, russia. you have the currency issue which makes u.s. real estate more expensive. it has to slow down this year compared to last year and 2013,

doesn't it? >> all those reasons are reasons why they don't slow down. the fact is that after the china slowdown with the real estate going down and with chinese stock market going down, everyone felt the chinese investment in new york or in the united states would slow down and in fact it increased. i think if they sat there and said, well, we lost 30% of our net worth -- >> you see more chinese buyers now than you did this time last year? >> yes. they lost 30%. they don't want to lose the other 70%. >> there's so much high end inventory in miami and new york, aspen. feels like 2007 when everyone was building for the mythical billionaire that would buy a $30 million penthouse, there's too much on the market, isn't there? >> you don't have to be a billionaire to buy a $30 million penthouse. it is simple. the market for overpriced apartments has slowed down. >> you can get money out of china, you want to get money out of china.

>> how does this work? >> mortgage rates are 2.5. why buy for cash? >> have bedroom communities of new york city ever failed to eventually follow prices in manhattan and has there been then a decline in manhattan before the rest of the -- i live in one them -- before the rest catch up. a decline where they don't catch up? it lags a little, doesn't it? >> it does lag. >> what's the problem? >> people want to be in the urban cities. they want to be in the cities. they don't want to be in the suburbs as much. >> treasury rules took effect yesterday. very few people know about this. yesterday new rules took effect that are designed to track illegal money laundering through new york city apartments and miami. have people said this could put a chill on the market. what have you seen in the market right now -- >> it's a big nothing. we have one customer that changed his closing date one day

to march 1st. no problem in the closing. no problem with the title company. no problem with anything. it's really a big -- a lot to talk about. it doesn't mean anything. >> you have worked a long time with donald trump. i know you talk to him a lot. what do you think of the potential for a developer in chief and what is he like as a real estate guy? you deal with him in that business world. his business career has gotten a lot of attention for better or worse. is he a good businessman and would he be a good president? >> it's obvious he's a good businessman. being a good president means you have good people around you. i can tell you that donald talks to a lot of smart people. i hear who he speaks to. there's plenty of smart real estate people around and smart businessmen around that he does speak to. if he were to become the president, i would say that he will have good people around him, which is important. >> by the time media and left got done with romney, he was thought to be a horrible businessman and even bill clinton said he had a stellar

business career. same thing with trump with bankruptcies and stuff like that. if it was four personal bankruptcies, which it wasn't, to build a billion dollar business then he picked himself up. it was what a lot of people use in private equity where bankruptcy laws of this country people use them when a project doesn't work. >> i guess then you have to say the private equity firms are all bad businessmen. >> you watch the narrative of how he's being portrayed by the media. >> i was called about an article on him and wanted to talk about atlantic city. i said atlantic city was failing of the government and not donald trump. everyone failed in atlantic city. >> they probably hung up and said that's not what we want to hear. knight frank, is that you, buddy? >> not yet. we're working on that. >> so cool. >> we do have big hour of "squawk box" coming up after the break. gop candidate john kasich joins

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trump train rolls on. on tap this hour, one of trump's competitors, john kasich, and legendary investor. stocks riding 300 plus point rally into today's session. a look inside the numbers ahead of today's training day.

>> and the ex-chesapeake energy ceo indicted. the shocking details straight ahead as 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" 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 a little bit of red. dow jones looks like it will open off 32 points. s&p 500 down two points and nasdaq would open up marginally. things in europe a marginal picture. checking out what's going on in oil, wti crude trading at 33.76 and finally the 10-year note and you're looking right now at

1.844. there you have it. >> before we get to our special panel, here's what's making headlines at this hour. a key economic report is a little over an hour away showing 85,000 new jobs in the private sector. investors will look at the fed's beige book. regional assessment of the economy. and latest mortgage applications data is just out. the mortgage bankers association reporting that applications fell by 4.8% last week despite a drop in the 30-year mortgage rate to 3.83%. >> voters in a dozen states have spoken. it's the wednesday morning, morning after following 2016's super tuesday. and john kasich is republican governor of my home state, ohio. stanley druckenmiller is ceo of duquesne capital and ken langone, chairman and president -- did i mention home

depot. juicers. both of you gentlemen are here to support governor kasich. i'm going to give you both a chance to talk about it. i don't know who to go to first. i don't know whether to -- wait a minute. we can rank it on smarts and wisdom. >> he gets it. >> on age. or on -- >> no contest. >> or on net worth. >> he wins again. big time. >> you start then. >> do i have to listen to this banter? >> let's do it on age. you're younger. >> i met the governor in 1995. >> about that, yeah. >> i watched him move the clinton administration to the right on budget matters, balance the budget. >> economy was growing. >> clinton has gotten a lot of credit ever since but i watched two of them work together and i watched john and newt gingrich move the needle.

since then i know he was on the defense committee for 18 years when i talked to him about the world he goes around it like this, this, this. been a great governor of ohio. i compare that to other candidates on both sides and the delta is just so huge. it's a no brainer to me who would make the best president and it's clearly to me governor john kasich. >> some might say he ought to go to congress and work with hillary clinton as next president and do the same thing you did first time around. >> you're not serious? >> no. i don't know if we want to talk about how great those days were too much. i don't know how much that helps. >> one thing you can say. that was a time when politicians didn't care about their own hides but they cared about the country. we don't balance the budget just for numbers. we did it. economy was growing. wages were up. we paid down half a trillion of the national debt. things were stable so job creators could invest. same thing we've done in ohio. >> would you say you dragged

bill clinton kicking and screaming into that? >> of course. >> was he a more moderate -- as democratic party moved far left? >> he had some people working for him who thought it was important. one of them was bowles. he felt we should balance the budget and had people around him. it was tough. originally they just wanted to make up smoke and mirrors kind of duct tape and wire together and phony. i said we're not going to do that. we have to do the right thing. we got it done. you know, we had a projected $5 trillion surplus. we could have created private accounts in addition to social security for young people but it's amazing. the republicans, house, senate, white house blew $5 trillion surplus. that was the tragedy. and so now we have to fix it again. >> i saw newt gingrich the other night. he's been relatively positive about trump. >> he was with me yesterday at my town hall. >> he said there's no way it could have been done without you

in the '90s. >> more than that, he gave him credit. you have done a great job as ceo in ohio. you go out to cleveland. cleveland is like an infant city. booming. >> not as good as cincinnati yet. >> i understand. but i want to -- i was with governor christie. i'm loyal. stan and i tried to get him to run in '12. he didn't do it. i stayed with him. he chose to drop out. he gave it his best. it wasn't enough. >> you have to eventually comment on his backing of donald trump. >> i'm happy to comment on it. >> i want to say this to the governor where i'm so proud to support you. the way you've behaved to show some sense of decency and maturity. i'm sorry. i looked the other night and i thought it was two 5 year olds

in a sandbox spitting at each other. kids kicking sand at each other. i mean it. we need to restore the faith of the american people in their leaders. this is what this is all about. and i commend you and i hope we'll work like hell to make sure that you are given a shot. >> we didn't expect super tuesday to go very well. we almost beat trump in vermont. we split delegates. same number of delegates. finished second in massachusetts. we picked up delegates in virginia. it was a good night for us. much better than expectations and now we're getting into the march madness where we move toward the final four and it goes to home court for me. we get up to michigan and most important ohio and, listen, i have to tell you that here's the problem for me early on. i got absolutely no coverage until new hampshire. six months in obscurity. then i got some coverage and then it kind of faded but people are starting to hear my message. and i'm telling you that to be

