tax and i don't want to mention some of the other things he's thrown out and have the wall street journal wears him out i know he's looking for a way to pay for it so that's the tough part >> senator bob corker, thank you very much for joining us today it is great to see you >> folks, that does it for us today, make sure you join us tomorrow, right now it is "squawk on the street. ♪ >> good wednesday morning, welcome to "squawk on the street," i am carl quintanilla and david faber and jim cramer we watch earnings from industrial bell weather like ge, busy morning in davos with dimon. solid flash in the pmi back to 265. we begin with earnings central ge up in the premarket despite

missing estimates and comcast dividend boost we'll go through the report and tell you everything you need to do the big bank ceos are speaking out on everything from taxes to bitcoin, we'll hear from jamie dimon. first up, ge missing its fourth quarter results of weakness and power division its cash flow is improving this is john flannery on the conference call talking about some of the early challenges that the company has faced >> you heard a lot from us since i came ceo in august i recognize the news we share in that time, power and insurance have been tough. we have moved to tackle the issues our responsibility is to reshape this company and ensure that ge matters as much in the next century as it has in the past.

>> they did say we expect more challenges to continue at least for power >> right, the relevance of ge is largely going to be aerospace and power is a disaster. sometimes you wonder whether what did they do to make you feel that power is good. you know who seems to be as interested as that as i am sec, investigation and how they book that revenue which i think some of us realize had to happen the sec is going to pursue individuals as well as the company. it is behind mr. flynn and had nothing to do with him >> tough is the least of the words of what he may have used for his tenure and, dealt with -- well, difficult earnings right from the start as jim has referenced in power and particular lack of execution there.

he says kind of miss the market and moving onto failure of adequately reserve and account for long-term care policies and what they left of a legacy of insurance portfolio and so many questions that continued was it a buck of share that we are working off this year? >> you can figure out a multiple on your own. guys, you know as well as i do, it is a lot of questions and the call is not over >> it is ongoing >> we'll see in terms of dividends whether the cuts are enough and concerns of other liabilities that people may not be aware of. the overall, i don't want to call it an over hang but questions moving towards a full break up which i continue to hear as a decent and if not strong possibility as they continue to review their options. >> how are they going to make up for the pension plan fall? >> those are questions that bankers and advisers are dealing with, pension and dissynergy and

given their historically lower tax rates. it does not mean they'll find a path it does effectively separate these businesses >> i can see a series of ipos. i think a lot of people like the healthcare division. that provides a lot of cash. they have to hold off on ge companies because this late cycle of oil and gas which is coming back so they can do that later this year. when you are dealing with of a business of this size, it is certainly a possibility. so we'll see, i don't know specifics, i do know they continue to really hammer away as they have for many weeks now. and, the board of directors as you might expected is involved and the board is going to change its composition very soon and very much involved in this

we'll see where they end up. we had a number of analysts, i can think of john lynch coming on saying there is no way they cannot do it because of the slightest ability of synergy >> i think they can do it. that makes it so the situation is relevant. it is clear that they must distinguish all sec management >> do you think it is important in the narrative here or a side show >> that's a great question >> sometimes the scc and nobody cares. >> the only reason i would say it is not a side show because we have to figure out the possible reinstatement of what happens with power you cannot dispose power until we have genuine finances >> in general, you have little tolerance of discrepancy in accounting overall >> they did use gaap accounting this time. i have a sign on my desk at

home, accounting regularity equals sales i heard on-air they do do that they need to get it clarified because you cannot get that division you have to go back and the previous ceo to understand how that was booked. >> right >> because it was not booked the way other companies booked things and pensions failure here >> are you talking about long-term contracts where they sell or where they have service agreements or moving it forward, perhaps? >> aerospace historically, they have done that very clean, exactly how united states technology -- they do the same kind of accounting for engines david, the accounting they use

for power is not opaque, it is just ill advised is the term that i would use >> ge does say scc is investigating the insurance reserve review >> yeah, if you looked at aig or manual life, you would know that people were living longer and you would have to adjust again, mr. flannery, it is not his fault. >> what was going on there >> if you are the sec, that's what you are asking right now. they got to get past it. they have to refence it with the previous administration. mr. flannery had obviously nothing to do about it i don't think he knew about it >> the board is a failure. >> the board the board of directors there >> how about mr. garden on that board? >> he is he was not on the board.

can one man do anything? >> yes >> certainly >> now, an 18-member board that ge had is tough. >> they have a lot of people and catch a couple of football games and check things out. that's kind of what they had there. so i disagree with you entirely. >> it was a medal for trying you know who says medal for trying it is a sub text >> what does it matter i think everything is fine >> he does have some explaining to do. >> to who? >> you >> i got no subpoena power >> no, you do not. you do have the megaphone though i got a show, they don't have a show >> you got this show, too. >> i got a lot of shows.

>> i have a show you see that >> what's my rep you are sitting right here on our show, too. >> i got a couple of shows but i still don't have subpoena powers that seems wrong to me >> it is good to aim high, jim >> i am not going to slam the court. why? it is a new world. the fact that they use actual accounting, i find it refre refreshing, don't you? >> always. >> it looks like the -- >> you see the stocks going negative on the premarket of the hill >> sec, not justice. >> there will be a ge in the culture but it will look different than it does today >> comcast meantime, the parent of our network better than expected results, higher theme park revenue the company announcing raising its dividend of 21% and

expecting of leasing $25 billion of stocks this year. nvidia is down >> nvidia, the lost is not as much when i look at much of the consensus out there. yesterday, i talked to verizon from fios lost 29. >> i am coming at you. >> there was another company at one time >> yes >> that company is disney. they hit the 100 millions and they go down how did they solve that narrative? they bought someone. can comcast solve the narrative. i mean you can go higher than 30,000 people. can they solve the number that's down by making acquisitions? >> they can but it is not clear to me what it would be and lets not forget, you are talking about different things video subs continue to go down

they are lower margins >> don't we love wi-fi >> broad band goes up and keeps ongoing up broad band were in line with expectations and the pace of net growth did flow and year over year continuing a trend that we have seen. >> broad band is moving the right way. that's the key product by to verizon yesterday where lowell was talking stuff about 200000'" th 200000'" -- you are looking at part of the content right now. they have that covered the question is where? we know he fought fearlessly to try to buy fox, did not really get there.

