welcome back, everyone. exxonmobil addressing the analyst community yesterday, announcing plans to cut capital expenditures by 25% this year. that's more than the street was expecting and also follows steep cuts from last year. exxon is betting on higher prices to generate more cash flow. earlier this week, the company successfully raised $12 billion in its biggest bond issue ever. >> we're coming off a five-year period of very high capital investment. if you look at the previous five years to 2015, we had invested about $190 billion back into the business. some of the major projects that would have funded, they were to have partners. the partners and we have agreed we should take advantage of this market situation. let's go back and relook at the costing of those projects, the strategies, and is there some value we should be trying to claw out of this market before we make a final decision.

governments have been working collaboratively with us on that. the second is in our north american drilling activity. we've been bringing our rigs down like everyone else, not because the opportunities are no longer economic at this low price, but clearly the returns have been diminished. as i told the group today, i said, i just don't see pushing a rope into this market. we're going to drill to maintain our acreage. we're going to continue a program so we keep learning. we have got a very good learning process going on in the basins where we are working. i don't want to interrupt that. but it's just a question of how active do you want to be. >> you have recently stopped buying back shares, part of the way that you're going to make sure you maintain your balance sheet strength. but you raised your dividend again. now it's 33 years running that exxon has continuously raised that dividend. how safe is the dividend? >> as i told the group today, you know, and i've said it many times over the years, we are a company that's built for the

long-te long-term shareholder. when we make decisions about the financial structure of the company, our investment programs, we're really thinking about 20, 30 years out. we're thinking about those long-term shareholders. so our view -- and the question came today. i said, did you borrow to pay dividend or borrow to invest? we borrowed to invest. we take the cash flow, and we're going to pay that dividend. we know it's so important to people. for a lot of people, it's really important to them. so to answer their question, the dividend is safe. it's part of what we feel is the obligation to our shareholders. >> let's talk about that $12 billion, what you see in terms of potential opportunities. are we talking mergers and acquisitions here? >> all of the above. it's really do give us that flexibility. cost of borrowing is about as low as it's going to get.

so we want to take advantage of that. i commented to the group today, most of what we're doing are asset acquisitions. whole company acquisitions still appear to be difficult to do. >> why is that? >> i think there's two aspects of it. one is valuations, believe it or not, are still not aligned in terms of what companies want versus what we see the value to be. and the second thing that's happened over the last year, and i've commented to the group, because companies have wanted to maintain themselves, looking i think for the price upside, they've taken on additional leverage. they've issued additional shares, diluting their existing shareholders. in some respects in doing that, they've destroyed some of the inherent value. so when we look at the assets, we love the assets. when i look at the balance sheet, i'm buying a house with a huge mortgage on it. >> how much would valuations have to come down before things

look a little more reasonable to you? i know it's a case-by-case basis. you can't paint too broad of a -- >> well, maybe the question is how much does the premium need to come down? that's really where the hurdle it. i understand. i appreciate the other folks that are oning these companies. they have to justify to their shareholders, you know, why they cannot command premiums that are what people are accustomed to. >> we're going to hear more from rex tillerson later in the show. a few things he talked about, guys, is just the demand from the economy. he says it hasn't been helping out. it's not just the global economy, but what he sees here in the united states. >> i think we might have finally had some inkling of that. it wouldn't go down out of a commodity glut. >> exactly. it's gotten so much cheaper to produce when it comes to fracking. you've had companies like

continental resources and others saying they could make it profitable at $40 to $45. if they're going to continue to pump at those levels, that means we're looking at lower prices for some time to come. >> all right. i still think, you know, sooner or later that becomes positive for everybody. except for people that have a big stake in renewables. coming up, u.s. airlines jockeying to win the coveted routes to cuba. you like routes or routes? >> routes, i think. >> i wonder what we say in cincinnati. >> you get your kicks on route 66. >> you do, and you buy insurance in cincinnati if you can get an accurate reading on what you need. but for cuba, that's what we're talking about. plus, hitting the golf shot of a lifetime. it's just 11 years old and right in front of tiger woods. the viral video he'll show you next. as we head to break, here's a look at yesterday's s&p 500

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welcome back to "squawk box." time for the executive edge. a couple news stories for you. the big u.s. airlines are now vying for regulatory approval to start flying to cuba. in memos filed with the department of transportation, american airlines, jetblue, and others arguing why they're the beth suited for the coveted routes. u.s. and cuban officials signed

a deal last month to restore commercial flights between the countries for the first time in decades. it allows 20 daily round-trip flights to havana and ten to other airports in cuba. i thought that american air already does a direct flight at least from miami. >> i remember hearing that. all right. let's tell you about another story. google says it is working with unicef to analyze data in an effort to try and map the potential spread of the zika virus. the company is providing a $1 million grant to help volunteers on the ground. google says a group of engineers, designers, and data scientists are helping unicef build a platform to process data from different sources. things like weather and travel patterns to try and visualize possible outbreaks. all right. that's scary. the zika virus has been linked to 4800 confirmed and suspected cases of birth defects in brazil. >> and there's a new way to tell astronaut scott kelly apart from his identical twin mark after nearly a year aboard the international space station.

he grew two inches. one of the goals of this mission was to study how well the body can endure a long space flight. kelly says overall, he feels pretty good. he now begins what could be a year-long project to monitor his health and how everything is different. >> your spine just expands? >> what happens is because of gravity, we're all a little shorter than we should otherwise be. >> i need to go to space for a while. >> everything in our body is the result of literally hundreds of millions of years of evolution with gravity being present. it's never been any other way. so you go out there, and every organ is like, why aren't i lower? >> just think of when you get off a plane, imagine being up that far for that long. >> they talk about muscles

astrophy. you have to take a lot of calcium. >> you really need to be a physiologist to know everything in the body affected by gravity. when it's not there, you figure it out. >> every time we've talked about this, it makes me a little queasy. >> the idea of just being in this little thing up there. if there's a breach anywhere in the wall, it's like a vacuum and you're dead. >> he said when the cold air brushed over him, it was the first time in 500-something days he smelled fresh air. >> you see the lunar landing module. it's aluminum foil. >> you can poke right through it. >> neil armstrong is like, i'm going to take over manually, there's a bunch of rocks. 20 seconds or i'm not going to have enough fuel to take off. there's a good spot. those guys, they don't -- i don't know. >> cool as cucumbers. >> all right. oh, here we go. imagine if you hit the golf shot of your life. now imagine doing that 11 years old and with hundreds of people watching. my hands are clammy already.

remind me of playing in front of people. let's see this swing. that's nice. helped open the playgrounds on wednesday, a par three course designed by tiger woods. he got a hole in one from 80 yards out. the crowd went crazy, obviously, as it tiger. gave taylor a big hug and a pat on the back. tiger looks healthy. there was a time when tiger didn't even want to give someone a hug because of his back. hopefully he's coming back soon. good posture. >> way to go. >> wow. >> three-quarter swing. probably hitting a 9 iron, maybe a 7 iron. that's fun. how does that happen? what are the chances of that? >> that's cool. >> buy a lottery ticket. >> no, the chances of that are about a trillion times more likely than winning the lottery, i would say.