in a position of where we thought we would take him out particularly in vermont, we didn't even know it. i went there a couple times. people responded. so where we focus, we do well. it's a connection both with the head and the heart. that's what's been working. you know, a little bit about ohio just so you know because ohio is -- i went in we lost 350,000 jobs. we're up over 400,000. we cut tax by over 5 million. we're doing a lot of things out there. people who have lived in the shadows are getting help. mentally ill, drug addicted. ohio is working. we have a ways to go. our credit is good. pensions are strong. you take common sense regulation, lower taxes and a fiscal policy that makes sense and you get jobs. it's not that complicated. >> it's a tough year for moderates in gop, governor. if you look at when your time

would be, you look at the default candidate to donald trump now is in some people's view is ted cruz. if you said two years ago that the gop, center of the gop will be near ted cruz, they would have said you're crazy. >> i don't think it is. we're going to be heading north. let me tell you, we're going to head north and it changes in terms of where we're going to play. i win, ohio, which i expect we will, it's a new ball game. it's back open. the race is wide open now frankly. >> when ken came on the set, you said that revolution is going on in this country. >> absolutely. >> the question is whether you can be moderate and be in the middle and be part of that revolution. >> yes. because the chances of success are better if you start in the middle to bring people over. by the way, in the spirit of openness, let's not forget the fact that a lot of this polarization was driven by newt

gingrich. he did a lot of good. newt gingrich was the guy that fired up the base and all of the stuff that went on. this thing has been going on 20 or 25 years. the american people are fed up and the thing i find interesting about this political season is the pros don't get it. they just -- we're going to have a turnout -- prediction. we're going to have a turnout of voters in november like we haven't ever seen before because people say maybe there's a chance they're going to think of me and educate my kids and help me have a great job. this is what this is all about. >> but the most animated voters are not the moderate voters. >> this was your guy. you wanted to defer to him on his decision as president of the united states you thought he would be in a position to make the best decision as president of the united states. here he goes. he decides to endorse donald trump. his first decision he makes you

thought would be great decisions, you think that's a terrible decision? why not go along with trump. >> a guy has to make every decision right to support my position -- >> why do you think he's wrong? >> i don't know if he's right or wrong. he didn't call me to ask what i thought. my fingerprints aren't on that one. >> i think it's disgraceful. >> you were never backing christie. >> with ken i tried to get him to run in 2012. i got to know him well a year ago. >> you tried to get ken to run? >> god forbid. >> i actually did try to get ken to run. it became clear to me at least six to nine months ago the man believed in absolutely nothing but his own ambition. governor christie. if i had any doubts, he more than proved it last week. it's disgraceful when you look at what he said about donald trump to come out and endorse

the man so he can be attorney general, i find it appalling. >> let me say, first of all, i'm not a moderate. i'm a conservative. secondly, the other thing i want to tell you is ken is right. people think i'm going to lose my job. the trade deals are bad. my kid can't get a job. big college debt. all that stuff is frustrating. you see, at some point what voters want to know is who can actually fix it. in other words, you can't just go and knock all of the pieces off the chess board. you have to have a plan to fix it. the strong part of my resume is i did it in washington. i did it in ohio. i can go back. here's what you're going to be shocked at. there are people who get asked who are you going to vote for? it's between bernie sanders and kasich or trump and kasich because i'm not viewed by the public when they get to know me as an establishment insider. i fought establishment all of my life with great success. >> you are seen as the adult in the room. why is that message not picking up? >> it is picking up.

we're heading north. last night you have to understand -- you do money. i understand money. i used to be in money. now i got to tell you a little bit about politics. nobody thought -- everybody thought i would be wiped out last night and it did not happen. i'm getting big town halls, big crowds, enthusiastic. you know what people say? thanks for being positive. keep going. and raise the bar in american politics. don't get down in the mud. we had one candidate that got in the mud with trump and he had a terrible night. that's not the way to do this. at some point the people will listen to somebody that says i've got an answer to your frustration and that time is coming. >> who should drop out? >> if you don't win your state, you should leave. i can't tell you what ben is going to do. if you can't carry your own state, you have to leave. >> you would give him until march 15th. >> let's see what happens.

>> ted cruz has been legitimatized by his win in texas. >> he had a good night. where does he go? does he take what he is up north? that's really the question. >> why do you think the party thus far has been so willing to indulge the mud? the playing in the mud? you're denouncing the mud. >> do they have a choice? >> they have a choice. they can vote against it. >> the mudder is winning. that's why. because the mudder is winning. are you asking me why he's winning? i can tell you why he's winning. they think they're voting for ken langone when he was 25 years old. they think they're voting for an alpha male. there is a big difference between someone who can operate a casino properly. he hasn't released his tax returns. if i was running for president and my legitimacy was based on being a successful businessman, i would be dying to release my

tax returns and show the public what i'm all about. i don't know what's in there. it's not a good thing, okay. so they think they're voting for ken. this guy, okay, maybe he's run a casino well, maybe not, maybe we'll find out if he releases tax returns but he has a kindergartner level view of economics. the man says china is manipulating currency. china is in the biggest currency run in history. this man every day says china is manipulating currency holding it down. he doesn't know what he's talking about. the stuff that comes out of his mouth just astonishes me. >> that may be right but let's go back. he's a token of the american people saying you forgot me. i've been left behind. my kids aren't getting educated. look at the numbers. look at the numbers in public schools. who is going to -- let's be blunt. who is going to take on teachers and say enough? we're spending more money than any other developed country in

the world per student and we rank 30th among 30 most developed countries. something is radically wrong and this is what's happening. this is exactly what's happening. it's got nothing to do with trump. it has everything to do with the american people saying, wait a minute, bring me to the party. help me. let me have a future. let my children have a future. what's going on in america? this is what's going on. you're the guy -- you to me are the guy to bring in all of the desperate parts and say, come on, guys, we have to work together or i'm going to whip you and whip you and go back to voters and say you're the blocking point here. >> the reason i get this is stan knows this that i grew up in a little blue collar town. if the wind blew the long way, people found their way out of work. my father carried mail on his back. i grew up in a town where i understand this anxiety. i understand why people feel so frustrated.

the question is who is it that can deliver the answer for them. if i were an insider or some establishment guy, it wouldn't work. i am not that. the more people hear me and more they understand i'm not. i was fighting a republican president to get spending under control. i reformed the pentagon and fought presidents over that to get it fixed. i reformed welfare. i was involved with people to fix that. in ohio, we turned ohio around. my first meeting i had with lobbyists. they had a luncheon. i said we have lots of changes coming in ohio and let me explain to you. i'll bring about a lot of change and you need to be involved and either you get on the bus with me or i'll run over you with the bus. and i've always been a disrupter. i'm a langone, too, drunken mun millmill miller and i know how to fix this country. it can be done really easy if

people have backbone. >> we'll continue this conversation in just a moment. we do have much more from our special guests today. presidential candidate john kasich. investor stan druckenmiller and ken langone. after a big day for markets yesterday, we're giving back just a bit. dow futures down 35 points. s&p futures off by 2.5 and nasdaq is flat. stick around. "squawk box" will be right back.

actions speak louder. something we'll show you. through small things. big things. and spur of the moment things. sheraton. ♪

welcome back. let's get back to our special guest this morning. john kasich is the republican governor of ohio who is running for president. stanley druckenmiller, and ken langone is here. i want to talk about what's happening in the economy right now. what you think is out there and what needs to happen and, stan, you touched on this by talking about the pressure that china is under right now. that's played out in a big way in the markets this year. are the markets reflecting the economy right now? where do you think we're headed? what's happening? >> i think the market was overvalued going into last year. we've had a huge liquidity support for the market for a number of years. it's dissipating because china was obviously buying a lot of western assets when reserves were increasing and now they're

decreasing. saudi arabia, they were buying a lot of assets here when oil was over $100 a barrel and now they're selling. i think it's the fed that stopped injecting. it's just the natural outgrowth. markets themselves and natural outgrowth of cessation of liquidity. i will say that all this fed action and other stuff all of the central banks have done the last five to seven years, we have pulled so much demand for it and borrowed so much from our future, so much financial engineering has gone on. this idea that we're going to have velocity in the economy, i don't see it. at best we'll muddle through. it's part of the reason i'm so excited about the governor. we cannot have somebody inexperienced come into this job because the challenges are huge going forward and it's going to be tough whoever the next president is. >> he'll have to make very, very difficult decisions, okay.

