to check out >> we saw things going from down 260 to 189 before the number that was better expected 10-yr picked up on that and as a result futures came down >> who knows what it will be by the end of the day >> next week is pebble beach week >> super bowl followed by pebble beach week >> make sure you join us on monday, "squawk on the street" is next. >> doubling down on sports ♪ good morning, welcome to "squawk on the street," i am carl quintanilla with jim cramer, david faber is back at the nyc, we are in minneapolis >> good morning guys, nice to see you, you do see we are down on the major averages, we just

got the jobs number a half hour ago. european markets have been negative lets take a look at how they are doing at this point. they perhaps have been tipping us into a negative territory and they continue to be by a roughly percent. 10-yr new yield, that's a key, of course, look at that, 2.822 people are keeping an eye on that after that jobs number. there is a look at crude oil back over to you, carl >> we'll start with the road map with futures pointing sharp lilo ly lower today the s&p 500 could post their worst week in nearly two years apple reported weaker than expected revenue guide numbers jim has some thing with his conversation from the ceo tim cook >> amazon, the company is

reporting its biggest profited history last night boosted by prime customers and echo sales >> we got jobs and google amazon and alphabet and yield and futures today. we walked in this morning with another premarket scare. >> i am getting tired of the notion of the export of europe to our market is very wrong. the principle reason why europe is weak today because of the banks reported bad number. >> for the third year in a row >> we have three majors that we can talk about that define this session which is amazon, apple and which is kind of an out liar >> how long is good news going to be bad news >> unfortunately for a long time we have so much correlation, i

always call them the pajamas trader every little tick and the level is so low on a percentage bases, it is freaking people out. when we get to 3% is going to be a freak out. this kind of what i regard as being a guard variety sell off that lasts from 8:30 to 9:47 seems misplacing >> we'll bring david in a second after the bell volatility, were you adding $70 swings at big names. it is harder for us to all track, it is harder for you. >> there was a tremendous influx of money and what seems to happen in january and retail is we don't have the support that we had it seems that now we are able to go down. the question is at what point do we freak out about stocks and not just bonds i don't want to be negative but it seems to be happening >> david, we'll bring you in here luckily, we'll have you and mike

s santolli as we count down to the big game on sunday >> we'll digest the key openings and you already referenced in terms of google and apple. amazon is looking up with their market trends here alphabet maybe among the weaker names. i have not seen where the stock indicating right now strong quarter, 102 billion in cash operating margins at 24% pr free cash flow is 6 billion jim, some concerns, i am not sure and i want to get your take >> football given the fact of where we are they seem to the point, they're happy to make the playoffs there is an element of hey guys, you got to trust us, we are doing some really cool things. this cool things per share does

not cut it we now say there is a lot of companies involved with advertising and including amazon which had a good advertising number we end up saying to ourselves, guys, don't you want to try to win the super bowl why are uconn teyou contend of g the first round. david, what saves is the evaluations that we often taclkc about. it is incredibly cheap stock the evaluation of clorox is far higher than alphabet >> alphabet with the 32nd quarter of 20% >> that's the take away but that's the problem do you mind in a world -- what an unfortunate thing to report the same day as amazon alphabet is fine but there is an element that says enough of f n fine do you really have to say hey, this is an excellent quarter and obviously, it is not an excellent quarter.

it is inexpensive. >> apple is stronger than expected iphones did help. the company offered some guidance jim talked to kjim cook yesterdy who pointed out, a, it was a shorter quarter. >> asp, up 100 bucks >> when we tried to figure out in the en. i call them consumer package product, that was something i brought with tim what bothers me is the bears are basically saying listen, there really is no staying power i don't know any company that's been able to raise price like apple. what an odd position to see apple as the under dog the whole night was basically okay, you know what, it is not as good as it is expected but the stocks have come down a lot.

there is a fella that comes on-air a lot >> the big part of this is the 10 especially, although they filled the channel quickly ran hot in the holiday and will not translate to x-holiday sales once we get further into this year >> right, 77.3 million phones sold through the quarter is not enough to sway those fears, i guess, guys. >> the other key area that apple did give us a lot of information on but they did articulate some sort of a plan is cash $173 billion net cash, they did say they are targeting net cash neutral overtime which means we'll have as much cash as we have debt. the $163 billion will be dealt with in some fashion they did not give us any specifics and simply saying we'll deal with it overtime as the number of time

it is interesting in contrast to google which has $102 billion in cash they're paying the tax bills and did not say anything in terms of capital allocations. is there a difference shifted there between shareholders between the two companies? >> the company is so unmessaged that it is too pat i try to get tim to talk about what's going to happen one, the multiple is strong to the point that's not expensive the other is hey, they're going to announce something that's so dazzling they're going to be in there buying they're saying we have 1.3 active units and our universe is good and china is great. there is a component of people just say tell us whether you are going to buy 100 billion or $150 billion >> alphabet. we got to buy back on. these are billions and billions.

hey, 3 m had a change of plan or i particularly like what caterpillar said we got these industrial companies that are conscious that you got to buy back stocks. we have these big tech companies, hey, we are going to get to it. stay tuned >> in apple's case, they normally talk about returning carbon the april call. >> yeah, you are sticking to message and we somehow think hey, your stock is so weak and people talking about components, when you bring up the bear case so to speak, all they do is say don't you love it? come on, you love it and it is the greatest thing ever. this is the greatest thing ever per share. so many people want one thing, they want revenue growth and that's why when amazon reported, you came back and say, give me amazon you are blowing your way amazon start of the night by far, this 1500 is just a waste

station. it is boring to me to watch this stock go up at this point. why does it have to stock up 80 in could you take up 120 or 150? what's the problem because amazon's quarter is remarkable >> your speechless >> i was not sure if david is going to take us to break or not. >> i am going to, i missed the cue. >> when we come back, we'll talk more about amazon and alphabet earnings and so much more to tell you about involving those two. you did hear jim referenced what's going to be the move up of amazon. another look at futures as we head into the opening bell less than 20 minutes from now we are looking for a lower open for what has been a little volatile week. have not heard that word too often, more "squawk on the street," back in a minute.