did not get there. >> right >> that would have been constant and international distribution it is not clear to me. do you buy up a wireless company at some point because you do feel the threat of 5 g's that's significant or do you keep the arrangements that you have with verizon in place or to buy your own. >> not as much as being delivered than anticipated the buy back is at least 5 billion but they did not go above. dividends increased of 21% >> is this the market electric power? >> what do you mean? >> is it a utility that can raise dividends unless more people move into the area. they're flat maybe they can raise the price a little >> maybe >> is it utility

hey, david >> it is not utility the content is an important part of business. >> i am probing. i am trying to get to your force field. >> the content launch is fabulous >> i hear you. >> on advertising, there was a declining of nbcu of 6.5%. cable network advertising was up 2-point. nfl weakness may have been one of the key strong differential that's interesting >> well, if super bowl can make up for that and by the way the olympics >> that's a nice one tone two punch and wi-fi is more millennials. i don't know if they'll pay for it they'll pay for makeup and uber and wi-fi. >> got to have your wi-fi. >> should millennials pay for

deodorant and should they brush theirteeth >> how about the way these bankers punch? >> we'll hear from dimon in a moment of what they told the squawk gang this morning osc osc osc oscar munoz is joining us. taking a look at the mark, s&p 500 and dow is looking at their best since 29, back in a moem. moment where a rising middle class powers a booming auto industry. draws youthful populations to mobile banking and e-commerce. between emerging markets. everyday our 1,100 investment professionals around the world search out opportunities for alpha. partner with pgim,

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jamie dimon and lloyd expressing the optimism, dimon talking about the reason of a slow recovery. we had 2% growth it is half of a normal recovery. we had 60%, it should have been 32%. >> the reason is lack of infrastructure building. i think it is going to hit 4% sometimes this year. >> it is not just the policies themselves and a gross kind of macro way of tax reform. i think we'll go up to a period

where they'll push for infrastructure spending. >> do you think it is terrible >> yes, i do think it is possible >> dimon says it is possible to get to 4 this year and he hopes eggs on the face on people that says to be stuck at 2. >> i think one time we would have thought impossible. we are a big economy, we don't grow like that >> he was not saying a four-year. >> they're both positive >> yeah, we have seen lloyd being glum he will be like -- >> well, he was a little mortem p tempered >> less enthusiastic of a 4 handle this year >> if clients want to do something in the future's market

with krcrypto, they are there fr them >> dimon would not have addressed bitcoin at all >> no, he's done with that >> he should get back to talking about something real valevant >> customers who wants to be involved with bitcoin and by the way, we had another one last night. customers who want to be involved, we'll do business, he did not want to say we are the crypto no more than jensen wong and nvid nvidia i thought it was important even as i think he did not. >> other big points this morning, the secretary of the treasury talking about a dollar obviously is a weaker dollar is good for us. they asked secretary ross about that after the fact, he said he was not advocating for any point of view. >> i went over the ruban doctrine this morning. listen, our long-term policies

have been the dollar and it is been long-term in 1992, we had enough there was a gigantic short squeeze against every currency, ruban was much less poignant in his language and mnuchin was very poignant. the ruban doctrine was more subtle i remember interviewing ruban after i worked for him at one point. if you do not say that i favor strong dollar than you are making news and i don't want you to make any news if you do not say i favor weaker dollar, you are not telling the truth. go back and you can google the doctrine it was so subtle it was so subtle like al capone. >> i know, it is an interesting thing seeing that weaker dollar given rates moving up. >> good for business and good

for our exports. >> and good for the quarters i hear music in my ears, do you? >> i do. >> comcast again >> we got to sell ads. >> it is part of it. >> we'll take a break, we'll get cramer's mad dash and we'll count down to the opening bell one more look at the market, don't go away. and... exhale...ke a deeeep bre. aflac! and a gentle wave-like motion... liberate your spine... aflac! and reach, toes blossoming... not that great at yoga ya but when i slipped a disc, he paid my claim in just one day. so he had your back? yup in just one day, we process, approve and pay. one day pay. only from aflac

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time for mad dash for this hump day as we like to say on "squawk on the street. texas instrument has had a great run this year but not today, why? >> i wish i can do a do over for the poll because at one point they said, the first computer business is iffy i mean -- it went -- that was it >> it was like everything is great, i mean everything is terrific so we let it three touchdowns and that's all right. they should have said these first computers are actually fine the stock runs so much they'll stand there and buy all the stocks this is the ultimate internet of things play. their champs are industrial. now it is trending as it was a semi and had a division that's not doing well

>> so nothing that concerns you from the call in terms of the actual evaluation. that's a big loss. >> i think you can argue and did they lay out and like many companies, they chose not to really lay out what tax reform means. you know the city noticed very typical. they are executing well. business is slowing down i don't see that you raise estimates which is more important they fumble but they what? you should focus on the fumble, no, they won opportunity is knocking. >> did it cover the point spread >> they did not cover. it goes down 8 and another 2 and 3 and tomorrow in have the investors institution cannot get out. you pressure the quarterback right here you keep these guys back it is covered by jenkins

