london. the lives. the singer spot ad proposal taking place in the audience and brought them up on stage. she does this. i'm a cynic. my family thought it was so sweet. >> you are a cynic and i think it is sweet. steve thanks for being here. that does it for us. happy st. patrick's day. right now time for "squawk on the street". ♪ good thursday morning. welcome to "squawk on the street". i'm carl quintanilla with jim cramer and david faber. the dow starts 99 points break even but futures are soft on weak guidance from caterpillar, williams sonoma. european markets in the red. philly fed just the latest regional survey to surprise to the upside and oil is about a dollar away from the first four handle of the year. our road map begins with the fed

cutting the number of rate hikes it expects this year in half. what that means for the markets. shares of fedex are up on earnings and company taking a shot at amazon on its call yesterday. plus jim cramer spoke to target ceo about competing with amazon. how he's positioning his company against jeff bezos. first up something that would have been nun thinkable. dow and s&p down 1% for the year after the fed reduced the number of rate hikes it expect this year from four to two. futures moving lower. caterpillar issues first quarter estimates in the wake of lower commodity prices even though they stayed firm on their guidance for the year, jim. >> yeah. i found that two surprising things was one how deep the cut was first quarter. and two, how they believe that somehow things are going to get better quickly. i think that caterpillar is in a nutshell what fed did. look these are great american companies. not doing well at all.

that has to do a lot with oil and gas and mining. not just all international. it kind of took my breath away. the data was looking good. i have my green tie on. up morning. luck of the irish day. and, no, because caterpillar chose once again listen we cutback and cutback but we don't have the sales. >> it's not a shaving, it's a cutting. >> looking for 65 to 70 cents streets at 95. >> it's a meat axe. you were looking for smothering subtle than that. one of the thing i do like about caterpillar is that they show you exactly where the weakness is. what i didn't like is every business. hoping just one other business. every business. do people understand when you use shale, when you dig shale, when you go up to the canadian tar sands -- these are giants caterpillar earth-movers and you

can't get the stuff out of the ground. this isn't like hey let's drill a hole. you don't drill a hole. you move a mountain. one of the monies why the environmentalists are so upset because when you do -- i mention that because that's where we're going, 2 million barrels a day we added in north america that involves moving mountains and make being very pristine area look nonpristine. >> all that said the stock isn't selling off that dramatically. this is hard to tell. less than 3%. people do believe when the company says we'll be okay for the full year. >> yes, they do. by the way i go through the charts as meaningless as that can be. this was the best chart in the dow. >> stock had been up 16%. >> been roaring. remember, we keep thinking china is going to do something great so we saw iron ore up. but copper which people relate very closely to caterpillar is

on fire. oil is up dramatically. people are saying hey wait a second this quarter was hurt at oil being at 25, this quarter was hurt by no real infrastructure build in china and wait until you see what will happen in the second half. wait until you see. it will being a great. i think -- they keep saying it. >> fedex was more solid rising. >> wow. >> better than expected quarterly results. raising the full year end guidance. talked about shipping competition from amazon saying i want would cost the internet giant tens of billions of dollars to effectively compete with fedex. last night on the conference call fred smith concerns about industry disruption is fueled by fantastical and let me emphasize i chose this word carefully, articles and reports which are devoid of in-depth knowledge of logistic systems and the markets

which fedex serves. >> it was a beat down for people like me. amazon are 3%. he did say that this was the year where it's no longer just a peak day. people shop every day online. they talk about six days. what does he mention? i love. there was a moment in this call. when mike glen who is president and ceo of fedex services getting involved in the conference call. what are people shipping out? mattresses. canoes. swing sets. big screen tvs. but they figured out a pricing mechanism to make it so they make money on those canoes. >> i'm glat you can okd you can. i've never seen them deliver a canoe in manhattan. >> you don't need to shock me. >> you can go on whatever that river near you that toxic river. the one in brooklyn.

>> the gowanus. >> it's going to be venice. >> as of now it's still eat the bottom away. >> it has a different color of water. looks more like what mr. white made in "breaking bad". a product. >> i came in this morning, first thing i saw was you on the floor of the exchange interviewing head of target. >> what's the fastest growing digital shopping company? >> target. >> 30 some -- >> mid-30s. i think brian cornell -- >> awfully low base. >> he's killing walmart. this is a new store. new direction. you got to listen to him. the guy is monster good. he's re-inventing a company we like to shop at. >> here's a taste of what brian told jim. you'll hear more on "mad"

tonight. >> the fastest growing digital both online and offline including amazon how are you melding those two. >> sometimes in our stores. other times on their phone clicking, placing orders, come by at their convenience and pick it up and sometimes they just want it shipped right to their home. we got to make sure experience counts whether they are in store or shopping online. >> here's a man who is really using all the stuff he laerchd at sam's and pepsico. he's talking with elm pathy, need for touch. people want to shop. 90% of people like to go bricks and mortar. re-inventing the front of the store. now they have some great stuff. billion dollar brands. they have a lot of categories. growing 20%, 30%. brian cornell has re-invented target in a way that says we're opening in tribeca. in october you go to target. target greatland where you need those giant land masses opening

next to colleges. how many times when you take your kids to college i'm not going to walmart -- i'm not going walmart. take that gun from my head i'm not going walmart. they will go target. >> we haven't experienced that yet. >> how many apple crates do you need to put your clock radio on. >> we go target my eldest for throw pillows own clothes. my youngest for swim wear and furniture. what cornell is doing is saying we're going intercept when you have a baby we'll intercept when you move your kid to college. when you move your kid to college you don't go amazon because you got to get towels. >> this guidance out of williams sonoma is soft. lb downgraded credit suisse. >> i'm tired of the excuses at williams sonoma. they are charging too much. memo, you're charging too much. i was very disappointed. >> you loved these guys for a

while. >> die. they kept saying west coast was a problem. now we're seeing supply chain a problem. we're seeing this core store not doing that well. the branded stuff is not doing that well. williams sonoma lost its edge like restoration hardware. too expensive. you want to go to home goods and target for your stuff. people are staying away from this williams sonoma stuff. i put it back on the shelf i'm not waiting in line for these expensive candies. >> why would you? >> thank you. the downgrade of lb argues that some of these stores have an outsize footprint and others are going to be -- they are too reliant on companies that will go direct. >> i disagree with that call. i think he has developed a

mosaic of businesses that are unassailable. victoria secret undergarmentes in double digits. that's a franchise i want to be more involved in. don't forget bed, bath & beyond -- forget them. bath and body works. have you seen the accessory numbers? you write off wexler you write off retail. he got out when the getting was good. go ahead make my day. good luck. when we come back this morning what pershing square bill ackman is selling after taking that beating from valeant shares. nike taking its sneakers back to future. we'll talk to the ceo mark parker about what they are talking about the hyper adapt 1.0. take another look at the futures. break even for the s&p. a little farther off at 2043. we'll see how the morning goes.