we'll fix it. don't sell america short. we'll fix it. you know, there's one more thing about this election cycle that i like personally. we've proven that america is not interested in dynasties. jeb bush started with $110 million a year ago. $110 million. spent $36 million in new hampshire. 19,000 tv ads in new hampshire. and didn't do very good. this notion about money buys elections, bernie sanders, forget about it. >> it's amusing they keep repeating that and people that spent all of the money lost. don't confuse anybody with the facts of the situation. >> you know, i want to tell you, within the first 100 days, they'll get a plan to freeze all federal regs for one year except for health and safety. i will have a vice president who will unravel all of these regs like i've done in ohio to restore common sense. i would also force the congress to vote on any regulation more than $100 million so that bureaucrats are not making law.

i bring corporate rate down to 25%. i do expensing on any investment and plant equipment and at the same time i bring the dollars back from europe. i wouldn't double tax them. and then on the individual side, 28-25-10 with capital gains at 15 and more money into defense and slowing the growth of medicare from 7 to 5 and medicaid from 5 to 3. and ship welfare, infrastructure, job training and education back to the states and then fix social security. secure the border. have a path to legalization for those who are here illegally who have not committed a crime. and that's what i would do within the first 100 days. you see, we need a shock and awe plan because if you don't get it to them quickly, they will cut you into a thousand pieces down there in washington. you have to move quickly. >> maybe we'll do $10 a barrel on oil. you've seen the supreme court

weighing in on epas ability -- >> the epa rules are crazy. >> you're a global warmer. i mean, would you allow all those regulations? would you honor the paris treaty? >> what i would do is to promote renewables. i think we do need wind, solar and battery technology, fuel cell, hydrogen. >> right now it's $30 oil. it makes no sense to subsidize this. >> i would continue to make sure we could develop those renewables because of the issue of climate change. we don't know how much human beings are affecting the environment but a reasonable plan to develop renewables and use all of the above. natural gas. we frac in ohio. not as much as we would like. we don't have the big giant industry yet. obviously if you dig coal, you have to clean it before you burn it and then nuclear power and then these renewables. it's a reasonable plan to make

sure we have all of the above. and, look, when battery technology works, when we are able to restore power, that's going to change the whole country. because then when wind doesn't blow, we'll store power and when sun doesn't shine, we'll have power stored from solar. this is change the country. a reasonable approach -- most things are balance. it's like this crazy thing going on between apple and our security folks. i mean, how does a president not sit these people down in a room and i'll put langone in the room. they won't come out of there until they fix this. >> amen. >> they can figure this out. figure it out, boys. i'm the president. you go figure this out. don't be putting this thing in court on the front page of the newspaper. this is our security we're talking about here. and it's resolvable. we don't have to give the government carte blanche but there are some things the government has to have when it affects terrorists activity in this country around the world. let's get somebody leading.

>> absolutely. >> i point at you because you've been disagreeing with this position the whole time. >> that position i've been disagreeing with? >> he said if you can do it on one phone, go ahead and do it. obviously you didn't see my -- i left "the wall street journal" paper. encryption is more important and it will get more and more important and risk to us of people being able to hack that want to do harm to us, the risk of that to our grid, the companies have to develop encryption. >> our money will be on a smartphone. >> how long have we been worried about privacy? it's always between security and privacy. we've been doing this a long time. i don't know whether a closed door session -- we may need congress -- >> you don't need a back door. you just need the technologist and security people to be together to say let's use common sense and figure this out. and don't come out of the room -- what i'm going to tell them is you'll be in the room with langone.

that will give thie them incento get it done quickly. >> governor, what do you see when you go around the country in terms of the economy? what's happening right now? >> i tell you that's really true. it is related to the economic insecurity but there's another thing going on. people feel alone. they feel as though nobody celebrates with them and nobody cries when they have losses. people come to my town halls and they just are willing to say things that are just so deep and so personal to them. when they feel safe, they want somebody to listen. if they think somebody is in a position to maybe do something to help them, they come down. they'll give you a hug. they'll actually cry. they'll say, please, listen to what i'm telling you. a guy said do you realize national institutions of health only 4% is spent on childhood cancer. what are we doing?

you know, these are things you hear. we need to slow down and pay attention to other people once in a while. the strength of our country doesn't rest with big wigs. it rests in neighborhoods. it rests in the family. the neighborhood. the community. they feel alone. >> you know why nih money is not available? langone is getting social security. >> you're right. >> seriously. it's a tradeoff for me. >> it is disgraceful that -- >> we're cutting nih grants for entitlements. to people like ken and unfortunately me pretty soon. >> i shouldn't get it. >> you want to mean test social security? >> for those wealthy throughout their lives, they'll get less. not zero. i don't want to turn it into a welfare program. so those who dependent on it get it and that will fix the program

forever. >> peggy noonan piece about people feeling unprotected in this country. part of what started this whole trump movement was an immigration issue. you don't want to deport 12 million people but what about porous borders? >> you fix the border. i believe they don't fix it because there was interests down on the border that said leave it alone. >> this wall nonsense reminds me of emergenimaginary line. >> we can protect it with technology. >> we don't have a problem. many people want to go to mexico as want to come from here. >> people feel there's a problem. >> canadians want to build a job to keep nut jobs like us out of there. >> we can control the border like we lock our doors at the country. a country can lock its doors but

we have to let people come in. we wouldn't all be here if it wasn't for the fact that there was immigration. >> immigration and anti-illegal immigration. >> let me tell you something i learned. you can walk into a room of 100 people and get them dark, negative and angry or walk into that room and tell them that we have problems but we can fix it and we'll do it together and they cheer. it's just a matter of how you tell them we're going to deal with what is a legitimate concern. langone is right about this. peggy noonan when she wrote that piece was right. david brooks also wrote a piece. when outsiders keep -- when people think i'll put an outsider in and they can't fix anything and put more outsiders in and it keeps slipping down the road, they get angrier and angrier. it's been empty promises by a bunch of politicians. i'm going to give you one example. i want to repeal obamacare. for somebody to run in 2012 and

say they'll repeal obamacare with president obama sitting in the white house, i mean that's a phony promise. and all it does it mislead people and aggravate them even more. >> exactly. it's ridiculous. we'll get rid of it and have a rationale plan to replace it and i have one. you cannot run in 2012 and say i'm going to washington to repeal obamacare when the guy in the white house has a veto pen. tell the people the truth. >> if a scientist didn't think he could discover something, he wouldn't try. but they believe they can find something. so they try. the same is true with america right now. we can fix this. we have everything we need. we need more inspired leadership. we need guts. we need to tell the american people not what they want to hear but what they have to hear. guys like me need to know i should pay more taxes. i shouldn't get anything from the government. this crap that's my money.

i put it in. forget it. i bought an insurance policy. i won. i didn't need the income. i don't get it. >> governor kasich, thank you for joining us. stan, great to see you. come back soon and ken will be with us for the rest -- >> unfortunately. >> luckily for us. >> very fortunately for us. when we return, ken will be here and we'll talk about the former chesapeake ceo indicted on antitrust charges. we'll look at one of the pioneers in the shell boom and how quickly he has fallen from grace. take a look at oil this hour. wti crude at 33.80. we're back in a moment.