>> fletcher cox. >> okay. >> we got "openi bl"omg next. cin

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you are watching cnbc "squawk on the street. the opening bell in just about a minute's time. busy morning as we watch the headlines coming out of davos. more on the way tonight with whirlpo whirlpool. he did make a note of nafta and there is a quote of good chance if it does get re-negotiated >> the best currency of the year >> how do you like that? >> crazy >> i have been stuck in a lot of p pesos. i would say this, i thought it was common sense and many people won't. how you make engines back and forth and back and forth >> fill lebeau will describe how

impossible it is to do what wros wants. >> right now lets get to the opening bell this is the celebrating over the nasdaq they're celebrating the 10th anniversary. >> ge have been able to come back a little since the disclosure i want them to talk, it is nothing to do -- the investigation. >> that's the windfall david, there is as committee, it is called the audit committee. if i remember the audit committee, i would be seeking counc council separate from the company. >> i am looking through the q and a, the call started at 7:30

and they moved in on the q&a >> this is the cfo on the call a few moment ago >> we are notified of the sec, they are investigating the process as well as ge's revenues we are cooperating fully of the investigation which is in early stages >> all right, that's going to be the reason that they do restate some past results. >> that's a business judgment. you wrote a policy betting that you would not have to have a nurse live with you and people who wrote it, wrote the policy for 20 years which is what happens. the number is twofold, second, the longevity of the people requires that you have live in

health the only problem i had with ge in the last few years that everybody else knew this ge chose not to acknowledge it >> yeah. >> i care more about power because power could involve a restatement, power needs to be sold >> yeah. >> powers, how many people needed power >> i think a third of the orders >> they are getting questions. i am reading a question, it will be tough to get to your guidance of industrial profit being up 2 to 7% given everything else. the company pushing back saying we are sticking with it. >> i think it is impressive that we are sticking with it. there is no need to, right >> what a good opportunity, listen, i keep on discovering things, we are not done yet. >> yeah.

>> so stock back, taking back the gains that it lost briefly when we heard of the sec >> will there be any analyst changes his or her mind. i don't see anything in here since the raise of capitals >> they have not mentioned it. one of the concerns is they need the dividend, again, was it enough >> on the flip side, another industrial with extremely good news, these rolling three months number, europe and middle east is up 37 and latin america is up 55 a long while ago, these numbers are looking much different >> i don't recall that the numbers ever looked like this in all the year i covered cat i remember the year that

villanueva won the championship, it was the hope that now they weighed off everybody, the managers broke off the union, you can have numbers fly they did not get the orders. here they laid off so many people, they got control of the network, wow >> it was 60 in january of 2016 then it can go to 200 without a problem. >> the big issue is can they make it all. it is constraint you want constraints the united technology call >> yeah. >> they need to make three times the number of engines they are parasitic ma making >> craig hayes is an accountant. he never shared ge strategies. did you know that? >> he felt that the gaap was a good thing he fell into the gaap.

what did ge fall into? >> the non-gap >> it was sparkly but it was sparkly with phosphorous >> it was the hudson river >> that was with the transformers remember don't eat fish until late next century. >> that goes back away >> we are not there yet. >> that was catch and like sniffed it >> or catch and glow >> catch and glow. >> how is the sushi from the hudson there >> it is unbelieverabable hudson is doing very well. it has come a long way >> new york tapped water has been rated the best. >> you should take it and fill it with that >> go ahead. >> united is down 9%

the results $1.40. they're taking deliveries to a bunch of systems and leading into many places >> almost 5% >> that was a conference call was like a bad netflix movie that got cancelled as long as they are trying to do something new and it felt flat it was kind of like hey, we are cool, you know we are not going to do the old call, hey, it is great there, get on board, it was like a travel on. >> it was a travelon i prefer earnings call >> i can see it happening. they're not calling it i want to be sure that they're

not calling it that was the turbin problem. >> they do real conference calls. >> it was too weird, it is okay, you can ask us it was too weird is this a conference call or they talk about flying from rochester from one point i don't know, it was rambling. >> i don't know what else to say. it was rambling. >> well, we'll hear from oscar munoz. >> it is a new conference call and it is never repeated it should have shot at new haven before they came down here that was like the curtains was down and the review was bad. >> um, we heard from jamie dimon and lloyd blankfein. >> most companies are not

giverigive giving us a great deal of grand. verizon, one of the larger gifts to employees were bonuses, not in the form of compensation but 50 shares of stocks, they'll price it on first of february. 150,000 people are going to get restricted stocks. that's up to $400 million of stocks they are giving out they'll benefit to 2.5 to $4 billion and operating cash flow from tax reform >> yeah, that was good >> that's one number i thought they were caging you when they're talking about what to do. >> you have a film for it. >> no take a listen and give me your thoughts. >> we are going to remain on the leading edge of network so

investing in our network is our top priority when we took over the asset here, we took over $100 billion of debt on our balance sheet, paying it down is important to us we know that our investors look for our dividend and we had a great track record around dividends. >> there you have it again, flexibility is what all these companies seemed to be stressing is the benefit of tax reform i can do a lot of things but few of them are committing and their parent company as well stocks are barely down and there maybe more in terms of what's coming in, going to share shohor or being identified. that has not happened yet. >> you hear unite technology talking about they can bring it back remember, united state technology, not giving 50 shares or a thousand dollars but putting people in college. more than 30,000 people gotten a degree it is really hard to match and

starbucks, too >> 250 million and added pay and benefits which they do say accelerated in the recent changes from the tax law we saw disney yesterday. the percentage of gains in cash flows of payments to workers verses the overall >> you are not talking about single digits. >> yeah, you are not getting that >> by the way, when you think about it, that's what you would expect to do listen, we don't know and they're always, flexibility. we'll see what the landscape looks like we'll make our decisions about capital allocations as we always have we'll invest in our business, nobody said and very few is sitting out there. okay, i am doing a, b, c, and d, right off the bat. >> that was dimon's point this morning looking for them to be aggressive overtime and this is a down payment grade of sort >> you don't want to get ahead of it. they're the ones that's the most