we are counting on the big game for super bowl sunday, we are here in minneapolis, cramer and me you called the destiny verses

dynasty. >> what's happening here is you got a team, very worth and classic, the eagles and you got what's become a national villain outside of a couple of zip codes. a lot of people talking about social media fatigue when facebook reported, we got patriots fatigue we need a new story line but, the problem with the eagles is they don't want a story line, they just want to play they got brady, we have go got -- no, nick foles is one of the most humbled people in the game and the eagles defense is the star obviously, we are televising the game and it is going to be spectacular. what i say is i was down there in jacksonville when the two teams played more than ten years ago. the eagles got off the play and they said wow, jesus, and the patriots got off saying jesus. >> when you look at brady's

season wins, how much of a differential is there and being in this town and facing this kind of media. >> the practice is extraordinary and what i like about the eagles people forget of the defense of coach is amazing frank wright, think about him. he's the greatest come back. he was the greatest come back in history of college and greatest come back of history of pro. they changed the offense to foles. when you are the under dog against atlanta, the hottest team coming in or against the vikings, domesticity teestiny t back in. these guys are watching films, okay, bring on the next guy, i like that attitude >> who are you rooting for, david, do we know? >> say again, what was that, carl >> who are you rooting for on sunday >> you know, listen, i am no fan

of the eagles, you know that do we want him to be in a bad mood the next year i got to root for my good friends, i am in for the eagles, why not? who can bare to watch the patriots win another super bowl, i know a lot fans can. jim, i am with you babe, and ip hoping the best and i hope not to see you on monday is what it amounts to >> well, look, i think one of the things that's difficult is all new yorkers are torn new york is the only team, the giants beat the patriots they want to be the only team that beats the patriots. that's something that new york fans are not crazy about >> kraft was here on "squawk" this morning and you said fly eagles fly and kraft said fly eagles fly but win like a

patriots >> he's a gracious winner the whole time he makes it so it is palettable. the brady thing, one of the things that bothers me is they have to play another team. >> it is not over now? >> the coordination, if i want to watch that, i will watch will's favorite to crown i don't need that football >> david >> the crown is very good. >> guys, you are having fun and enjoying yourselves? >> minus 7 is the best >> yeah, there is nothing like -- >> i went to the last super bowl, i have been to jacksonville and new orleans, here it is like do you have any skin cream or how about some gloves or what kind of gloves do you want it is a lot of the tire issues >> yeah, i am getting that from both of you. >> david, look at this can we see this?

what do you think it says? >> t.j.maxx? >> how sharp you look under all that attire. >> we got super bowl predictions coming up and opening bell is 12 minutes away you can see futures indicated the dow opening. a lot more "squawk on the street" right after this finally. hey ron! they're finally taking down that schwab billboard. oh, not so fast, carl. ♪

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welcome back to "squawk on the street." before we get to super bowl mad dash some information regarding dell. any time it has a change of

heart of any kind or any significant thing involving that, it needs to file a public statement. we got one this morning of 13-d defiling a potential business combination between dell and vm ware dell technology considering maintaining the status quo and they say right now they're evaluating things that do not include the sales by dell to a third party of technology or v vm ware. they don't know any of those activities that they'll pursue the ceo says we are not in the position to speculate on the outcome of dell's evaluations and potential business opportunities and he goes onto say they have been a tremendous partner. we'll get more every time it changes, they'll be forced to file a 13-d, jim. lets send it back to you now

getting your "mad dash" from minneapolis. >> one of the things that's totally lost in the market is the big oil companies. exxon was disappointing. production growth is not great statements that's basically lack of cluster once again a kind of like apple like number. meaning just okay, it is not that great what do we do except for the differences is oil seems to to peaked right now i look at exxon, i have no reason to buy it it gives you nothing to hang your hat on but its got a great balance sheet. we want production growth and there is not a lot of production growth >> jim, chevron also, any idea there, people think it was a decent quarter, you have any

thoughts >> chevron have been a gross stock the whole way. is that jay ajayi -- he called himself the greatest running back whatever remarkable situation they build so when things went down, they would have production growth now you need that. remarkable company and really took a lot of risks when oil was lower. they're all paying off >> all right, interesting. we know this is all done to airlines and you saw jet fuel charts the last couple of days >> yeah, i saw marathon last night. they're saying we are making so much we are exporting it wait a second, we don't want export, we want prices down. president trump figuring very big in what they think is going to be a terrific refining era under president obama that would have been impossible >> absolutely impossible >> opening bell in just about six minutes.

more "squawk on the street" continues on this friday morning. don't go away.

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you are watching cnbc's "squawk on the street. we are live from new york. mike is joining me we have not had a chance to digest the jobs number as much what's the take away particularly for the bond market >> the market anticipated of a relatively good wage number which is what we got when i say the markets anticipated, the upper market treasury yield this is what the stock markets have been trying to make some peace with it is okay if we mark the 3% for the ten-year and all that stuff. everyone is saying it is still low and going up for the right reasons. the context is important, a market a week ago have raised to

gains in three weeks or whatever this is what a pull back looks like and feels like down 2% off a record high at this point is what we'll open. it is hardly a disaster, i do think some sectors are getting hurt by the yield move it leads to the question that is this going to be a run away move in the bond market we are talking about 4% investment bond yield for corporates that works its way through earning numbers and everything else that's why people are focused on the jobs number in that way right now. nobody is complaining about better wage growth it is just a matter of how it filters through. >> carl and jim, less than a minute and a half or so from now the opening bell >> it is amazing at this stage of the cycle to be printing 200 k. >> yeah, look, i will point out

these wage growths there really is an inflation, we have other people say it is time to panic the economy is red hot obviously. i will come down in between, i would say if you are panikickin on this and selling stocks, it is a move. it is a week that's pausing to let people in and not pausing to come down. when we see an opening like this, we have some big cap stocks, apple is going to be under pressure and alphabet. that's not a reason to be done 300 dow points what it says is profit taking, that's a boring word for the people at home that's what we have. just profit taking >> we have done extraordinary well >> yeah, well not. you are big at this point.

gordon gecko was wrong, disappointing, i know. >> falcons heard the falcons >> david >> yeah, there it is we'll get to the opening bell on this friday, a couple days before the big game. we have more red than green on the board, some realtime exchange >> here is the big board a power generation company in argentina celebrating its public offering today pep pepsico is celebrating the super bowl weekend >> and showcasing the fact now that nasdaq is where pepsi is listed >> thank you for pointed out >> there is another stock listed there is amazon. we hit alphabet and apple at the

top of our show. you have to wonder sometimes they reported better than expected profit number, even if had not, it is not clear to me >> the reasons that it is being bought today i don't think it makes the top five it is more of the fundamental momentum across all businesses i feel it is at a fascinating moment in terms of where the trajectory of the stock is ea everyone loves it for all the right reasons. the sales side targets have not been able to keep up with the stock. the average price maybe below where it is trading right now. >> it is this upside down world and nobody knows on a quarterly basis how to fit in the narrative of they're kind of taking over. it is one of those days where you are looking at amazon rescuing the s & p a little bit at least in terms of amazon and

similar stocks >> jim, we talk about amazon services and a small part of the overall revenues and large operation of cash flow you said 1500 is a waste station for the stock as we see it moving towards that number >> first time in eight years you have everything going david, you got web services fabulous and retail is going great and you have this new advertising component that's weighing on alphabet by the way. amazon is delivering what people really want from the common stock. they want excellent revenue growth this is a company that is gigantic given revenue growth that we expect from the best i will tell you when you have a conference call like last night where they say listen, things are excellent in all these different businesses, it is hard to find any flies and if there are no flies, why should it go above where it was 48 hours ago. >> by the way, prime sub fees