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welcome back to "squawk box," everyone. this is cnbc, first in business worldwide. we have stocks in the news this morning. zynga shares rising after they named a new ceo. a former executive of video game

maker electronic arts and ross stores beating estimates and raising quarter dividend by 15%. that stock is up by 1.3%. the department of justice charging former chesapeake energy ceo aubrey mcclendon with conspireing to rig bids to buy oil and gas leases in oklahoma. joining us to discuss the case, greg zuckerman. good morning to you. >> good morning, guys. >> let's walk through what you think the case is but also what it portends. >> this is a guy who is the pioneer, the architect you could argue, of the shelf revolution that has put pressure on iran, saudis and pressure on oil and gas prices around the world and the justice department is indicting him for allegedly

rigging bids in a part of oklahoma. there are e-mails that seem to suggest that he conspired with others but he instructed employees at chesapeake energy, the company he co-founded, to keep prices down in leasing of these areas in oklahoma. >> indications there may be other charges. i don't know specifically about him or in other cases? >> well, that's the irony here. so the oil and gas guys in our country are dealing with lower prices and now they have to deal with this. this is the first case that results from a federal antitrust investigation into price fixing in oil and gas business as if they need something else to worry about. we all remember just from about 2002 until 2012 there was this rush, a land rush led by aubrey to lease acreage around the country when they all figured

out that rock can be accessed to find oil and gas so they leased all over the country and now the justice department is looking at whether they paid prices that were appropriate. >> if mcclendon were to be found guilty, what would his sentence look like? >> depends how many counts. even just one count you get ten years. you have to be concerned here. it's justice department here. this isn't fcc. these are serious charges for a guy who back in 2008 was on top of the world worth $3 billion and was seen as the shale barron. >> here we go again in america. indictment. guilty. this is nuts. do you remember back and one of the great managers of all time in the oil industry was bob crandall. do you remember the episode with crandall and the guy running continental and he made an innocent remark and the world

said he's rigging prices. it's very interesting. i think you can't announce a charge until you've adjudicated it. i think what they're doing right now is unamerican. they are quick for an indictment for a businessman. what about hillary? what about hillary compared to petraeus? >> you can't figure out why it's not happening? >> i can figure it out. it's why the american people have no faith in what's going on. >> she's a political appointee of president obama. >> i agree. she's a nominee and presumed nominee of the leading party in america. the point is -- >> this is different than the airline industry thing that you were just referring to. you're right. there's the presumption of innocence until it gets through the courts but if the company was handing over parts of -- if it won a bid and turned around and handed part of that bid over to another company 25% at the

same price they paid it, that sounds like there's price fixing there. >> guess what? economics works. he can't be competitive at $33 a barrel. okay. economics work. i'm not arguing that because it doesn't work. he should be given a pass. i'm saying that we don't know what he said. it was presumed that crandall did something wrong. crandall did not do anything wrong. the facts proved it. >> by the way, it may very well be that this case could go to court, of course, and it could be found that he's not guilty. but you said this was done sort of -- he was just indicted willy-nilly. my understanding is they were investigating this for four years now. >> you know why? they want him. >> government can do what it wants. >> they wanted him. help me out. i had some of my closest friends plead with me, settle with mr.

spitzer. move on with your life. i knew i didn't do anything wrong. i know dick grasso didn't. >> government can't steam roll you. >> all of these headlines, come on. give me a break. we don't know the facts yet. all it takes is some rabid lawyer in the justice department to say i'm going to get him. look at hank greenburg. look at what this attorney general is doing to one of the greatest americans that ever lived. hank greenburg. look at how disgraced -- by the way, if schneiderman wins, he gets hank can't serve on a public corporate board. 92 years old. what the hell? i don't want to be on the board at 80. i can only imagine 92. >> there's lots of evidence that this guy, wherever he was, was constantly trying to maximize profit for companies that he ran and andrew is right about that. >> you guys -- >> he's absolutely right. for shareholders and companies.

>> right, andrew? guilty? i don't know whether he's guilty or not guilty but i do know that there's an indictment and he will have an opportunity to defend himself in court. >> he's starting out with that as a given. >> i'm not making a presumption that he's guilty. >> when we return, a check on what will move the markets on trading day ahead and what details are a derailed possible deal between -- derailed -- between canadian pacific and csx. we'll be right back.

welcome back to "squawk box." we've been watching futures this morning and after a huge day for markets yesterday, you see things are relatively flat this morning. we were down by farther but dow futures down by 17 points below fair value. s&p off by less than a point and nasdaq up just over 3%. in headlines this morning, csx rebuffing a january takeover bid from canadian pacific. canadian pacific says that it's committed and would consider

another overture to csx. this move will take place after the close of trading on thursday. when we return, we'll talk jobs with ken langone and don't forget we're less than 30 minutes away from adp report. "squawk box" will be right back. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

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welcome back, everybody.

we're moments away from the adp employment report and friday we'll get the employment report for the month of february. our guest host this morning is ken langone, co-founder of home depot. and, ken, looking at the jobs picture. numbers we've been getting have been looking better and better for several months now. >> if you cook the books, you can make the numbers look good. >> you don't believe the numbers? >> if you stop looking for a job, you're not unemployed anymore. >> is this a huge portion that got left behind? >> unemployment rate is more like 10%, 11%. this is what's going on in this election. people are hurting. what i don't get about these professional -- they should able to read what -- they're politicians. they don't get it. the american people are hurting. they're worried and frightened. 2% growth over the last 15 years, they're being left behind. they're right. >> is this also because of

part-time jobs that have been created and just a different economy? >> it's a lot of reasons. one of the big reasons is we're not preparing our kids with a good education to be competitive in a more technologically driven society. how can a kid participate when he can't read or he can't write? by the way, now we're saying would you like to go to a doctor that didn't have to take tests to prove his competence at what he does? this is nuts. would you like to have people driving cars that didn't have to take a test to get a license? >> are you talking about common core? >> forget the word. tests are not the issue. the issue is understanding a kids' level of knowledge and helping that kid where he needs help. you don't do that unless you have a way of measuring what they know about a given subject. we're leaving these kids -- that article yesterday on the city of detroit, 45,000 kids, that's a total number of kids, they're dropping out because there's no education. this is -- look, we've got big

problems in america. the routine and standard politician hasn't got it done. you keep talking about trump. forget trump. it could have been mickey mouse and i think votes would have come out because this is the american people's way of saying what about me? you forgot me. what about my kids? what about my retirement? all of these things. look at these low interest rates. do you realize how it's crushing pensions? think of what's going to happen to these peep that have 401(k)s, what's going to happen? we have to -- my dad was a plumber. my mother worked in the school. i remember what it was like. there were no pensions then. unions didn't have pensions. no health insurance. they have it all now. we have to figure a way out and take care of these people. they're it. they're america. >> what went wrong? was this a combination of politicians forgetting about what's important? was this the great recession that we've never recovered from.

central bank intervening and keeping these low rates? >> a lot of things went wrong. a lot of things went wrong. i got a wonderful public school education and in fact if you go out to the school districts on long island, these kids get fabulous educations. look at the colleges they go to. >> i heard a statistic today on new york city public school kids in high school. only 56% of them take the s.a.t.s to get into college. >> worse than that. do a competence test on english and math. these poor kids need a shot. we can't hire a kid at home depot that can't read. think about it. and the social promotion that's going on. we're hurting these children by letting them go to the next level. you don't teach a kid physics and calculus in kindergarten.