so far >> the most free cash flow out of nowhere >> $4 billion? >> did you see the oath number >> i thought the oath numbers were good. >> aol and yahoo continue questioning whether they want to and a need to get bigger and he says there is nothing going on right now but it does not mean at some point verizon is not going to revisit this of the idea if we need more scale in content or being an independent distributor who can license that content effectively and compete with at&t in that way. >> remember when we are worried of verizon this thing is a cash machine >> wow >> david, business life were not so bad >> these unlimited plans seemed to be keeping people the competition seems to be epic on price >> yes >> it does

that's a great point everybody is kind of winning now. >> john legere came back to you yesterday. >> yes, he's back there. is he at the super bowl, john legere, singing at the super bowl >> no, that's john legend. >> similar guy >> what? what did i said? >> i don't know. >> that was a fire hazard. >> the thing was largely -- i thought it was sent from chevron. the dow chemical, the old dow. i don't know, you want to get in that thing >> no, i am not getting in anything pink. that's the rule. >> it was the fiber i was talking about. >> got it. >> was it like velvet?

>> it was like something of this combustionable spontaneous >> verizon and ge are leading the dow. lets get to courtney >> hi dan, you can see s&p 500 is getting closer to 450 on the second trading day here on the week we are up by almost 7 points in the early going. take a look at the dow transport, this is a streak that's broken yesterday. we have seen this higher and broke lower yesterday. it is moving again lower today and we talked a little earlier on the program of airline similar bom simil symbols. pay attention out of davos mnuchin made comments of a weak dollar being on the trade. we are below 90 on the index

we'll watch this one closely as we move forward. a number of stocks buy backs announced after the bell yesterday. today, comcast is the parent company. wells fargo with a by back and valero and sirius xm as well take a look at the number of companies on both earnings and r revenues we are hearing from comcast and united technology. you talked a little bit about the report and i also want to call oscar munoz, the ceo made a comment is the best way to compete is match their prices we cannot let low cost carriers in our hubs delta is down by 7% and american airlines are down by 6.5% and

southwest air is off by 4% i know munoz will be on the program a little later, that's something we'll look forward from the ceo's comment there >> john sculley is going to join us take a look at the movement in treasury this morning. 30 years hit the highest deal since october. we were looking at a tenure around of 265. back in a moment for mom,

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and private debt to finance transportation and infrastructure. building blocks of strategies to pursue consistent returns over time from over one hundred fifty billion dollars in real assets. partner with pgim. the global investment management businesses of prudential. we had a lot of conversations about crypto currency and bitcoin >> you switched your view about this i think i have said enough i am not going to say anymore. you guys talk about it too much. you should talk about ait and g

back to something relevant >> over discussed. >> well, you see lets say you walk a foot from here, like right over there and -- every doorman or cab driver, jaime may think it is irrelevant i am tired to go to restaurant because i have to get a bitcoin wrapped. >> maybe you should pull out jaime's and i don't want to talk about anymore, it is not relevant i will not give people -- i was doing about what about bitcoin buying boeing? no, people did not like that either jaime and his world, it is different. the world that i hang out, people always ask about bitcoin. take a look at what corbat says.

>> we'll talk about digital currency, i don't see it as a currency i don't understand the under line fundamentals of the investment >> that echoes what visa kellyit >> that makes sense. when you get them off camera, they say it is largely used for ransomware, speculation, and people in failsed currency countries. they say everything is horrible, we're kind of dumb, we can't come up with new horrible things, but block chain is real. i think corbat knows that. he has it right. by the way can we touch on apple for a second >> we didn't discuss it as well as we should have.

>> if you read the analyst commentary it's basically buy one get one free >> you're referring to the jpm call yesterday >> yes, basis says their x is fading demand, it's not selling well and it is a consumer product stock. is sells in 12.5 or 13 times earnings, but the analysts are saying stick a fork in it, and i'm not until say 2025 why stick a fork in it >> and jeff williams tells cnbc they're in the process of adding more health records to the iphone >> it is remarkable. the uniform lack of belief in what they're up to if they want to trade at 175 -- >> google is only $77 billion behind it in market.

closing in >> venmo is real i think people don't realize the other bets, the moon shots are paying off they're paying off >> if they really do pay off we may be talking about that is the largest market cap company >> on the you tube channel, youtube is it. you should have a youtube channel. what is that >> i stretching a little >> my tendons and my elbows. >> do you want us to get our yoga mats? we'll get more with jim in a minute [ keyboard clacking ] [ click, keyboard clacking ] ♪ good questions lead to good answers. our advisors can help you find both.

talk to one today and see why we're bullish on the future. yours.

jim, trading >> last week, goldman sachs reported a hideous horrible quarter where everything was bad. it was miserable and the cfo took a lot of heat it was a good quarter, and no one could believe how good the quarter was given how weak

volatility was, and goldman is doing a lot of things right. it was another great opportunity, and again, you know the financials are right and goldman is good. who knows what they will do to generate new revenue that's what they do. i wanted lloyd to talk about that >> wells fargo today, 65, on the additional buyback >> lloyd would not go there. i wanted him to be more positive, but the tostocks were positive >> that's a lot of year-end arguments right there. >> it is scrip tick. >> he was cryptic. goldman, making trades for people who want it he was cryptic on crypto i have brian jordan, i have

logitech, and i have dominos we're over here, we're going to do netflix and we're going to give a scholarship -- >> looks like a real athlete >> yeah, huge wrist strength >> it is all about wrist strength >> coming up at the top here, existing homes, and oscar mu no when we come back in a minute. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances.