>> when we return today, sportwear maker adidas has fallen to third place in north america behind nike and under armour. the company is in the midst of a turnarou turnaround, and investors are getting on board. in fact that, stock has outperformed both competitors over the last year. the outgoing ceo will join us to talk about the legacy that he will hand over in october. and as we head to a break right now, a quick check of what's happening in european markets. you can see things are mixed right now. ftse slightly higher. the cac and dax slightly lower. "squawk box" will be right back. you're an at&t small business expert? sure am. my staff could use your help staying in touch with customers. at&t can help you stay connected. am i seeing double? no ma'am. our at&t 'buy one get one free' makes it easier for your staff to send appointment reminders to your customers... ...and share promotions on social media? you know it!

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welcome back. u.s. equity futures ins united states at this hour are indicated down now. i believe they were up fractionally a little earlier. i don't know whether oil has moved or not. yesterday the session was -- i don't know how many times we went above the break even line. down, up, down, up. finally closed up a little bit. remember, we had a very good start to the week. 350 points or so on monday. >> adidas out with full-year results. the german sportswear company projecting that sales and net income will rise between 10% and 12% this year, banking on a boost from sporting events like the european soccer championships and the rio olympics. joining us now is the ceo of adidas. this is his last report before stepping down. herbert, we want to thank you for being here. one quick question. when you're in the united states, do you call it adidas or

adidas? >> it goes both ways. >> so i'm okay no matter what i say. >> yep, exactly. >> okay. herbert, why don't we talk a little bit about how the company has been turning things around. you all had been struggling for a while against some of your major competitors. what went wrong, and what have you done to turn things around? >> first and foremost, i have to say that 2015 was an extremely good year for us. we exceeded all our financial targets on the top line or on the bottom line. it was not only the financial numbers. i think brands, both adidas and reebok, are in high demand, and i do believe that the adidas brand was never stronger as it is in the moment. also in the u.s., you can see collaborations with kanye west and pharrell williams, through our investment in the american sports, a guy like james harden

or vonn miller from the denver broncos. so 2015 was a very good year, but i believe 2016 will be even better. >> was part of the problem that you needed to invest more? you mentioned some of these partnerships like with kanye west. i know you're working on trying to make sure your women's apa apparel line is a little stronger too. was part of the problem partnerships like that? was it the marketing you've had to increase spending on? what happened? >> when you say part of the problem, then you refer to 2014. but let me also make it clear that even in 2014, the adidas brand was growing by 11% worldwide, but we lost most of the sales through currency devaluations against the euro. but anyway, i think that we invested a lot into new products and innovation stays at the forefront of our company. this is what drives our business. and innovative products in

relationship with great ambassadors, as i just mentioned. i think this is part of the success. >> in terms of what you think needs to happen this year in 2016, you talked about some of those new innovations. what are you most proud about? what are you most looking forward to bringing to market? >> we have a complete new collection of football boots, where we really revolutionized the industry again with our laceless boot, which is just brought to the market. we'll have great sport events like the european championship, the copa america, which for the first time is played in the u.s., and the olympics, which will all help us. we'll increase our revenues by 10% to 12%, which means another 2 billion in additional revenues. so this is definitely something we're looking for. >> casper is taking over, i

believe, in october. what should we look for from him? >> first and foremost, i think he's a proven ceo. he understands how to work with the financial markets. i think he's a good, educated ceo who will try to spur and accelerate our growth, which we have. and i'm sure he's bringing new ideas out of his experience of his industry to our company and therefore continuing the growth. >> all right. herbert, we want to thank you very much. we know this is one of your last interviews before you step down. we really appreciate your being with us today. >> you're welcome. >> okay. a little news to tell you about. a new law is going to be prohibiting airline passengers from smoking e-cigarettes on planes. the department of transportation is now prohibiting the use of electronic cigarettes on any domestic or foreign airline flying to, from, or within the

united states. i kind of thought that might have been the law already. who knew. transportation officials say the rule will protect passengers from unwanted exposure to aerosol fumes while aboard a plane. the relglations are also designed to clear up any confusion over whether the previously existing ban on tobacco products included e-cigarettes. i guess there was a debate about that. passengers are allowed to carry the e-cigarettes with them on to the plane, but you can't use them or pack them in your checked luggage or use them in the lavatory. i remember going on a plane, air china plane, and the pilots actually went into the lavatory in the middle of the flight to smoke cigarettes and then went back. >> that's gross. >> did they dismantle the smoke alarm? >> i don't know. this is probably five or six years ago. going to beijing. i will always remember because i sat in the exit row of coach. i was coach in the back there right near the bathroom. i watched the pilot.

>> in normal european, any country there, people are smoking. the ticket agent -- maybe not anymore. but just a couple years ago in france. just this big ash. it's so weird. >> welcome to 1950. >> yeah. i can't imagine someone pulling out one of them vape things sitting next to you on a plane. >> can you smell it? >> yeah, you can. it's like a different type of smell. >> an airplane is full of different types of smells already. >> you ever get on a plane -- >> then they come around again. there it is again. >> you ever get on a plane and it looks like they're sending vapor into the air? >> yes, it's the mist. that's the humidifier. >> i thought maybe it was -- i didn't -- anyway. >> like a germ spray? >> i didn't know what was going on. >> coming up, disney shareholders gathering for the company's annual meeting today.

julia boorstin is here to tell us -- >> in person, right there. >> tell us what's on the docket when we return.