you believe they're able to deal with challenges of those subjects. >> i would argue of the list that becky provided the one not on that list was globalization technology which effectively are on the path of putting middle class frankly out of business. the question is how do you bring that back given you want to make profits if you run a company and you can do it a lot better abroad than you can do it here. that's the complication. >> that's not so. >> you don't think that's real? >> number one, children are not being prepared to be competitive in a highly technologically society. agree with that. but this is where you have to begin. you have to begin with basics. a baby crawls and then walks and then talks and so forth. we are so crushing the people in america that want to do better for them and their children.

my father used to say to me you can never get enough education. he went to the eighth grade. never get enough education. he was right. i'm here tonight because i got a great public school education. i went and got a great business school education. it all worked. the system works. we lost sight of what's important. it's not teachers but children. it's children. that's why we have schools. until we understand -- by the way, pardon me, teachers have to accept the responsibility. when a teacher says you don't understand this kid comes from a broken home. guess what? that's more reason why you have to be a better teacher. >> i will not disagree with you there. completely in agreement. >> all of us made it in this country. if you go back far enough, all of us made it by virtue of progression driven by knowledge and education and ability.

okay. don't knock capitalism for saying all of these wealthy guys out -- i respect them. they invented stuff. i think of how much more productive i am with the iphone or ipad. i have to call this guy and that guy and write this note. as soon as i get it, i send it back. >> a lot of 1% and 10% aren't the same 10% from their parents. upward mobility. they moved into 1%. >> my grandfather when he died, 72 years old, could not read and could not write. he left school at 6 years old. he never had a chance. >> there's been wage stagnation to some extent. as we heard the other day, the average middle class person lives better than john d. rockefeller did based on all advances. i grew up in cincinnati. vibrant middle class. i go across the country and there's people at barbecues and people working at the factories. >> if they were so happy, we wouldn't be as polarized as we

are. he's telling you how unequal the country is. >> there are middle class in this country which is the most vibrant middle class in this world. >> it still is. >> the idea that everyone feels unstable -- >> not all middle class. >> they feel like nobody will worry with them. i think it's time we start acting like a business. ok. -here we go... oh, look at this... ok, so number one. no personal items are permitted in the workplace... ..so those will need to come down. we'll be doing some mandatory testing. and there's also a strict no dating policy. uh, but honey, we're married. that's going to be a problem. grow your business with the online shipping tools from fedex.

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welcome back, the race for the white house. donald trump and hillary clinton doing well on super tuesday. we'll break down the results of the road ahead with ed rendell and ken langone. market alert, stocks surging to the best start of the month. we're just minutes away from the adp report. we'll get richard fisher's take on what the fed should do next and back on solid ground. scott kelly returning to earth after spending a year in space. a record mission for the international space station. the details are out of this world. final hour of "squawk box" begins right now. ♪ >> live from the most powerful city in the world, new york. this is "squawk box."

>> welcome back to "squawk box" here on cnbc first in business worldwide. i'm joe kernen along with becky quick and andrew ross sorkin and our guest host is ken langone. home depot founder. co-founder. sorry. take it easy. are you the chief architect of the langone medical center? >> not at all. i'm the chief cheerleader and fund-raiser. >> okay. >> that's all i do. i go down and let these people know what an incredibly great job they're doing. every one of them. bob grossman's leadership is spectacular. look at the progress we've made since he took over as dean since 2007. i'm bragging.

>> yes. >> also, by the way, my beautiful wife, she has a putting stroke she'll kill you with. >> 85. pretty good. >> five more years and she's shooting my age. >> that's right. >> we are less than 90 minutes away from the opening bell on wall street. the data point is adp employment report comes out at 8:15 eastern expecting to show an increase in private payrolls last month. 185,000 is what we're looking for. futures right now see if they improved. given back some from yesterday. down 25. just a little bit of consolidation from a big gain. nasdaq is now up by 1.5 points. >> let's tell you about stories that investors will talk about this morning.

weekly oil numbers show a build in u.s. crude stock supplies and oil prices wti crude looking like 33.94. almost $34. keep an eye on natural gas now trading at 17-year lows and then the other big corporate soap opera drama, aubrey mcclendon has been indicted. justice department saying he orchestrated deals between two large energy companies to not bid against each other. chesapeake was not named in that indictment. mcclendon stepped down and is now with american energy partners and mr. langone is planning to represent mr. mcclendon in that case. >> i'm not a lawyer. i can't represent him. he has a right to presumed innocence. i don't think the way it's being spun today that it's presumed

innocence in my opinion. and csx rebuffed a january takeover bid from canadian pacific. it is committed to a sprite norfolk southern bid that wants to keep options open. >> a few other stocks on the move this morning to tell you about. ambercrombie & fitch nine cents better than expected. they registered their first same store sales gain in over five years. hillary clinton and donald trump dominating super tuesday but no sign that the rest of the field is going to move to the sidelines any time soon. john harwood joins us with more.

hello again. >> you know, you're right. they're not moving to the sidelines. the question is is there a viable play they can call to try to win this game against donald trump. you've got marco rubio, john kasich, ted cruz, all of them have arguments to make but they're not very strong arguments. here's john kasich just a few moments ago with you guys on your set. >> we didn't expect super tuesday to go very well. we almost beat trump in vermont. we split delegates. we got the same number of delegates. finished second in massachusetts. we picked up delegates in virginia. it was a good night for us. much better than expectations and now we're getting into the march madness, right, we're moving toward the final four. it goes to home court for me. we get up to michigan and most important ohio. >> now check out the map. john kasich said it was a good night for him. look how good for donald trump. he won most of the contests last night. he did lose to ted cruz in

texas. that kept ted cruz alive. cruz won in oklahoma and in alaska. marco rubio finally got his first victory in the caucuses in minnesota but fell short in virginia. all of these guys are struggling to find some foothold against donald trump. look at the democratic map. hillary clinton won most places on super tuesday. she rolled over bernie sanders on the strength of african-american voters. bernie sanders won his native state of vermont. he won in oklahoma. he also won the caucuses in colorado. won in minnesota as well. you know, bernie sanders has got a challenge trying to even though he has money, even though he has a constituency, make a credible argument that he can stop hillary clinton from this nomination. big contest as john kasich indicated when we go to ohio and florida. rubio and kasich both need to win there. if they don't, we are likely

looking at a hillary clinton/donald trump general election. >> has rubio cut into that 20-point lead in florida at all and where is kasich in ohio versus trump? >> kasich in polling i've seen most recently is a half dozen points behind donald trump. single digits isn't bad. marco rubio's deficit is 15 points or higher range. he has to make some headway. we'll see whether or not advertising by super pacs and going after trump can dent his lead. rubio did have progress with late deciding voters in virginia. i think that's his hope is that with a very aggressive campaign in florida he can cut donald trump down to size and win enough to stay in this race by capturing his home state. >> is kasich in michigan? is it the same kind of thing? >> what kasich hopes to do is demonstrate progress in michigan.

>> what are numbers in michigan? >> trump is leading. >> by how much? >> don't think there's been a ton of great polling in michigan. i think donald trump has had a lead in the double digits and what john kasich is hoping to do in neighboring states is make enough headway to say i'm rolling going into march 15th. it's just a tough argument. the burden is on those challengers. even ted cruz with more victories than any of the others of them to show that they can actually stop donald trump and not simply keep going and have enough oxygen to keep going. >> you're a realist. i love ken. idealist man of lost causes. what is your handicap for the potential for kasich to be the eventual republican nominee. what would you give him as far as chances? 30%? >> john kasich? >> yes. >> we're looking at 5% to 10%. something like that.