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how am i going to explain this? if you don't like their answer, ask again at schwab. schwab, a modern approach to wealth management. welcome back to "squawk on the street." breaking news from the realtors. home sales in december down 3.6% to 5.7 million units projection. novembers numbers were also revised down still sales up 1.1% year over year and we have the 2017 totals in total sales in 2017 up 1.1% year over year. sales would have been a lot

stronger had there simply been more homes for sale. that continues to be the storied inventory. that is down 10.3% year over year to the lowest since the realtors began tracking in in 1 1999 down 31 straight months. a sixth month supply is considered a balanced market the existing home median price that is up 5.8% year over year and prices have been rising now for 70 straight months so existing home sales down for the month. up slightly year over year, and inventory continues to be the problem. >> thank you, diana. good morning and welcome back to squawk on the street sarah is off today markets on another tear, dow is up 167 lead by some big

industrial bellweather earnings. the investigation of insurance for ge and united beat the street, but the kal is spooking investors. big bank ceos making waves at the world economic forum, what they had to say, we'll take you to davos lives shares of ge were all over the map this morning they were up, now they're down again. they missed top and bottom line estimates. also the sec investigating that recent write down for policies particularly those related to long term care let's bring in brian langburg. and also jack, the chief officer. they recently sold out of all of

the shares why did you share your g.e. position after owning it for a long time? >> we held it for over 20 years, we lost confidence in management's ability to have a handle on the profitability of their industrial businesses. with gooiuidance for 2018 dropp in the last few months, we were very concerned that long cycle business will take some time to turn around, and we thought there was better opportunities elsewhere. >> jack, it's not that easy to find positive analysts on g.e. brian, i should go to you, you're one of those positive analysts what did you hear on the call that perhaps confirms your view of the company >> not a thing, excement one thing, that 2018 will be an awful year understand where jack is coming from in terms of what john flannery

walked into, this is a big mess. the last year the ceo was flown out, the cfo, and the head of the power business it is absolutely a mess. my recommendation on the stock has nothing to do with current or near term fundamentals, but looking at the assets in the inherit earnings power of the company. when you look at the bigs right now saying it is worth less, frankly they're jumping on this late yes things are bad, the sec investigation clearly a negative but also warranted when you look at the industrial portfolio and the fact they're getting adult supervision. the charges are about 25 dollars a share and you can pick them up now for 17 almost everything else in the market is very expensive

>> brian, nose are strong words coming off of this call now. the company says they're still early in the investigation, but what do you make of the disclosure that they're investigating on the heels of that insurance charge disclosed last week? >> yeah, so when you look at why the charge game it was over things from 10 years ago what they should investigate is okay, did you just find you had a problem now, or did you find out you had a problem a year ago or two years ago or whatever it is warranted they will take a look do i see that investigation as an existential threat? no but i can see where they will want to look and maybe some fines will come out of it, we'll see down the road. >> jack, at what point do you look at shares of g.e. in the midst of this turn around that is still ongoing and probably going on for awhile. at what point do you look at

these shares and say "i would buy them again >> i would be interested in the low teens, but brian is right, it is probably fairly valued in the mid teens here if we can trust what the management thi s thinks you know, brian just addressed the sec information into rese e reserving. that will give a share shake, too. the last policy they wrote was in '06 companies have been dropping out of that long-term care business, s adding to reserves, and for it to come out 11 years after the runoff road. >> jack i wonder with the terms to adjust the portfolio, is that con ttingent on what they do in

other months and quarters or is that separate from their plan to build in a different way they said on the call it will look different in the future >> it looks different now than it did five years ago and i think it will look different in another five years their history in the last 15 years of managing a portfolio of businesses has not been good and you know, we'll give john flannery the benefit of the doubt that he can do a much better job, but we just came to the conclusion that we'll look elsewhere for a couple of years, and see how this plays out and if ge were to get extremely cheap, lower part of the teens, we might look back at it >> and brian, finally you seem to be positioning your buy rating for a break up and perhaps for the parts numbers out there higher than the current stock price, is that a fair assumption? >> there is implicit some of the

parts evaluation the huge swing factor in that is this if you have a business that normally when run well generates four or five billion in profit, do you put a multiple on it now? or do you put it on normalized earnings and profits when it can recover. i don't think you sell when the worst is going on. i think the time to sell is when things are going better. you buy the future, that's why you buy now. >> got it, guys, appreciate your insights thank you to brian and jack. >> thank you, we have a rally under way this morning the s&p, dow, nasdaq, russell hit some highs this morning. 13 of 16 to the upside we have the floor director here, art, good to have you. how much of this is related to what's happening to the dollar earnings headlines out of davos >> i think it is the dollar to

some degree, but i think we may be seeing near spontaneous combustion from mr. dallio's rally. he talked about the potential for a blow up, nervous money on the side people that have not gotten in yet, and you're seeing that here it's not as much news driven as those late to the party that are beginning to say wait, this train is pulling out i can't wait much longer everyone that is waiting to buy in the dip is now becoming frustrated and saying "i may not get that dip it is not full combustion yet, but it wouldn't take much to turn these sparks into a blaze >> how much are you watching interest rates right now >> relatively closely. it will be important they will have a press conference if he turns out to be as dovish,

i think you could get a push out of that. even the people at muzuho said they don't think the bank of japan will do any tightening for at least two years this is a great backdrop for people saying he is in there, we knew he would not rock the boat, maybe we're not going to move here either. i think the key will be inflation and what the inflation numbers come up with >> and the strengthened any questions there for you? >> it is remarkable. not for generations have we heard a treasury secretary say paying with the weak dollar. i think reuben said we may benefit from it, but we want a strong dollar. >> does it bother with you

does it collide with having the reserve currency >> not fully when they are trading as freely as they are, when they artificially try to push it down, i think it is still slightly overvalued. a little further dip would not bother me if they tried to push it harder against that, then i would be a little concerned. >> we talked in the first couple weeks of the year and you said watch for january finishes, february finishes before you can start thinking about double digit gains for the year that thinking still on track >> yeah, i think so, but i'm -- of an opinion that some cycles and indicators that i'm looking at say we might get a little bit of a pullback in february. i don't know what will be the catalyst for that, whether it is geo politics or whether the fed does surprise somebody but for now, it looks like pile

is on hold trump is still in a position to influence the fed greatly, compared to anyone since woodrow wilson it will be a very interesting time, but as i said, you can almost feel the tension behind mr. dallio's rally being out there. there is an anxious nervousness. and it is a nervousness among the bears. >> a fear of missing out >> thank you, art. when we return this morning, united posted and earnings beat, but comments made on the call are spooking investors we'll speak to oscar munoz coming up. "squawk on the street" will continue after this.