are up 49. calan suggests that the price we saw could affect a third of the prime subs that's a lot >> look, the bargain proposition here remains incredible. the number of people just at it, they're a job factory and people still thinking of where they want to put their plant, they're a new headquarter. they'll sell facebook and alphabet and apple and buy amazon it is best in the show i was struck by a conference call not of arrogance but just, yeah, people will pay more if we want them to that's not our stock >> there was bezos on alexa saying we don't see positive surprises of this magnitude very often. you can expect us to double down all things of alexa. >> and voice technology remains

a theme through, amazon is the best voice technology. i am still waiting for amazon by the way to issue one of those statements like alphabet and facebook which is hey, i know we are really powerful, don't worry. we are not going to take over the world. we are not worried about it. amazon is not complying with anybody other than themselves. there is not a government issue here, the government issue is causing a lot, which is why you have alphabet and facebook people are uncertain of how much they're going to have to do in order to make it so they're not hauling for congress >> it >> we do have facebook shares up after earnings yesterday amazon jim points out so many different things of the power of the company, he says they should not be concerned 40% of all online sales and 75%

voice activated devices and they don't get questions of capital allocations because unlike google had 102 billion cash, told us overtime they'll get that to cash neutral amazon, we know whatever they earn >> they escape a lot of that 40% of all online sales, so they're not duo opoly to jim's point. it is going to seem like people are getting too excited, richest man and super bowl ads and new headquarter and all this stuff it is win across the board that's a sentiment base pull back it is not on a fundamental base where you have the major over hangs that you have to explain away in order to buy the stock >> jim >> one of the things that i thought interesting when you talk about this.

among facebook, i am sorry, among microsoft and alphabet what they are saying, hey, lo l at us, we got this really good cloud and amazon is winning so much and vm ware is in talks of the whole mix of dell. vm ware have been on the mad money bunch. in the end, everybody wants a cloud. that's where the growth is worldwide, data center and cloud amazon is not beating its chest and everybody else is saying, hey, we got cloud. we have ibm. hey, we are cloud. i want the guy on the field. >> all right, all right, i have been told we should do a faber

report can you hand me that >> just getting a little notes here, excuse me. i want to talk about cbs and i viacom, what's most important to discuss here is the prospect for union between cbs and viacom importantly on the cbs side over the last few weeks where i sort of spoken to people who's preparing for this it appears there is certainly more constructive level of engagement from cbs in terms of a possibility doing a deal with viacom that deal is likely structured to cbs buying viacom at the end of the day, all stock deals don't matter too much, it

is all about how you end up, of course, you have the same controlling shareholders in both cases. why different this time than last time? scale. they know they needed at cbs and they got one way to get there. that's purchase a union with viacom it is not the controller is going to let cbs sell to a potential buyer, that made it very clear they want to move fairly quickly here at this point, they designated the director's side and the viacom and of course, marty lipton is in there and morgan stanley on the viacom side and others will be on the cbs side who will be advising these two companies as they move ahead first, they'll be dealing with basics here and talking about organizing themselves in terms of the committee, they'll be

doing that and talking the numbers of each company. they have been engaged in conversations. and from there, they'll talk about values and they'll get to governance last time around, it was lipton's voice that was heard the loudest and they did not get to an offer. the governance issue that did not allow the deal to get out of the starting gate. there was not an offer made. this time, it does appear that'll be a different construct. does it mean they'll get to a final deal, they want to get it done, i am told lets call it by the end of the quarter, the next forward, they'll move resolve it you are dealing with a viacom that's a better position >> the paramount studio is in

turn around mode the library still presents a decent amount of cash flow for it they're still dealing with challenges with the proliferations of over the top platforms. they did resolve the charter carriage deal unclear on the i can economics there. for cbs, mike, they know they need scales. >> yeah. >> they know they need it and this is the only place they can get it as they begin this process, one would have to say the likelihood of a deal is far higher than it was the last time around >> i wonder of all the issues that you put out there, what's going to be the story that they tell why this makes it central they cannot say we are playing defense and sub scale right now and maybe concentrate on some of the best networks that you are going to have a presence in all the skinny bundle. hey, we are uniquely immune to a lot of these things. >> now, they're going to talk

about having more leverage which is a big distributor such as our parent company, comcast. viacom being help and the the studio, they're going to come back to all the arguments that why cbs and viacom had been one company to begin with. >> right >> there will be a potential for savori savings. well, it maybe they can make the argument that we'll be financially stronger as well so we'll see guys, watching a lot of other stocks jim, don't know what's your radar out there before we send it over to bob pisani but we'll check back with you in minneapolis before we do that. >> a new chief at sony, i am listening to you on cbs and viacom sony got someone that used to be aggressive wow, the market likes that story. >> yeah, that's been a decent

turn around over the last five yea years, has it? the stock is up dramatically today. the music business is something we don't talk about his come around, the at vent dvent of stg and emerging of spotify and umg, that's all doing a lot better, that's going to help >> this is an untold story people are focused on what's netflix is putting out and what amazon is doing with film. i think seony is let out of the discussion that's a mistake i like a company that's basically the stock is doubled and no one really cares. japan is back. i think people at home think th that if sony coming back and reemerging as a great

entertainment play cbs does not have the scale of sony it is working. >> yeah. >> i am glad you mentioned that, we'll see that stock is up almost 8% this morning lets get a check on what else is moving this morning at a very busy news day, bob pisani joins us on the floor. >> busy and a lot of red 10-1 you don't see that a lot when stock traders started talking something besides the stock markets, pay attention and it is about rates. the markets have not had a problem with higher rates for a long time. the velocity of change is occurring here what we have seen all of a sudden is we have gone from 2.5% to 2 point we have been saying oh wait, the

con wilhelms consensus is three rate hikes. we'll get the futures in the last two days. the mid odle of the day, we dropped 20 points in the futures. that's a lot the 10-yr is moving 20%. look at sectors here today, banks benefited from the higher rates are not doing too much right now. you can see they are down. consumer discretionary, that's up because amazon is up 6% theres the reflation trade industrial are weaker and energy is to the downside europe has been strong and numbers have been good but it is an ugly week for europe. it is the worst week for germany and most of europe is down 1%. the problem is currency. euro is at a three-year high against the dollar right now right now we are half way and

almost 250 companies and the numbers have been quite strong estimates keep ongoing up. january 1st, we thought we are up 1% today. if you just include the companies that are reporting and not the ones that are reporting. the actual earnings that are 15.3%. the revenues keep ongoing up there was no revenue growth and all about cost cutting, that's all gone away. today almost 8% revenue growth that's the best and almost the best in many years more importantly, q-1 which is what the market cares about numbers have been holding steadily 10.6% october 1st and today 14%. these are all nice moves to the upside the amazing thing if you look out second or third quarter, all the numbers for the s&p 500 mid and focap, it isall rising