>> that's about the odds when we started home depot that we would succeed. >> i need to ask ken langone something. maybe you guys have already talked about it in which ways i apologize. ken, i want to know what you thought of the image of chris christie standing behind donald trump throughout that press conference last night. chris christie did not look like a comfortable guy as the man behind donald trump last night. >> i really didn't have any opinion on it. unlike the media where they make their minds up beforehand -- like your performance with the debate, remember, when cnbc had the debate, it was clear where you were coming from. and i don't have any opinion. the governor didn't make it and thought that this is the best thing and he did it. i don't read anything into what he looked like. you may have. i give him benefit of the doubt because i'm not sure what was in his head and i won't make a conclusion until i find out from him what he was thinking.

>> ken, what did you think of the criticism that whitman had for chris christie since he made that endorsement of trump? >> i think it's meg's opinion period. i could ask you -- i'm sorry to nail you on this. what were you thinking about in that debate when it was clear to everybody you were partial and trump called you out for it. i think the problem in america today is you guys say you're objective in the media but you're really not. >> i was raising the same questions directly to donald trump that republicans are raising about him right now, which is -- >> i'm not sure. they don't have a microphone and they haven't got an audience of 10 million people. >> they have super pacs. >> they don't work. we proved that with jeb bush. >> i'll show you what's confusing. it's meg whitman and talking about christie and then slim whitman. it's very confusing.

>> marco rubio and ted cruz. >> john is in trouble if trump wins because guess what? they're going to the back of the bus. okay. you and consultants and advisers and pollsters and everybody else. it's going to be a new day. this is why the media is as frightened of trump as anybody else is. >> if i could as a joke, i would pull the plug. >> you know, i'm getting told we have to go to a break. >> they want us to get out of this? >> they do. >> when we come back, i have a question for you. hopefully that will inspire people to stick around. coming up, breaking economic news. adp employment report and plus ken and mark zandi will join us to break down numbers and how will a comeback in crude play into exxon mobil's strategy

going forward. "squawk box" returns with a lot more in just a moment. (dad) ah! greetings, neighbor. neighbor boy.

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welcome back. let's take a check on the markets this morning.

futures are weaker but this is after a big day for markets yesterday. dow futures down by 27 points. s&p futures down by 2.25 and nasdaq actually in positive territory up by one point. we are just a few seconds away from the adp employment report. joining us is richard fisher. former dallas fed president and cnbc contributor. let's get that adp report and steve will react. >> adp beati ining consensus. the private payroll company does a good job guessing what friday's job number will be. the january number revised down by 12,000. 193,000. here's numbers you need to know. 185 was estimate. 214 is the number. big enough perhaps to cause economists to maybe nudge you have estimates for friday which is 200,000 right now for government and private sector. you can see the split there. goods 5,000.

i want to show you one interesting fact here which is job growth by business size. the reason i bring this up is large businesses adding 76,000. they had come down in january and there was concern that the decline in the stock market may have caused large businesses to reduce hiring. that did not show up in the february numbers. now let's bring in mark zandi. good morning, mark. what happened to the recession that the market promised us? >> there is no recession, steve. you know, i can't discern any impact from the financial markets on the real economy. none. you see it in today's adp numbers. vehicle sales, we got that yesterday. rock solid. housing sales, retail sales, even investment last week really strong numbers. so at least so far no impact. that's a surprise to me.

i would expect some fallout. i don't see it in the data yet. >> there was some weakness which is manufacturing sector of the economy continues to take it on the chin and we're lucky to have richard fisher here. i want to get to your comment. manufacturing down by 9,000. you have to believe that at least some of that is going to include what's happening in the oil patch as well as the impact of the strong dollar on the economy and yet when we look at other aspects of the economy, for example housing, and that 27,000 gain in construction, it seems like the economy is able to withstand the impact of what's happening in the oil patch. >> well, manufacturing is in recession. no doubt about that. two key points, one, is that it's not entirely -- not all of manufacturing is in recession. the vehicle sector is booming and that's a big part of manufacturing and that's offsetting some of the weakness in trade sensitive sector part and energy sector part of

manufacturing. the other key point is we're not talking a lot of jobs. manufacturing is a highly productive sector. it's only 8% of total employment. even if manufacturing is in recession, it's only costing the economy a few thousand jobs at most per month and is being completely offset by the very rapid job growth in the rest of the economy. >> mark, this is just another buildup to the great richard fisher coming on in a second who is right here looking at me. real quick, do you think this number if it translates into a strong number on friday, does it put the fed back in play for later this month? >> no. i don't think so. only because it's too early to tell whether the fallout from the financial turmoil, what that is exactly. it still needs to play out a little bit. my sense is they'll probably pause and wait until june. having said that, the current rate of job growth, 200k plus per month, we're absorbing any

remaining slack in the market and we're closing in on full employment. inflation, actual inflation is accelerating. everything is in place for a series of rate hikes later this year. i don't think it will be march. they'll want to see what impact it will have. later this year we'll get a series of rate hikes. >> mark, thank you for joining us. mark zandi. let's bring in richard fisher. what do you think of the numbers? >> the key numbers on that little screen you had there are small and medium sized businesses. you add those together you have 140,000. this is where america works. this is not what's traded on s&p 500. 82% of the employment in this country is small and medium sized businesses. some big businesses but doesn't trade within the s&p. that's where you get the disconnect between what's happening in the stock market and concerns in the market and what's happening in the underlying economy. ken made a good point in addition to wearing the same

shirt that i'm wearing earlier. >> looks better on you. >> distinguished on you. if you look at the middle income, we did analysis at the dallas fed going back 15 years. the lowest income has done well and thanks to zero interest rates and middle income have not had jobs created or income increased for over 15 years. it's just beginning now. >> we've had this debate. do you believe there's a thriving middle class in america right now? >> i don't. what we did is we had texas secede from the union. without that you had job destruction. now we're beginning to get some of that back. we have a long way to go. you asked about the fed -- >> it wasn't a fluke.

>> joe, this is muscle and fiber -- >> 4.9% unemployment. people have two cars in their garage. >> we made a hell of a lot of progress. >> the country doesn't look like detroit. >> hold on. the reason why white men in america are killing themselves at alarming rates is a large part of the function of the fact that -- >> let's be neutral and look at numbers. >> you talked about numbers and how middle numbers were bad. i don't understand how we're having this conversation. i feel like i live on another planet. >> you do, new york. >> not everybody is uneducated and blue collar in the middle class. >> let me give you specific numbers and explain how dpogood things are. truck manufacturers are laying people off as we talk. i know that firsthand. used truck prices are down 15%

and a major truck leasing company that sells -- i don't know why they take the word used and turn it into pre-owned. used is quicker and says the same thing as pre-owned. they give this leasing company coupons to buy used trucks from them. >> that doesn't support the proposition. >> what's your point? >> the point is i don't think this economy is as good as people think it is. >> that's more efficient if you said that. that's good. >> i agree with you. i don't always get a chance to sound like you. >> why not? smarter guy than i am. >> we're 20,000 truck drivers short in america. hold on a second. you know where? they can't pass the drug test. >> bingo. >> we're going to run out of time here. let me get to richard here. >> monetary policy, regulatory policy, in hands of congress,

executive of the united states has done a terrible job. >> should fed hike rates here? >> the fed needs to look further down the road here. i would like to see them move. i don't expect them to move in march. if they do, they'll have something to give back in case things slide backwards. >> let me ask you another question. >> they have to be careful. you don't want to look political. they have to move sometime between now and the august -- >> let me ask you this question. my sense is the market is well offsides relative to what the fed is likely to do this year and where the market is priced. i see the market pricing in zero in terms of interest rate hikes. is your sense in what the fed will do that market is mispriced here? >> with zero entry policy and with qe3 in particular, we -- because i was there, the fed, put the market on the high wire. market expects to have some kind of cushion underneath. they put it up there. the way valuations have

