good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with andrew ross sorkin and brian sullivan. joe is off today. today's top story, the markets. the bank of japan keeping its monetary policy steady as expected. the bank of japan offering a bleaker view of the economy there, atributing recent weakness in exports and output to a slowdown in emerging markets. the central bank removed language from its statement that it would cut interest rates further into negative territory if needed. check things out for the yen. you'll see this morning after this announcement, the dollar is down against the yen. so the yen is rising. 113.14. the dollar is up against the euro at 1.1075. take a look at stocks in asia. here's how things close. the nikkei ending down by almost 0.7%. same story for the hang seng. the shanghai ended in positive territory but just barely.

in the early trade in the european markets right now, you'll see that at least at this point, there are some red arrows there as well. looks like the dax in germany is down by 0.4%. right here in the united states, it looks like the dow futures are now 71 points below fair value. s&p futures off by 12. >> among this morning's other top story, we're watching the price of oil. crude oil under pressure again today. this follows yesterday's drop of nearly 3.5%. that drop came after opec said global demand for crude would be less than previously thought this year. in corporate news, jpmorgan reportedly wants to sell new securities that would pass along the credit risk on 1.9 billion in mortgages. this has been left to the government for the most part since the financial crisis. "the wall street journal" reports the bank is expected to price the residential mortgage-backed deal over the next two weeks. and apple's response to the

justice department is due today. this is the latest chapter in the dodj's case against apple. authorities say unlocking the phone of one of the san bernardino terrorists could provide more information about the shooter and the plot behind the attack. apple has claimed this would breach the promised protection of the privacy of all of its users. both parties are due in a california federal court next week. andrew? okay. some stocks to watch. keep your eyes on these guys this morning. general lek tri announcing three of its board members will leave this year in what it calls a refreshment. maybe that's a polite euphemism for what's going on here. the ceo's total compensation fell this year nearly 12%. also, viacom shareholders voting to re-elect the company's directors. they also voted to remove voting rights from all shareholders. finally, outerwall, the parent of red box, saying it's going to be exploring strategic and financial alternatives.

the firm also doubling its quarterly dividend to 60 cents a share. big headline there. that company is now officially on the block. let's get another check on the markets this morning. yesterday was the lowest volume day for the markets that we've seen all year. probably because we're still waiting to see what the fed d s does. ahead of that, a lot of people think the fed will be a little more hawk ir. the dow futures are down by about 75 points. yesterday the dow finished up by only by about 18 points. it was its eighth positive session in the last ten. s&p futures down by 12.5 today. the nasdaq down by 22. one more time, take a look at european markets. there are some declines across the board here. biggest decliner of the major market seems to be the cac in france. as we showed you, asia, japan ended down. it was down by about 0.7%. same story with the hang seng. oil prices yesterday were down by close to 3.5%. that was the worst session for

wti since last week. again, there are some concerns about oversupply as we hear more from iran talking about ramping up its production once again. take a look at the ten-year note. you're going to see treasuries. at this point, the ten-year yielding 1.931%. yesterday saw its highest yield level in over a month. also take a look at the dollar. as we just showed you, the dollar looks like it is up against the euro at 1.1077. it's down against the yen. yen is trading at 113.12. gold prices saw its fifth negative session out of the last six yesterday. it's down another 1% to 1,233.30. well, today may very well determine if the political fates of both john kasich and marco rubio as voters in five delegate-rich states will head to the polls. at stake, 367 republican delegates. for the democrats, it's even more, 691. most eyes will be on that gop

race. john harwood joining us. is it fair to say that today is do or political die for kasich and rubio? >> for sure, brian. really, the underlying question is can either of these two front runners, donald trump on the republican side, hillary clinton on the democratic side, be stopped for these nominations. i just want to run through the scenarios, what it take for that to happen. first of all on the republican side, if donald trump is going to be stopped for the nomination, it starts with john kasich must win ohio today. does not look like marco rubio will be able to do that in florida. if john -- ted cruz needs to pick up chunks of delegates in the proportionate states today, especially talking about missouri and north carolina. and overall, kasich, cruz, even rubio with the delegates he's already gotten, the other candidates have got to hold together enough delegates so

donald trump cannot get to 1237 on the first ballot in cleveland. that's the way you get to some kind of brokered convention scenario. on the democratic side, what does it take to stop hillary clinton? first of all, bernie sanders has got promising prospects today in midwestern primaries. missouri, illinois, ohio. the polls show hillary clinton leading, but they showed her leading in michigan last week, and her team is concerned that bernie sanders has been able to cut into both the african-american and hispanic vote. so bernie sanders needs to win those. secondly, he needs to start winning some states by large margins because he's got a big delegate deficit to hillary clinton. both in terms of pledged delegates and super delegates. only by narrowing that gap can he have a realistic shot. the way to do that for him, which would happen in part by the victories today we just talked about, ohio, illinois, and missouri, he's got to enjene engender a collapse of confidence in hillary clinton's candidacy.

that's how he moves ahead as the calendar goes to places like new jersey, wisconsin, california. that's how he develops the potential for big wins there that can make up that delegate lead, guys. >> john, we know that kasich hasn't won anything to this point. even if he does pull off a victory in ohio, what does that look like in terms of potentially getting him to the point where he could win the nomination? >> well, becky, it's not really about getting john kasich on a path to a delegate majority. that is exceedingly difficult. what it is, is about denying that chunk of delegates to donald trump. it's really kind of a delegate keepaway game right now because donald trump has got an advantage. if he wins big in remaining states, especially the winner take all states, he can't be stopped. but if more chunks are taken off his pile of potential delicates, the more difficult it is for him to get a first ballot victory. the name of the game is denying hum a first ballot victory.

after that first ballot, then delegates begin to shake loose and be able to be susceptible to some sort of negotiation. don't know if that's going to happen. you'd have to bet if you were laying down odds today, you'd have to say donald trump is likely to get there, maybe even on the first ballot. but it's all about the possibility of denying him that strength. >> you know, john, we talk so much about ohio and florida. they are obviously very important states, but did you think we're also underrepresenting the importance of illinois, which is winner take all by district, and missouri, which if you go over 50%, it becomes winner take all? i mean, there's, i think, 120 delegates for those two states right there. >> well, sure. if donald trump goes over 50% in missouri, he's going to be the nominee. i don't think that's likely because of the polling. in illinois, ted cruz has always been running pretty closely behind donald trump. again, it's about ted cruz grabbing a chunk of delegates. ted cruz isn't that far behind donald trump in pledged

delegates. he just keeps losing in big state contests. but if he can grab chunks there, if he can even win those states, then he develops the possibility of getting into a one-on-one race with donald trump that could go more favorably. you know, every time you isolate two candidates, donald trump and somebody else, the somebody else tends to win. so that's been the goal all along for marco rubio. it's the goal for john kasich. it's the goal for ted cruz. the challenge, of course, is that sometimes the way it actually shakes out is as other candidates lose, you don't get that pure laboratory one-on-one test. you start getting trump looking stronger to voters, like trump is the winner, i'm going to go to him. so it's a complicated scenario, but basically the non-trumps need everybody to be strong against him to deny him that first ballot nomination. >> john, i know this is the beginning of a long day and potentially a long night. thank you very much for being with us that oday.

>> you bet. >> for more on today's primaries, let's bring in morris reid and scotty hughes. let's start with you. donald trump has said if he can take ohio, he's going to run the table and that's basically over. what are the odds of that? >> i think it's actually good. the fact that john kasich is not winning overwhelmingly in his state proves that the people of ohio don't have as much trust in him as he should after being governor and being a congressman. maybe it has something to do with jobs. as congressman, he signed into nafta. as governor, he's lost over 112,000 jobs just to the tpp. and when we talk about ohio, this is main street. this is where the rules that have been implemented in d.c. have an effect. ohio has been probably affected the most. most of these manufacturing jobs have gone out of the country, and the people are still hurting despite the numbers they were trying to tout yesterday on the campaign trail.

>> right. john kasich does have approval ratings of over 80% in his state. >> then why isn't his number higher? we can talk about approval ratings, but when it comes to the polls, if he had that high of an approval rating, he should be blowing donald trump out of the water, but he's not. he's done well, but there should be more than just a few points in the margin of difference. >> right. morris, let's talk about hillary clinton. obviously what happened in michigan was a huge surprise based on the polling we'd seen ahead of time. how confident do you feel in how she'll do today in states like illinois and ohio? >> well, if she looks past bernie sanders, she'll have another shock. i'm hoping her ground game, they doubled up the efforts in these key midwest states. but when she takes her eye off the ball like she did last time against barack obama and like she's done a few times against bernie sanders, she tends to lose. so she needs to stay focused and make sure she's concentrated on

this issue. i think there's a larger issue in the ohio narrative. it's interesting because if donald trump can beat kasich in the primary, i think it will be very difficult for him to beat the democrat, presumably hillary clinton, in the general. as you know, no one has won the presidency without winning ohio. >> you mean in the state of ohio itself. >> yeah, so that's really the game within the game. it's very interesting to see what happens there tonight. >> why do you think that trump couldn't be hillary there if he can't beat kasich there? >> well, there's a diverse electorate in ohio. if you look at northeast ohio, there are a number of minorities, african-americans, hispanics. northeast, highly democratic. there are some pockets of anxiety when you get in the rural areas. if he can't beat kasich, as we go into the general, where the population will be more diverse, it will be difficult for him to

beat the democratic nominee. >> how can he say that considering the one reason probably why bernie beat hillary in michigan was because of hillary's support of her lack of, saying she didn't support nafta, which is the same reason ohio is hurting so much with jobs. so it doesn't even come close. and diversity is color blind. it all comes down to the green, called the dollar in the pocket. ohio is hurting because of jobs. they're in the bottom half of the unemployment numbers. they definitely have not been a i believe to recuperate from the 2009 crash. so the same thing that killed hillary in michigan is going to hurt her again in ohio. it's the same scenario. i think what you just said is absolutely bogus. >> well, let me explain it to you. if you look at the urban areas, cincinnati, akron, cleveland, those populations will go overwhelmingly democratic. the key vote will come out of

either columbus and the columbus suburbs. those tend to break for the democrats when you have a candidate that can get out a large population, particularly a population that will overindex on the minority side. looking statistically, and i've run ohio so i know what i'm talking about, if it breaks that way, the democrats should win. >> let's look beyond ohio. i want to get your thoughts on what happens if we wind up on the republican side with a brokered convention or on the democratic side relying heavily on the super delegates. scottie, what happens in that scenario? >> i'm still optimistic. i don't think we'll have a brokered convention. you must win eight states. >> if he does not get to 1237, you're looking at a situation where you could watch delegates be opened up after the first round. >> if you remember, these votes are voted on by the delegates. the majority of these delegates

are donald trump supporters. they been elected by their states. trump supporters are extremely loyal. when they adopt new rules 48 hours before the rnc should begin in cleveland, i imagine they're favorable for mr. trump at the top of the ticket. >> i think they won't change the 1237 ruling just because the deadline to do that has already passed. >> no, but we're talking about when they actually go to vote. every year you start with a clean state. right now rule 40 is in place. they're going to go in, they're going to vote whether or not to keep it the same or to change it. the minimum states we've had in the past have been four. because of ron paul in 2012, they upped it to eight. i guarantee they're not just going to eliminate it and vote from the familiar. you have too many delegates loyal to the front runners. >> morris? >> listen, the only way you keep donald trump off the ballot is to beat him. if they go to a brokered convention, i think he'll run as a third party.