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. during a week in which bill ackman's purchasing square lost a billion dollars in the drop of valeant he said they sold 20

million shares of mondelez. it originally had been about 7.5% but they had trimmed it previously to get it down to about 6.5%. it was at one point the mondelez position at 5.5 billion the single largest acquisition we've seen. mr. ackman has not been active, if you will in mondelez in the sense of challenging the board of directors or anything along those ways but simple portfolio management jim says that when you suffer the losses that pershing has and he said this, mr. ackman in a memo to his investors you have to take down the size of one position given it's outsize role in your overall portfolio from a risk management perspective hence they sell the 20 million shares in mondelez but it's all because of valeant. that's what it's about. >> if you have an outsize position that wasn't outsize because valeant was so big

before. 4120. >> yeah. >> is that someone who went to college to get stupid. who bought that at 41.20. why does somebody want that business so badly. >> block trading can be a dangerous thing. it's one of the things where wall street firms step up and provide liquidity. >> maybe they are finding what a cadbury bar. >> mondelez is looking down a bit below where that trade taoo place. for mr. ackman it's been a difficult 18 year period. herbalife going up. platform specialty going down dramatically or whether it's canadian pacific which i talked about which has been at highs but well off those highs or valeant. all of these significant positions in his portfolio, adding up to a 47% decline from the high that he saw in 2005. >> i had the privilege of

interviewing for delivering alpha where we genuine alpha. his position was fannie mae. i didn't know the treasury could do a two for one split. fannie mae down dramatically. no one had to attend. first amendment allows to you recommend fannie mae all you want. i checked into it. the founding fathers have been asked a lot. they say you can buy fannie mae. >> they do. i'm not sure why you've been asked a lot about founding fathers. >> the other day apple booked founding fathers. >> listening to the "hamilton" sound track in my house over and over. >> founding fathers would love this election. >> keep him on the $10 bill

because of that show. everybody would like a general growth. street being too tough? >> number one performer since the hanes -- >> that was a great position for him. now we can also remember jc penney where the dollar losses were nowhere near where he suffered on valeant but where you could argue his decision to install ron johnson cost so many people their jobs. >> i rather be all in rather than all out. >> i got people who were in the target special purpose vehicle for many years ago. all that said mr. ackman manages to hold on to his assets because he's got locked up money, permanent capital as well given he issued that abroad. that's come down by half if you went into that vehicle. and then he's also got provisions that prevent anybody from taking their money out in a rapid way and so he still is down but got $12 million. >> as long as he doesn't start buying sears i'm all over him.

might be an interesting level to get involved with bill ackman. i don't think he'll continue to do that poorly. that's terrible performance. >> come on you give the guy 100 bucks at the beginning of 2014 and where our >> i'm from philadelphia. we have many sports teams that are far worse. >> phillies haven't even started playing. >> sixers, the sixers, he makes the sixers look fabulous. other than nova we have nothing to touch that kind of performance. i think you have to think about it city by city not hedge fund by hedge fund. >> valeant the incredible down draft it suffered. >> that went up a couple of pennies. >> 33.61. we haven't talked that often about sequoia. remember the sum ear couple directors said they left and then valeant still in a significant way and paulson.

this thing has taken a lot of people down. >> how can you not like it at 33 if you loved it at 260, 150, 80, 60. remember only it came out at 86. >> a lot of people argue it was always a play on rising drug prices and no one is arguing that story is over. >> now you're trying to figure out what's the breakout. they are ganging up. i don't know. happens. bausch and l omb was worth a lot of money before everybody shot against it. when you see a wounded animal like valeant believe me you go to the doctor. hey listen that stuff you're using from valeant i don't know how valeant is doing. maybe it's time to switch to juvener or think about those accuview contact lenses. this is what happens.

it's a wounded tiger. >> is it still a tiger? >> yeah. wounded tigers eat people because they can't hunt. >> they may be eating each other on that board of directors the way they must be going at each other. figure how they got themselves in this mess. >> was there a particular drug he liked? >> like the model. >> the whole model. >> that hillary clinton doesn't like. >> roll them up, use the low tax rate, don't spend a lot on r and d. keep rolling things up. incredibly low interest rates to make acquisitions. raise price of acquired drugs. >> henry silverman. >> again -- >> i did not say -- i said fhs. come on facility some hairs with me. i don't have enough to go

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we have a mad dash here. >> oh, my david. >> before the opening bell. >> oh, my. here i am listening what i thought would be a placid circuit call. j. bell does a lot of ble for apple iphones. then said -- they mentioned apple's name once. they said modest declines experienced in the second quarter have turned into an abrupt downturn significantly impacting our third fiscal quarter and it's apple. and they are not losing share to someone else they are gaining share. this is extrapolated apple. we saw a note today -- >> yesterday morning -- >> citi said -- >> some positive things. >> apple will grow units. they didn't lose the business but i think there's a pause between iterations, but this was devastating and apple was trading up a dollar when it was reported and then dropped. on the down day people will say -- >> what was that language again they used.

>> this was a quote. they said -- let me read it because it was a little stark. they said that -- this is a quote. modest declines experienced during the second quarter now turned no an abrupt downturn significantly impacting third circle quarter. it was apple. basically saying apple stopped ordering. that's the only way to look at it. that will hurt apple. people will freak out. they are switching iterations to the cell phone 7. there's a big meeting next week with apple. people will say this must be demand bad even though citi said demand good. so, it's a clash of the titans. when worlds collide the builders of the product versus what the analysts are saying. >> okay. we're going to keep an eye on apple. talk about it around the bell in terms of potentially moving its cloud services from amazon to google. we'll have that and oh, so much more when we come back.

you're watching cnbc "squawk on the street" live from the financial capital of the world. the opening bell in just over a minute. a lot going on today. we're coming off the highest closings of the year. within spitting distance of the close of the year. philly fed all components up for the first time in seven years. oil came within about 40 cents of 40 for the first time. >> a lot of oil companies are assessing right now the idea of doing a little bit, you know, frankly selling a little equity the ones that have it. freeport which has gone from being the biggest dog to the most popular because it's got oil, gold and copper that's the holy trinity about what's going higher and that tells you look we're in a different kind of market and that's aided by the fed. that's why i don't think caterpillar will be down that much. freeport going up caterpillar gets orders. that's why people won't give up

on cat so easily. >> obviously futures were week at the pre-market but if the dow can go up that's five days in a row, would be the second such streak in march alone. there's a look at the s&p, the big board. transunion doing the honors and at the nasdaq staffing company kelly services. speaking of green on this st. patrick's day celebrating its 70th anniversary. >> i urge people to go fedex is run by fred smith. a big free trader. he's talking about the millions, the greatest thing about free trade. more importantly these companies, the post office he mentioned very positively, u.p.s.. the amount of business they have out of nowhere because of the internet is so strong and if this was the quarter that it clicked and the idea that there's that one day where you have all that business, it's every day. and there's no more peak holiday

season and fedex the conference call is a must read because they talk about lowering gdp but raising their own forecast. this show you people shop. they shop fedex. they shop u.p.s.. now i actually -- i get that sign on my door which says listen deliver today because i didn't sign whatever -- i still like to go to the stores plus i find the store is fun like michaels. i like crafts. i like etsy. fedex this kreps call conferenc one of the better. top five. >> wow. >> yeah. >> along with honeywell and -- >> honeywell -- >> facebook had a good call. >> facebook call was like "hamilton." you can't get a ticket to that facebook call. i tried my agent. >> you can listen to the sound track over and over again. i'm talking "hamilton." >> fedex has not been above the