united airlines beat estimate estimates, but stocks are now down 10% we have phil labeaux >> oscar, everyone wants to know what is happening for all of the airline stocks are you getting a little too aggressive in terms of adding capacity >> i think when we lay out our plan yesterday, is a, i think a very exciting path forward for

united to realize their full potential. i think the market today we expected that. sometimes fire departmethe trann the world, the stocks have been highly correlated and volatile, but it was important for us to lay out our mission. from our perspective, the growth, and not all growth is' quality. >> why is this capacity growth in your opinion is good for united but also for your growing profits and margins. >> i think it is the balance for investors. now just laying out a blan doesn't mean we're going to get it done. we have to execute, but i think it is great for customers. customers from my places will get a chance to fly with us. >> but you know the criticism out there. this is a industry that does terrible when it comes to adding

capacity it sparks others adding capacity it sparks a fare war and no one wins in the end. >> nothing we laid out yesterday talks about pricing and price wars we talked about the growth to strengthen and fortify our areas of business that are essential when but think about our business and where we receded to, that's where the opportunity lies and that's where we layed it out >> you know your competitors will not sit still we will be in dallas talking to doug parker, we'll ask him and he will say we're not seeding any areas. if we have to respond we will, and this is the vicious cycle out there. >> that's what is to be expecting. it is a highly competitive industry, always has, and we do this every single day, every day of the year. so competitive responses will

come and go. what happen is important is for united to have a defined strategic plan about what we're trying to accomplish and do. >> you used the word transparent, and you did not use the term price wars on the call last night, but that is what the street walked away with. one of the things i heard from investors is maybe there is a mismatch between the messages whether it is last night's earnings call, third quarter call, or other commentary in the past year, and the message that the street is taking away. is there room for improvement there? >> there is a communication adage that you have to say thing up to five times before people get it you have to say what people want to do and people hear what they want to hear the stocks have always been volatile the people that carry them have always been attuned to the

historical facts i think the industry has been improving. we have a financial base as an industry that is infinitely stronger we're able to weather storms and fuel prices in a significant way. we're realize businesses these days, there will always be those issues, but these concerns are constant every day we do this at every one of our locations. >> are you surprised the stocks are down over 10%? that is a large loss despite that volatility you mentioned. >> we expected it. we expected it in this range, and i think it is a buy in opportunity. i think in the course of the day and the next couple days when everything settles in and people absorb the story we told about the strategic path forward that is clearly defined i think they will get it and the rest of the industry -- so many people hold these stocks, kind of the template, the basket of stocks, as opposed to individual

anything that affects the industry may create this noise >> but you did come in expecting to have this kind of reception >> we had ranges of what we might expect because transparency at the end of the day is redefined we need to continue to make the proper investments, the proper things for our employees, and to make that investment for that responsible type of growth >> can you slice up some of the deliveries you're taking regional jets and what is says about the overall market right now. >> i think the people from davos were reporting today how strong they see the market. our aircraft are designed for specific missions. if we fly short hauls we have a certain type of aircraft, the long haul are different. we're trying to get our fleet aligned. buying an aircraft is always

difficult but we're trying different suppliers. if it is buying a tieup between boeing and embrier >> the conversations we have with some of our major suppliers are the product line that we work through the things around them we watch closely, but we worry about our individual line of suppliers >> getting back to the growth plan you outlined last night you outlined in that explanation four key areas where united is not number one, not number two, but number three or number four. and it was a very candid moment. and at the end of the day, the question that i'm hearing back from investors and those in the industry are why should i believe that united can get it's act together this time we heard it in the past, and the track record of united is that we're doing better and it ultimately doesn't happen. >> great question nap is the

exciting part of this. we put together a management team that when i joined the company a couple years ago, everyone told me about the unsolvable puzzle that united was. >> the profit margin you had a great network, no one knows how to use it. we brought in some name are excellent at doing this work it is a broader team, and we're excited about the possibility of laying out a specific plan, getting the right people to work through it, and the foundation is getting the people, our 90,000 employees aligned with us and what people don't give us as much credit for is the foundation we have we have a very, very engaged workforce. we made the proper investments across the thing and our proof is our reliability we finished in record departures you start with the people, build operational reliability, and then we build upon that.