if he wins outright -- he's going to have to lose in order to not be on the ballot. >> my point in asking these questions is not just taking a look at the potential of a brokered convention but also the idea of super delegates. if it turns out voters themselves don't feel like their votes matter, what do you wind up with on the democratic side? >> i think that hillary clinton is going to get enough delegates. i think we play too much into these super delegates. >> exactly. super delegates and brokered conventions are not the things that look like democratic votes. that's my point. >> i don't think we're going to get to that point. i think if hillary wins, she's going to win with a majority of delegates. if trump win, he'll win outright. a brokered convention will undermine the process and embolden his constituency. >> i think you're going to see those bernie sanders fans when they realize it was stolen from these by these super delegates.

they're probably going to cross over and support mr. trump, hence why we're seeing low voter turnout on the democrat side and record numbers on the republicans. >> well, i think as you know, once the general starts, we'll see what happens when we get into a primary. what hillary clinton needs to do right now is focus on ohio, illinois, and missouri, make sure she has her turnout operation to the right level so she doesn't get stunned again like she did in michigan. >> morris and scottie, thank you for being here. obviously an interesting day. away from politics for a moment. long-awaited earnings. weave be just out from valeant pharmaceuticals. the ceo was out on medical leave for quite some time. quarterly profit of $2.50 per share, which is below estimates of $2.61. the company does say these results are considered, quote, preliminary, as it reviews its

financial reporting. we'll have more on all of this, what it means, in a little bit. of course, what it also means to people like bill ackman, who's been a big supporter and owner. coming up, fed policy in focus. central bankers gather for a two-day policy meeting. we'll talk market strategy next. its sleek design... is mold-breaking. its intelligent drive systems... paradigm-shifting. its technology-filled cabin...jaw-dropping. its performance...breathtaking. its self-parking...and self-braking...show-stopping. the all-new glc. mercedes-benz resets the bar for the luxury suv. starting at $38,950.

with everything else going on, do not forget about the fed. the federal reserve kicking off its two-day meeting today. as always, their interest rate decision will come out at 2:00 eastern time tomorrow. then we get the live press conference 30 minutes after that. let's talk about what all of this means for you and your money. gabriela santos joining us now, global strategist at jpmorgan. along with tom manning. guys, thank you very much. appreciate it. a lot of debate about, oh, they're going to raise rates, what are the dots going to look like. as our viewers of the 2:00 show know, i have being less enthusiastic about the federal reserve as of late. not saying they don't matter, but how much could tomorrow move our listeners' and viewers' money? >> i do think there will be some

interesting information in the famous dot plots and the new projections and the press conference. i think they're slowly going to start moving the market towards pricing and a rate hike maybe in april or june and that's what we should be watching for. >> please, make it interesting. what will be the most interesting things you are looking for in tomorrow's announcement? >> we're looking for, first of all, in their statement how they view the balance of risk. things have gotten better since their last meeting. we'll be looking for them to update. we'll be looking for janet yellen's tone at the press conference. does she start prodding the market towards expecting rate hikes? >> you think we could get a rate hike tomorrow? nobody expects it. >> not tomorrow. they have shown they're cautious and want to prepare the market beforehand. >> is there a point where they get sick of communicating all the time? >> certainly the ecb and boj like that tactic. i think janet yellen has shown she likes very much

communicating and preparing the market. >> if it was just, tom, one -- and i'm going to drive this interview into a ditch. if it was just one -- if it was just yellen speaking, that would be great. we're getting fed speak every two or three days. it's like if all of us started talking about our own views, they're all different. the fed is aiming for transparency. how do you feel, personally, just as someone with a 401(k)? i feel the fed is more confusing than ever because everybody is talking all at once. >> i think you're right. let's be clear. i think the fed ought to move tomorrow. they won't. >> you think they should raise rates. why? >> because the economy and some of the targets they've been attempting to steer towards are starting to be realized. i think that waiting any longer is just going to create more uncertainty. the reason we've seen the turbulence in the market is uncertainty. no one knows where things are going to go.

a move tomorrow would certainly send a message. it's not going to happen. it's probably not going to happen in april. >> do you feel you understand what they want? >> no, not really. i think no one really necessarily understands what they do. without the market backdrop, i think they would move. we've had a 200-point move off the lows in february. if that had occurred two months ago, the path would be clear for them to make some moves this week. >> so the data dependency is where the s&p 500 is. >> don't you think the path would be clear? >> that's the weird thing about this. gosh, we're all getting up there in age. >> speak for yourself. >> are you ageing backwards? >> yes. >> i remember when 2% was so low that we would never go lower. it was unbelievable. now we're terrified of 50 basis

points. one half of 1%. if they raise, that's where we'll be. do you believe that the global economy and all the debt on china's books and the ecb, do you believe 50 basis points or even 1% is enough to bring down the world? >> no, we absolutely do not. >> why does that theme seem to be out there? >> i think to your point, right, in previous rate hikes in normal times, we used it hike 250 basis points a year. now we're quibbling over 25, 50 a year. i think the concern for people is they feel the economy is just not strong enough, it can't handle rate hikes. that, to us, is a misunderstanding of the strength of the economy. we actually think that in the beginning, some of these rate hikes could have actually a positive impact. a little bit of a confidence boost. >> there does tend to be -- and i don't want this to be a political statement -- an aura of negativity around america the last couple years. things have gotten a lot better. yes, there are always people who are struggling, but things have improved.

>> are you beating around the bush, which is to say, is there a political element to all this? >> i think at this point, there's a political element to everything. >> that's the question. do you think there's a political element? we're in an election cycle. we're not just in a market cycle. do you think there's a political calculus to when they do this? >> there may be, andrew. it's tough because the fed clearly wants to move rates higher. we're in a period of time where the economy is not overwhelmingly strong. we're certainly in the throes of an election. who knows where that's going to go. adding uncertainty at this point in time could be destabilizing. i think that despite the fact they should raise rates, the cautious path is the best one at this point in time for the fed. >> and you think that raising rates leads to whom winning? >> oh, i don't know that raising rates actually determines the outcome of the election. >> if you think raising rates is going to slow the economy down, right. >> you know, i don't know.

i think that the tone of the election is so polarized this year that where the economy is at the very point in time when the election occurs may not be what caused the ultimate outcome. >> so let's say that the fed gets back to 1%, which we'll probably call normalization of interest rates. if you look at history, 1% is far from normal. still, incredibly low. what does that mean for the stock market? somebody with a basic 401(k), what should they do? >> we've been saying since we were talking about the fed all of last year, we were actually always of the belief that if we do get rate hikes, that could be a positive thing for the stock market. that's fundamentally to our point that the reason they would raise rates is because the economy is doing well, it's getting better. especially this year. i think it allow the financial trade to come back, such an important part of the stock market. could allow financials to rebound. overall, we really look at the rate hike cycle. we think that can still be

positive. >> in 1994, tom, and i know nothing is analogous. there wasn't all this central bank stuff. but in '94, the fed raised rates i think 250 basis points. at least 2%. in 1995, the dow rose 33%, posting its third best gain in 40 years. i'm not saying we're going to get that again, but do you agree maybe a rate hike could be a positive for stocks? at least because it might decimate bonds. >> the early part of the cycle, the stock market obviously can and has shown it can move higher. you go back to 2009, 2010, notes were coming out of some of the big banks saying the only way the market was going to move higher was if interest rates started to rise. here we are years later, and that hasn't happened. so a move from 25 to 50 or 75 basis points is not going to derail the market. it's still an unprecedented period of monetary stimulus. we've never been in this environment. we'll still be in that environment even with a couple

rate hikes. >> so the headline is don't fight the fed, don't fear the fed. that fair? tom and gabriela, thank you so much. when we return, valeant pharmaceuticals just out with its quarterly results. the company obviously under pressure from investors to provide more details about ceo michael pearson's recent illness. details right after this. right now as we head to a break, take a look at yesterday's s&p 500 winners and losers.

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welcome back to "squawk box." time for the executive edge. the meditation and mindfulness industry raked in nearly a billion dollars last year. more than 20% of corporate employers now offering mindfulness training. that figure is expected to double by next year. the billion-dollar number doesn't include the revenue from nearly a thousand mindfulness apps. >> what is mindfulness? >> so i do, as you know, transendental meditation. i couldn't sleep last night, did a little tm, put me right to bed. it does work. you have to be consistent about it. tm is 20 minutes twice a day, which i don't do. >> there's no way you're spending 40 minutes a day.