200 day in really, you got to go back to june. >> a lot of people felt they weren't going handle christmas right. one of the things that's so interesting about it, this pricing. they figured out pricing for the larger things. larger things are being shipped and they were losing money. not losing money any more. they talked about -- one of the things david talked about a long time ago maybe they have too many planes. they are using fewer planes. >> that was a criticism. they were an airplane company as opposed to a delivery company. >> they are sensitive. they are buying back stock. this was the quarter which tells you the idea that you shop during that one period of time, millennials shop. millennials like experience and they like travel. they are not crazy about going to the store unless it's like target. >> right. i did want to mention amazon. not down sharply at all. less than 1%.

some news this morning that at least is going around. something called trn which is apparently a fairly credible news source for enterprise and cloud news reported that apple has signed a deal with google that will reduce its reliance on amazon web service. apple has used according to a morgan stanley report back in february, apple is one of the largest clients of aws. they estimated in fact it would spend about a billion dollars with aws representing 9% of that unit of amazon's revenues. back in february they talked about apple building out its own data centers, enormous data centers, 2.5 million squier feet of data centers but raised the idea they would move away from aws. this may confirm this. all these things are private. i don't want to go too deeply into it without knowing more.

certainly making the rounds this morning, jim. and seen as a positive for google which has been a distant third behind amazon web services and microsoft in terms of its public cloud efforts. >> another reason to own alpha. don't forget also this is the company of the major tech companies has the most exposure to europe. as the dollar keeps getting weak versus euro you raise -- weaker dollar is really -- >> how about this, strongest against the dollar of '14. >> this is incredible. i got to tell you. i went out last night said some positive things about ibm. ibm had terrible dollar exposure. don't forget in terms of the pharmaceutical, it's j and j. he's got the most exposure of the major pharmas to the euro.

>> there's a lot, hpe. discovery. you can think of a lot. e-bay. a lot of companies have derived half their revenue from overseas. >> it's incredible how important this would be not just for the honeywell, people forget that our companies went in big when the single currency was starting. they have been getting clobbered. when i look at how much business google does and don't forget google does a huge international business but remember where they are not allowed to do business. they don't do business in china. so when you see international business that's europe. euro is doing higher. the multiple is way too low. it's a good company here and i was surprised to see that shift. remember, larry took a shot at amazon web services too. >> he took a shot at everybody. >> he didn't attack ackman. gratuitous attack of ackman might have been warranted.

>> there's been enough of those. >> spared ackman. how do cadbury bars taste? >> pretty good. >> maybe the trading desk is we're the mondelez and changed the name. >> he's on the board but didn't like the name. >> the name is kind of a made up name if you ask me. mondelez. right. mondelez please, moan ndelez ifu don't please. >> gold is up almost 40 bucks. this is going to be best quarter for gold since 1986. is this a reflection of what poor cpi is doing. >> six companies, six brokerages downgraded the best gold stock in the last five weeks which is rand gold. six companies have taken it to a

hold. got the lowest mining costs. i whsh i told them how could you possibly do business in those countries and he called me a sissy which was the last time somebody did that named sheldon. i beat the heck out of him in fifth grade. then his mom called my mom. >> where is sheldon now >> i don't know. he's probably running a hedge fund. >> probably retired. >> living in. florida. >> might have gotten out of ackman at the high. >> i heard that about sheldon. >> sheldon is big. he runs a casino now. >> he's a little out of your age group. i did want to -- lodging hot, this week a lot of people are wondering are they going to sign up a deal potentially with the chinese led by this chinese insurer and its two partners.

>> you wanted to change. >> starting private equity firm in china. we're going to call it prima vera. why not. >> remember mama leone. >> tonight is the deadline of the first of the waiver that was given by marriott to starwood to negotiate with the chinese. and there's been some expectation perhaps you might get a deal as soon as tonight or at least the prospect of it that would force marriott to make its decision whether it wanted to raise. but at least at this point what i'm hearing you may simply see this thing extended further. there's a lot of complications as you might imagine. they want to make sure the financing is in place. text is there. that being the chinese. and frankly on far of marriott if they were not to grant a waiver, these guys still can't negotiate or get that shareholder vote which is schedule for the 28th. they haven't delayed it. the expectation is if they ask for new waiver they will get it and more negotiations to come.

we'll see. things could change. i don't want to say with certainty because there isn't certainty you won't see some news either very late tonight after midnight or tomorrow. but at least it does appear more likely you get an extension of this pared of negotiation. >> i know for a couple of days people were worried about financing. if you think the chinese -- >> they will be okay. financing they've already got the equity. i think they moved it over here. >> why do we not know anbang a near ago. >> we did. >> bought the waldorf. we've heard of them. and wondered what are they willing to spend that kind of money, give them a 100 year management agreement. they are buying that thing at a low yield and got to put in so much money to upgrapd it. they took a long term view. >> they do. finally on apple, we failed to mention tim cook on the cover of "time" this week talking about apple versus fbi stubborn stance

on that fight. then back in the investment grade bond market adding to the size of their three outstanding bonds as they pay more capital back to shareholder. >> remember, ever since they did that last bond deal when the stock of at 93 it's been screaming. i'm schocked after the conference call the stock is not down more. maybe people realize there's a lot cooking. don't forget big apple meeting next week and could be some surprises and service rep -- i got my apple bill today. i got my kids' apple. i just bought something. i didn't do anything. i had my pictures. when you lose your phone and don't download the cloud i'm not that good i.t., i'm not talking about anything involving chelsea's apartment. if you lose your iran phone and haven't backed up your pictures you're a chump. now you pay. it's apple, you pay. how much do you pay? you just click -- >> i'm not sure. >> it goes to them. what's the margin on that. . it adds up.