guys, if we end here, it will be the worst week of s&p 500 since february 2016. carl, back to you. >> bob pisani, lets check in with rick santelli, good morning, rick. >> we still have michigan left that's going to get busier all right, lets go to the scene of accident. markets definitely changing a little buy but not necessarily good in different ways many people have been simmering on this data, we are talking year over year hourerly earning. solid number unfortunately, you have to also look at the amount of hours worked this is the fly and the oinment. look at the 10-yr, we dropped down to 34.3 you don't want to get much below that the fact that we did drop a

couple on both year over year and on a monthly basis in this regard, it diminishes, you work less and the extra income gets modified so the numbers on earnings are not nearly as juicy and everybody sighs when they start to research and digging down on this it is important. i may stop the incentive yields and anything can happen. zoom up to 283 next chart is about january, there was a bund chart in there as well. they responded in like and they are hovering since the best levels since 2015 september. there is your chart of 10-yr rate going back to early 2014. you know the fed meetings this week and all the things we had coming out that many are talking about, the crash and the curve is getting too flat. all the way up to 66, the steepest since november of last

year, finally $2 index chart big rally on the dollar. we still get back to where it was. today cha today's chart, you need good glasses to see that. carl and jim, the field market, back to you. >> when we come back in minneapolis, we'll sit down with j.j. watt, one of the three finalists of the nfl after raising $37 million for hurricane harvey relief. absolutely incredible. a lot more still ahead stay with us

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jim, tonight on "mad money" you're going to take advantage of being in minneapolis? >> yes we had 3m which i've been wait inge thulin. huge buy back. we have clorox which is the best consumer package

and then arthur blank who we know, those of us who have grown up as trading and investing, think of him as home depot here we think of fly falcons fly and also just business of football >> yes >> we know that bob kraft is terrific to talk about football. best of luck to jeff floor ry. the fans are important >> they're going to start showing up today we're going to talk more about it in a moment when we visit with vikings owner mark wilf lomo on the jobs number. the market is down dow is down 255. what did you have in mind? i don't know. $4.95 per trade? uhhh and i was wondering if your brokerage offers some sort of guarantee? guarantee? where we can get our fees and commissions back if we're not happy. so can you offer me what schwab is offering? what's with all the questions? ask your broker if they're offering $4.95 online equity trades and a satisfaction guarantee.

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♪ ♪ great friday morning welcome back to "squawk on the street." i'm carl with jim cramer live from minneapolis super bowl lii is this sunday. back at new york post nine is melissa lee, david faber sara is off. dow is down 250, almost a full percent on the back of a couple of things, jim one is disappointment in some earnings for better or worse the other is the increasing obsession with yields now as we

cross 2.8. >> yeah. we're up at ridiculous hours i had heard the ten year treasury interest rates ticked up a tad i said, this is going to be a bad day. then we come in and we obviously are more colored by apple's decline and by alphabet than we are by amazon's increase may i point out there's a frequent guest on cnbc, tony sagana he is just creating the narrative that this is really the kind of end of apple as we know it. i totally disagree with that at the same time i recognize when you have to cut numbers, you cut numbers. any number cut in this environment after we've had such a big boom is going to drive stocks lower even the great ones. >> we got a scare yesterday when the atlanta fed, which tends to run hot in the early days, takes their q1 prediction to 5.4 we haven't seen that in five years. >> right >> how -- how likely is that

we start to run that high. >> i think that that would be rather amazing and i don't see that europe is pretty strong. you would need to have china accelerate to 8% remember, when i look to pricing i have 3m on later what's the weakest of his holdings it's america let's not be too threatened by a little bit of growth i emphasize a little bit of growth we don't have 1970s wage growth. and we also have companies like amazon pushing down. when you look at amazon, all you should be thinking about if you're someone in the work force, when are they going to take my job? >> right >> guys, to jim's point about wage growth, 2.9, it's a rorscha rorschach. it's not 3 others say it's a long way from 2.5. >> it does add though to that narrative that seems to be staring the market a bit of late, which is, of course, melissa, the idea that rates are going to move higher we're going to see some

inflation. the fed is going to get aggressive under new chairman, mr. powell. >> on the wage inflation number, still this is enough of the markets now factor in more rate hikes than had previously been factored in. we've got that, we've got higher yields and we have a dollar strengthening. combined you've got this narrative that perhaps there could be volatility ahead of these markets. that's exactly what we're seeing today. >> guys, let's get to rick santelli really quick getting sentiment numbers and factory orders. >> to your point here, actually. to our final read on michigan. university of michigan we throw out 24.4 mid month. the new number is 94.7 it is a bit of a disappointment. it follows a number that's 95.9, that was december's final read it's the softest in september where you're 95.1. on the inflation front, 2.7 down a tenth on one year and five to ten year, 2.5 equal to our last look factory orders, this is december

final. they were up 1.7 solid number with a solid revision from 1.3 to 1.7 transportation up .7 with a positive revision. if you look at durable goods orders, this is your december final, up 2.8. pretty solid not far from the last three to 2.9. and what's really interesting -- i'm sorry, what's really interesting is ex-transportation is up .7 that's also solid. here's where it gets depressing. on our december preliminary read, capital funds, aircraft, what's capital spending going to look like? this gives us insight there. our preliminary down .3, we thought it would be revised down it doubled down. down .6. after weak productivity yesterday, these are not good to see. if you look at shipments versus orders, they were up .4. our mid preliminary read was up .6. they both deteriorated something to pay attention to. carl, back to you. >> rick, we're going to watch

that carefully to rick's point about this number, the productivity number, obviously the regional fed survey as we've gotten from five big markets, what does that tell you? >> well, look. i think what it says is we've got to get used to better numbers but also not perfect when i say not perfect, you have a president that has set a tone that everything is perfect i can't wait to see what he thinks about a decline like this because the decline is -- a lot of it is set in motion by things that were done by a republican congress, but also can we just say, 200 points. we've got to remember, 1%. you've been saying over and over again, carl, we have to be careful of what a decline is this is really not a decline after what we had in january this is basically saying, hey, you know what, breather. breather, not decline, unless you're in the oil stocks which are down a lot the financials, melissa mentioned a great point. maybe more fed hikes we're so used to hearing that's

good for the financialfinancials the government test might be tougher than we thought. the idea was going to be that we were going to hear a lot of capital return to shareholders instead some are saying, wait a second is this a trump fed or is this -- is this a trump treasury or is this an obama fed, obama treasury i didn't expect to see anything about tops. >> that explains >> yeah. they took away a major prop, which is one of the reasons why i'm saying we lost that prop. >> melissa and david, to jim's point about the decline. maybe it is letting some of the steam out of the kettle. better slow than fast. >> you know, i think what is -- i don't wantto say troubling about what the decline is that we've been seeing for the past week, but it's a decline that's happening all around the world, jim. it doesn't seem that there is a safe haven at this point for the markets. we're seeing five straight days of losses in european stock.