. welcome back to "squawk box". disney holding its annual shareholder meeting today. joining us to talk all things disney and viacom, julie

boorstin who happens to be in the big apple with us. >> good to be here. i'll be monitoring disney's shareholder meeting today in chicago. usual topics up for vote including approving executive compensation. they recommend shareholders vote against the re-election of jack dorsey calling his commitments over boarded. one proposal to watch asking the company from provide additional disclosure of political activities. disney says it disclose as lot already. now two big shareholder adviser groups support this proposal but given the failure of similar proposals at other companies it's unlikely to pass. just yesterday disney announced it would bring its channel stonesy's playstation individto

sony's playstation. so we'll be listening in for more fun stuff. >> one of the things i did want to talk to you about is this sort of sense -- we've been or at least i have been talking about it, others have said that all this cord cutting is terrible for this whole world, this whole business but there's now some new research out suggesting there's push back on that? >> there's always a lot of debate. how bad is it? yesterday the big cable analyst came out with a report and said things have been overblown. in q4 numbers have been stabilizing. how much more cord cutting will there be. have we hit a critical mass. cord cutting has slowed down. comcast numbers were strong. q4 numbers overall pretty good. it will be interesting to see this year how much more cord cutting there is. things have stabilized. maybe all these fears about the

death of the bundle have been overblown. >> have successful have the ott offerings been. people look at that and okay that worked or is working. >> hbo recently disclosed it had 800,000 subscribers which doesn't sound like an awful lot. but hbo says it has been successful so far. all of these over the top services say it's very much early days. they don't want to grow too quickly. so they want to offer just enough that people who don't subscribe already to the cable tv bundle would subscribe to hbo now but not so much that they are giving it all away. >> joe has this smirk on his face. >> it's obvious to me improving middle class is using some money they are saving on cheap airline tickets because of all the competition in the airline industry cannot do a bundle and to be able to access this on an iphone that hasn't been hacked

because hopefully -- >> bundle -- >> i got all things we argued about that you have been wrong on in a put them all together. >> we'll see a lot more skinny bundles. everybody is offering them. it's not bad thing. >> that was just a joke. i didn't want an answer. come to new york and you start talk facts. >> but to be serious for a second, a ceo is fine with skinny bundles. >> by the time i get to where i want to be with the skinny bundle it's costing me more than when i get everything. >> we'll see how these skinny bundles pan out. >> i need a lot. >> if you want to watch sports. >> i need all of those. i want choice. i need that. >> not everyone wants to pay -- >> i know. kids, my kids probably could get by on netflix and never have any idea that, you know, anything

that's happening in the news or sports or anything else they will just know what's going on with "orange is the new black". >> a lot of news service out there. >> or they with watch jon stewart. or is he already gone >> jon stewart is gone. >> thanks. >> to be continued. who is this elliot guy? elliot is reaping -- is that spitz zero? >> -- spitzer? >> elliot. >> who he is lie oat. >> they just say one word now we're not supposed to say elliot management. done it have a name. i'm supposed to know this? elliot. >> when we return today authorities in oklahoma investigating the death of former chesapeake energy ceo. we'll talking to an energy executive and zbrournlsijournals

been covering the ceo for years.

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.

energy industry pioneer dies in an oklahoma car crash day after being indicted on charges of cold lug-- collusion. aubrey mcclendon is gone. . latest details on his sudden death. exxon's top tier credit rate cigarette it in jeopardy. also the impact of crude's collapse what it's having on jobs. and andrew is on a mission. ♪ >> so where are we supposed to

go? >> the jpmorgan ceo summit is about to kick off and we cents andrew to track the fearless leader of the firm, jamie dimon joins us within the hour as the second hour of "squawk box" begins right now. ♪ >> announcer: live from the beating heart of business, new york city, this is "squawk box". >> welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with becky quick, andrew has turned into j.r. trender. so weird to watch that. smarter. >> that's why we're playing "mission impossible" music. >> keep that you want. take three, camera. anyway. he's sitting here.

okay. he's headed there, andrew is to the ceo summit to speak with jamie dimon. he'll join us in 30 minutes. futures at this hour are indicated down 13 points or so, down 1.4 on the s&p and down 2.75 on the nasdaq. in the headlines this morning ahead of tomorrow morning's february jobs report we'll get the latest weekly initial jobless claims and that will come in in about 90 minutes. analysts are looking for 270,000 new claims from last week down from the prior week. herbalife shares are take a big hit. get rid of the h. why put it in there. it's a waste. it says it's discovered and corrected some errors in its active new members metric. i want will not affect previous financial statements. look at that. ackman is not down quite as much more 2016. 2012 gop presidential candidate

mitt romney won't go away. and he's taking aim at republican front-runner donald trump at a speech to be delivered later today. mitt romney said trump is a phoney and done have the temperament or judgment to be president. when i say it like that they don't know that i added that. >> i'm sure nobody knows you ad libbed that. >> jamie dimon is coming up. you're not andrew. you weigh more. you're older. >> heftier. >> andrew we'll go to, when does that start, half hour from now? >> about 40 minutes. . >> that will be cool. >> good to see you. >> good to see you guys. >> we'll let you talk in a second. can you just watch the magic. >> of course. absolutely. >> did you see this yesterday, you must have been shocked.

i saw it on twitter and we had just been talking about mcclendon all day long. i didn't know what it was. >> i didn't believe when it you told me. >> yeah. >> we'll tell you a little bit about this. authorities in oklahoma are investigating that car crash that killed former chesapeake ceo aubrey mcclendon. scott, a lot of questions still swirling here. >> reporter: absolutely, becky. and for now, though, here in oklahoma city they are remembering aubrey mcclendon as a visionary who really helped shape this community and whatever you think about him, the last couple of days are horrible end to a singular business career. mcclendon died in this one car accident, barreling down a stretch of road on the outskirts of oklahoma city, crashing in to a wall with no attempt to stop. it happened on the very morningers supposed to turn himself into authorities to face

the single count of conspiracy, antitrust violation allegedly for rigging oil and natural gas leases. he spoke to cnbc about five years ago talking to kate kelly, the subject was hedging and he talked then about the importance of predictability. >> we have to have some certainty. we can't make out year budgets, we can't find employees and buy acreage if we don't have some idea what our revenues will be. >> reporter: well the feds say he took that too far when it came to the important issue of leasing lands for drilling and fracking for natural gas that he was conspiring with a yet unnamed co-conspirator to depress those leases to rig the bids. that was the charge he was facing when he met his demise yesterday. unclear what will happen now to that investigation. the justice department not saying at this point, clearly too early to tell.

this was supposed to be the first of many cases involving this important area, an area that's important to the whole industry. guys? >> scott, thank you for more on mcclendon's passing and the legacy he left behind. let's bring in a partner at capital and cnbc contributor. forbes senior editor joins us also now he followed mcclendon's career and wrote the title story "america's most reckless billionaire" and chief investment strategist research partners joins us as well. is it overstating it, chris, to call him one of the fathers of what we're all talking about every day now and that's $30 oil because of fracking? >> absolutely. and he was titan of the industry. he will be remembered forever as one of the greatest wildcatters of his generation. he had brash and bluster and

arrogance and drove him to uncover and discover millions of acres of oil and gas plays across the united states. without aubrey mcclendon we wouldn't have had the kind of boom in oil and gas that we've enjoyed in america in the last five years. >> so you use the word "reckless" and you think of wildcatters wherever they are, big risk, big reward but he took that on the next level, even, which kind of benefitted probably all of us, but there's times when it goes the opposite way where you get caught overleveraged or something. >> it benefitted america because he uncovered a lot of gas and oil we didn't know there was. but he had a real great appetite for risk. and this really became evident back 2008 when his $2 billion fortune was wiped out in one a