>> i'm not that good. but mindfulness is something you can figure out in just a moment. >> zen any time you hit the app? >> is there an app for this? >> there's an app for all of it. but it's about finding yourself and your space. i'm not good with the mindfulness. it's a separate thing. >> still, a tough critic when it comes to this stuff. i get reflection. i get prayer. you might say that meditation is part of all of that. >> could be. >> a mindfulness app that's going to get me in a zen place instantaneously. >> the app doesn't do it. it's a glorified timer. that's what all these apps are. except for the ones that are guided. there's something called head space. if you want to try this, it's worth trying. no joke. it's a guided meditation. you have a guy who's talking to you for about ten minutes. you can do it on airplanes, in the subway. >> is he really boring and puts you to sleep? >> i'm going to try that. >> we'll try head space first. >> if tm doesn't work, hulk smash. >> that too.

other news this morning, this is my favorite guy. michael jackson's estate has agreed to sell its remaining stake in a lucrative music catalog to sony for $750 million. that's going to give sony sole ownership of some of the big works by the beatles, bob dylan, eminem, taylor swift among others. the sale does not include rights to michael jackson's master recordings or songs he wrote. this guy was an investing genius. he bought that library originally for $41.5 million in the '80s. it should have actually technically been worth double. he ended up selling half of it to sony already. he got into terrible debt towards the end of his life. so that portion of the estate unto itself could have been worth a billion and a half. >> wasn't it paul mccartney who advised him on some of these things? buy the stakes to everything, buy the rights to everything because we didn't. >> exactly. well, gogo may be gone, gone.

at least on american airlines. exploring other options for in-flight wi-fi. apparently passengers have been complaining about the high cost and slow speed of gogo. after a legal battle with the company, the airline is looking at competing proposals. you're accessing the internet from a metal tube going 500 miles an hour 30,000 feet above the planet's surface. but you're complaining about it because it's slow. >> with apologies to the gogo people, it is a terrible service. i don't know how often i used it. i signed up every time i got on the plane. i've stopped because half the time is doesn't work. >> i'm just a united donkey. >> the united one works. it might even be powered by the via people. i don't know. the gogo problem, we have the co on, is so many people log on that there's too many people handling the bandwidth. >> we just did a segment on mindfulness and tm. i've been guilty of it if i've got to work, if i have a lot to do. the plane has always been the

savior space. not logging in. >> there are times when you have to. >> welcome to the world of increased productivity at every level. >> by the way, e-mail destroys productivity. >> not going to disagree. >> does anybody in america agree with me? raise your hand. put both hands on the wheel. don't do it if you're driving. anyway, valeant pharmaceuticals out with earnings just moments ago. it missed on both the bottom line, and it's cutting its revenue forecast for the year. >> these were highly anticipated because they had been delayed by a couple weeks, as the ceo came back from his two-month medical leave of absence. it looks like these are not what people were hoping for. the stock is down about 10% premarket. probably that's because they lowered their 2016 guidance by so much. in terms of revenue, the new guidance is $11 billion to $11.2 billion. that's down from $12.5 billion

to $12.7 billion. and adjusted eps down to 10.50 a share from 13.75. in addition, they're saying things like the first quarter is going to be very weak. they're saying management transition issues and continued organizational distractions are expected to negatively impact operations during the quarter. there's a quote here in the release where mike pearson is saying the challenges of the past few months are not yet behind us. but really trying to look forward obviously. in addition to the 2016 guidance, they're giving guidance for the next four quarters. so an additional quarter of guidance there. interestingly, as you go through this release here, they have added a new line item to their accounting at the end of it, which is the cost of winding down philidors. this is costing them. people are still waiting for the outcome of that board investigation. that's going to be an overhang on the stock. they also haven't said when they're going to file their 10k. that's something people are really waiting for.

>> obviously the market not reacting kindly. stock down almost 11%. >> right. and reuters was reporting there were questions about mike pearson's illness. he hasn't spoken publicly. though, some people are taking issue with the fact he's been doing private analyst calls since he came back. it will be interesting to hear from him. >> do we know what bill ackman's average price on this is? >> more than the stock price is now. >> there you go. >> listen, i was talking to a biotech ceo, private company ceo but in the game for 30-plus years. they said the biggest problem with valeant, and this is just somebody talking from an industry perspective, is now they're on the radar. their business model is on the radar. buy drugs, raise the price, change the distribution model. that's really all they do. do you think there's a great concern among people about that? just that now everyone is aware of valeant and they've really not heard of them before?

>> i think that's exactly right. i think one of the concerns here in addition to all the other things swirling around this company is that they're going to get pushback from payers. so they're saying here things are going to be a little slower. that's in addition to all the questions around the company. that's sort of the fundamental part of their business. people are worried it's going to keep slowing down. >> there was an article earlier this month that said ackman may be down by $2 million. of course, he's been buying more shares since then. >> he's also been buying options and puts. $160 at one point, $95 at another point. all of those numbers materially higher. >> herbalife is up 59% over 12 months. now, again, ackman may have bought puts or may be cost averaging in. at some point, if you're saying

that this stock is going to zerzer zero, and the stock is up almost 60% in 12 months to $57.10 -- >> look, even ackman himself said he made a mistake by not selling it when he could. >> bill is a friend of cnbc. i've met him a few times. if you look at valeant or herbalife, there's some real -- what was he down, 19%? >> oh, yeah. >> you can't have that. >> down 14% this year. >> i don't know if they're going to give you -- well, what do you think, andrew? >> 50% of his fund at least is permanent capital. so he sort of has that money. it's very, very sticky money. >> how do you get permanent capital? >> oh, because they actually raised a fund. >> all capital has to be somewhat transient. >> but closer to permanent capital. it's made a lot of money for other people. some people are sticking around. it's not going to all roll off tomorrow.

>> should be season two of "billions." >> we'll take that. >> thanks, meg. coming up, video killed the radio star. so will internet kill the tv star? more and more ad dollars are flowing on to the internet. you know that. but do you know what stocks may benefit from it? we're going to find opportunity with rbc next. 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! now i'm seeing dollar signs. you should probably get your eyes checked. good one babe. optometry humor. right now get up to $650 in credits to help you switch to at&t.

all right. welcome back and good morning, everybody. time now for the squawk planner. it is a big morning for economic

data. you have got the government's retail sales report and the producer price index for february at 8:30 a.m. eastern time. of course, we'll have those for you with reaction. the federal reserve kicks off a two-day meeting today. tomorrow we will get that decision right around 2:00 eastern time followed by the live press conference with fed chair janet yellen about half an hour after that. after the closing bell today, you get quarterly results from oracle. and that, america, is today's squawk planner. >> okay. let's talk tech this morning. the online advertising arena heating up. google is still on top, but with names like netflix and amazon down double digits this year, are f.a.n.g. stocks losing their bite, or is now the time to buy? mark, thank you for being here. we also have to talk about tv. you got a big call on the end of tv. sad for those of us who are all sitting here on tv. >> where should we start? >> let's start with the f.a.n.g. stocks.

would you buy? >> we go first with amazon. we think that's the most dislocated stock. they had an issue with expenses. too many people wanted to use amazon's delivery network. that's a good problem to have. they'll sort that out. google is the number two pick. >> just in terms of what your price target is on those companies? >> oh, boy. amazon, we're at 750. google we're at 1,000. priceline, 1700. >> how does amazon figure that out? they're going to raise prices for prime? raise prices for delivery? >> they have increased prices for fulfillment by amazon. that's the new program. about half of all of the items sold by amazon are actually other people's products. amazon picks, packs, and ships them for them and charges them a fee for that. it's actually a good move for amazon to have all of these third-party vendors say, take ore inventory and deliver it for us because you do a better job.

>> we call them a retailer, but are they going to basically become a cloud competing company that also happens to have a retail division? are we watching a transformation of amazon over the next couple years? >> great question. there's two points to this. first, this is the first year in which their cloud profits are going to be bigger than their retail profits. >> do they have retail profits? >> thin. look, retail, what do you expect? mid single digit operating margins. second thing, they're now becoming a logistics company. we did a report this morning on the impact that amazon could have on partial carriers. >> that is really expensive if they get into this business. >> but just watch this. not next year, not the next five years, but over the next five to ten years, the scale of which amazon is operating, 200 billion in sales total, 15 billion in shipping -- >> you think they're going to do logistics for other companies? >> it's almost inevitable. they're running at such a scale, it will make sense. they offer cloud services to

other companies. they offer marketing services to other companies. why not do shipment? it's a matter of time. >> tell us why the end of tv is upon us. >> i think i said that four years ago. it takes a while for these trends to play out, in all fairness. what we're seeing now is about 40% of people of marketers when asked where their sources of funds are for internet advertising are coming from, 40% now say tv. so it's been gradually rising over the last couple years. three years ago, 25% of marketers would have cited tv. what really tipped it over, we think, this is just a thesis, is where those auto play video ads that facebook rolled out. you finally had massive platform. you had youtube, but you had another massive platform that offered brand advertisers a medium, video ads, that they were comfortable with. i think that happened a year and a half ago. you're seeing these budgets tip now. >> so this is the year for the tip? >> a couple of years. yes, i think it already started happening last year. it's happening this year. two years in a row of weak upfronts. what does that tell you? >> we'll see. i wish joe was here to fight

back. he would tell you tv is here to stay forever. >> i think he said that about espn too. >> are you challenging me? >> you're in the chair. >> i use apple tv for the most part. there's a cnbc app on part. there's a cnbc app. you can watch this live on apple tv. if it's a phone, apple tv, the content is still the king. i don't like to use the word tv because it makes me think of a physical device. i think tv is not going to be physical any more. it's going to be every where and as long as you create compelling content you'll be okay if ad rates can stay high. facebook is one sixth of what they would get from a television ad. so that's the risk. ♪jake reese, "day to feel alive"♪

♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪

welcome back, everybody. the fed kicking off a two day meeting and that means it's time for results from the latest fed survey. a look at how the nation's top financial minds view fed policy. lease h steve liesman has some of those findings. >> rate hikes are on the table this year but not as many. when is the next hike? in the prior survey it was may

2016 and now it's moved to june. pretty strong support for that june rate hike, about 80% see june or even earlier for that rate hike. next one, when will the balance sheet be allowed to decline. that remains unchanged. what's interesting about this, february 2017 folks less than a year away we may be talking about the fed one uniteding the $4 trillion balance sheet. final the terminal rate. had been in the second quarter of 2018. now a little bit higher moving closer to fed. further out the third quarter of 2018. how many hikes this year? 2.8 or call it three for the december survey and that's come down two. just call it two here. what's interesting about this is the fed itself, the median fomc member has four in there and that's remained a difference with the market for quite some time.

is the fed too easy. i'll show you one other thing. this is the different between the median fomc and our survey. call it 80 here and here over time. what we're looking for in the wednesday announcement when we get the new forecast from the fed itself is that they come back down to the market, 49% of our respondents see the federal reserve as to accommodative. the fed needs to move 64%. some commentary we have. the case for gradual rate hikes remains in place. just one more here. the job market says hike, inflation says don't hike. stock market says can hike. >> steve, thank you very much. coming up, presidential front-runner donald trump and hillary clinton looking to widen the gap against their competitors in five primary states today. live reports from florida and ohio right after the break.

>> trump aims for a knock out while john kasich and marco rubio try to keep their gop hopes alive. voters head to the polls. we have live reports from the key battleground states. plus a response to this comment from donald trump. >> these stupid people like club for growth, these are stupid people. they come to my office, they ask me for $1 million and i say for what. >> club for growth president and former congressman david mcintosh is here to sound off. >> can the unicorn fairy tale of 2014 live on. we'll talk start ups, apple'sing fight with fbi and the deal environment for tech in 2016.