proceeded, prices are well above underlying valuations still to this day. when you raise rates a fraction, you discount future cash flows. that's the issue. i don't think the fed should be distracted by market. it should be driven by the real economy and they need to see improvement. >> i have a quick question. the fed raised rates 25 basis points in december. from that date until a few weeks ago, treasury securities went down in yields. >> amazing. >> help me out. i think maybe we have to ask ourselves a question. has the fed lost its thunder? >> it's a very good question. >> markets are driving this. >> that's what i'm saying. it was 190. >> you didn't see a need for qe2 or qe3. >> i was right. >> it also suggests the feds not as offsides as people say relative to what the market would price. >> i just want to thank andrew

for proving republicans are right about the obama economy basically. >> sure. all right. >> as long as we can concede -- the economy has gotten better but the middle class and wage growth has not gotten better. the reason why donald trump is succeeding and reason bernie sanders is succeeding is because middle class is not vibrant. i don't understand how -- i'm not saying it doesn't exists. it exists but it's getting smaller and his numbers will tell you that. >> more vibrant at central banking policy to do it. congress and executive. period. >> obama economy. >> richard, thank you. >> i learned it from you. >> no. >> when we come back this morning, exxon cutting capital spending plans. we have details straight ahead.

welcome back. we have breaking headlines about exxon mobil. >> good morning. exxon mobil will meet the street in half an hour to give details about full year plans and

beyond. a slight decrease expected in 2017 in part from its chemical operations. exxon expects production to be 4.2 million barrels a day through 2020. flat compared to 2015. cash flow from operations is expected to grow over that period. that's based on oil price scenarios ranging from $40 to $80 per barrel. that's key. analysts have been concerned spending cuts could pressure exxon reserve so cash flow is a reason that s&p put aaa rating on credit watch. they will pay out reliable and growing dividend and tapered share buyback program is flexible. the other thing to watch when exxon meets with analysts in a short while, the company just recently raised 12 billi$12 bil largest bond sale ever. they'll look for commentary

regarding prowling for assets. back over to you. >> thank you very much. we should point out we'll talk with rex later this afternoon and we'll have that interview on "squawk box." let's look at futures right now. right now futures are down a little bit more than they were before adp. >> kanye west in the spotlight once again. the rapper tweeted a picture that showed him listening to some music on youtube but fans noticed another tab open on the screen. illegal file sharing site pirate bay. kanye is a champion of paid music streaming. put that in the irony category. >> i still don't think he's caught slim whitman. coming up, a story out of this world after spending nearly

a year in space, astronaut scott kelly is back. the details next as we head to break.

welcome back to "squawk box." here's what's making headlines at this hour. the u.s. economy adding 214,000 new private sector jobs last month. that was more than expected. january's number was revised downward. also, a magnitude 7.9 earthquake struck southwest of indonesia. no word on any damage or casualties yet though a tsunami warning has been issued there. and spirits producer brown-forman showing relative short of estimates citing global economic uncertainty. scott kelly returned to earth after spending almost a year in space. the extended stay was part of an effort to study effects of long

duration space flight on the human body. scientists will gain further insights by comparing scott kelly with his earth bound identical twin, mark. the mission is a record for the international space station. >> you have to wonder just about everything, muscle tone with no gravity. you have to do a bunch of stuff. we don't think about it. the act of what's normal bodily functions. things floating around. it must be scary. >> queasy. >> it's everywhere. every little drop. the planet you're on. consolation you're on. that's from "apollo 13." back to ken langone, mad associates ceo and president. i don't know where we haven't

been. we've been in interesting places already, ken. what do you want to talk about? you have so many neat things happening. it's still possible in this country to have an idea and to commercialize it and to make a big success. >> i tell kids -- i love to talk to young people. i tell them the opportunities today are better than they were for me 60 years ago. i think of all of the unmet human needs. you think about home depot when we started it. '79. middle of horrible economic times. two guys fired from their jobs. me broken down investment banker with a small firm with $600,000 in capital. this is the greatest country on earth. if you want something bad enough, you can have it. you have to work and you have to be equipped. why am i so passionate about education? not only in high school but in

college and my dream, my last remaining dream is that every kid that comes to nyu langone to come to nyu medical school comes tuition free. if we get that job done and we will, if we are major medical center and medical school as we are with significant standing, and we say you come here. you get admitted. you come free. every other medical school in america will eventually have to do the same thing. think of the quality of the kids that will want to become doctors because they won't worry about being 150,000 -- it's a game changer for everybody. we have a company with a revolutionary drug alluding stint and electronic technology to help orthopedic surgeons to better align when they do joint replacements and another company

that if you have parkinson's -- this all has to be proven but we're excited about it. we have another company you take cluster headaches, you take migraines, the results the company is achieving so far and a product before the fda. what i'm saying is just look around. there are so many things that need to be done. this is an opportunity for each and every kid. >> why is opportunity better today? because science is better? >> capital is more available. you have venture capital firms. you have angels. capital is available. information is all over. you know, i wanted to study a company on a weekend and i had to go to my office and get a big 10-inch moody's manual. i can sit in home now with my ipad and i can go in and all of the information technology is allowing us to do so much more and so much better. you look at people that embrace technology in their businesses. it works. home depot's numbers in good

part -- let me say this. let me brag. home depot is being run today the best it's ever been run. i call people down there and i tell them that. it truly is. but a lot of it is technology. a fellow we brought in for logistic and supply chain management. look at what we've done with margins and we haven't raised prices because we're running our business better and more efficiently. there's opportunities every place you look. >> let me ask you. this is the sort of question about this that goes to employment and middle class and all of these ideas which is to say do you ultimately think technology which makes things more productive and more efficient -- >> i buy my good friend jack welch's logic that if we educate people, they'll go to higher levels of work and you won't worry about losing jobs on an assembly line where you put a

nut on a screw to put a tire on. >> it's an argument never born out. >> what i'm saying is we as a world wants better whether it's medicine, whether it's education, whether it's -- i don't care what it is. as the world wants better, we create more opportunities for job creation. >> amazing what's going on. >> we're going to have ed rendell on. before we get to that. stan obviously has strong feelings, stan druckenmiller and you're hoping kasich. if kasich doesn't make it, you'll move to the hillary clinton camp and vote for hillary clinton? >> don't be a wise ass. >> you would vote for trump? >> absolutely. >> let's go back to this for a second. you think donald trump wouldn't necessarily be the disaster that many people think he would be? >> not at all. >> why? he can hire people? he's smart? >> i'll give you one for

instance. i'm passionate about what we're not doing in education, public education in america. i'm passionate about it. i ask myself who would i rather have sit opposite the lady that runs -- wendy -- the woman that's ahead of teacher's union. who would i rather have sitting saying game, set, match. changing things. donald trump or hillary clinton? hillary clinton needs her. this is part of her base. forget about politics. public education system in america is in shambles. we have to fix it. >> larry summers said it would be the end of civilization as we know it. there may not be a united states left in donald trump was elected president. >> he's entitled to his opinion. far right said that about barack obama. >> look, the great thing about barack obama, we can hold our breath for nine months and it's over. you have to look to the bright

side of life. ronald reagan, movie actor, what are we doing? >> fascist at the time. >> help me out. >> with all due respect to ronald reagan, mobility numbers were not that very different than they were today. it it is what it is. >> reagan made mistakes. immigration. fine what he did. don't let it happen again. he didn't stop where we are again today. he said let's let them in. let's work. what we need to do is stop the clock and say, wait a minute, let's not -- my grandparents had to go through a rigorous process to come to this country. i'm all for -- look, so much of my life is made better by people that came from other countries. my friend and my driver, maria

at our home, these are people that came from other countries. they're wonderful people. and they're law abiding and contributing to society. i don't want to stop them. it might have been my grandparents that would have been stopped. >> you want to build a wall? >> maybe you don't need to build a wall. maybe you have an electronic signal. the wall is -- this morning i read over 4000 articles on leukemia. in less than a second. (speaking japanese) i can understand euphemisms, idiosyncrasy and complex metaphors. i know every detail of every public quarterly report in the last 20 years. and i'm just getting warmed up. hello. my name is watson. together we can outthink the limits of what's possible. welcome to the cognitive era.