the itunes. the cloud i'm paying them. by the way, on the fixed income front, carl, you mentioned as well big offering. anheuser-busch priced a huge euro offering to fun its acquisition. 13.25 euro note offering from anheuser-busch. >> what's the terms? >> interest rates ranging from .2625 to 2.75% based on the maturity. that's not bad. important deal. >> high yield. >> yeah. high leverage transaction. >> because that market kind of got a little more open. >> high yield is roaring back. >> roar back is the way to look at it. emerging market and high yellie. people are in shock that the fed didn't take into account that market is better. >> banks dragging. let's get to bob pisani on the

floor. >> split market, industrials, materials, energy lead on the upside and financials lead on the down side. that's what's happening in europe. take a look. we got two problems in europe. first lower bond yields hurt the bank like here. then the weak dollar strong euro, that hurts the exporters over in europe. so your autos are down today, bmw and daimler, adidas are on the down side. lower bond yields. here in the united states a lot of discussion about caterpillar. cat is down but notice the competitors deere and terex, they make machinery on the upside. a lot of debate why they didn't cut the full year ovals. they took almost 30% on their first quarter but threat full year intact. that doesn't make a lot of sense to me. still expensive. captain cat is close to 19 times

forward earnings almost 20 before. still expensive. caterpillar reflecting long slow decline in the global commodity market. almost $9 in 2012 for caterpillar's earnings now in 20153.50. this estimate i took 30 cents the consensus owas 3.73. you can see the slow decline on caterpillar's earnings. revenues for caterpillar, it's important to note about 45, 46% in north america but ame, europe, africa, middle east a quarter. the real problems is in asia-pacific, latin america notable sales decline. remember caterpillar has reflect this decline of $115. now $75. competitors reflected that. i don't have coukomatsu.

so this morning elsewhere the weaker dollar, cat captain not with standing the helping the industrials. it's helping the materials. so big industrials, fedex great report. u.p.s. is up in that group. the bigger global real industrials your eatons, your elmer s emerson electric super. materials same thing, getting another rally. not as big as yesterday. mosaic, illinois. freeport has weakened. lower bond yields we saw this yesterday, continuation of the friends the fed to announcements yesterday. regional banks like suntrust, bb and t and citigroup and bank of america. bit of a schizophrenic market. not sure where it wants to go. lower growth and lower bond yields. that's the key. right now we're sitting near the loss of the morning.

bob pisani. let's get to rick santelli see what he's watching at the cme in chicago. >> of course we're watching the yield curve and there has been a little bit of a step-enning going on. we're also watching the effects of the fed statement. down here pretty much the refrain after yesterday was is the economy just can't be that good otherwise the fed wouldn't make so many excuses to normalize rates. i can't disagree with that. but rates haven't moved that much. let's look at the intraday ten and two day ten. we sit at 190 down one on the day seven on the week. the action was really in the two year although today two year is unchanged down ten on the week. as those yield goss down and they go down faster it's not that dramatic. you look august 1st start to the ten year, 2% is the kind of magical line jumps out at you.

there was an area that represent as pivot that's textbook pivot. if we look at really the biggest market that was affected by the fed's nonconfidence in the u.s. economy it was the greenback. greenback, consider we're hovering a little bit under 95, last week we close ad bit over 96. we're down a penny and quarter on the week. let's look at the dollar index since october of 2015. what you want to pay attention to here is the notion that other than this little trade around february this would be the lowest level there. now if we look at euro versus dollar that's what i meant on february we're at the lowest level. if you look at the euro versus dollar should be the mirror image that one february jump is all that's keeping you from that comp. as carl has been talking about today and everybody on the trading dollar/yen continues to forge ahead. looking at october 1st, start of 2014 unlike the last charts in 2015 the dollar is just getting

tagged, and we want to continue to partnership attention to the aftermath of that because it's a big counter intuitive considering whatever we're doing japan is doing a whole lot more of. carl, back to you. >> rick thank you very much. best performing dow stock right now nike getting futuristic. sara eisen is in new york. >> nike's tap brass is in manhattan. yes those self tying laces, the first mass-produced sneaker that ties itself. we're getting a lot of buzz. we'll ask ceo mark parker how big the market is for these shoes. news on digital strategy. olympics and more. an interview see first in the next hour on "squawk on the street".

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>> rolling bull market rolling bear market, caterpillar up nicely today on disappointing earnings. why? because we're in a bull market. why are these banks down? everyone thought with four rate hikes we can have an earnings model that would be terrific. there's no earnings model. so when cat is up on that incredible cut what would happen if they made the numbers? watch out. eaton a dollar stock. a lot of stocks that directly mentioned by bob are stocks where you take numbers up because the dollar is weaker. >> you don't see cat as a buy back story today. >> cat people are fwleefg guidanguid believing. when you buy this at the trough. the number of customers, i'm sure someone will downgrade it tomorrow. they wouldn't let you cut the full year. the banks, i don't know. you can cut numbers for every single bank. every bank. cut numbers. because they needed this, the four cut.

they need at least three. >> only going to get two. >> what's incredible is this oil. it's not quit. you start seeing yields -- >> wti back. >> pioneer 139 these are moves of a lifetime. >> not going to save is a lot of these companies. >> no. but they can do equity. health care is bad because of hillary. and because of what, i guess, medicare, trump doesn't want very much money being given to drug companies. banks are bad. big part of s&p. industrials are good because of the weak dollar is brand new. brand new. >> we'll talk more with jim and get stock trading in a moment. dow is down 11 points. don't go away.

>> time for cramer. >> microsoft is too often linked with pcs. their cloud business is on fire not unlike oracle. don't look at the first headline number. i think microsoft represents one of like cisco, these are not expensive stocks to keep kind of moving up that are also weak

dollar stocks. you'll see numbers raised microsoft. the numbers are too low just like they were too low for oracle. i like these kinds of stocks. health care i'm concerned about because of the election. money is piling into this group. piling into tech. weak dollar. weak dollar. not enough people talking about it. i made it my business to talk about it. >> ibm second best dow stock. nike makes sense. >> nike is fantastic overseas orders. mallinckrodt down again. that's health care versus everything else. >> tonight mortar get, more cornell. >> business is accelerating. stores are changing. he's done a remarkable job. he's been there less than two years. the stock has been under a lot of pressure because people feel there's too much overbuilding of senior living. that stock is great. new guest, intuit. i don't know if you've seen their ads.

very millennial ads. a women's rock band playing two nights in tucson. and quick book. quickbooks is easy. old guy like me i reference, of course, thank you, your old guy reference yesterday. >> i'll never live that one down. >> no. >> my late father were alive gee david is saying you're older than me. >> you'll never forget it. we'll see you tonight jim. >> it was a low blow. "mad money" 6:00 p.m. eastern time. when we come back the ceo of nike mark parker in a live interview with sara. don't go away. this bale of hay almost derailed the ranch.