"squawk" goes shameless. >> i rather be riddled with bullets than spend one more hour in this place. >> william h. macy is here 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" right here on cnbc, first in business worldwide. i'm andrew ross sorkin along with becky quick and brian sullivan is here today as well, the futures at this hour are in the red. dow looks like it would open 75 points down. nasdaq down 19 points down and s&p 500 would open off 12.5 points. oil as we flip that board around, wti crude trading at 36.23. fed policymakers are set to

begin their two day meeting today with their latest policy statement due tomorrow afternoon fold by janet yellen's news conference. ahead of that a slew of economic data. retail sales and producer price index hitting at 8:30 eastern time. business vince and home builder sentiment at 10:00 a.m. the bank of japan kept its monetary policy unchangeled but it glaef a bleaker view of japan's economy and warned of a weakening inflation expectation for the nation. >> in other corporate news valeant releasing its quarterly earnings report and it's ugly. the drugmaker earned 2.50 a share but 11 cents below the consensus forecast. valeant cut its revenue forecast for the year and the company said even these results are preliminary as it investigates its own financial reporting. that stock is down more than 11% in the pre-market. the ceo michael pearson is back

to work. activist investor backing pearson during an interview on closing bell yesterday. listen. >> he's incredibly, incredibly driven. incredibly smart. he's a great problem solver and we're solving problems as we speak, as the model changes and shifts. he's about, you know, 80% back. he really was sick. and he's finding his energy as we speak. it's surprising how quickly he's attacked and having come back. and really being as determined as he can be to the shareholders to solve his problems. so we think mike is the right guy for the job. >> pearson has to be all that because valeant's market has more than halved since act. apple's response to the department of justice is due

today. the latest chapter in the doj's case against the tech giant. unlocking the phone of one of the san bernardino terrorists could provide more information about the shooter and plot behind the deadly attack. apple claims this breaches the promise protection. they are due in federal court next week. amazon will be launching a cloud my grace service today. the technology willett companies shift data from their own computer servers to data centers run by amazon. microsoft has a similar program. this goes to like ibm and these other guys who thought they had a wall garden, this will make it much more challenging once the migration becomes sort of a turn key solution. >> we'll talk in a few minutes to a guy who knows a thing or two about technology. right now it is primary day. voters in five states heading to the polls. at stake 367 republican delegates for the democrats it is 691.

we have full team coverage including eamon javers. he's in west palm peach florida. scott cohen is in columbus, ohio. scott let's begin with you in the buckeye state. a state always pretty much named the next president. >> that's right, brian. if there was any doubt that people in ohio are paying attention, look behind me. the polls have been open here just outside of columbus for about half an hour and the people are lined up, still lined up in a day that's huge for both parties. for the democrats, 143 delegates at stake. 66 for the republicans. the democrats will award their delegate proportionally. the republicans ice winner take all but a pivotal primary for both sides. on the democratic side hillary clinton has been favored here but bernie sanders campaigning to the last minute hoping for an upset along the lines of last week's upset in michigan. he's here and pushing his stance against free trade agreements

which have not been popular here in industrial ohio. on the republican side much more complicated and potentially the last best hope for those in the republican party hoping to stop donald trump. the republican governor john kasich has been favored here. he was campaigning yesterday with the 2012 gop nominee mitt romney. kasich trying to continue to push a positive message. >> this country is about us coming together. this country is not about us tearing one another down or having fist fights at a campaign rally. that's not what america is. >> reporter: but donald trump was here in ohio yesterday as well, sensing perhaps this state is still in play. also a big part of the trump puzzle is in florida where we find eamon javers. >> reporter: good morning, scott. big day here at florida's palm beach, fire and rescue squad number 3. the doors are opened here. poll workers have been sworn in. voting has begun.

we think we know what will happen base on the polling. the polling has been off in several states. right now hillary clinton has a pretty significant lead. also donald trump in the lead on the republican side. take a look at this republican poll in florida and it gives you a sense of where the candidates stand. donald trump 44%, rubio 27, cruz 17, kasich at just 9%. what's at stake here? a lot of delegates in the state of florida. republicans 99 of the 1237 that they need to win the nomination are at stake. democratic side 214 regular delegates plus 32 super delegates of the 2832 needed to win. we're in walking distance from donald trump's massive estate here in palm beach. this is trump country. when you talk to voters you get the sense that the opinions here are all over the map. take a listen.

>> frankly it's embarrassing. >> a lot of people feel it's the lesser of all the evils you'll vote for and i don't like to feel that way. >> tomorrow i'll vote for donald trump. he's not a perfect candidate but we have to choose from the people who have made the effort to run. >> republicans have to stand up and say to themselves it's time to get somebody in who is -- who has the ability to basically start from scratch. >> reporter: so andrew the polls say one thing but now the voters have a chance to say their say here in florida. back to you. thank you for that report. we'll see how this plays out. stick with politics, free enterprise advocacy group clup for growth is not letting up on donald trump. they are spending $4 million on anti-trump ads. mr. trump join us on box. he spoke out about the club for growth. >> these stupid people like club

for growth. they come to my office, they ask me for $1 million and i say for what? they said well it's this and that they gave me an explanation that didn't make any sense. they wrote me a letters and asked me for $1 million. i said no. then they became hostile and doing ads all over the place. they are terrible people. >> joining us now is what mr. trump calls one of the extortinoist club for growth president, david mcintosh and alan patrickoff. david, you just heard what trump had to say. >> we all know how challenged donald trump is with the truth. the reality is he invited me to his office and said what are you doing. we did send him a letter and never heard back from him. >> he writes you.

or you invite him. >> he invites me. >> then you ask him for money. >> yeah. >> he done give the money. >> yeah. >> then you start running these -- >> i figure if he's really a conservative -- he's telling me i'm changed more free trade than i used to be and i don't want to raise taxes the way i used to do it. maybe the guy is a conservative. >> you had come out against him you said four years ago. >> our group had told everybody four years ago when he was running the guy is a disaster on trade. he would raise taxes. we looked into his record. that's the thing about donald trump. he doesn't want to acknowledge that until recently -- >> what record? >> it's all of his comments on public policy. >> it's comments. he doesn't have any kind of a record. >> he hasn't voted for anything. right. a lot of people had to put their name on a vote in the legislature or anything else. but often, 12 years he's consistently been for big

government solution. he hates the idea of free trade. he thinks he can negotiate better trade agreements and if not slap tariffs. >> i want to make a final point on one piece of this because he made the comment. you did solicit money from him. why did you do that if you thought he was a terrible guy. >> i'll take contributions to elect our good candidates from anybody who says they want to give us money for that. >> had he given you money would you still be running these ad? >> we would be against him. i told him that in the meeting. i don't agree with you on trade and taxes. if you want to send us money, you can. >> this wasn't a hard sell? >> no. i was surprised by it. usually i have to knock on the door a lot. >> are you surprised by his comments or are you a terrible person? >> no. what we are is a group that is the best advocate in washington for limited government, free markets, free trade, lower taxes, things that will grow the

economy. >> what is trump? >> i think trump is a brand and i think he's out there -- originally he thought he would build his brand by running for president. he caught on because there's a group of people in america that feel the american dream has left indemnify beline for the last eight years. that's a group of people we should address as republicans. >> in terms of free trade that's a message that all of the candidates seem to be running from at this point. not anybody will step up and defend. who your supporting. >> anti-immigration sentiment. we, the chamber, all of the groups that support free trade i think it's now our responsibility to go out and explain to people, trade creates jobs. when i left congress there were more jobs that were exporting than the old -- >> u.s. steel. >> it was indiana. >> northwest? >> how do you sell that?

how do you sell that when both sides are making an argument against free trade at this point. >> i think what you got to do is tell them the facts. these are the jobs that would be lost if we didn't export our products and then point out if you slap a tariff on everything coming from china your iphone costs 40% more. your computer costs 40% more. >> maybe you're making 40% more. >> maybe, maybe not. maybe the government has a big tax increase because you're paying more. you go to walmart and you're a middle class family you can afford to buy what used to be luxuries. that's a great thing. you slap a 40% price increase that will hurt. >> can you admit also as america is a little bit in the culture of cheap, right? we're so obsessed with low prices that we forget that with low rice come low wages because has there ever been a history in the world a country with high wages but low value products.

i can't name one. >> you get better productivity for it and a lot of the costs that prohibit us now our regulatory costs. we got a dysfunctional corporate tax rate that drives businesses overseas. we can address many of the problems that would make us competitive. >> david, if donald trump becomes the nominee, who do you support? >> you know, the club timely actually doesn't get in the presidential race and we have a firm policy if there are two bad candidates we don't get involved. >> what will you do personally? >> i haven't decided. i haven't reached the position never but at inpoint it's a bad choice. >> if you're running these anti-trump ads you're saying you would potentially vote for him? >> i haven't made up my hind. i woke up right after south carolina, this would be terrible. >> it makes no sense to run ads you're against somebody and then

say actually if he runs -- >> let me tell you why it makes sense to politely disagree with you. we don't have to have a choice of donald trump and hillary. if rubio wins and kasich wins trump is done. what i realized two or three weeks ago we have to do everything not to make trump the choice. >> if cruz wins one state and kasich wins one state you think trump is gone. >> yeah. >> it has to be ohio for kasich. >> your math doesn't work. the sentiment will shift? >> the delegate math will work for cruz doesn't work for kasich. >> i have to say i don't understand how you can come on television talk about a man call him a liar and then say y you might have to vote for him. seems very strange. >> i bet i decide not to vote at all. i want to vote for a third-party but i haven't made up my mind.

coming up, in the silicon valley zodiay last year was the year of the unicorn start up valuations through the roof. some of that froth coming off the top. we'll ask alan patrickoff about where he's investing now. and later on, "squawk" goes shameless. william h. macy joins us to talk about the future of tv, the movie business and his show. we'll be right back.

zodiac. the screws are tightening in technology. some are calling this year the year of the unicorps. devaluations are declines. the ipo market has stalled. with us this morning is alan patricof, the co-founder managing director at patricof partners. >> it's interesting, becky, you talk about the unicorns. i heard a great line the unicorns are starting to grow a second horn and turning into cows. i didn't say it. >> not so mystical. not so special. where do you stand as a technology investor who has seen a lot of these things. >> i think the unkorns are icora way a difficult position.

see i wish i had them at the beginning. on the other hand, they are in a bind right now. they got to have a vibrant public market to go into an ohio because there is no m and a transaction for a company that had the last $60 billion. in order to go public you really have to -- wrehere he'where's t. you have to have a consistent growth rate or else you're asking for your stock to come out and lay a big bomb and then lie out there forever as what we used to call the living dead. i think the unicorns have got to prove themselves and we really don't know because a lot of these companies have not disclosed what their actual results are. >> define a unicorn. >> anything over $8 billion valuation. >> the unicorn was a mystical creature that never existed.

i'm trying to make a tongue and cheek point the one corn should never have existed. is the unicorn company, is part of this fantasy again? have we seen this movie before >> not to this extent, certainly. we didn't have this kind of extreme valuations on these companies prior took public. i mean you look -- >> is it worse than '99? >> very limited group. what's happened really is that the companies like fidelity and wellington, i don't want to attack specifics, t. rowe, hedge funds have wanted to play in this game and the only way they can do it is to buy later stage investments and with big money. they can't get in the area we're in which has less money involved. >> the good news is that it's not going to -- this is not like

1999 or 2001 where the public sector was left holding the bag. >> something else that's happened which is encouraging. i honestly feel that the expression soft landing has happened in the venture business in the last six months because i can see people stepping back and instead of wanting to throw money at the next round -- first of all the companies we just mentioned those firms i think they are getting shy because they had to mark down their portfolios to some realistic value and that's tempered their enthusiasm, i'm sure. plus people are starting to say where's the beef? companies that raise -- >> two horn unicorn. >> they are saying listen, i see your revenues growing and the reason revenues are growing because they are pouring money into marketing. where's the bottom line? the gross margins in some cases are negative, which if you have

gross margins that's negative you can have a bottom line that's profitable. >> when do they go bankrupt or get sold or you see something happening. where will they run out of capital, cash. >> they have been able to put together strong coffers. i don't have access to tell you when it will happen. i'm probably more concerned with the companies that aren't in the unicorn stage that raise these -- without becoming unicorn, raise 50, $100 million and burning at the rate of a million and $2 million a month and they will run out of money and won't be around. you may see a lot of fall out in the next tier. >> alan patricof is our guest host. in the meantime when we come back big bucks behind the wheel at amedalia island. one of the most coveted car auction results are in.

the business of box. this company is disrupting the worlds of bulk shopping. think costco. our guest host alan patricof is an investor and the company's ceo will join us to talk about the business model. box will be right back.