due to margin calls. he borrowed heavily against his own stock and likewise put chesapeake deep into debt to go after growth at all costs and that's what ended up having him kicked out of the company by carl icahn in 2013. chesapeake was way too overextended. he was personally overextended. doing all sorts of deals on the side that were not particularly kosher and came back to bite him. >> certainly did. weird, isn't it. killed off -- i think about a lot of, you know, big business leaders that you think -- remember maxwell he jumped off -- i'm not saying we don't know what happened with aubrey mcclendon but the highs and lows, almost shakespearian. >> yes, sir are spectacular highs liens. i can't overemphasize the impact this gentleman had on our country and his contributions in terms of adding to our national

security. our energy security. you know, these were fields that he was able to reinvent really in old technology, joe, that unleashed, you know, all these molecules of gas. when gas was double digits it's trading about a buck 70 now. back then our fertilizer industry was going to go by the boards. our chemistry was going to go by the boards because the inputs in natural bass was too expensive. now it's completely reversed. fertilizer industry is back on top. onshoring of chemistry jobs and we're a player on the world stage in terms of energy. >> do you think they realized what they were doing would lead to gas prices being solo. that's part of the rob for their own fortunes going away. >> i don't. i don't think any of us imagined the efficiencies they were able to wring out of this process. the break even has gone from 60 to 50 to 40 and now they are

saying oil can be profitable at $30 a barrel. >> what was the law that they were using for this? we stopped talking about that. it's like 100 years old. are you up to speed on this? on what the indictment was about. >> i'm not. >> is this first case. first executive in the oil industry that's been brought against. >> that's what we would be talking about today is whether this was sort of a -- you know whether it's justified, wrongdoing -- there's a lot of things that now we put on the back burner. >> apparently some deals were already cut with the prosecutors to do him in, to do aubrey mcclendon in. it was collusion on keeping land prices low. that was a rip off of people who were selling their land at below market prices. it's something the government obviously takes seriously. already that settlement in michigan. this was going on in oklahoma.

it's an old boys network and we believe mcclendon was part of the plea deals. what was incredible is the amount of prison time you get for just one counts. i understood to be as much as ten years. >> ultimately who is the real victim? if oil prices are at $30 a barrel. >> there were reports about who else was involved here. have you been able to confirm the other companies involved? >> i have not. there's a lot of speculation about that. it's probably sandra energy run by mcclendon's co-founder at chesapeake but that's speculation at this point. what's clear is that aubrey had pled out the a felony charge that would have been tend of his career. all of our employment contracts have morals clauses and once an executive is a felon it's going

to be almost impossible for him to continue as an officer and it would be impossible for him to keep raising the billions and billions of dollars that he's raised in recent years to try to redeem himself. ever since he left chesapeake energy he's raised $10 billion in equity and debt to go all across america and then around the world trying to make a second go of this. and much of that investment is deeply under water, and a felony conviction would have ended his fundraising days. >> yep. okay. chris, thank you. and jason will be with us for the rest of this hour. when we return, is exxonmobil's chief have concern about the company's credit rating. i asked him that question. plus we got his outlook for crude supply and long term effects that the glut is having on jobs. as we head to a break take a look at oil prices.

wti up slightly, $34.75 a barrel. box will be right back.

exxonmobil is one of just three american companies with a aaa credit rating. its peers are microsoft and johnson & johnson but moody lowered to it negative outlook.

it's concerned that kidnap expenditures is coming down rapidly. so is exxon's top rating in jeopardy and does it matter? ceo rex tillerson spoke to us yesterday about this issue. >> hopefully we provide a little bit of insight with our forward expectations on volumes and as we told the group today we don't set volume targets we set investment programs and the volumes are the outcome. having said that even at the reduced levels because we have a lot of major projects that are nearing completion that's coming off this high period of investment, we have a lot of new volumes coming online this year and over the next two years so our volumes are expect said to in the 4 to 4.2 million barrel a day. going forward as i said that deep hill resource base the quality of it is still good and i think as we look over the next certainly five to ten years

we've got plenty of capacity to maintain our volumes and continue to bring reserves online. so, i understand and we're -- we want to give the rating agencies all the information we can give them to help them understand how the future looks. you know, over 90 years of being aaa this is not the first time we've been through a period like this of pretty extreme stress on the financial model of the company. in fact we've had periods where our financial metrics by their standards are much worse than they are today and they maintained that rating. i hope we can maintain the rating because it's important to us reputationally. our cost in the marketplace is largely unaffected but i think it's something that i would be disappointed if they lowered but i understand, they have a job they have to do. >> i read some things recently where it's been said they are now able to make shale

worthwhile at $40 a barrel, $40 to $45. both of them said they would pump more if we got to $40 or north of that. what does that mean for the long term price of oil? >> it suggests the future will be in a fairly narrow band depending again on what global demand does. our development cost are about $10 a barrel now. our cash cost is 10. so you can drill today at these prices and generate a modest return. we wouldn't do that because we think resources are worth more than that. but i'm sure others are in similar situations so when you get to $40, particularly companies that this is really all they have. it's a one play opportunity for them, i expect there will be some volumes coming back. so it says we're going continue to have some volatility but bounce around in a narrower range. >> rex, what has lower oil

prices meant for your home state of texas where you are based what does it mean in terms of job in terms of the economy there? >> you do sense it in certain parts of the state. certainly midland. you sense it. you drive out there there's a forest of rigs sitting on the side of the highway stacked and you know every one of those rigs had a crew of people working on it six months ago and where are those people? in houston it's having an effect but houston has so diversified its economy over the years that this is nothing like the 1980s, which really devastated the houston economy. by and large the state is weathering it quite well. they are seeing it in tax and royalty revenues, local governments are seeing it in tax revenue, so it's putting some pressure on some localized areas. i would say by and large the state is doing fine. >> in next hour we'll hear his thoughts on the geopolitical

risks to the energy industry. what do you think about oil prices in general? >> i think it is -- it probably is very difficult to see them rocketing much higher. the recount has fallen dramatically. oil production in the u.s. have gone from 5 million to 9 million barrels a day. the rigs that are still in existent are much more productive. production is relatively high. we're starting to export some of our resource. so i think i'm kind of in the lower for longer camp which is to say, i probably think we've seen some sort of a bottom here. no one likes to see bankruptcies but want to see more supply taken out of the system to be put in a real bottom in oil. by the same token, those i think probably a lot of the worse is over in term of the down side. >> and demand has been weaker than they had hoped or

anticipated not just globally but also the united states. >> did he definitely tell you that? >> no, he didn't. >> you just -- he whispered it. >> yeah. >> as far as texas is concerned we have a lot of business down there. i think he's quite right, texas economy -- texas has more home starts, certain parts of texas like houston had greater home starts than the entire state of california over the past several years. some of the people that he's talking about that have been displaced from the energy area picked up jobs in home building and construction and the state, texas in particular has notorious inflows of people because it's a tax friendly business friendly state, it is a very diversified economy. so much more than the late '80 when you saw the see throughs and the rest of it when oil prices fell. >> what are those? >> these far the reagan library.