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good thursday morning. be about to "squawk on the street". i'm carl quintanilla with david hobbs and david faber. sara isner is at any kerr where she will talk with mark parker at 10:20 eastern time. she will join us in a few minutes. dow is almost perfectly flat

down five points. oil the more intriguing story which came in about 36 cents of a four handle today. rick santelli has leading indicators to start the hour. >> the indicators is a positive number. up .1. why do i sound a bit surprised? because if when he a negative number this would have been third in a row. very unusual. haven't had three negatives since march of 2009. what makes the comp easy, last positive number we had was november and up .5. that's where the set point 1 comp comes back to. we're basically unchanged on the day, down about seven basis points on the week on ten and continue to pay attention to the fail to surmount that 2% mark. simon hobbs, back to you. >> markets are really interesting, rick santelli. certainly the stock market is flat down 12 the day after fed cut the number of interest rate hikes it says it's planning this year in half to just two.

let's bring in steve liesman, cnbc senior economics editor and celebrating st. patrick's day art cashin director of floor operations for u.b.s. happy st. patrick's day. >> same to you. >> there's a certain jolliness. when the fed makes a major move as it did yesterday, the s&p rallied 17 points, less than 1%. okay. above the 200 day moving average. but it's not the sort of euphoria you might normally expect. why is that >> i think the real story was less about what the stock market did and more about what's happening with the dollar. and both yesterday and today the dollar continues under some real pressure. the bank of japan can't be happy with that. they got negative trade data today, exports were down for the fifth month in a row. so we may be looking at temptation of currency wars breaking out. fed has effectively taken the

sting out of the dollar. very good for our multinational companies, but trading partners are not going to like it. expect to see something from the bank of japan. >> you would normally have expected a bigger knee jerk reaction on this. >> i agree with that. but i don't think that they feel entirely comfortable with where things are. yellen seemed to indicate that they would tolerate more inflation and the risk of higher inflation if they could get pressure on the wage area to go up. her background and training is as a labor economist so that's an area close to her heart. >> anyone looking for more from the bank of japan would point to kurod a's most recent comments which was more limiting. >> he went and recorrected that later.

he understated things and the yen went up and then he went back and told the diet that he thought he could take negative rates as low as half of 1% and that weakened the yen again. so i think really think you're seeing soe seeing some stretches. central bank of norway thought of going negative interest rates. that cut the legs out of large banks. >> let's bring in steve liesman. let's return to the fed. caution is appropriate, seems to be the main message we got from janet yellen yesterday. nonetheless an achievement to get everybody singing from the same hymn sheet moving forward. >> that's instructive, simon, in the sense it was 9-1. but clearly what we're hearing is that the committee the tenor

of the committee was more towards the dovish side and what you saw yesterday was a fed that was definitely more cautious and more cautious i think than the market expect preponderance of the evidence nobody expected the market to hike. but there were several aspects to the statement and to the outlook that i think surprised markets with how dovish they were. i think it's still possible and not crazy to think that there's going a june rate hike. but this idea that two is baked in and the fed so elegantly said despite the hat he's wearing the fed seems to be willing to tolerate more inflation in return for some upside when it comes to wages and/or growth that's a cogent remark. >> arguably people like art should be doing a victory lap because they never thought the fed would raise rates as suggested. my point of this interview, my real question here is whether

the reflection reflexes in the t are broken. this market is not flying as it would have done three or four years ago on this announcement from the fed. it seems to me we're in a different situation which may speak to the underlying fundamentals of the market and the caution that people have. >> i would say say art should pass the hat to you. that's another sort of right way to look at it in my opinion which is the market i think is unimpressed with central bank tools. i think that there's a sense of reaching an end point here of effectiveness. the central bankers would definitely disagree with that but negative interest rates are poorly reviewed here in this country. poorly reviewed in europe when it comes to the effect of banking stocks. you're right about that. i would, though, point out just to push back a little bit, simon, essentially the fed gave the market what was already baked in. in the sense that the market was already down to forecasting one or two rate hikes this year. the fed was at four.

the fed really came down to where the market is not quite but almost there. there wasn't really any additional easing that way. what was a bit more dovish was the sense of the reaction being a little more staid less quick on the trigger when it comes to raising rates. >> you seem to be right again. goldman sachs was forecasting three rate rises. you thought they would have trouble towards that. the fed notified the position you have. how many do you think we'll have this year >> i think if i heard correctly at one points during the press conference, yellen said i expect to see another move this year. that would indicate one. she should check her dots. another does indicate two. i think they will have trouble. teen people who are expecting the home move two times are talking not about june, they are talking about september and december. they think they are going to want to wait that long to see where things stand. i think they are lucky if they

can hike rates one more time and i down that they will. >> have a good day art. art cashin and steve good to see you. nike unveiling several new products at an event here in new york. sara eisen is there live this morning. >> reporter: good to see you again. this is an innovation summit where nike is unveiling a bunch of new products, those self lacing shoes have been the focus getting a lot of buzz. first time they are being produced for a mass consumer base. ten years in the works since they first filed the patent for this. they light up. they have two buttons a plus sign and minus signs that tightens and loosen the laces. they are set to hit the market holiday of this year. no word yet on the price. we're certainly going to talk to ceo mark park per the size of the market here, what he has plan. we talked to the lead designer about it yesterday and he said that they are already working on 2.0 and thinks they got pretty

solid patents so the competition can't chase them even though puma is set to release it's own prototype. this is ahead of the olympic games. we'll talk to mark about some challenges, those that nike could face this year with the zika outbreak in brazil and the recession political upheaval and then the digital strategy. they have just unveiled a rand new app. that interestingly is focused on the retail experience not as much on connected fitness like their competition under armour. all of that coming up in a few minutes. back to you. thank you very much. when we come back a new report out saying trump presidency would threaten the global economy. we're going break that down with two long time gop strategists. before we go break check on fedex. stock was up 9%. the ceo calling any threat from amazon fantastical. and the do you is about 70 points from break even for the year. back in a minute.

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the economy sees warning that donald trump withining the presidency could have as it terms it a dangerous impact on the world economy. updating its global risk assessment the publication research unit ranks election of trump as 12 out of 25. the same rating it gives the possibility that islamic terrorist would destabilize global growth. in the event of a trump victory his hostile attitude towards free trade and allenation of

mexico and china in particular could escalate rapidly into a trade war and skuper the transpacific partnership, unquote. let me give it to you first of all barry what do you think of this assessment from the economist intelligence unit. many people abroad are very, very worried about donald trump and what he's putting forward. does the campaign care? >> well i men i think it's a little bit over hyped, maybe a lot over hyped. there's no doubt donald trump wants to help american businesses to compete better in the global marketplace. we want to lower our corporate tax rates so they can compete. we strongly believe american workers and american business can compete anywhere in the world if there's a fair platform to do so.

we can manufacture anything in this world as lone as we try and the government gets out of our way. that's what donald trump is about. there's not going to be any trade wars with china or mexico. that's ridiculous. >> you had do you know that? i ask because yesterday when he spoke to msnbc donald trump suggested he doesn't have many foreign policy advisors. he said i'm speaking with myself number one. i'm my perimeter consultant. i have a good instinct for this stuff. shouldn't you assemble a team that could tell you from perhaps china or mexico whether you would have a trade war? >> yeah. we have. >> i beg your pardon. >> we have and we are. >> why does donald trump suggest that really he's his own consultant. >> he was his primary consultant. >> you honestly do not leave that the chinese would respond if there was a massive increase in trade tariff from their country? >> i don't think anyone has proposed massive trade increases on import from china.