we're seeing the worst week for global stocks overall since the end of 2016. this is the worst week for stocks in the u.s. since before the election across the board pretty much we're seeing trouble out there. >> yeah. to put it in perspective -- >> with the bond decline. >> up 4.4% on the s&p. if i were to tell you in early february -- >> i would have said not bad. >> absolutely. by the way, the nasdaq comp up 5.5% exxon mobil is down 5.3% reported earnings this morning that are not being well received even chevron which actually had decent numbers, down 3.5% this morning. then the likes of apple certainly pressuring the market and the s&p given that it is a market cap weighted index. that is the largest market cap weighted stock out there. >> it is the global growth trade, it's off right now, jim i don't know how concerning that is for you the reflation trade is on hold the financial trade is on hold right now. what do you think?

>> i think you're absolutely right. what people have to recognize, if you have a really good earnings number, it's not going to be your day he is tai la este lauder had good numbers tableau data had good numbers. it's a chance once again to get into amazon. melissa, you're so right this is one of those days that reminds me of the '90s where you would have a big run in stocks and then you would have something that jarred you and made you feel like, wait a second, please focus on fixed income fixed income is not going your way. until this week when interest rates went up there was a big cohort that said, hey, you know what, this isn't bad we seem to have lost that cohort. >> a lot of this has been telegraphed for a long time. >> thank you. >> the magic 2.6, 3, we got there. what else did we expect? we talked all through january about the risks of february.

>> yes i think that the numbers show there was a dramatic increase in the public coming in in the month of january there will be a lot of narrative. i think it's monday. a little too early to say it now. i'll say it. hey, everybody's in, if everybody is in, what do we do maybe we have to scare people. i don't want to do this. i want to tell people, this is really natural we've forgotten what it's like to go down we have forgotten what it's like to say, wow, my 401k, i just thought that it was going up because it goes up so let's be careful. there are people who have come into this market who don't know what to do when it's down other than to say, darn it, i'm not going to lose money, and they go a little bit of a bitcoin phenomen phenomenon. >> yes yes. melissa? >> all right we're going to talk apple right now which is down sharply as we mentioned before adding to the market volatility this week. investors digesting tim cook's plans for the iphone services

and 285 billi$285 billion we have two guests now rob, i'll start off with you down 2.6%. was there anything in the quarter in your view that warrants a decline like this >> i think what's coming out of this stock is the sort of expectation for a super cycle, and people realizing, no, we're actually, i think, in an up cycle. but we're not necessarily going to have some huge pop this year. i think that's good really in a way because i think we can have growth this year and growth next year, maybe more modest in unit terms, but the up side was in prices and we got that ast has jumped 15% that's the biggest revenue driver this year. >> if you can backtrack, apple doesn't break down the sales of each individual kind of iphone, the x versus 8 versus 7. can you back out how many units you think they sold of the x,

rob? >> got a pretty decent deal which is 1/3 of the units of the x. i think that's about as expected i think the bigger concern is that things will slow in the march quarter, which they will seasonally you fill the channel in the december quarter, that comes down to the march quarter. i'm still looking for, you know, 6% unit growth in calendar '18 for iphones. that might be higher than most, but that would be the best -- the only positive growth actually in the last three years. >> abe, this morning tony sagana over at bernstein downgrades the stock, to the point that rob was just making. his concern is about iphone channel inventory growing 4.2 million units ee sentences against -- sequentially he's worrying about them missing on second quarter and third quarter guidance does he have a point >> you know, i think apple

missing numbers is a bit hard, but they have a decent idea and they have channel inventory that they can play around with, but at the same time if we look at the is the sequential drop, that's more than we've seen in the past. rob's point said they got a big lift up but a much bigger step down in march. i think iphone x underperformed. there will be an air pocket and things are playing out like we laid out back in june where we talked that this cycle is not going to be as big as egg peopee expected. >> in terms of the cash pile, abe, can you do a back of the envelope math here the cfo indicated in the long term they would like to have an equal amount of cash and debt. they have $120 billion in debt

and that would imply $100 billion to put to work what would you like to see them do now that they're being more specific about how they're going to divvy up that cash pile, what do you want to see them do >> they can do three things, right? they can increase the dividend or go after m&a. we think they're going to increase the dividend by a much bigger jump than we've seen in the past they're not going to make a one-time dividend. they'll do a steady increase in dividend they'll increase buy backs and at the same time they might do some large transformative m&a. they look at it of all sizes if they do large m&a that could be a risk to the story as well. >> abhey with the neutral, rob with a buy on the stock. let's move on to amazon which is bucking the overall market trend right now you can see the stock is up 4.5% there it is, 4.8%. company reported an earnings beat after a boost from holiday

sales. john blackwood, john, it seems like amazon could do no wrong. even if they had had not a particularly good number stocks would have gone up because people believe in the model and the story. do you >> for sure. they crushed it. you know, they came in at the -- at the high end of guide and revenue in 4q. they crushed the operating income they were above the high end of guide and crushed the street and that was driven by rising margins in north america and at aws and the first quarter guide was great. the revenue was above expectations so we raised our long-term forecast price target to 1700. remains our topic. it's been our top pick the past three years. >> that's been a good thing to have as your topic, no doubt about it amazon is fairly terse on their conference calls in giving real details.

they will continue to invest, right? a lot of that is going to be an international expansion. that's where they're spending aid lot of money and losses are coming from. did you get any other sense in terms of their plans and capital allocation >> nothing really on capital allocation on investment i would say aws, they're going to expand the global capacity. and it makes sense we saw acceleration in 4q and -- which is incredibly bullish, and one of the long-term drivers for the company. and obviously the fulfillment we saw acceleration in the footprint in '17 and that should continue as well and also bezos said they're going to double down on alexa. so a lot of investment areas for the company as always. >> i want to tell you -- to hone in on the point of alexa he said essentially that positive surprises of this magnitude don't come along too often. it was a surprise to bezos i imagine it was a surprise to a

lot of wall street, john how much do you add into your model, the sort of flywheel effect that potential increase investment in alexa could break? >> yeah. it's not really impacting top line at this point, but our proprietary data would say 20% penetration of u.s. households in december versus google home at 10% so it's more about engagement right now, but over the long term we think it will drive replenishment sales, particularly around the consumables vertical which is a $450 billion market in the u.s. personal care, household goods and so that could drive the ecommerce business over the longer term. and it will also be big for voice search over time as, you know, they don't have any, you know, smartphone or anything like that. so it's a big deal it's a big deal for him to say

doubling down. >> john. appreciate it. the stock, again, up over 5% john blackledge, thanks for joining us. >> thanks. >> carl, over to you. david, we have a selloff on our hands. s&p back below 2800. stocks heading for their worst week in two years as we reverse some of those extraordinary january gains. we'll sit down with minnesota vikings owner and super bowl committee chair mark wilf in a minute when "squawk on the street" continues. think your large cap equity fund has exposure to energy infrastructure mlps? think again. it's time to shake up your lineup. the alerian mlp etf can diversify your equity portfolio and add potential income. bring amlp into the game. before investing, consider the fund's investment objectives, risks, charges, and expenses. read the prospectus carefully at alpsfunds.com/amlp