>> those are presidential? >> it's too much of a pain for french cuffs for me. >> is that right >> do you put them in and then slide your hands. >> notice got big hands. >> he's a big handed guy. >> you got spray tan. >> of course. >> yeah. coming up after some tough new sanctions from the united nations, kim jong-un is back at it with another violation. details after the break. don't forget to keep it locked to "squawk box" because andrew is track down jamie dimon at the jpmorgan summit. "squawk box" coming right back after a quick break. hould hire stacy drew. ♪ ♪ she wants to change the world with you. ♪ ♪ she can program jet engines to talk and such. ♪ ♪ her biggest weakness is she cares too much. ♪ thank you.

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just hours after the u.n. security council voted to impose new sanctions on north korea, the isolated state fired several short range projectiles in to the sea. it escalated tensions on the

korean peninsula which has been high since the north's nuclear test in february. south korea's defense ministry said it was trying to determine if the projectiles were short range missiles or artillery fire. north korea faces harsh new sanctions for its weapons progr program. drafted by the united states and backed by the north's main ally china and that's the difference, china has been on board with this. >> die miss it when they decided whether that was a or h, atomic or hydrogen? what's the problem. they said it would take a couple of weeks to figure it out? >> he told us it could take months. >> the news cycle moves so favgts oh, yeah. >> forgot about it. >> but i think at the time it was not. >> we thought it was not. but we needed to wait to find out.

do we just decide that it wasn't? >> people in charge should -- follow up. nail it down. tell me. you mention mushrooms. >> stocks to watch costco reporting lower than expected quarterly earnings. american eagle saw its sales rise and offered upbeat guidance for the current quarter. >> coming up, gm's cadillac brand looking to reshape its image. we'll take a look at a new crossover that they are hoping will attract new customers. jpmorgan chief jamie dimon joins sore live from the company's summit that's taking place in new york city. as we head to a break take a look at u.s. equity futures. things have taken a turn for the worse. the dow futures down about 16 points. s&p futures down by one and nasdaq futures down by two.

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welcome back, everybody.

among the stories that are front and center this morning target is caught back on the number of items on its shelves. idea is to have more efficient inventory management and cut down on instances where products are out of stock. linkedin ceo giving up his annual equity package that's worth about $14 million. instead the stock will be distributed to employees. that comes after a disappointing earnings forecast triggered a decline in linkedin shares. judge justice department has given immunity to a state department employee who set up e-mail server for former kansas city hillary clinton. that worker had worked on clinton's 2008 presidential campaign and the paper says the fbi has secured his cooperation in its investigation. i thought it might be -- if it was weiner we would be using that bell. after anthony weiner faded into -- if it's not weiner we

need bring back the bell because -- >> carlos danger. >> yes. >> who was in some reality movie. at the sundance film festival. he was mad about it. >> carlos danger or anthony weiner. >> josh mchenry. >> isn't it weiner. i think it might be weiner. >> if it's not -- >> we don't have speakers so i can't play it. >> i would love to bring the bell back. gm is giving us a first extended look -- if it's not weiner i think you would be mad. anyway. gm is giving us a first extended look at cadillac's new crossover xt-5. phil lebeau joins us now from california this morning.

i wonder a lot, i know you're coming up, phil, and sometimes i do it just because i know you're coming up, waiting for your hit. if we took a shot of you, you would be going -- anyway thanks for joining us. i know it's early. >> reporter: it is early but we're glad to be here. behind me this is the xt-5. here's the reason why this is important. take a look over the last seven years at the growth in luxury auto sales when you compare cadillac with mercedes and bmw. cadillac sales have increase ad little bit but nowhere as much as mercedes and bmw. why? mercedes and bmw have much more extensive and crossover lineup. now with the xt-5 is this beginning of several crossovers and suvs that cadillac will be rolling out. this goes on sale next month

starting at just under $40,000. the issue for cadillac is this. while sales were up it's suv sales even with an ageing lineup anchored by the srx and escalade they were up 24%. now the challenge is to consistently roll out new models that benchmark and do as well as the other luxury suvs in the market. >> the guidance is important. like a boxes match. you can't win the fight by landing one heavy blow per round. you need knock out punch after knock out punch. and here we are, it's the second month or perhaps third month of the year. we already had two important model launches. >> reporter: the xt-5 coming out next month. last month they launched a new signature sedan, the ct-6 and

this part of 11 models in the next few years coming out from cadillac which has a much more refined presence, if you will. they are benchmarked against maernds mercedes and bmw. and for cadillac it's about increasing the value of the brand. here's one measure they point to. last year the average transaction price was up $5,000 to $53,000. that's important. it's not necessarily volume it's getting people to pay more for a cadillac model and the xt-5 crucial to that. the cross over market is red hot right now. >> phil lebeau, they thank you for that. we'll talk to jason about equities. our guest host says one reason for that is because sentiment was too washed out. jason trennert at strategic

research partners. linkedin, we have nothing against -- it is weiner. we won't use the bell a lot because that was against anthony weiner. marc faber noticed sentiment got too negative. is it a sustained balance to test the loss later or do we get the new highs >> it's former rather than the latter. listen, you don't want to fight the tape. by the same token i'm not sure the fundamentals have changed all that much. credit spread they have come in a little bit. credit spread are elevated. i haven't seen anything in terms of earnings revision which are particularly good. on the other hand i was in japan last week for five days and i can tell you if you're outside of the united states and you look at the american markets you're saying this is as good as it gets especially in an era of

negative interest rates. >> goes back to your analysis. >> it does. there's more opportunities now than a year ago which is to say i would say there's certain parts of high yield market. >> there's no alternative for tina. >> this idea if you have a large pool of money, you can't really go to cash. individuals can go to cash bath if you have a certain claims on your corpus every year where you have to generate 5% or 6% you can go cash. and now two-thirds of the world sovereign debt as a negative yield interest. you are forcing people to take more risk. but having said all that, to joe's question, i would be cautious in terms of thinking we would reach the kind of the old highs we saw last year. i don't know if there's enough of a catalyst in terms of the fundamentals. >> i think tina is strong and no

reason to think that there will be an alternative. i don't know why we couldn't necessarily -- >> we have one portfolio called the thrifty fifty and another one that's modified but companies that have the lowest credit default swaps. companies that you could actually see as proxies for sovereign debt. so they are better -- the market is telling you they are better credit ratings than countries. >> what was the absolute high on the multiple? it wasn't 22. why can't we get the blow off phase in this market? >> the only reason i would say that, joe, retail investor, individual investor has been -- not largely but completely ap h apathetic. to me that's one of the issues. >> coming up andrew will sit