>> i must have misread what mr. trump was suggesting. ricketyler we could have this debate in public. where your guy able to actually meet trump on the public stage but it would appear he's withdrawing from debates. in an environment where donald trump gets a free pass to appear on television virtually as soon as he stands up that's serious for you if you want to debate the issues isn't it? >> donald trump has survived most of the debates because he's been one of millimeter. he's only one of three he has to put forth some serious substantive policies. the reason the assessment has taken place. it's very difficult for a president to change things -- barack obama has found that out. in a pragmatic sense i think it is a bit alarmist. here's why it came out. they don't know how to assess it. what markets want is predictability. they want to know what trade environment will be like. will we have a stable dollar, stable labor force, what's the market going to do, are we going

to have a stable energy supply and data point has really throwed doubt into all of those things. he keeps announcing half baked thought out policies, he did mention a 45% tariff on countries that he didn't like and that we were going to move apple back to the united states, which just sounds like that would being a great but sounds like a pipe dream. he has the chinese upset and chinese dicy dee dissidents be talks about the thornianism of china having a strong leader. look all this doubt has cause this assessments and donald trump did it to himself. they won't name any economic advisers or trade advisers or people he's talking to himself and that's what got people assessing the markets worldwide wild. >> barry, how would you respond to that? >> i don't think the world markets are riled. first of all. second of all, you know, american businesses need a level

playing field. our corporate tax rates are ridiculous. the fact we can't repatriate our foreign profits is absurd. american workers can't compete with the global marketplace and they have to be given a chance to do so. that's what donald trump has been talking about get government off of businesses backs and allow american to win. that's the structure of his entire campaign. >> there are nonetheless and many people who would clearly agree with that, many millions have already sign up and taken the trump pledge in many sense. what about those people involved at the very least in export industries who might fear retaliation. what would you say to them, barry? >> we don't need to increase tar arrives we need a level playing field. if carrier air conditioning wants to move to mexico the american consumer can judge that for themselves. if there's american made products of similar quality and price then how come they can do

it and carrier can't? >> rick, i mean part of the discussion involves how cheap some goods made overseas have gotten and what that has done for households that lower income in this country. so are we to argue that a lot of homes that don't make more than 40 grand a year are going to be able to afford an air conditioner that's 30% more expensive >> americans like free trade because they like higher quality products at the lowest price and greatest convenience. free trade and open markets and free enterprise gets us all those things. but, again, i'll go back to donald trump has failed to articulate and lay out -- what barry said is more substantive than anything i've heard from the candidate himself talking about his policies and his vision and it's that lack of vision that causes doubt of people who are assessing these things for the future. and, again, markets like predictability, they like stability and they like

security, and all donald trump is going to steal the iraqi oil, send troops into sir area we'll have 45% punitive tariffs on companies. none of these things are comforting to the markets and people who assess them. >> we'll leave it there. thank you both. ricketyler and barry be rick tyler and barry barnett. >> when we come back sara isner will sit down with mark parker. the dow up almost 9 points.

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where imagination is in production. let us help grow your company's tomorrow - today - at business.ny.gov nike making some big product announcements in new york today including what you probably heard about a shoe that ties itself. our sara eisen is with mark parker the ceo of nike. >> good morning. i'm here with mark parker at their innovation summit. good to how far back on cnbc. so carl just mentioned the self tying shoe. that's the big buzz of the moment. this has bean long time coming. how many years, since back to

the future? >> since back to the future. 30 plus years. since the original idea. so here we are today. this is incredibly exciting. >> there's a lot of hype. my question is who exactly is going to be buying this? what does the market look like? >> i think there's a wide range of people that are interested in this whole self lacing adaptive performance. obviously you have sneaker heads who are all over it. this has bean buzz for them for years. there was actually a write in petition to any key to power through and get the power laces in a product. so, it's great to be able to put a product out there that is a step towards the future of adaptive performance. >> is this like self driving cars which everyone thinks will be the future. is this going to be mainstream like that? >> i think so. absolutely. that's a good analogy. i think the performance that adapts to you real-time to suit

your needs as an athlete is going to be a part of product more and more as we head into the future. >> some people are come plarg it to fly net which you introduced and didn't get traction. but now it is essential to the process and product. >> fly net started as a single shoe and now it's almost in every sport category. i think you'll see, yes, adaptive lacing in this case start off small. with a type of one product and then you'll see it move into other categories like basketball and running and other court sports. it will become more -- >> how much will it cost. >> we'll see. we don't that have price set. the shoe is coming out later this year. the price cigarette still yet to be determined. >> i want to ask you quickly about the broader economy from your vantage point. janet yellen of the federal reserve was cautious on it.

she right to be cautious right now given what we've seen in the stock market at the beginning of the year? >> there's a lot of economic ups and downs here that we're in the middle of a lot of instability around the world. we're facing some head winds and that sort of thing. but i think what really drives nike and our business is what we see here today the innovation. the product. we're not seeing consumers backing off of really innovative products, game changing product. that's what we're all about. that's why this event and what we're doing with this new wave of innovation so exciting. >> i know you can't get too deep into it. let's talk about what elserelea. the nike plus app. what's your strategy? >> this is about personalized service for athletes. on demand coaching. if you wanted a work out, you have a certain goal in mind we can personalize your work outs to help you achieve your goal. there's also a personal store

attached to it. the more you interact with nike plus the more we learn about you and the better recommendations we make. >> soofrt crowded field. a lot of your competitors have scooped up apps getting into connected fitness. what makes this difference? >> this is a full service, one stop connected easy access point is really what this is all about. is this best of nike and one access point. >> is it about e commerce and the retail experience? >> that's part of it. actually a personalized store is part of it. so you'll have access to unique and limited product as a nike plus member. it's sometimes hard to get that product when it comes out that's in high demand but guaranteed return we can make that happen. >> what's noticeably absent is hardware. every time we talk you tell me we can tease the apple

relationship. so far nothing. is that not happening? >> it is. it's in the works. i cannot say. we recognize that data and a dashboard is actually important in the process of an athlete, you know, moving towards their goal. so that is a part of what we're talking about here. that's a part of nike plus. we'll have others coming in as part of that process other partners. i talked about apple before and that relationship and that work continues. very excited about where that -- >> you're not giving up on hardware? >> we're not to concussion on hardware as a nike focus. that's not our expertise i think is to push the hardware piece it. that doesn't mean that hardware and sensing and traction not part of creating data that will help drive the personal experiences we're creating. so this is really about making it easy. you know it's hard enough to get fit as it is. so our job is to make it easier for people and that's what this is all about.