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minneapolis is the host of the super bowl this year as you know even though obviously the vikings will not be playing on sunday, the team still has a lot of visibility all over this event. joining us to talk about it is mark wilf, the owner and president of the minnesota vikings and chair of the super bowl committee welcome. >> thanks. >> first off, congratulations on bringing this game to town, but on this stadium, it has to be seen to be believed. >> you're exactly right. we're so excited to have the whole world come and see this venue. we think it's the world's best sports facility. it's going to be spectacular on sunday >> we were walking through it this morning it's a building with a stadium inside. >> you know what, the word dome

is clearly wrong. >> yes >> museum of football, but dome just doesn't give you any sense of what you've got here. >> dome shows your age when you're saying dome i mean, the reality is, these new state of the art facilities, this is really setting a new trend the way it is inside it's spectacular. >> it is the largest construction project in the history of the state we talk a lot about infrastructure on our program, but talk about -- a bit about how it was getting something like this completed. >> well, there was a lot of back and forth, but we had great partners governor dayton, state of minnesota, legislative leaders there was a lot of private/public partnership there was so much economic development that got spurred by this and the amount of jobs, 8,000 construction jobs generated by this stadium. the amount of effort that went into this. we have a great, great community here this is a great reward for the fact that they stepped up and invested in such a great stadium. >> i know you as someone from livingston, new jersey, not far from summit. okay, so just help me here i get up, i go to starbucks.

people say good morning. what is that all about people say hi everywhere is that just some sort of thing they do? >> they're doing that even with your hat, which is impressive. >> happy to see you. you're rooting for your team where's the beer cans coming at my head? this is a remarkable place. >> well, the vikings fans and minnesota fans are great sports fans the best fans we think in the nfl. they have been so great to us in our 13 years of ownership. great community. great corporate community. number of fortune 500 chairs richard davis from union bank and marilyn cross nelson these are a great leadership team, great community. they deserve this. and they're so warm and welcoming. i think everyone is having a great time. >> it doesn't get talked enough about corporate culture of the companies here community? pride. you see these signs, billboards, and what i think you see is not

just money was paid, but like, yeah, my company's participating in this. >> and i think you can tell the -- these corporate leaders know when you have a major event like this that can attract the super bowl, final 4s, x games, it's great for the employees it helps attract business. helps attract people to come here and have their families raised here. so it's great all around we're just excited to be part of this. >> now touching on your question on the nfl journal has a poll out this morning. they poll men ages 18 to 49. they asked, do you follow the nfl closely? four years ago it was 75 plus. now it's in the 50s. how -- how do you process that >> well, i know one thing that commissioner goodell and all of us in ownership are working hard at is making sure that the game is still the game. and you just look two weeks ago at that miracle catch that we had at the vikings those kind of plays, no matter what happens, the game still shines it's a moment everyone -- i know

vikings fans, sports fans, not sports fans, they remember where they were when something magical like that happens. i'm not sure how that works but i know nfl and american football is the greatest themed sport in the world. we're going to make it better. work on youth football, the safety of the game, making the product better, figuring out maybe tweaking things on rules constantly every year, making it better, more entertaining for the fans i think we're still in a great direction. >> how much of what the numbers carl just said may be some sort of fatigue i know that there was a terrific deal for the nfl on thursday night. those of us who really love the product sometimes feel, geez, these guys look tired on thursday there's also a sense, wow, i remember when it was sun aday a the only time you saw thursday was on thanksgiving. have you made it not so special by being on so much? >> i'm not so sure the way people view the game, it's not necessarily on the tv box anymore, it's on the devices

and tablets. so there is a lot of uncertainty even with how things are calculated so i know after a big game or big moment everybody i know and everyone that we all know has watched the game so something's going on here but i know the product is a great product. >> yeah. i think i've watched that play you mentioned, the joe buck call a hundred times so i see what you mean couple business questions. we spend a lot of the past month talking about the tax bill and we'll ostensibly be talking about infrastructure more. does it feel like the economy clicked into a new gear? >> we're real estate in our day jobs and we're still sorting through it the reality is i think it will help lead to some stimulus here. the bottom line is, whatever the tax situation is, the long arc of things, this american economy is still number one. we're great believers in the american work force and the american companies and we're part of it on the real estate end and even in the sports end just to see the amount of productivity that all of these

businesses generate. we have a lot of optimism. >> there is a moment right now, 50% of people voted against the president. 50% for. i think people are struggling. help me here the economy is really good, but there is such an overtone when you read the papers. you're in the in new york anymore, but you read it, this presidency is under siege. then you come out here and you say, geez, this job is pretty good how do you reconcile >> there's a lot of day-to-day static going on and we look to you to help sort this out. like i said, the reality is as business people, as investors, we want to make sure there's certainty and stability. like i said, the long arc. i know my own family is a family, my parents, holocaust survivors, immigrants. what this country has meant to them and the economy, we were successful i think america still gives people the opportunity to have a great job, to have a career and this economy, no matter the sissitudes, if you will, of the up and downs of the day to day, the american economy is going to

be in a great direction. >> mark, have fun on sunday. thanks so much for coming by. >> thanks. >> jim, thank you. >> this man, i know him, jersey, charitable, humble people did not feel that you ever could afford a team whether it be like an xfl team congratulations for staying that way the whole way. >> thanks, jim. >> we'll see you tonight "mad money", 6:00 p.m. eastern time melissa and david over to you guys. >> thanks, guys. thank you, jim taking a check on the markets here s&p 500 down by .9 of a percent. off the session lows by just about 8 points right now but as we were talking aboubefo it's the global growth trade that has taken a turn for the worst. david, you had mentioned energy stocks exxon mobil and its earnings not helping. materials names, it has been a brutal week for some of the steel names. they got a boost on this notion that there is going to be global

growth, global demand, infrastructure, ak steel, u.s. steel, some of the ones really feeling the pain this week down 14 and 25% for the week. >> yeah. >> and the s&p off its lows of the session down less than 1%. of course, as we pointed out, amazon one of the names that is solidly in the green up 6%. wanted to mention charter communications because we haven't hit the earnings and the fact that they didn't lose or actually gain 2,000 residential video has that stock up along with our numbers that were better than anticipated. has that stock up almost 4% this morning at charter one of the few names of a big cap stock that is substantially higher. >> amazon though, the run here on a bad tape is really astonishing. you know, steve holt calling it the tom brady of the internet. >> it's incredible it's added more than 1/4 of its market value up 25.4% this year this year.