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welcome back. andrew is over at jpmorgan chase

headquarters in midtown manhattan. that's where the company is gearing up for its annual summit. andrew is sitting down with jamie dimon. >> we are here at jpmorgan and they are having their ceo summit. this is their 18th ceo summit but a little different this time because they have renamed the summit and renamed it after a man named jimmy lee. he was an investment banker vice chairman at jpmorgan and it's great to have you here, jamie. before we get into what's going on in the world we need ask you about the idea of renaming this. for those who don't know who jimmy lee was. why was this so important to you >> this is the 18th conference. started first time in deer valley 18 years ago by jimmy. we have ceos, mogul, titans, politicians, former government officials and so jimmy was a

force majeure. professionally, everyone knows him dealt with him. he's embedded in this company. jimmy was always about the clients. when jimmy talks about we he's talking about him and the client not jpmorgan. so he's part of the dna here. we thought in his honor we would name it the james b. lee summit. we had three of his children here. we did a video. on a personal level jimmy was loved and adored bay lot of people. you saw in that tape all these ceos, moguls, titans some with tears saying i love you jimmy. they really did. jimmy would come in my office every day and give you a hug. he was an exceptional guy and we want to be him. >> he was an amazing man. this is from dan loeb when he passed. jimmy loved wall street. he wasn't driven by money but by his passion for people.

it's one of those things i go back and read that often. jimmy was a deal maker. volatility is the enemy of deal making. what would jimmy make of this market. i know you said this has been overdone. >> jimmy was a client guy. it was what the client needed. the deal was just part of it. so he put himself literally in the client's shoes and also prided himself when he does those things helping the company grow and expand and helping his country. he's very religious. he deeply believed in america. remember he always made this quote which i hope the world remembers, short pessimism and long america. he loved you. would call you, he thought he could help you he would call you up and give you some advice or a spanking every now alibi then. >> while i have you here volatility you last week said it's overdone. you are not a pessimist.

you're like jimmy. >> when i was in davos what we see is the american economy, the actual economy, the 145 million people working, more people working, wages going up, spending money, spending the gas they save. we're seeing data. balance sheets are in better shape since it's been recorded, the consumer. they are buying cars at all time records. home sales are going up. household formation is going. that's pretty good. we all want to be better. >> what's the market missing? >> nothing. the market is sometimes irrational and times ratisometi rational. the fact there's always a list of worries. there was a reporter we get breathless go back a year ago your breath was something different. authors real concerns.

i won't diminish those concerns. if cline grows at 4%, 5%, america grows at 2% that's a good thing. we all think it's not enough to help people. >> jimmy grew up at a time when banks trade at multiples of their book value. today they trade under. what would jimmy think about that? >> i don't care what banks trade at. i care what jpmorgan trades at. you look at the history of banks it's quite a cycle. early on some of these banks -- when i started working chemical bank, bank one, first chicago, jpmorgan, chase all worth less than a billion dollars. and in certain recessions down on their dmees. jimmy would say what i say fwuld company, serve the client, do a great job, tech ups, research all the things we do and we operate in 100 countries around the world.

he would be telling you jamie tell them what a great job we do and we'll do more. and steadfast. you are there forever for your client and the countries. not in and out. you don't run. you don't run and hide when things get bad. what are we doing in the oil area? try to work with our companies to get through this. not run and hide. you'll see bankruptcies and problems. we're in a very senior position so we're fine. i want to go to houston in a year and have people in houston say jpmorgan thanks for sticking by us and helping us through the tough times. >> still tough times for the energy patch? >> i don't know. i don't think anybody knows. supply and denand will sort out. it's confusing to figure out how it will happen but it will happen. this has happened to all commodities. not surprising commodities have imbalances and you have rapid

moves. this very large and unexpected. i don't remember anyone being expect police department. >> two quickies, negative interest rates. what do you think of that? >> my view, first of all united states i don't think it's in the cards. people say well it's the last thing central banks -- it's not true. there's fiscal tools. if i was in the central bank i would be saying we need joint coordinated intelligent policy not the central bank making up for everything. overseas -- look i don't think it will work that which. it will have a lot of unintended consequences and you guys will be writing books for 50 years on it. >> final question, jimmy was a republican, you historically have been a democrat. what would the conversation be about going on today in politic? >> we both love the country deeply and we think values are important. we both would have said -- i

don't care if a person is a democrat or republican. everyone should read the other side, collaborate. we extoll george washington and abe lincoln. they are gods. but they did not denigrate people, didn't demoralize people, didn't scapegoat people, didn't storm people, they worked with people and compromised and collaborated and did the best thing for the people. you and i can have long discussion what those policies are and lift up people that need it. how do you do? it tax credits, work for us, education, skills. not just either or. the world is not binary. some of these things we sit down we'll find a solution and make it better. for all the people out there this country will do fine. we can do better. it's the best it's ever been. warren buffett said it last night it's an unbelievable country even at 2% growth the

nch gdp per person will go up. 75,000. that's an unbelievable thing. should it are shared differently? probably. some upset. you guys say technology will take away jobs. technology is the best thing that ever happened to mankind. if it didn't happen all of us would be hunting buffalo and living in tents and dying at 35. fix it. retraining, education. proper safety nets. so jimmy and i would be talking about how to make it better. what we try to do throughout all the crisis all around the world when we get killed by some of these people what can we do to make it better for people in your country. >> jamie dimon, thank you. and thank you for honoring jimmy. >> thank you for coming here. >> becky, back to you guys.