>> and you will be adjusting the type of aircraft you fly into your hubs for smaller and bigger markets. people started seeing ridgeal jets from say newark to chicago. you're adjusting that. >> our history, pre this administration, we listened too much to too many people and started being too cost conscious. and we started bringing smaller aircraft and not the larger more comfortable aircraft and we wonder why you stop flying with us >> obviously you come from csx you worked there the board is looking to basically start mandating their ceo undergo medical examinations and report it back to the board. i know you had health issues yourself in the past, what do

you make of a move like this >> i think it is fairly standard i was at csx i had an annual physical as well there is a broader question about what type of medical examination are you looking for. i had one every year i was a involved athlete, a vegan, and i suffered a major heart attack tests can't do everything. it's important that we do that and make sure we understand people's health, but it's standard >> how do you feel now >> i feel great. so excited to have the story out in front of us we'll deal with the issues o the day -- >> specifically about your health, they're curious. >> i feel great. it's one of the most incredible wonderful miracles in life when i reflect upon what happened and the fact they have a new heart the community that supports it and the people around me that had similar issues it's an important thing and the most critical thing to recovery for anyone out there working through this is anyone that you

know that is involved, the mental part of the recovery is as strong as the physical. you have to give them hope and confidence, and that's what i tend to do in our hospitals and work through to let people know that i go back to an interesting job, and many other people will >> and you will be here -- >> yes, here in the job and here on planet earth. >> i didn't mean it that way, but okay, thank you. >> oscar, phil, thank you, guys. good to see you. >> thank you, everybody. quick programming note, tune in tomorrow to "power lunch. we will talk to doug parker. when we come back, secretary steven mnuchin making headlines at the world economic forum in davos. and coming up, looking at

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well, it'sonce again.eason >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade.

welcome back to "squawk on the street." he said the u.s. welcomed a weaker dollar. it dipped slightly after it's comments it is near three year lows, mike joining us now at post nine for our etf spotlight with a look at strong versus weak dollar etfs >> yes, they're gaining more strength right now that is nearly a decline if the treasury secretary really wanted to state a new doctrine of the u.s. government or not, his comments really reinforced a very strong trend that has been in place for a long time

now you have three etfs, the one in decline there is a bullish etf. that basically tracks the u.s. dollar index the euro etf is up in the past year that is the most pronounced, and the other one is wisdom tree emerging, is for lesser developed countries. you have seen money flowing out of dollar based etfs if you look at the japan equity et etfs, they have huge inflow. so the big question here, guys, is whether or not this trend that is really mature right now,

more than three years on, and what it would mean for the other markets. right now the stock exchange is really happen with the dollar, the rest of the world is growing very well, and it means that other strange banks earlier in their process has been great for stocks would have reversal higher in the dollar be that thing, the pebble in the pond that ripples across >> what the whole world doing as well as it is, maybe they don't matter as much >> they may not. if you look at it from a big picture point of view, the dollar rally is giving back about half of that since let's say early last year. so it's not exactly like to is creating new lows. the currenty markets do trend in a long direction and they reflect where the economy is growing more or more

than expected i guess is the way to look at it. >> maybe the president will address it don't go too far let's get a update at this hour. good morning, everybody. this is what is happening this hour militants stormed a nongovernment's organization for children in afghanistan killing five and wounding 24 more. the lasted eight hours until police killed the two attackers. the islamic state group claims responsibility speaking to a crowd of thousands in st. peter's square, pope francis says there could be no compromise with sexual abuse of minors in the church. >> toys are us says it will close 180 or 20% of their u.s. stores within months saddled with $5 million in debt, they filed for bankruptcy production and the american lung

association has issued a report on their federal tobacco laws and policies they say more needs to be done to reduce tobacco in the united states now over to jackie for the eia inventory report >> just coming out, a draw down in crude oil inventories of 1.1 million barrels. a build in gasoline of 3.1 million barrels that was more than expected. this is a choppy report lying in the middle here. the price action in cruise is like that right now. we're trading higher here. very close to $65 a barrel what is holding us up? the potential for geopolitical strife demand projections have been very bullish supplies in the united states have rose again this week.

9.87 million barrels a day that is our u.s. production getting very close to saudi arabia they think the demand absorbtion neither the s&p nor the dow or the nasdaq have fallen in back to back sessions so far this year back in a moment when you look at the mercedes-benz glc...

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welcome back to "squawk on the street." smishl there and joins us with more, hi, michelle >> the dominant topic of conversation, president trump's visit on friday. he is expected to say that america is open for business again and he thinks the cut in corporate taxes is crucial and the ceo's we spoke to echo that sentiment >> if you need america to be competitive you need a competitive tax system and that is definitely true overtime >> i'm a big fan of repatriation given the way we have been set up in our length of time, being in business, we have been able to move our moneys around pretty freely as we needed and we just paid the tax we have been a strong proponent while in the short run we have a lot ahead of us. >> i think people are under

estimating the impact of repatriation the impact of the money moving around the world and how it will be put to work what it means for the consumer bank and the consumer wallet we have seen a consumer in pretty good shape. >> the only change is the 4.4 billion write down so if anyone wants to share that with us, please give me a call >> i bet he doesn't find any takers on sharing that with him. participants also eager to hear about what the president will say about trade and the america first agenda also about what he says for immigration reform >> we're pro immigration i would like to -- he is pro daca, i heard him speak about

it, trade trade. i think they're legitimate issues being raised by the administration and trade >> many of the agreements needed modern sdags there was nothing like a digital chapter in them. nothing to protect ip, nothing to let d.a.t.a. flow, and they need to be modernized. my hope is they do find a common ground in that they get modernized >> the administration is not anti-trade, they're antimultilateral trade and what we have seen, i think we have seen it in nafta in terms of wanting to see that as a precursor to conversations coming to china and other places >> we have more ceos coming up on "power lunch toda" today.

there is the president's upcoming speech, the dollar, trade, what else are they talking about? >> bitcoin and block chain are a big topic of conversation, there is a second off campus conference going on like two blocks down the street taking a whole building up running a separate con frieference all dag about block chain. that is a very big topic i think it will be culture shock. do you remember that day at the u.n. i think it will be similar to that >> what are you expecting to hear out of the president versus what you're hearing there on the ground do you think people are optimistic about what will come snout. >> the administration has given a lot of giant about what they

expect him to say. maybe this discussion here at the world economic forum will be slightly more economic than the one he gave at the u.n., but i bet the stone will still be different from what they're used to the stax cut is gotax cut is goy believe in fair trade, which will be tougher for what they want to do with bye lateral agreements i think the messaging will be similar to what we heard, but i wonder about the tonality and how he will deliver it to this crowd. comcast better than we expected the over all business, but not as expected, but the cable business was also announcing a 21% dividend

increase at least $5 billion in stock this year it also did five billion. also, "squawk on the street. 9:00 a.m., gary kelly get his take on the industry, "sawquk on the street" back after this. and keeping it in the right conditions is the best way to get that fish to your plate safely. (dane chauvel) sometimes the product arrives, and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. (tom villa) we took our world class network, and we developed devices to track environmental conditions. this device allows people to understand what's happening with the location, but also if it's too hot, if it's too cold, if it's been dropped... it's completely unique.