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when we come back this morning, tired of lugging that 10 gallon jar of pickles home there's a new bulk retailer hitting the scene and they deliver. right now take a look at u.s. equity futures. weaker all morning. yesterday the dow finished up but just barely. this morning the futures show the dow down 78 points below freezing fair value. s&p down by 1 and nasdaq down by 17. valeant stock down 16%.

among the stories that are front and center check out shares of valeant pharmaceuticals. they are down pretty sharply. on this last check you can see the stock is down by over 16%. this comes after the drugmaker reporting quarterly profit of

$2.50 a share. that missed the streets estimates by 11 cents. it cut its revenue forecast for the full year. these are results that had been delayed for several week. mike pearson the ceo is back after a couple of months of medical leave. he'll be speaking to wall street for the first time in a half hour. we're an hour away from retail figures. and new jersey voters can decide whether to allow two casinos in the northern part of the state. we're talking about lyft launching a car rental program with gm. the goal is to let drivers work for the ride handling app without having a car. >> in the united states alone $2 trillion is spent every year on car ownership. and so there's a massive opportunity as more and more

millennials and others in cities switch over from car ownership to transportation as a service, they are picking lyft and we want to stay focused on that big opportunity. >> lyft is fighting to take market share from its larger rival uber. a few coveted ferraris help offset weakness at a classic car auction in amelia island. a 1961 ferrari, 250 gtspyder. it sold for just over $17 million. the auction company made a total of 60.2 million in sales including 22.2 million brought in buyerry seinfeld's sale of three extremely rare porsches

including the one you're looking at right now. >> let's take a look at some stocks to watch this morning. starting with apple tech giant's response to the justice department in its high-profile encryption case is due today. the dodge dodge is trying to compel april told unlock the iphone of one of the san bernardino shooters. morgan stanley shows apple iphone ahead of consensus. >> this is a decision -- i honestly side with the government in a sense to a great extent. we can't fight wars and have people killed all over the world, our own soldiers with one hand tied behind our back. to protect what could be very important information, i think is a real challenge and i think that i don't know how you solve it. i think, frankly, snowden is another example of the same

situation. he did a lot of damage to this country. a lot of free speech people will defend him. i understand that point of view. i come down on the fact i don't want to see our people, our boys, if you will, getting killed and on one hand saying we don't want to have all the access to information available. >> i assume you're getting into a lot of debates. we have big tech companies coming out on the side of apple. >> they are fight a war that has, i don't know -- it sounds good. all technology companies should be in favor of protecting themselves. on the other hand, i think we have a country to deal with and we have a nation that we want to protect, and i don't think you can do both at the same time so the judges are going to come out as i say a solomonic decision. >> if you're looking for a solomonic decision, you cut the baby in half. >> open one phone up.

do something. you just can't deny the government access to information that could be extremely valuable and i understand the problem. and i'm glad i'm not the one making the decision. >> that extends well beyond apple, obviously. >> everybody is going to encrypt. as a result we'll just open up a field to a lot of terrorists and -- i understand the other argument. but i come down on the side of saying i want to have some kind of rules that enable the government to, when it's justified -- >> is there a way -- >> strict rules be able to access information that they think -- >> is there a way, though, technologically to actually protect people's privacy, to have secure systems so your data isn't hacked but that allows the government in when necessary and there has been, by the way, a roam put out there that i just heard about, maybe your solution that when you get your phone, you will actually check the box if you're going to use all this

data, if there's a legal reason you would open up your phone. >> they are talking about preferences. we told our customers they have privacy. >> you would say -- to use these services -- >> that seems a little ridiculous. for years we seemed companies would be giving in -- >> there's a difference between having access to your phone or my phone because they think we've done something. in this lar case we have a known person who killed people. >> right. >> we have a known case. when we have that -- >> i was surprised to see am. >> post de facto basis. >> i was surprised to see apple digging their heels in this case. you're talking about terrorists. 12 to 14 americans that were killed. many more that were damaged on a phone owned by the county. >> owned by the county. the privacy concerns don't exist in that realm. the question is whether privacy concerns exist once you open the

phone whether you have to do it a million more times. it's the precedence issue. >> we're agreeing that if some defined rules are set up that do protect privacy in the sense that we're all concerned. what we're concerned about is invasion of privacy when it really isn't justified. when you got killers, i don't think any of the rules should apply. >> obviously we need some new rules because we're going off a law that was created in the 1700s. alan patricof is our guest host. take a look at the futures before we go to quick break. we have some red arrows. dow would open up off 71 points. when we come back it's shameless on "squawk box". william h. macy is here and we'll talk about the acting business and much, much more when we return with the man. "squawk box" will return in just a moment.

welcome back to box. nothing shameless about a many decades long career on stage and screen big and small actor, william h. macy joins us the star of showtime "shameless" renewed for a seventh season. good morning. did you ever think when you

started this six years ago you would be doing this seven years later. >> i sure hope so. >> how long can you do this for? >> four more years. showtime doesn't know that p.m. i'm just announcing it right now. >> that's oddly specific. my wife and are building a house so we've already spent the money. >> the house keeps getting bigger and the show goes longer. >> i can do it for a long time. the writers come up with it. one of the big fears ever doing a series, they have a tendency going one or two years beyond their expiration date and this one has not reached that yet. the scripts are engaging. >> you're seeing more and more viewers. do you think that's a function of dvrs and this whole sort of new world that we're living in? >> i think so. it's really become democraticized. anybody can watch anything any time. we don't have to tell very specific stories that offend no one. we can tell the real stories.

it doesn't take that many viewers to keep something on the air. we've been growing every year. >> is that growth, do you think that comes from digital? do you find a lot of people talking to offseason and say i just saw the show for the first time. >> i do it. do you binge-watch. >> that's the way i watch. >> a lot of people do that. >> there was an interesting comment from fx who was talking about anthology. and this idea for actors it's becoming easier to do tv. you're in it for seven seasons. this idea that actors will do tv for a year or two and that the way the i'll is going to work it will shift. >> yeah. it's bold. my wife is doing one called ""american crime"." they are in their second season but she's back telling a new

story and she's got a completely new character. she changed her appearance for it. i think probably do a third one. did i mention we're building a house? >> like the tv series "fargo." now the tv series has nothing to do with the movie other than i really feel like the guy from hobbit copied your accent. >> i do too. i didn't make up the accents. they talk like that up there. you betcha. it's fantastic. just a couple of years ago the idea of an anthology was an anthema. they wanted one offs. you didn't have to know anything about the show. you could watch one episode. better story telling. >> you were recently in a really cool ad i don't know if we have shots of it from samsung. besides the new house you were building how do you decide to do

different advertising. >> that's for taking that off my plate. somethings happened. i don't know. there used to be an invisible line between doing on camera commercials and having a successful career. alec baldwin busted that one wide-open. i paid my way in this business. i paid for my off broadway habit by doing commercials, mostly voice overs. but now it's okay to do an on camera commercial. and, you know, there are no walk in the park. if i'm honest i've seen a commercial do in 30 seconds more than some features have done in an hour and a half. >> they are more expensive to produce? >> more expensive to produce because they make them perfect but there's some stunning writing in these commercials. >> mr. patricof is 120 or so investments, a lot in the media. we had an earlier discussion which is we're all doomed. okay. for tv is doomed in a way.

but yet there's more stories and more contents than ever but rates seem to be going down. alan, how do we bridge the gap between all the contents folks like william are making and the fact that nobody wants to pay anything any more. >> conterngts i've never seen a period of time when contents is so much in demand. in the investment business and venture business no one would back a contents company. we back lots of content companies. we had a very successful sale to disney about a year ago. which is making content for youtube and other out lets. so i think we're -- this is a period of great excitement. >> when you have a customer base that largely does not seem to want to pay for it. >> well i don't think they are not paying for it, they are paying for it in different mediums. you look at all the stuff that's on cable, they are paying for it

indirectly through they're subscription and tv is, you know, tv shows are still pretty popular. i mean, you know, i hope you have a large viewership. i'll hear from them an hour from now if you do. >> real quick before we let you go. you were very critical of the oscars this year. you're an academy member about the diversity issue. i was curious what do you think can to be done about that? what has to change? >> i think some of the rules that they put in place, that there's some hangers on in the business. it could use a bit of culling. >> you got to get rid of a lot of people who are voters who have been there too long, are no longer involved in the business and sitting at home it's exciting they can still vote. >> you get rid of them or just bring in new people? >> they will figure that out.

but, you know, the big thing is what you said. i think it's going to be self-correcting to a certain extent. we need so much content that it gives everybody a shot. and i think we've seen the benefits from that already. i mean -- >> is it a good time to be in the contents business? >> oh, my lord yes. it's a good time to be in show business. we're in the golden age of television. there's not enough time in the day. >> the show after yours is pretty good. >> there's a billion shows that's really good. >> billions. >> william miss jacy. you didn't skrafrp anybody in the rump with the emmy. >> i stabbed a woman. there's two horns that stick up that are really sharp. >> william macy we should tell you "shameless" airs sunday at 9:00 p.m. on showtime and the leads into another show. trying to help you out. when we come back this

morning we'll talk all about the markets, va lants shares as we showed you before was done over 16%. later the business of box. the company is disrupting the world of bulk shopping. our guest host alan patricof is an investor and the company's ceo will join us to talk about the business model. "squawk box" will be right back. need to hire fast? go 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.