>> like "the revenant". running from guys in bad bear suits. did you see it yet? >> i have not. >> chasing a buffalo guy and dying at 35. i wish andrew asked him about the middle class thing. jimmy is with me. we're heading south and never coming back. it's not optimism. did you see "the revenant"? >> i have not. >> have you ever slept in a horse? >> not yet. >> he picked the wrong end. >> andrew, thank you very much. jamie, thank you. when we come back a check on what's moving in the pre-market. and tragedy in oklahoma, aubrey mcclendon dies in a fiery crash days after being charged with breaking antitrust laws. more on the investigation.

slight declines but dow futures is down 25 points, s&p off by 2.5 and nasdaq off by 4.5. "squawk box" will be right back. everhas a number.olicy but not every insurance company understands the life behind it. for those who've served and the families that have supported them, we offer our best service in return. usaa. we know what it means to serve. get an insurance quote and see why 92% of our members plan to stay for life.

welcome back, everybody. let's get a final word from jason trennert. he's been our guest host for the hour. jay son, the reason we saw markets gown there were worries that a recession would start in

full swing here in the united states. you don't think the odds of that are great. >> i don't think they are particularly high at all. consumer spending, going with what jamie dimon was saying before very low. unemployment rate below 5%. some of the things people don't know, government spending will add something like .6% to gdp this year based on the budget that was passed at the end of 2015. the one i would say if there's a potential fly in the ointment, it would be frankly from policy or policy error. in my own opinion if the fed were to tighten either in march or june, that would be a policy error that would tighten financial conditions so much that a recession could be back -- >> another quarter point. >> based on what? based on a strong dollar >> based on a strong dollar. strong dollar has between meticulous jichlg through which you path lot of pressure on

assets. at this point -- we've relied too much on monetary policy for too long. i don't think it will solve anything from here. by the same token first do no harm. i would rather see other policies come forward. >> does that mean our hands are tied? we can't raise rates until the rest of the globe -- >> may very well may mean that. we put ourselves in this position. we just have to look for other slugs to get out of it. >> all right. jason, i want to thank you very much for being here today. great seeing you. when we come back, bob doll will join us to talk more about markets. plus we're waiting on earnings from supermarket giant kroger and then we'll get reaction from the company's ceo mike schlotman. "squawk box" will be right back. we needed 30 new hires for our call center.

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s&p trying for a third straight dave gains with stocks sitting at a two month high. breaking data jones this hour slow down the bulls or fuel a rally? >> is opec still a factor. what does iran come back online mean for the energy market and how will krud impact countries

like russia and venezuela. >> here we go again, profits from home flipping hitting a ten year high sparking fears that trouble is brewing in the housing market. is there a reason to worry? a live report straight ahead. >> final hour of "squawk box" begins right now. ♪ there is a house in new orleans ♪ >> announcer: live from the most powerful city in the world, new york, this is box. yes. the eggman himself. welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with becky quick. less than 90 minutes away from the opening bell. counting down breaking economic data we'll see on jobs. adp yesterday, today weekly unemployment claims and that's at 8:30 eastern and filings are expected to hold steady around the 270,000 level and then at 8:30 fourth quarter productivity which is expected to be revised slightly lower.

futures have been trading slightly lower for most of the session now down 20 on the dow, down two on the s&p in a down three on the nasdaq. >> you what tomorrow is? >> jobs. >> let's get to stories investors will be talking about. natural gas prices plunging to 17 year lows. apple formally objecting to a judge's order directing the company to help unlock the iphone of a san bernardino shooter. this filing is a procedural move. aclu filing a friend of the court brief urging her to reject government efforts citing a ruling in a similar case in new york. crowikroger posting better expected results. we'll have the cfo of kroger on for an exclusive interview coming up at 8:40 eastern.

shares of herbalife saying the company identified erant information regarding new member information. the errors do not impact historical financial statements. who was it said i was a card carrying member of aclu. bob doll is here. i would be one now. >> not kerry. >> it was somebody. >> i think it was dekakis sniemd be a card carrying member of nra. can you do both? >> i think you can. there's a place where it's logical that you're both. >> constitutional law. >> it was michael dukakis.

not everything but in this case. come on. let's take a look at stocks to watch. disney upgrated from neutral which points the value of disney's film slate over the next five years. every time iger seems to have paid too much -- you paid too much for "star wars" or marvell? luxury luggage maker has a deal to be bought by sampsonite. such a transaction would be worth up to $2 billion. joy global had a loss. revenue was below forecast. mining equipment maker says customers are taking unprecedented steps to conserve crash. >> andrew caught up with jamie dimon at the company's ceo summit. dimon shared his view on the economy and market volatility. >> what we see is the american economy, the actual economy, the

145 million people working, more people working, wages going up, they are spending money, spending gas. their balance sheet is in better shape than ever been since it's recorded. they are buying cars at all time records. home sales are going up. household formation is going up. that's pretty good. we all want to be better. >> what's the market missing? >> nothing. the market is sometimes irrational and sometimes rational. there's this long list ever worries that people have now from the qe, negative interest rates and i think people are breathless about that one. china. but the fact is there's always a list of worries. if you go back -- there was a reporter who wrote we get breathless today go back a year ago your breath is about something different. those are real concerns. i won't diminish those concerns. if china grows at 4%, 5% and america is growing at 2% that's a good thing.

we all want more. >> you can see more of that interview at cnbc.com. >> second straight day for the major markets. our next guest says this might be a time for active management. bob zoll our guest host for the next hour. depending on the guest, a lot say it should always be active and others concede sometimes maybe indexes may be passive is better. did you used to think passive was better now active? >> in the early stages of a bull market when everything goes up it doesn't matter. just got to be there. passive is fine. later in a bull market when the market narrows security selection is critical and therefore i would argue this is the time for the good active managers to distinguish themselves. sneeps if a bull market clupds what this recent sell off we had where we say it was 20% but some stocks were down 60%.

so depending which sthouks you were down 15, 20 or 60. >> when it's alma crow we know the correlation is high. some were down a lot, some down a little. depends how much business you did overseas. pricing power. all these factors that active managers try to sort out. >> where are we in the bull market. >> later in earnings. no question. easy money is in the rear view mirror. traditional signs that cause tend of a bull market are not evident. it's grinding from here happen we're in an environment where we'll frustrate the bulls and bears for a few weeks of the year. we frustrated the bulls now we frustrated the bears a little bit. just wait around for a few weeks and we'll go the other way. >> if you don't like the weather. >> i asked jason what happened to the blow off phase, what happened to the 22 multiple.

we're at zero interest rates and negative somewhere. where is that over enthusiasm that usually comes towards -- >> we may get that. i haven't given up on that. i don't know how we get that, what the ingredients are but one of the signs of the end of the bull market is investor exuberance. we don't have that. it's just the opposite. cash on the sidelines. people biting their fingernails worrying about the few equities they do have as opposed why don't i have more. >> you think with negative interest rates you think the fed should stay on track to normalize them. >> yes. as the world seems settled and as jamie dimon pointed out the domestic scene is pretty good weapons the consumer. the fed has move to some more. nominal gdp is running 3% to 4% and fed funds are 25 basis points. doesn't make any sense. >> the dollar will get stronger is the reason.

there's always a reason. >> i can't find too many people bearish on the dollar. they are either bullish or neutral. >> always bad? are we going think about our manufacturing sector forever? i thought a strong dollar was good. >> in the long run it is but at a pace. the problem we had it just went up far too fast and nobody could adjust to it. >> why should we be at 2% or 1.5% if people are negative? because we deserve to be, we're better? our economy is better. >> interest rates. >> our economy is better. needless to say non-u.s. rates solo are pulling our rates down. no question about it when you think about core inflation running in the low twos no longer in the low ones, a 1.8 ten year treasury loan i don't think makes much sense. >> you always like -- health care didn't go down. >> we took money off table in health care last summer. we're neutral weighted.