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the s&p 500 just did something it has never ever done before what it is and what it is, more "squawk on the street" in a moment

our next guest has a hand in two of the most recognized named in the fitness business. he is joining us here at post nine it is great to have you back, harvey, welcome. >> thanks for having me back >> i think one of the last times

we had you on was to talk about the upcoming hotel in new york >> yeah, may of 2019 will open, we have a lot more deals we're looking at as well >> you could lead right into commercial real estate what is the picture like from where you stand? >> that is a good thing for us we have been doing this for a long time. it is defensely a retail oriented tenant. i think the opportunities are going for us specifically because of the success of our business it is also because of the availability of real estate. it is a great opportunity to grow right now, we have been a growth company and we are never growing faster than we are right now. >> you just mentioned blink. you have exposure to the fitness business from a wide range of

impact points. >> demand has never been stronger and it's not a mistake that we segmented the way we have done. we said that we're best in class, and in the fast fitness category with blink. our brands are doing well. demand has never been stronger, and it is a great time you look back 20 years ago, trying to raise capital or convince a landlord about putting us in their building and it was difficult >> back then some people say it was fad business it is part of the daily routine. people want it every day, that is what has given us the permission people want it, health is the new wealth and demand is going in all directions. >> is soul cycle going public? >> you love to ask that. >> equinox

>> we don't have any plans for any of our businesses to go public right now >> generally t is not very different. the profits might be a little lower, but we look at returns on our capital investments and they're pretty consistent by brand regardless of the city including now we're in london, toronto, vancouver, and we're doing extremely well it gives us a global opportunity at this point. >> we did a segment on annex should people think that the cycling aspect is growing old and you need new ideas >> i would say that demand suggests it's not growing old. we continue to open new locations and be at capacity in a lot of classes with that said, the consumer wants more for us.

we have anticipated what they want we have project by equinox, and we're constantly looking for new opportunities. >> now a lot of your expansion is happening in the u.k. we hear it from other companies and companies. it seems like you're moving forward, why >> as a private company, we looked at it as an opportunity to grow our business and we transformed our business and if you look at where we were in 2007 and 2008, you would have said this business is in trouble. fast forward to when the wheels did not fall off we had a transformational year at the time it was our closest competitor so brexit, it is tough to get the square footage we want so we said we're not worried about quarterly results. we're trep neuentrepreneurs and

getting access to great real estate and we're being very aggressive >> if it is tax cuts and pea seeing higher paychecks or just wage pressure overall, year growing do you think people spend additional discretionary income on membership? >> good news, it has always grown. partly because of who we cater to, a wealthier consumer with more discretionary income. they want fitness and high performance living more than ever before. health is the new wealth blink is a lower income consumer, more affordable. same thing if i look at january data, having the biggest month ever at blink. we're seeing high growth basically explosion across all brands of business no slow down. >> keep our eyes on you. thanks for coming back now it is time to send it to john for a look at what's coming

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welcome back to "squawk on the street." discretionary stocks leave higher, cruise stocks posting sizable gains. royal caribbean reporting better than expected earnings, 10% jump in net sales they cite strong demand from north american and european cruise lines and increase spent on on board experiences. they're announcing a 5% equity bonus for all employees after hitting performance goals. that stock had session highs shares of carnival and norwegian move higher in sympathy. back to you downtown >> thank you we had an opening on ticker symbol pags. credit card processing company, up sharply

i tweeted out earlier, 15 times oversubscribed told the top ten accounts got about 40% of the offering, and had it its offering, did price above the range. had a top range of 20.50, price of 21.50 lot of shares. 105.3 million shares, raising over $2.2 billion. you can see quite a nice reception this morning different than more recently with some of the offerings >> what a difference a year makes when it comes to brazil and all things tied to brazil. >> has been a better year to say the least. you see that stock is performing very well. more companies announcing doling out bonuses and pay raises as a result of new tax law. starbucks will use tax cut savings to give employees pay raises, company stock, expanded benefits, with combined total worth more than $250 million disney of course announced plans

to give $1,000 to more than 125,000 workers, will invest 50 million in a new education program to cover tuition costs for hourly workers the president tweeted about announcements this morning said tremendous investment by companies from all over the world being made in america. there's never been anything like it disney, jpmorgan chase and others, massive regulation and tax cuts are making us a powerhouse again long way to go jobs, jobs, jobs pretty much a curtain raiser of what we expect him to talk about friday >> it is good for the employees, good in a lot of different ways. we made the point many times as percentage of overall benefits accrued as a result of tax reform biggest companies, it is still relatively small, most companies have not fully addressed as they were expected not to do what they'll do with the benefits, $4 billion for verizon alone. >> starbucks attribute acceleration of benefits to the tax law. we will talk to kevin johnson

friday 9:00 a.m. eastern exclusively in the 9:00 a.m. hour hope you join us for that. when we return, former apple ceo john sculley joins us. "squawk alley" starts in a moment

good morning it is 8:00 a.m. at apple headquarters in cupertino. 11:00 a.m. on wall street. "squawk alley" is live ♪ ♪ good wednesday morning welcome to "sqwk