and its market value exceeds $706 billion. >> yeah. >> it is interesting to note, i think the five top market values are apple, alphabet, facebook, amazon and microsoft. >> yeah. energy we had mentioned one of the biggest s&p laglaggards. mike santoli is here. >> it's the weakest sector in a very weak market the sector as a whole down about 3% at the moment xle, let's take a look at some of the etfs that actually play on this sector xle is the broadest and largest of them all. it is down pretty much about that 3% that we saw the broad market down. this one is dominated by the integrated majors. exxon and chevron together have 40% of the etf exxon is down some 5%. one thing i will note about the xle is this decline has brought the dividend yield up 3%

it was above 3% during the oil crash. also, the xop, that's the exploration and production etf, it's basically equal weighted. no stocks in particular dominate that also down 2.9% down 10% on a one-year basis oih, this one dominated by halliburton and slumberge. basically nowhere to hide in the energy space, guys, in particular i think because some of the downstream operations of exxon mobil were the weakest, chemical, petro and refining that's where the see the defensive elements of these stocks it seems like it's a little bit of a purge down 5.5% the xle. flattish on the year. >> it's interesting, you heard so much commentary about higher oil prices sticking around and the integrateds remaining down and the cap ex, we're seeing

wti. the dollar is finally strengthening along with interest rates you have to wonder what the oil back drop is going to be in 2017. >> exactly i think you did have hedge funds kind of very long crude oil. if you're in this sort of a reversal phase with all of these macro trades, although crude is not that far off its highs. >> that's true. >> it's not a bloodbath, it looks like a pull back obviously the market bracing with something worse. >> any other day we would probably be spending a lot more time on the jobs number given, you know, obviously the deluge of earnings from very important companies that hasn't been the case total nonfarm payroll is up 200,000 in january if you missed it unemployment rate 4.1% and perhaps more importantly average hourly earnings have risen by 75 cents to 2.9% over the last year is that enough to sort of spark an even deeper and more broader conversation about rates >> it's enough to say, you know what, maybe there's another rate

cut that's not being factored into the markets. >> hike. >> sorry, right hike so used to saying cuts after all of these years we've seen the probability go higher. >> not to mention a new fed chair. we haven't had him prevail over a fed statement yet. nobody thinks he's going to try to disturb the path too much you have to wonder exactly what tone is going to be struck >> yeah. all right. let's go over now to sue herera and get a cnbc news update at this hour. sue. >> thanks so much, david lots happening this hour, everybody. the father of three girls who were victims of convicted sexual abuser larry naaser, two of whom gave statements, charged at nassar in the courtroom before being restrained by three bailiffs that's after randall margraves asked the judge for five minutes and one minute alone in the room with nassar. the taliban's base is in pakistan and asked islamabad to take further attacks on afghan

territory. he made his remarks in a televised speech to the nation pakistan of course denies those claims. the man who drove into worshippers killing one and injuring others is sentenced to 43 others. they said darren osborne's crime was malevolent new witnesses have emerged about the 1981 death of natalie wood her former husband, 87-year-old actor robert wagner, is now considered a person of interest connected with that crime. that is the news update this hour david, i will send it back downtown to you. >> okay. i will take it thank you, sue. when we come back, we'll have a lot more on the january jobs number. delve deeper into the internals of it as well. "squawk on the street" back right after this at fidelity, trades are now just $4.95.

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let's get back to today's

important jobs report and breaking news on janet yellen. steve liesman joins us. cnbc has learned janet yellen will go to work monday morning at the brookings institution. staying in d.c. even though she's from san francisco she'll be joining former fed chairman ben bernanke along with former vice chairman don cohn there. the hutchins center is the center created by hedge fund magnet glen magnum she leaves the office with another solid jobs report. up 200,000, better than the expectation. november and december combined revised down 24,000. not all that important a nice average hourly wage up 0.3% unemployment rate, unchanged now for the fourth straight month at 4.1% participation rate unchanged for four months at 62.7% here's where the jobs were, education health services, not a

big surprise construction is a surprise good numbers for construction. also down below, good numbers for manufacturing. retail doing well up 15,000 after a decline in december. leisure/hospitality up 35,000. something you don't see is transportation and warehousing up 11,000. a lot of retail numbers there. pantheon saying the labor market is tight and getting tighter the question for the fed is whether the plan for, quote, gradual tightening will be enough if wage gains accelerate further. let's take a look at what the market thinks about that comment. probability of a rate hike, 90%. another coming in june 65% december 60% i want to show you something else we're doing here for the first time which is the probability of the fourth hike 12.5% in november. 23% for november technically it's not the fourth hike in the same year but that next hike which would bring us to 2.25%

that's the january 2019 contract i don't think the fed is panicking. they're more likely scratching their heads. the increase in the ten year yield would appear to be a restoration of a more normal level and relationship to the fed funds rate the two year note along with better underlying economic growth this is going to be a steady as she goes, david. fed doesn't have to think about four until it does one, two, three. >> thank you, steve. we're going to get more on other people's thoughts. steve liesman from h.q we're joined by david kelly and diane swan she's a chief economist there. diane, let me start with you what was the most important take away you have from this jobs report this morning? >> certainly the wage numbers, that's something to celebrate and pop champaign corks over we need to see it sustained. we will see this year as a break on through to the other side and see more wage acceleration out

there. the one red flag i'd point out is that women's participation rate continued to fall in this number we're already lower than other major countries and we're lower than japan that's something that's not acceptable going forward and we need to reverse that and re-include those prime age women if we want to have workers to employ out there many employers are going to have to sort of resurrect some things they did back in the 1990s with the whole women who stayed at home back in the labor force and women who are caring for elderly now as well. >> why are you confident that in your words wage growth is going to break out this year >> i think we're finally seeing the point where we're seeing acute labor shortages across the board. we're also seeing finally employers recognizing it's not just skills erosion, which they said even when we had a 10% unemployment rate, it's that they're literally running out of workers, and the only way to bring some of these workers back in is to bring the wages up. 18 states moved up minimum wage and we're starting to see some