health care tends not to do so well. there are some violators. stocks aren't as cheap. >> what are you overweight. >> technology. free cash flow is king in a slow growth world. telecom for defense side of the portfolio. rest of its on s on sis between discretionary. jobs. pay slowly going up. balance sheets improved. oil dividend. consumer is doing okay. >> back to the financials where you said you were overweight a month ago. >> trimming now. coming in to the year underweight the banks you get a bear market in five weeks and not much has changed. that's an opportunity to pick soip. in an environment where i think it's going to be repeat frustrate the bulls and bears when they push things up. >> consumer discretionary can we

dig down a little bit in that area. what do you like >> home depot and lowes. housing existing and new homes. that's a good fliebs. targ -- place to be. target is doing a good job. gm and ford. people say you shouldn't own them when pes are low. i think those companies at the bottom of the cycle will not lose money this time and therefore with their free cash flow, high dividends, rising dividends they are fine. >> is europe cheaper? >> yes. for a good purpose. look, some of the multinationals in europe have done well. if the dollar does show some weakness you want for the first time in a long time own some u.s. multinarks careful of the european multinationals.

the problem with domestic europe the economy can't get out of its own way. it is cheap but deserves to be. one currency, moan monetary policy different currency for every country i want creates problems. demographics are horrible. >> you don't know what will happen with the potential brexit later this year. >> how many elections -- we've seen a lot of elections. >> this one is different. >> before we talk about that, what normally happens to the stock market? >> in election year itself is the second best of the four years. best year is the year before. election year usually the best except in years where you have to elect a new president. two termers the election year on average down 4%. >> if you're elect agnew guy. >> yeah.

>> then we got what's happening. we think it's different. remember barry goldwater. that was crazy. >> there are similarities. >> george mcgovern, dukakis. >> both sides -- right. this one is different. donald trump, he's is going to get a lot of democrats and a lot of independents and lose a bunch of republicans. where they are going to go i'm not sure. >> for every person that says they are going to move if donald trump is elected there's someone that will move if hillary clinton gets back to the white house. >> here, here. >> you didn't give me a here, here with donald trump but the here, here with hillary clinton. >> chris christie saying he'll do everything to make sure hillary doesn't get within ten miles of the white house. how many times have you heard that one? he's standing right by donald trump. >> i know. >> for tv it's unbelievable.

this is incredibly good for cbs. what can we do other than -- we are here to watch the show. >> he's a show. the most amazing thing out of super tuesday from my point of view wasn't who won or loss was the republican turn out was up 80% and democratic turn out was down 30%. amazing. >> i wonder what that maengs for november. >> make it awfully hard for pollsters. >> you're an establishment republican mostly. these guys, are they the enemy or friend now of the party? >> you know, so donald trump wants to do trade wars. that's not good for the republican party. >> he's a negotiator. >> you start there. >> he's a negotiator but it's my way. >> things aren't perfect with our relations with china or

trade imbalance. and he went into the lion's den, the "new york times" said yeah i say all this stuff when you're ready to give some of it up. i don't know. he's been disdpourntd a long time. we'll see. these republicans if that's all they got they better figure it out pretty soon unless they just want to say okay we're hoping hillary isn't serious and she governs like bill clinton. >> if they want a republican elected they have to you night behind him. >> so far they have not. i called them pharisees. blowhards that have been there for so long. like how about the last four times when you ran your candidates. bob will be with us for the rest of the show. >> when we come back iran preparing to bring its oil back to the market. but with the supply glut and tumbling crude prices is opec still a factor.

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i couldn't do this on -- what's the show on before us. i couldn't do this on world wild exchange. joe walsh and bad company announcing a 25 show tour they will kick things off on may 9th and paul rogers will welcome back bad company and that's classic late early '70s band, late '60s band. early '70s. may 9th in dallas. shows will run through july 3rd. check your local listing for on sale dates. james gang. eagles. >> eagles, man. >> not the eagles but it's not the eagles. they are going to alternate who is the headliner each show. >> that's nice. >> they are sharing theoretical literally. >> i read this -- you know going to a concert now takes a lot of -- you got commit to it. there's parking. seinfeld is 61 talking about whether he decides to do things.

everything is -- no way. no way. >> doesn't rise to the level. what did you decide. >> zip line down in brazil. no eating potato chips and picking crumbs. >> joe walsh, bad company. you going to do it? >> will guy? >> yeah. you in? >> i might. i would think about that. that's one i would think about. global oil producers watching iran as the country prepares to bring its oil supply back to the market after years of sanctions. how will iran's re-emergence impact american oil companies which are prevented from doing business with the middle east country. which spoke with rex tillerson. >> u.s. companies like ours are still unable to conduct business in iran. a lot of our european competitors are in working actively. i don't know we're necessarily at a disadvantage. the history of the iranian in foreign investment in the past

their terms were always quite challenging, quite difficult. we never had large investments in iran for that reason. i don't know that the iranians are going to be any different today. we'll have to wait and see. there hasn't been any contracts put out. i also learned a long time ago sometimes being the first in is not necessarily the best. we'll wait and. see if things open up for u.s. companies. we would certainly take a look because it's a huge resource owning country. >> brings us to a lot of instability like in saudi arabia and russia. how do you measure things in terms of the global risk factor and where would you say we are? >> geopolitical risk is just a way of life for us. it has been my whole career. and it changes, the nature of it changes. we've been through war, we've been through revolutions, we've been kicked out of countries, we've gone back to countries.

it's very country by country specific. i would say, you know, there's a lot of uncertainty in the world today, certainly in the big producing regions, the middle east, relationship with russia and those are enormously important parts of the world for everyone's economies and this is -- energy is the life blood to economic growth. hopefully things will work themselves out. middle east is a tough place right now. a lot of wars on multiple borders that people are having to deal with. we continue to work successfully there in spieft that and have very good open relationships with the governments there. >> is opec still a factor >> opec is still a factor although i would say they are -- they are going through process of coming to grips with what that means when they are a factor. instead of one country. i think in many respects perhaps that's what the minister in saudi arabia is trying to do is

create a basis on which to have a conversation on what's opec today and then future. when he talks about needing to force the high cost of barrels out of market, of course everybody sees that as being north america and deepwater. within opec there are barrels that are not high cost per se but they are barrels that will get forced out because countries don't have the wherewithal to continue to re-invest, venezuela, nigeria. those are low cost barrels. so opec has to deal with that. >> our thanks to exxon ceo rex tillerson. our guest host today is gobble. bob what do you think about exxonmobil, about any of the big integrated oil