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by debating our research to find the best investments. by looking at global and local insights to benefit from different points of view. and by consistently breaking apart risk to focus on long-term value. we actively manage with expertise and conviction. so you can invest with more certainty. mfs. that's the power of active management.

welcome back to "squawk box." hillary clinton and donald trump moving closer to securing their party's nomination for president. joining us now, former pennsylvania governor and cnbc contributor, ed rendell. good morning to you. >> good morning. >> i don't know if you had an opportunity to listen to this conversation. we had governor kasich on during the 7:00 hour. do you think he has a chance? >> i do. i'm in the minority right now. people are saying it's over for donald trump. i thought donald had a good night last night won 7 out of 11. he won three of those by less than 3%. that was in virginia, vermont and in arkansas. he could have won 4 out of 11 and that would have been a stunning upset and stunning reversal. it's clear to me that the attacks have started to hurt him a little bit. now, that's the bad news for donald. good news for donald is it doesn't seem like anybody is dropping out. when he gets to the winner take all states, if he gets 33% and is highest, he gets every single

delegate in those states and goes way over the top and clinches the nomination. >> and on the other side of the aisle, hillary ran the table. do you think it's over for bernie? >> i don't think it's over. bernie did win four states. the good news for hillary is she got 3.5 million votes last night. bernie sanders got 2.2 million votes. so she won by almost 1.3 million more votes. she emasked a big lead in delegates. hillary at 70% of all of the delegates committed so far. >> let me ask you a different question. we have ken here. maybe i'll ask ken this at the same time. money in politics. you put money behind chris christie. you put money behind the governor. >> all $10,800. >> i appreciate that. a lot of people on wall street put their money originally behind jeb bush. the smart money has not turned out thus far to be that smart.

has effectively the public -- is trump's popularity a reputation of the big money? >> no. trump's popularity has nothing to do with trump. it has everything to do with the american people whether it's trump or bernie sanders saying we've had enough. we're tired. governor, can i ask you a question that would help me a whole lot. you ran a great state. i went to college in pennsylvania. i was on the board of the medical center for a long time. i have a passion. governor, what do we do to address the biggest issue in america which is elevating the quality of public education for our children. we can't be competitive in the world if we aren't competitive with confidence. you ran a state. you're a man who has give an lot

of your life to public service and i commend you for that. how do we get people to understand that the greatest nation on earth is falling further and further behind as we spend more and more money. i understand my question might be uncomfortable because frankly the people that run the schools are essentially on the democratic side. i don't mean for it to be political. i'm interested in the kids. what do we do? >> first of all, your point about the teachers union is partially right. they have clung to things that are not good for education. for example, teachers are hired and fired by seniority. they are assigned to schools by seniority. there's no assessment of talent. best teacher could be someone there for two years and if there are layoffs she gets bumped and a teacher just marking time and lost her zest for teaching keeps the job. we've got to change that. we have to get rid of seniority.

we have to go to hiring. we will have merit pay. not base pay but teachers who do particularly well have to get extra pay. there's no question about that. we have to make sure our teachers stay longer and that's why we're rewarding the best awarding the best teachers, giving them extra pay and bonuses we can get them to stay. so that's true. but it's also true that we have to fund education properly. during my eight years as governor, pennsylvania went from a bottom third in the national test to what u.s. news and world report say the third best state in public education. the education research council in washington said that we were the only state in the first decade of this century to make significant progress on the national test in every subject matter tested and every grade level tested. we did it because we invested in education, but we didn't give the schools a blank check. we invested in pre-k, full day kindergarten, we invested in technology in the classroom.

we invested in afterschool tutoring. things that we know that the science and education knows works, so if we all get together, put aside our rigid positions, install competition, i love charter schools. some are good, some are not so good, but they're competition for the district schools, and they goat better to face that competition with we can do this, ken, but we have to do it together. >> i agree. >> republicans and democrats. >> i love your message. >> great so see you, sir. zblenchts when we return, gentleman kramer from the new york stock exchange. owen! hey kevin. hey, fancy seeing you here. uh, i live right over there actually. you've been to my place. no, i wasn't...oh look, you dropped something. it's your resume with a 20 dollar bill taped to it. that's weird. you want to work for ge too. hahaha, what? well we're always looking for developers who are up for big world changing challenges like making planes, trains and hospitals run better.

why don't you check your new watch and tell me what time i should be there. oh, i don't hire people. i'm a developer. i'm gonna need monday off. again, not my call.

let's get down to the new york stock exchange, gentleman kramer joining us now, as the first couple of days of the month go, maybe that's the month, jim, that was a good start for yesterday, but was it a rally that you'll be sold again or is it different, do you think? >> i don't want top sell it because dudley came out last night and said when he was in china and said the data is weaker. bowler said if on your show, maybe we're not going to get the employment number on friday

gives us room to run. oil down today, that is going to take things down. we've seen this time and time again. you can't be aggressive. oil back to 33 or be difficult. i love your show this morning. i've been working with the doctor, i've got to say --s. >> he's the best. johnny is my doctor. >> it'll make you embarrassed. the amount of money he's made to make this health care system coherent and good and patient friendly is far more than anyone else in this country and people need to hear that. they have a view, they must include this. they must include the charities for buck, thank you for what you do in health care, it doesn't get talked about, so i'm talking about it. >> thank you for agree something speak. i just got the paper. i didn't know you have a daughter that's a student. she's cross of '18, right? >> yes, and my friend bill gruber knows you. and john is the most former-looking president. i'm honored to even be mentioned

by you. this is just the kind of thing we're doing because of people like you, ken. >> i'll be in touch. i also raise funds for buck nel. >> you're the best there is, thank you. >> thanks jim. we'll see you in a few minutes. final prediction from ken lango.

let's get a final prediction from our guest host today. we've talked an awful lot, covered a lot of ground. some people look pessimistically, you more than anything are an optimist. >> absolutely, look, this selection going to be good for one reason. the american people are telling the politicians been you don't know what we need and what our desires are. there's so many good things in america. this is the greatest country on earth and always will be. look at what we've done with medicine. look at the diseases we've cured. go out to a mental institution in queens, creedmore, empty because we discovered drugs that help these people deal with it. don't sell america short. we have the greatest nation that ever existed and we're going continue to be so, notwithstanding our politicians. >> its been a pleasure here today, ken, pleasure to see you. >> honored to be asked to be

here. >> and governor kasich -- >> don't forget kasich. >> don't hold back. >> two weeks. >> i don't hold back. i think kasich's going to be a great president. and by the way, i don't want any job, nothing. >> tell us what you really think. don't sugar coat it. >> join us tomorrow, "squawk on the street" begins right now. good wednesday morning, welcome to "squawk on the street." the new york stock exchange, a study premarket to follow-up the best start to a month in three years as stocks have now narrowed their losses for the year to about 3%. super tuesday obviously a huge story as the front runners sprint ahead. europe is mixed, china 4% overnight. and back at home, 214 as oil inventories are on the way.