>> a lot of these product announcements are coming ahead of the rio olympics which you're gearing up for. what will be different for nike during these olympic games. >> the level of innovation is unprecedented for nike and we're sweating every little detail. you've seen some of that over the course of this last day and you'll see more of it coming out today. every sport pretty much that we represent will have a wave of new innovation. really designed in close relationship with the athletes. so this has been a multiyear process of working very closely with athletes to create break through innovation. >> there's new challenges in brazil, the economy is in recession, there's political upheaval and an outbreak of zika. how are you dealing with all that? >> we take that very seriously. obviously the athletes have to make decisions about what's right information. >> are any of your athletes thinking of not going? >> i've not -- i'm not aware of any athletes pulling back and

say they won't be attending -- that's a choice for the athletes in the end but we're not hearing that. so i think it's up to the world health organization working with brazil to sort of minimize any issues. >> is nike doing anything differently in terms of presence on the ground because of what's going on? >> we're not adjusting our strategy so much just making sure athletes who are participating and that we're a part of the nike experience down in brazil are as well taken care ever as possible. this is the biggest moment in their lives as an athlete. so we want to do everything we can to make that the best moment. >> die want to ask you about athletes because so much attention right now is on the younger stars. steph curry who we talked about. jordan spieth, the young hot shots are with your competitor. nike has lebron and kobe but they are established and some of them are retiring.

is that a fair comparison? >> if you look at the entire cast of athletes associated with nike it covers quite a range of athletes. not just the older established athletes we have quite a few young athletes coming up through the college ranks. and, young professionals across all the sports. we're very happy with the roster of athletes that we have. it's really exciting. they ultimately drive the innovation. >> who is the youngest biggest star that you have? >> we've got quite a few in basketball. we got kyree who is doing incredibly well. you look across all sports. you'll see younger athletes here in the olympics at rio representing their countries as well. so we're very excited. >> why did you decide to move so swiftly to suspend maria sharapova? >> well, again, it's a suspension not a termination. we take all those issues case by case. so we have to look at those on a case by case basis and try make

the right decision. in this case it's a suspension, and we'll stay close to the situation, see how it plays out and make the right decision. >> also wanted to ask you about trade. and the election. nike has become the poster child of a company that benefits from trade. we were together when president obama was on your campus to tout the tpp and now trade has become a political punching bag. why do you think the anti-trade centsment is resona-- sentiment resonating with people on both sides of the aisle. >> trade is critically important to the u.s. economy and globally as well. we think it's important to be at the table when that policy success developed. so it's important for nike. we think it's a job creation policy. tpp and modern trade policies should be about creating jobs and we're convinced that tpp

will help jobs. in our case it will create 10,000 direct jobs we think over the next ten years plus another 30 to 40,000 indirect jobs because of the trade. >> so, if the next president rips up some trade agreements to renegotiate what will that could to your business? >> we'll continue to move forward. it would help us advance manufacturing agenda here in the united states which is really important to us. we'll continues to move forward. it may not be at the accelerated pace that it would be with a trade agreement in place. but we'll continue to look at how we can localize manufacturing around the world. >> all right. thanks very much. mark for talk about a range of issues there. mark parker is the ceo of nike. we'll scene it back to you guys. >> interview of the day. straight ahead on the program the world's wealthiest countries have a $78 trillion pension

problem. 20 times the balance sheet of the federal reserve. the author of that report will come in and talk to us about the looming pension crises when we come back.

welcome back. want to be direct people to shares of valeant cosmopolitaning what's already bean historic fall. down over 53% on the week, down almost 8% this morning. perhaps continued concerns about

the fate of the company to file its 10-k in a timely manner and what the banks and bond holders may want from the company in order to give it waivers when those dates that it has to file that 10-k and come and go if they come and go but some concern about that weighing on that stock which again approaching the $30 mark, carl. it was well above 60 only a few days ago. >> unbelievable. david, thanks. citigroup is without this eye-opening warning about a massive and looming global pension charisma. the latest installment in citi's global perspective and solutions report found 20 of the world's biggest countries remember facing a pension short fall of a whopping $78 trillion on top of the existing $40 trillion in sovereign debt. charles miller joining us us who is the director of the u.s. pension benefit guarantee under president bush. good to have you. welcome.

amazing report. graphically you laid it out like an iceberg where the ice we see are the numbers we know and everything under water is the stuff that doesn't get reported. >> right. one of our recommendations. governments should publish the actual number. they should find a way to compare apples to apples so people understand where people think government owns xx governments combined they own 78 million. imagine your mortgage was 440,000 and the bank called you up and said actually it's $1.3 million and that's why we have the hidden part of the iceberg, trying to show people what's out there. >> it's global number. >> 20 oced countries. includes the u.s., netherlands, uk. >> who is worse off? >> if you look at poland, 350% of gdp. u.s. is actually reasonably strong compared torch else but the u.s. a total debt is about 19 trillion and the total pension debt is about 18

trillion. >> is there public outcry? >> just public. covers private but these numbers are government obligations. >> very difficult for politician stocks to be honest about the extent of those particularly work in the public sector what taxpayers will have to pay for them why you go to this entitlement reform discussion so oft often. >> one of the most important reforms people need to make their contributions now. that apply to corporate and public. the reason why you have that iceberg under the water people haven't been making contributions as they go. >> this has gone on for daecade. you should basically automatically uprate the pension age each year as you might what you pay in pensions according to inflation. people close to retirement will be screaming at the television nonetheless moving forward it's an idea that might work. >> one of the biggest challenges

is demonstrate demographics an security when it was put in place people expected if you made to 65 to live about another 12 years. today many, many more people make to it 65 so you have a much larger cohort of people in that age group and expect to live another 20 years. what we should do we'll raise the retirement age over time and then link it to longevity. we'll decide we'll pay let's say 14 years of retirement and whatever that is in longevity is where you begin. you don't have to argue about it every year. >> we've been bhaerg the liabilities that lie out there for under-funded pensions for many years. yet the day of reckoning never comes. >> it's a ticking time bomb but it won't explode the way we normally see explosions. you'll have fewer cops in philadelphia. fewer teachers in oakland. you'll have states that can't afford some of their other

budget priorities. and bit by bit by bit it eats in to the rest of your budget. >> i've seen it here in new york where our public pension liability, we're fairly well funded but at 9 billion now a year where we were about 1.2 billion at the beginning of 2000. >> philadelphia it's gone from 5% of its budget to 15% of its budget in the last ten or 10 years. that's a huge budget cut on everything else. >> you mentioned fewer cops on the street. bridge safety is a quietly creeping -- that's part of the same dynamic. >> whatever you were going to spend in your municipal or state budget will be eaten up bit by bit by pension obligations. >> although the problem is getting worse we're making it more difficult because of what central banks have done. if i save a dollar and. if i have that rewarded in the market for saving my dollar what i get for that dollar in terms of a return or a dividend is lower and lower and lower

because the central bank has flooded the world with cheap money. my dollar is washed away mongs all the other free money. >> low interest rates exacerbate this problem. if you are retiefrd and on a fixed income it becomes worth less and less. even if you're not retired and your company has a pension plan they want to shut it down because as rates fall the value of those liabilities goes up and to have to fun more and more. which is one of the reasons why we propose collective define contribution plans which is a way that people can pool risk and pool returns and pool longevity but have it professionally managed and have the corporation makes its contribution in the beginning and be off the hook. then they don't want to get out of it they make their contribution. >> if we're in an environment of truly rising rates does this alleviate this. >> if rates rise that it changes liability. a little bit of smoothing in the rates you use is not so bad.