♪ no, you're not ♪ yogonna watch it! ♪tch it! ♪ ♪ we can't let you download on the goooooo! ♪ ♪ you'll just have to miss it! ♪ yeah, you'll just have to miss it! ♪ ♪ we can't let you download... uh, no thanks. i have x1 from xfinity so... don't fall for directv. xfinity lets you download your shows from anywhere. i used to like that song. >> say good-bye to traditional

warehouse shopping. boxed is among the companies rolling out a new wave in retail, the mobil wholesale club helps snare gigantic deals without going to warehouse stores and carry your own stuff. box is hoping to distrupt $2 billion industry dominated by companies like costco, sam's club and bj's wholesale. joining us now is the co-founder of boxed. this happens to be an investor -- this is not an accident. >> this is a board meeting. >> we've just been nominated. >> now this is why alan is rich and successful and i'm not. if you had come to me and said my idea is i want to give people that live in manhattan and iowa gigantic deliveries of bounty paper towels at home i would have said no way, no one wants it or need it they are happy with costco.

that's why i'm not him. how do this work? >> you're not exactly wrong. a lot of people did say no. lucky enough alan said yes in the early days. >> how many nos did you get? >> i would say close to 50 or 60 easily. >> what? >> easily. >> that to me, that's such an important lesson. forget about the company. the fact that you had that perseverance. >> i was just lamenting with somebody in the office if my day goes right now and everything goes smoothly then i get the shakes. i feel i'm in the matrix. i'll get ejected out of the matrix because everything is going too well. >> you can't go to one two people. it's hard work. >> so what did you see, alan? >> first you see a talented management team. and he certainly had that. and a concept that really made sense because perhaps because i

lived in the city i recognized the fact that people don't want to go up to 116th street and park their car and lug out the boxes and the fact that they've been able to buy efficiently because they've eliminated the physical presence of a facility which is a large part of the cost of costco or anyone else like that. so that the delivery at home, buying in large, somewhat larger quantity and at better prices is very attractive offerings. i said it for you. >> who is your customer? this makes stones me as somebody in the suburbs. i didn't understand how people in the city have space? >> our customer now is anyone who doesn't have the time, the physical means or the patience to go to a big box warehouse club. that actually has morphed over time. as we developed the business actually we don't take share away from costco, bj's or sam's club. those folks are very happy with

where they shop and how they do it. we're taking share away from supermarkets and drug stores. 81% of our customers are 25 to 44. we're getting the millennials just getting married, just getting bigger apartment, just having families. what are they used to doing, shopping on their phones. they are less driving for that two or three hour stock up trip. that's the demographic. depending on where you are across the country you see certain skews. >> we had the ceo of jet on a little while back, a competitor. does the economics of that business which is a different business than yours they seem different. am i wrong or right about that? >> jet is more so going after the amazons of the world and i harken back to the days of the off line world where sam club shared the same parking lot as walmart. folks parked their cars and self-select going for the stock

up trip or going into the one off transactional trip. for us we want the folks that would go into sam's club. with jet, i think, in a time -- i have a lot of respect for him. we're now entering into a time it's not about the best pitch, it's about who has the best model. the fundamentals of the private markets are changing. >> jet got rid of their membership fee. >> that's right. >> they are going make their money from the membership fee. >> are your making money on every sale? >> it depends on the actual sale. here's what i mean. because our average order value is so high over $100 and just about ten items per order. so profitability curve for any particular box is parabolic you get to that maximum box. you order your 11th, 12th item

you break into a second box. >> when you say pushing into the next box do i know? >> you don't know. >> with amazon -- >> pantry. >> you know when the box is full. >> the consumer just wants to shop and they just want to buy what they want to buy. we decided very early on -- >> how many items to a box. >> right now on average about seven to eight items. >> becky you'll go nine. >> i try to fill the box and it's a problem for me. >> the way we design the app is that the majority of the customers browse like they dine warehouse club. >> he's made some very interesting relationships with some of the major cpg companies in the country because they

realize this is a separate audience. >> we'll talk more about mobil. thank you for joining us. interesting story. keep us up to date on what you're doing. head over to cnbc.com make it.com today. if you never heard of it, it's a new destination launching right now as i speak and it's a platform to learn from the most inspiring self-made entrepreneurs, how to guides, testimonials and secrets of success. >> still to come decision 2016, voters in five primary states head to the polls today. this is a key race. will today's contest seal the deal for front-runners hillary clinton and donald trump or will their rivals make a last stance? we'll debate that after the break.

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your money your vote. five crucial primaries today including the winner take all states of ohio and florida. we'll get the ceo perspective this hour from auto nation boss mike jackson. clinton ad viesor joins us in studio with his take on the economy's role in the election. >> make at any time world's most inspiring self-made entrepreneurs share their stories with cnbc. new this morning a texas sized

american success story that's part gas station, part taco stand, and part zoo. "hamilton" heads back to where it began. the stars of the hit broad way show visiting the white house for a jam session with a little help from the president. >> how good is that >> the video going viral as the final hour of "squawk box" begins right now. >> announcer: live from the most powerful city in the world, new york. this is "squawk box". ♪ welcome back to "squawk box," everybody. this is cnbc, first in business worldwide. i'm becky quick along with andrew ross sorkin and brian sullivan who is in for joe this morning. we're kourntsing down to two big economic reports. first retail sales, also the producer price index both those numbers coming at 8:30 eastern time. headline numbers on each of them are expected to post declines. also the fed begins a two day

policy setting meeting. they will watch these numbers especially the producer prices. we've been watching the futures. they have been under pressure. the dow futures down by 75 points. s&p futures down by 12.5. nasdaq off by 14. if you're watching the ten year you're seeing the treasury the yield is 1.943%. let's get to some stories investors are talking about. the bank of japan keeping its monetary policy steady as expected. boj offering a bleaker view of the economy apsychiatrist butting recent weakness to a slow down in emerging markets. apple's latest response to the justice department is due today. morgan stanley issue ad report which sees iphone demand ahead of the consensus and that stock is up 1.5%. oil prices are falling. big driver continuing concerns about over supply. yesterday we heard from iran. it says it plans to don't step

up production. that put pressure on crude yesterday with wti down by close to 3.5%. down another 2% today. >> got a couple of stocks on the move this morning. va lan's earnings missing the mark. embattled drug cutting its revenue forecast. these are preliminary numbers which could change. >> people are starting to look at nongap, they are concerned about quality of the earnings. >> they are worried they will be trading to the down side. >> johnson work with bankers at lazard from take over interest. that stock super6% in the pre-market. shoe retailer dsw beating estimates on top and bottom lines. also outerwall exploring

alternatives. activist investor took a stake and criticized that company for quote persistent failures. dover warned its first quarter results will below forecasts. and finally amazon launching its cloud data migration service. it's a business that will help companies transport data from their own computers to amazon data center, turn key solution. one of the big factors for why some companies have been stuck on their old enterprise systems. >> results from the latest cnbc fed survey are in. this is a look at how the nation's top financial minds view the political landscape and its impact on the economy. steve liesman joining us with some of the findings including their political preferences. >> we'll show you a very wide gap between wall street and main street. first on the economic impact of the campaign itself, 56% saying

this is negative for the economy, 39% saying it has no effect. jim bianco writes i'm worried a contested convention should it happen will be very bad for the democracy and the economy. i hope it doesn't happen. one of the many who wrote in. let's take a look at which party they want to win. 40%, are looking for a republican. that's the best outcome for the economy. 18% looking for a democrat. 26% added to the 16, 42% say they don't know or it doesn't matter to them. a sense that politics is overstated in terms of its ultimate impact on the economy. but who are their preferences. here we go. bernie sanders gets a zero. cruz and rubio sort of towards the end of the spectrum. trump in third place. clinton in second place. governor john kasich, the governor of ohio, 42%. the choice for the best for the

economy from our respondents here. how about best for the stock market. 35% picking kasich. clinton come up a little bit. zero for bernie sanders. associating any of these candidates writes in one of our respondents with the word best is very difficult to do. they strike me as equally awful. support for kasich has less to do with any specific kpik policies and the idea of certainty and stability the two things the market crease. >> when you look at these markets -- >> we had a couple of people write in for cruz. i think a couple thought he was more on the extreme side of things and wouldn't get things done. what they wanted, one person wrote, he supported clinton if the house remains republican. they like that dynamic because, again, it's the dynamic we have right now.

>> we heard complaint after complaint after complaint that nothing is getting done in washington and that's why we're looking at this incredibly low gdp. they don't mean that. they want to see this gridlock continue? >> what they are saying -- first of all market always wants to have what it knows it will have. which is one of the reason it doesn't get a vote other than through its pocketbook. the other thing is that when it comes to the kinds of policies that are going to be enacted i think they think that no policy is better than some of the potential for extreme policies here. >> steve, thank you very much. it's ironic that these folks come out the way they do. the best period in the last 30 years have been under the two democratic presidents, job growth has been amazing and yet when you get polls like this it comes out -- >> you'll see the republicans argue the reason that happens is they set the democrats up for success. honestly, we hear this argument again and again when you look at

these numbers going back and forth. >> they have short memories. >> how do you think about the wage growth issue? that's one issue that has stagnated. >> that's the productivity argument and does technology build jobs or -- >> and immigration argument and becomes the nafta/tpp argument. all those things. >> yeah. i remember bill clinton saying you can't trade in the world with one hand tied behind your back. you got to have some rules that protect you. so, you're right. i mean there has been a negative effect to some degree. on the other hand a lot of people say the job decline wasn't specifically because of nafta it was because of a lot of other things. >> that's a huge school of thought natural you look at hoist you say after world war ii all the manufacturing jobs were in america because the rest of the word had blown itself up. >> they no facilities. >> for 20 or 30 years germany was busy rebuilding germany, japan was rebuilding japan, not

exporting many goods so we had a monopoly. maybe that time was the anomaly. that's not an argument. it's an argument people make. >> i agree with that argument. it's a fatalistic argument. >> the rest of the world has gotten wealthier. life spans are longer. we're sort of realizing capital can move if somebody hits a computer key and that's a scary situation. >> voters in five delegate rich states are hitting the polls today in what could be the republican's last chance to stop trump. among them two winner take all contests. florida and ohio. ohio donald trump and governor john kasich are neck and neck depending on which poll you look at. different story in florida. that's where the home town senator marco rubio is lagging far behind the billionaire. joining us right now with more on the battle for the sunshine state is mike jackson, the chairman anne ceo of auto nation which is headquartered in fort

lauderdale. great to see you this morning, mike. >> becky, good morning. how are you? i think it's going to be historic day. the unthinkable is about to happen in the home state of a very popular former governor jeb bush, who is now out of the race. sitting senator who won election with very strong numbers is about to be defeated by donald trump for winner take all, 99 delegates. and i think rubio's last chance were really hurt when he blundered a few weeks ago and went to schoolyard gutter tactics against donald trump, leaving his aspirational inspirational message and the voters of florida simply didn't recognize that marco rubio, and i think it was a blunder, and i think donald trump will carry the day and take all 99

delegates. >> what do you think that means? by the way it's still early. have you voted yet? >> i'm an independent, quite frankly now that you ask. i threat republican party last year when they didn't take on donald trump early and i'm now an independent. i'm more in switzerland. let's talk about ohio because i just wrote a check for john kasich. i think ohio is an even more interesting story. here you have a successful sitting governor who is very popular in ohio. has a good economic story to tell. has worked in democratic and republican environments successfully. is come period te t-- competent reasonable.