>> great report. everybody should get their hands interest. nice tie. >> holy cross won last night. >> cfo of pandora will join "squawk" alley for an exclusive interview. let's get a check on fedex shares. sharply higher on that strong third quarter results. "squawk on the street" will be right back.

are apple shares about to go parabolic. why one technician says it could go into unchartered territory and soon but you got to go tradingnation .cnbc.com to find out. more "squawk on the street" coming up.

welcome to opportunity's knocking, where self-proclaimed financial superstars pitch you investment opportunities. i've got a fantastic deal for you- gold! with the right pool of investors, there's a lot of money to be made. but first, investors must ask the right questions and use the smartcheck challenge to make the right decisions. you're not even registered; i'm done with you! i can...i can... savvy investors check their financial pro's background by visiting smartcheck.gov welcome back to "squawk on the street". markets trading close to just freezing marktionally high sorry far. as you can see the s&p 500 material sector is a stand out.

top performing s&p 500 sector up more than 1% so far at the moment. leading the sector higher, glass container maker owens illinois. other material stand outs includes mosaic and lyondellbasell. near session highs. >> let's get over to the cme group and get the rick santelli exchange. >> thanks, carl. today is our third fed official and i would like to welcome bob mctier. thanks for taking the time post-fed statement day, bob. >> my pleasure, rick. >> listen, you've seen and read the statement, most likely listened to the press conference. you watched cnbc and listened to some of the talks that we had post-statement. summarize how you think it all turned out did janet yellen do the right thing?

>> i think she probably did. the only think she could, they got themselves a quarter point off the floor but the economy is still pretty fragile. gdp was 1% now it may be 2% in this quarter. but business investment is negative. net exports are negative. she's probably scared to death that the economy will weaken so much she will have to reverse course. so i think the best course for her to the be cautious going forward and that's what she's being. >> now, let's look at this and take a kind of rise above it. an impersonal look. markets domestically and globally adapted to the point where the new normal is going to be next to impossible to accomplish, especially considering the current length of the expansion cycle. in other words, bob will we be

having this discussion basically at zero or negative interest rates for the next three to five years? i don't know that you can come to any other conclusion, can we? >> well, i hope that's not the case. but you may be right. the economy is sort of on a tear. over the years it got used to depending on very easy money. and the fed has been the only, only game in town. hopefully at some point there will be some fiscal policy in this country that can take some of the burden off the fed. >> you know, we talk about that a lot, bob. you know, monetary policy was the only thing, we have no fiscal policy. but still we have no idea if that's actually an accurate statement. in other words, the conversation we just had with citi's mallard, when he was talking about all

these issues, less services for residents of citi's because they are paying things off in the rear view mirror, liabilities growing much more cumbersome and hard to control with low interest rates. isn't this going great a loop even with fiscal policy, he talked about certain states now instead of 5% it's 15% of budget. we need to grow just to neutralize that force alone in the final half minute can you tie that together, bob? >> well, obviously debt that's grown too rapidly and gotten too large, and when that happens it crowds out other government expenditures to the extent that the government has to pay higher rates on its debt in both normal course of business and in pensions. the only thing that i know that we can do is grow faster. that's the only cure, i think, for this malaise that we're

getting into. and the best, the lowest hanging fruit for growing faster, in my opinion, would be to start with a cut in corporate income tax rates and reverse this and bring some of it back. we need marginal tax rates across the board. >> we're out of time and we have to stop there but i'm thinking if we cut our corporate taxes other countries are going to do the same. i think we created a loop that will be difficult to reverse. have a great weekend. i'm off tomorrow. simon back to you. >> truth be told other countries are cutting their corporate taxes. of course the u.k. yesterday. in the meantime, what speaker of the house paul ryan thinks about the tone of the 2016 election so far and his take on what you might call the trump factor. squawk on the street will be right back.

the looming election has many republicans condemning donald trump but then of course pledging to support the business

man if he does become the gop nominee. john harwood sat down with paul ryan to get his take on that and now the general tone of the election. >> that's exactly the issue. speaker ryan has been aggressive on occasions where he felt that trump got out of line but said he would support him as the nominee. i asked him what he thinks of the tone of this campaign. >> you mentioned your old hero, mentor, this has not been a primary campaign that sounds like jack kemp and you have spoken out on that for several occasions to say you don't like the tone. if people like you speak out and condemn things you think are offensive in the campaign but say you're going to support the candidate doing those things as the nominee, aren't you proving him right when he says i can walk down 5th avenue and lose somebody. >> have to respect the primary voter and the citizens of the

party and those that go to the polls to respect the nominee. it's the primary voter who chooses it but i am a conservative. i am a progrowth happy warrior, constitutionalist and i'm going to speak out for what i believe in. the inclusive, aspirational optimistic politics that unites people. the kind of politics that i reject which i think the president has played successfully is identity politics. that is kocondescending. the left shouldn't do it and neither should the right. that's why i speak out on these things when see that happening but at the end of the day the republican primary voter gets to make the decision. >> and you to follow that decision. >> it's not my decision but it's their decision. >> but who you're going to say -- >> i'm the speaker of the house i rehe present everybody here in

congress and as the co-chair of the convention, i respect the rules. >> and that's why if donald trump keeps winning primaries, that whole never trump movement is going to fail. there's too much commitment to party to buck a legitimately elected republican nominee and you can expect other leaders of the party to do what paul ryan just told me. >> although he fails to rule himself out as a contender if it was a brokered convention, correct? >> yes. although after we aired our clip of that conversation yesterday and john boehner came out and said he would be for paul ryan if the republican convention was deadlocked, he indicated his aids put out a statement saying he will not accept the nomination. >> okay. that's important. john, thank you very much and of course you can see john's work online as the speak easy series. squawk alley s'up on deck now. john has our preview. >> well, tim cook is on the

cover of time magazine perhaps making the most detailed case yet for why he believes he should not be required to turn over the information that the fbi wants. also amazon versus fed ex. fed ex isn't worried about amazon but is that foolish? and pandora's chief financial officer is going to join us in an exclusive. that stock has been battered. is there a future? all of that and more coming up on squawk alley. i've been called a lot of things. i have read all of your books. did you learn anything? i learned that humans are complicated. we're emotional. absent-minded. and we make some really bad decisions. my trade-off analytics can help companies make better decisions, but i am still learning what makes people tick. what makes you tick watson? natural language processing, reasoning algorithms, statistical parsing. now you are just showing off.

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