a winner take all stake. 66 delegates at risk. if donald trump sweeps these winner take all i think he's on the way to getting the delegates he needs to win on the first ballot. so ohio is the crucial state. i think, alan, i think you went to school in ohio. >> i between ohio state. >> there you go. you might have some in-state what will happen today. >> certainly john kasich is the most respectable, in my opinion, republican candidate and i think probably one of the things he suffers from you speak to most democrats they will say john kasich and i think he said it himself the worst thing that happens about him is democrats think he's okay. but at least he's a responsible person. >> he did an outstanding job during the clinton administration working with gingrich and, of course, president clinton that put the economy on a good path. and including handing off annual

surpluses to george w. bush. so, you have to admire that effectiveness that governor kasich has demonstrated. but in today's environment, i don't know how much that counts for. so i think florida is done. voting is still yet to come in. becky, you're right to point that out. i think trump carries florida. so all eyes on ohio. once again. >> let's talk about the economy and what you see. you've mentioned that while car sales are still coming in, the numbers are still coming in, the margins have not been as strong, that the auto dealers and the manufacturers have had to offer better deals to get people coming in. we did speak with bob lutz this week. he agrees with you. he thinks they are offering too many leases. a sign of potential problems down road. where would you put the economy? >> i saw your interview with

lutz. it was very good. i thought, you know, bob and i without speaking to each other often come to the same conclusion. sales are up 3%, 4% running in the middle 17 million range. what's there to kplain about? incentives are up. a lot of incentives will subsidize leasing which is now over 30% of the business. fleet business is up significantly. and all those are yellow flags that you're starting to take steps to try to sustain a sales volume that really isn't there. now as far as the profitability of the industry i think it's still in the naerm will be fine particularly because the mix is so weighted towards trucks which are very profitable. looking over the horizon we could be sowing the seeds for disruption. as far as the overall economy

i'm in the camp that 2% growth, gdp growth during an economic recovery is simply unacceptable and i think jack welsh had the best word yet. there are shackles on the american economy. i still believe that american entrepreneurialism and free enterprise is the best system in the world and creates the most well being for the most people. but 2% gdp growth with a country that's demographically growing is just not enough. and, therefore, you see the stagnation on wage growth and i'm in the camp that we need to get the shackles off this economy, get back to 3%, 3.5% growth and that ironically means more trade deals, more reasonable regulation, a reformed tax system to get this -- and an economic immigration policy and get the

controversy around immigration behind us, for god's sake. immigration is one of the great secrets of america's economic strength. so, i'm fundamentally dissatisfied with 2% gdp growth and i think the american people are and i think you see that expressed on the left and on the right. >> mike, i want to thank you for your time today. always appreciate talking to you. >> great seeing you, becky. thank you. >> when we come back it's a key issue in the race for the white house, state of the u.s. economy. we'll be joined by former economic advisor to the clinton campaign, gene sperling. we'll tell you about a new app that will shake up the way you get your weather forecast. we'll be back in a minute. [plumber] i need to be where the pipes are.

so i use quickbooks and run my entire business from the cloud. i keep an eye on sales and expenses from anywhere. even down here in the dark i can still see we're having a great month. and celebrate accordingly. i run on quickbooks.that's how i own it.

>> it may be the coolest cat in town. poncho is an app that's attempting to shake up the way you wake up and view the weather. the app contains and alarm clock. but also has a messaging device that sends hourly conditions and five day forecast. you can check this frizz level of your hair.

welcome. >> thank you. good morning. >> i use an app called dark sky which sends me an alert at 8:00 in the morning. here's how are you day is looking. there's weather.com, weather channel's, accuweather, how do you win? >> weather is every where. there's been an idea that weather is generic. i think i can say our weather is provided from the same source as dark sky. the difference with poncho we create character that basically would feel like a friend giving you weather in the morning and we see that as an entry point to really a relationship with our users. so that poncho is their friend and we built poncho to be built the first thin media company. >> what does that mean? the difference would be hey sam it's going rain today. you might want to bring a jacket. >> we try to give you a smile in the morning. sometimes a little pop culture information just to get your morning started with a little

bit of a good feeling. we try to do the same thing in the evening when you make lance to go out or go home. >> how do you that? >> we have a writing staff. professional writing staff. most are comedy writers. we use technology that allows the small writing team to write a potential forecast for who 6r,000 zip codes. >> i sat in on one of their session. it's like sitting in on a "saturday night live" writers session with seven or -- >> how funny can you nake weather? >> the weather is something that starts a lot of conversations. people use that to start conversations. there's a lot that's interesting about the weather. but, it had been reduced i think to this little package of data and our goal is to make it more conversational. >> that's a starting point for you. what does it become if there's something else next? >> we think we're on the verge of a transition in terms of the way media is delivered. so content will be delivered

into chatable interfaces, basically into very thin platforms like notifications and also messaging platforms. >> a weather app. >> an app is one platform for poncho. poncho as a contents company. we're building an android app available by text message in the morning. >> text message i can text and say hey poncho what is the weather today? >> you sign up and we send you a text message at a time in the morng and afternoon. the next step is that within these messaging platforms you will be able to talk to poncho and say what's the weather now. we've deployed that on slack and we're working on it for the other messaging platforms. >> it's a more clever version of siri. >> they are basically both personal assistants or sort of a.i. based characters.

>> what can you tell about me from my weather preferences? >> i think there's a lot we can learn. one of the things we'll be able to look, we'll know where you live, where you work, what time you wake up from our alarm. where you go if you go away for the weekend, we know what you do there and eventually we'll know whether you want to get a snow report, whether it's snowing in the mountains go away skiing, where you go on vacation, whether you go surfing, all those things will be built in sniechs in a plane the other day coming from california and as i was over kansas i got a ping from poncho saying the weather in kansas city is such -- literally. >> supposed to turn your wireless off. >> i know. this thing hit me. >> wi-fi. >> andrew doesn't either. >> what sam didn't tell you they are developing -- a guy who lives in brownsville brooklyn --

>> we think of poncho living in bushwick. >> this is a technology company in addition to being a contents company. >> we try to path human front end but made a very sophisticated technology platform to provide a thin contexturial information. >> sam thanks for coming in. when we return we have breaking economic news. ppi and retail sales.

. coming up breaking economic news. ppi and retail sales. clint adviser gene sperling joins us. "squawk box" returns in just a moment.

welcome back to "squawk box," four seconds away from breaking news. february reads on retail sales and ppi, and the numbers are down one tenth of 1% on headline retail sales. this is also including a very large revision. ornlly headline released up .2 now stands down .4. strip out autos down .1. and also downgraded to .4 this time from a .1 positive. strip out autos and gasoline sales, so far this is the best metric sos far, up .3, better than expected. but boy another negative revision from up .4 in january to down .1. the control group that gets inputed into the models that's

goose egg, we're expecting up .2 and subtracted .4 from its original .6 release to stand it up .2. let's go ppi. down .2 expected down .2 received. no revisions to january. food and energy month over month unchanged follows up .4. year-over-year one of the more important numbers especially, this is interesting pup up.6 last table. suspecting trouble. anticipated 1.2. we received the expectation. 1.2. i know expectations are about pricing, sequential set point 6.12 is something worth paying attention to. if i look back the last time we had a higher month or year-over-year read encore was 1.6 read and that was in january of 2015. market response, 173 yield on it. excuse me. 192 yield on the ten. so moving a bit lower actually

that makes some sense and pre-opening futures, dow now down 81 and of course we still have more data to come, especially empire, and of course housing market weather veane. >> steve liesman with his break down of the data. >> thanks very much. you know retail continues to confound the analysts and the forecasters. this number is okay when it comes to the current one but the revision to the prior month is going to reduce the gdp tracking forecast that are out there especially the core number depending, of course, on what inflation ends up being. got a lot of negatives in the currents report just looking at them. virtually every single sector. automakers from a plus 0.6 to

minus 0.2. big revision. only positives i see are building and garden equipment for february. up 1.6%. healther and personal care up 0.7 having fallen the prior month. big declines in gasoline station sales down 4.4%. as rick correctly point out we focus on the core and the reason is because that's what translate over to the gdp calculations. that was up 0.3%. that's what i saw in the -- sorry, in gasoline. the core number was 0% which was lower than expected and the prior months was revised down. looks like we'll get a down revision to gdp here. the producer price numbers i'm not seeing much in the way of too much inflation pressure here when we look at the overall numbers here. i'm taking a look one more time. 0.2. i'm interested in the year-over-year which is the headline, 0.1%. we won't get too much in the way

of inflation coming from the whole same pipeline towards consumer. becky? >> steve, thank you very much. the health of the u.s. economy and jobs, those will be pivotal issues in this presidential election. joining us now is gene sperling former national economic counsel director and an adviser to the hillary clinton campaign. thanks for being here. retail sales numbers are a bit surprising particularly the revision. what's happening with the consumer? >> i think you're right, it's the revision and i think that right now you're probably seeing the market about 50% increase over a fed raise in june. i think these retail sales numbers will perhaps make people more, project less likely of an increase in june. the revision is surprising that the fact that that .6 up as steve said in the core, that did lead several people to change their gdp projections for their first quarter now they are going to go back. i think overall, labor markets

are improving, but they are still not as tight as they could be or should be. wage growth is not as strong as they could be or should be. on the other hand, consumers are going to be fairly resilient in spending this year so that's why i've had this view we're not going to have spectacular job growth. i mean spectacular consumer demand but it's going to be resilient -- it's going to be resilient. >> with all due respect to rick and steve, did the retail sales numbers identify discounted and i'll tell you why. so much of it is gas stations. it's based on a dollar amount. as the price of gasoline has fallen the amount of revenue being raised by the gas stations has gone down. even if volume goes up gas stations were down 11% year-over-year. it's a revenue number. so you have to really be careful with the retail sales number if you're doing the headline it may say it fell .1% it may be up in

99% of the categories but -- >> that's why steve was looking at the core number which is taking out the gasoline. >> we're talking about core ppi. >> no, no, the retail sales. .6. it was revised out. that i think is the most significant number >> i'm just saying be careful with the retail sales number. if you look at the headline it can look worse than it is because gasoline is like a leech. it pulls it down. >> gene, what do you think is happening in the economy, though? you think things are relatively strong overall? >> when i look at the economy i don't see things being spectacular. i don't think consumers are spending as much as they could. you've had personal saving rays going higher. you have had these inconsistent sales retail numbers. on the other hand private-sector job growth has continued to be

strong. >> unemployment rate is phenomenal. >> are up a little bit. unemployment rate at all levels are going down. though it's not as tight as it might normally be. what it means is that the broader indicators of unemployment, under employment or the involuntary employment they are stronger when you're at 4.9% and that's why some of us have been dovish with the fed because we think you can get a tighter labor market that can get more wage increases and it's one of the reasons why some people like myself have been more dovish and not looking for the fed to raise rates and to look underneath the 4.9% number for -- and see there's still some slack in the economy. >> beyond the fed let's talk about that from a political perspective that's been why

donald trump and bernie sanders have picked up such resonance with their message of people who feel they have been left behind. >> i don't think it's just them. obviously secretary clinton and others have been looking at this. it's bean 15 year issue. the fact is that when i left the clinton administration in 2000, if you look at how the typical family was doing then compared to now, over 15 years they are down about $4,000 in real adjusted terms. so there's no question that over the last 15 years we've not had shared prosperity. >> tax changes and everything? >> that is looking at what the typical family income is. >> but you also look at the net, after transfers and taxes because middle class taxes are 50 year lows. >> i think you would still see that degree of frustration. for a lot of people they feel their big ticket items, tuition, child care have gotten higher. that's why they feel they are

working harder to run in place. for those of us who are supporting hillary clinton we think ultimately people care about this enough that they are going to want to know who actually has a constructive plan to hit the ground running on january 20th, 2017 and that's why, you know, secretary clinton has chosen to have a more practical plan. >> you believe that increasing the free flow of trade will raise the income of the middle class worker because i know my parents' neighbor got laid off when ge closed down the last light bulb factory to make green light bulbs in china. >> that was a cost -- >> 278 people in winchester, virginia lost their jobs. do you believe free trade will raise the wages of the manufacturing worker in indiana or ohio or kentucky? >> you know, i think, unfortunately, that unless we have stronger trade enforcement,

particularly against china, particularly in supporting manufacturing in the united states, i think a lot of people are losing faith in that question and i think that's why you really see virtually all of the most competitive candidates right now being very tough on trade. you have cruz, sanders, hillary clinton and trump all opposing tpp and i think we're going -- i think that's one of the things that secretary clinton has been talking about in ohio you have to really crack down on china. you look at the dumping of steel, steel prices are hurting people in indiana, ohio, pen pennsylvania and i want will be hard to get anything on trade until we're morre robust on worker trading. >> do you think the president, obama, who you worked for made a mistake on tpp and many other negotiations? >> i think that, you know --

>> it seems also i want to know were you make this, argument then? because it feels like a, i don't want to say a new argument but not an argument you heard taking place in the white house several years ago. >> when you're in the administration you're part of that team. for me personally with secretary clinton and president obama on this i feel like the child who doesn't want to take sides when mom and dad are fighting. secretary clinton there's no question has been somewhat of a trade skeptic. she voted against the central american trade agreement when she was in congress. i think we have to acnlk thknow that for at that lot of people they don't see an increase in trade benefits them even if the macro numbers might show a stronger growth. this is the whole point. what people care about now is not just growth, they care about growth but they care about shared growth. they want to see wages going up. they want -- i think on trade you're hearing this from

secretary clinton there is to be a higher bar it's good for middle class workers, good for manufacturing and maybe we should focus more on investments and green jobs, infrastructure, manufacturing, skills that are about ensuring higher wage growth for typical americans. >> gene, what's until applications of tpp going away? >> gene what's the implications of tpp going away? >> there is to be a higher bar going forward. what you're hearing from americans and secretary clinton economic patriotism. people here may just accept that multinational company has no particular commitment to the united states. that is not how americans feel. they react very negatively to inversions, to unnecessary outsourcing. people understand if you service the brazilian market you have to put employment there. but when they see somebody taking benefits from the tax credits, other benefits, just pick up and move to mexico, or

pick up and move somewhere -- >> do the skorms have the power to change i want by deciding to buy american made products? there's not many left. has that ship sailed? >> you can see a greater consumer awareness and consumers deciding that they are going to reward companies that are doing more investing in the united states. if you had to sum up hillary clinton's policies it's to reward those who are doing more to actually create jobs, invest in manufacturing, invest in innovation in the united states and who are not indifferent to where they are locating their workforce. >> gene thank you so much for coming in. greet to see you. >> jane wells went to the lonestar state to look under the hood of small business. taco station part zoo and more. that crazy store of this texas size american success story when "squawk box" returns.

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welcome back. the government has announced another series of amendments to the decades-old economic sanctions against cuba. this is coming ahead of president obama's planned visit next week. among the new sanctions proposed that were announced the provisions in all of this is a further relaxation of restrictions involving travel by u.s. citizens to cuba. u.s. companies can hire cuban nationals including athletes and poerms. new rules authorize various

transaction involving merchandise made in cuba and cuban nationals can have u.s. bank accounts. >> 65 million americans are dissatisfied with their jobs or careers. they are inspired to do more. today we're launching cnbc make it, a platform for aspiring entrepreneurs and a community for those who want more. jane wells joining us now with one of these inspiring stories. jane. >> this is why i came to cnbc to meet people like john, a guy who had a weird idea and somehow made it work. now his strange success, one of the many stories we're profiling on cnbc make it page and here's just a portion of his story. fuel city is a gas station station with cheap gas and easy freeway access in the middle of downtown dallas. last year sales reached $25 million. what? how?

>> we'll have eight or ten people here at night making tacos. karaoke is in the palm tree. we got a swimming pool. we have a dinosaur. >> you might call it a truck stop but the owner won't. >> i say it's some place where dreams come true. fuel city. the store costs $4.5 million. i bore rod $3.5 million. i put up $1 million to buy the land. i had to path second mortgage on my house. it was such a phenomenon when i opened up i thought nobody is going dome. i think in the next five years i'll have a couple of giraffes. wouldn't that be cool >> the rest of his bucket list isn't so nearly strange. >> i have goals in increasing my net worth is number one thing. $70 million by 70. >> how much your making >> how much am i making? a lot. >> his whole story including how long and why he put girls in bikinis out by the pool while

people were buying pool on cnbc make it.com, a woman made $30 million last year attacking bathroom odor. also all kinds of aspirational stuff like mark cuban or branson. it's premise favorite thing ever. back to you. >> awesome. thank you for that story. we love that stuff. in the meantime we got to get over. valeant shares getting slammed. >> people have been waypointing to hear from mike pearson for months. we got to hear from him on the call this morning. listen to what he said. >> i've been back from my medical leave for about two weeks and i've had a chance to review what's happening in the businesses, and there's a combination, mixed combination of good news and bad news.

>> if the market reaction is any indication folks think it's more good news than bad news. the company, course, providing its full year guidance. they lowered it quite a bit more than people expected. people expected. revenues expected to be 11 billion to 11.2, down from 12.5 to $12.7 billion. the call is still ongoing. we'll bring you any more headlines. back to you. >> meg, thank you very much. when we come back, we'll head down to jim at the new york stock exchange and get his stake on stocks, this morning's economic data. the fed, maybe tacos and swimming pools and gas stations. let me introduce you to our broker. how much does he charge? i don't know. okay. uh, do you get your fees back if you're not happy? (dad laughs) wow, you're laughing. that's not the way the world works. well, the world's changing.

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let's get down to the new york stock exchange. jim cramer joining us now. jim, there's a lot going on. but it doesn't seem like there's anything massive except for the political stuff whachlstuff. what are you focussing on? >> if you go back to the retail sales for the previous month, it was the big turn when there was the fear when there was the credit crunch and the slowdown. it made us feel better. i combine this with what mike jackson was saying on the show. it's back with are we at peak

autos? do we have a lot to worry about? it puts the fed more on hold. at the same time i was hoping to see more strength in the domestic economy. these numbers were very disappointing? >> they were. the thing about retail sales, gas is such a component. there is a core number, but it excludes cars, gas, building products and housing stuff. not sure what exactly it's telling you. how do you see things right now? >> i got to tell you, there's been no pick up in people driving despite the fact that gasoline is down. little extra change to spend at the convenience stores. i think the economy is fine. i wish it were better. i do think that there's no real inflation in the system. but i know there are plenty of people who feel this is a great time to continue to normalize. i think we just recovered from the last rate hike. i would like to see a little more time. i do like the fact that china, baltic freight keeps going up. that's positive. china feels better to me.

europe feels better to me. united states feels worse to me. >> by the way, we're almost positive on the year for the macro stock market. who would have thought it. jim, we'll see you and the gang in a few minutes. >> thank you. >> coming up. a presidential jam session with a broadway twist. y to direct. y to direct. thank you, we'll call you. evening, film noir, smoke, atmosphere... bob... you're a young farmhand and e*trade is your cow. milk it. e*trade is all about seizing opportunity.

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the cast of broadway "hamilton" visiting the white house yesterday. in addition to a performance to the president and white house staff, the creator performed a freestyle rap alongside the president in the rose garden. you're looking at it now. president obama held cue cards made up of words of headlines that were included in the rap. i thought he was going to rap. the president is not rapping himself. did you see the show? >> tickets are 2,000 each now or something. >> if you're scalping them. >> i haven't been to a broadway show since 1996. >> really? why? >> i don't have an attention span that long, alan. >> he says as he ends a

three-hour show. >> i didn't ask to be here. >> someone will invite you to a broadway show. >> except i'm in central new jersey. >> seems like a lot of companies in the mobile commerce space right now. >> people are trending more and more, whether it's the content they're reading or the products they're buying, they want to feel there's personal identification. we have interest in the skim, which sends you a message in the morning. what about combatgent? >> yes. they sell you inexpensive men's clothing and women's clothing, too. there's a big trend now to the e-commerce companies setting up a physical presence. >> you think that will undermine the model? >> no, i think it will compliment it. the online people are finding they can't just survive being

totally online. people want to see it, feel it, touch it to some degree. and then maybe buy it online. >> i would agree with that. alan, thank you very much for joining us. >> great to see you. >> brian, thank you. we'll see you tomorrow. >> join us tomorrow. right now it's time for "squawk on the street". good suze motuesday morning welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber. day one of a fed meeting. political primaries, retail sales. valeant, apple and more. futures are weak at the moment. europe and asia overnight in the red. the bank of japan leaves rates unchanged. retail sales okay, but the revisions are the worst in two years stateside. the selloff in crude continues. the road map begins with