higher wages in there for entry-level workers. we hire a lot of millennials at grant thornton we're seeing college campuses regaining some ground lost to the recession for the college grads and entry-level workers. i think we are going to see a turning point. it's going to come in fits and start. i've been looking for four rate hikes this year. remember, the fed is going to be also reducing its balance sheet much more rapidly over the course of the year which could bring some of that pressure as steve mentioned, upward pressure, to long-term rates as well. >> right david, economists might be popping the champaign bottles here, but investors seem to be ringing their hands. we have an environment where we have yields rising around the world. we have the dollar finally rising as well and we have no safe haven it appears in the market here. we see all asset classes selling off including gold how do you interpret this data >> i think we should calm down on both sides here first of all, it's nice to see the average hourly workings of

workers go up 2.9% if you look at the data, i think there's a weather effect here. the number of people who said they couldn't work full time was 1.8 million in january that's about 70% higher than a normal january when that happens, what happens is the people who do work tend to get higher wage workers we think that may have pushed up the average wage and average work week. i agree with that wages will move up. i still don't think they're moving up rapidly. i think the bond market's reaction says much more about the bond market right now than it says about the labor market overall i think we should, you know, calm our enthusiasm about wages. in the stock market, remember, we still have real yields which are much lower than normal if you have real yields much lower than normal in the bond market, you can actually afford to have above average pe ratio yes, the pe ratio is high. this tax cut has helped push up earnings it's not that high given how low

real yields are across the economy. >> we have a 2 plus percent in lines for the week >> i think it's an investing opportunity. markets are getting bubbly i think there are opportunities particularly in cyclic calls take advantage of this rising rate environment i think that will continue, but i think people need to recognize returns will be lower going forward. this correction was very necessary, very kind of overdue, really, here, but overall i don't think the market is very expensive. i think it's a little expensive and for long-term investors i would say u.s. stocks are better than u.s. fixed income i like internationals. >> short but insightful. thank you, david and diane carl, send it over to you. >> all right, david. thank you. when we come back. they are set for a super bowl marketing blitz. u.s. bank, which holds the naming rights to the stadium behind us, looks to capitalize

on sunday night's big game we will check in with ceo andy c cer -- cecere. what do they like? >> apple, samsung. >> appleby far. >> i have an iphone. >> i do, so an apple guy, but i have an hp computer so i'm not a big mac book fan. >> samsung camera's sucks. >> i've never had samsung so i'd say apple guy. >> neither i've got a nokia ] [ click, keyboard clacking ] [ keyboard clacking ] [ click, keyboard clacking ] ♪ good questions lead to good answers.

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welcome back to "squawk on the street." we're live in minneapolis. you will notice the stadium behind us clearly branded by u.s. bankcorp. they bought the rights as soon as the city was chosen to host the game joining us is andrew cecere. soon to be chairman in april >> thanks for having me. >> we were talking about the time line of when you pay for something like this versus what you know, whether you know the game's coming, whether you know where the stadium is going to look like. >> we knew what the stadium was going to look like we knew the game was coming. we wanted to be part of the community. this is a great chance to brand across the country >> what's more important to you, the longevity of the branding here in town or the fact that people in california, florida,

new york are going to hear your name again and again and again >> both. it's important to show the commitment to the community, which is what this is all about. the fact that we're able to go across the country and show the u.s. bank brand, we're able to do that and this is a great vehicle. >> did people try to convince you, it's a jinks? naming rights often have bad things happen to the owner of the brand? >> right richard davis was the ceo at the time and i was the cfo at the time we talked about this the vikings have been tremendous partners it's a big positive for the city the development around the stadium is all because of the stadium. this was not here five years ago. it's been terrific for the city. >> in terms of urban renewal -- >> great story. >> a lot of people have a good story. denver has a great story minneapolis, i assume it's going to get told this weekend >> i expect it would all of these buildings, this development is because of this stadium. >> the tax bill happens and then right out of the gun you guys come out with minimum wage

hikes, contributions to the foundation what was your calculus at the time >> we thought about this from a long-term perspective. it would have been easy to let it drop to the bottom line we thought about our employees, communities and shareholders from long term growth and customer's perspective we talked about a $1,000 bonus for a great number of employees, raising the minimum wage to $15. we're investing in digital technology we're trying to think about all of the constituencies and serving them over the long term. >> how do we watch you separate what would have happened regardless in this economy of tighter labor markets and so forth and what came as a result of this particular piece of legislation. >> i think you're going to see top line growth and i think the tax bill has been positive for the economy overall. i believe and u.s. bank is an example, we're going to be doing more investment, more technology, more activity and we're goings to have more jobs because of that. >> when you say technology, you mean specifically what >> digital activity, business to

business, real time payments, consumer digital activity. customers being able to contact us whatever vehicle they would like. >> that investment would have come any way but has been accelerated by this bill >> that's the way i would think about it it was investment we were going to make but this bill allowed us to accelerate it and do it more quickly. >> part of our challenge has been looking at the change in cash flow guidance but wondering what happens the following year. >> right. >> what happens to comps then. can you think that far ahead >> yeah. what you're going to see is generally speaking is an increase in investment in an ongoing basis. there will be a step up but i think you'll see it leveling off but at a higher level without the tax bill. >> we're in an environment today where rising yields are at least a concern to some equity investors. where are we in terms of rates and how they're reflecting this economic activity that we're seeing. >> so we've projected three rate increases this year consistent with the expectations.

we also expect a little steeper yield curve with the ten year above 280. that is all a reflection of the economic growth accelerating in the country. i think it's a positive. >> is it based on u.s. growth alone or does it have more to do with this ongoing narrative we've been hearing of synchronized global growth >> a little bit of both. the u.s. component is accelerating because of tax policies. >> when people argue, fed's behind the curve in '04, '06 they raised a dozen plus times we're talking about three or four to come >> right right. >> people argue even that back then didn't manage to hold back the housing crisis >> right >> is there a sense that they have catchup to do >> you know, i think the fed has been very thoughtful in their approach, both from the perspective of rates and how they're thinking about the pair back so i think -- i'm pretty confident that it's going to be smoothly handled i'm confident about the economy. we talked to our customers and we talked to our consumer and business customers and they're feeling pretty good where they

are. >> which brings us to a couple of other things. one is revolving credit. >> right. >> we saw this strange pop in the last few months of last year is the household -- we saw the saefgs rate, what, below three >> it's down we have a big increased spend activity but people also paying down their debt more quickly so the revolve rate is lower than what historically it would be confidence in spending but paying down so they're not at high debt levels >> and then loan growth. a weird dropoff at the end of the year >> it was. >> is that noise >> here's my perspective on that, i think the tax reform is going to be good for the long term i think in the short term there is going to be a phenomenon where you see decelerating loan growth or perhaps flattish loan growth people are taking the money from overseas and using the vinment or to pay down debt. >> on a commercial basis or also consumer >> principally large and small business. >> what about consumers?

>> the spend is good but they're being conservative with the dollars and paying down debt so our same-store sales spend is 4% to 25%. the revolve rate is down because they're taking the dollars and paying down debt >> it will be interesting to see, your pay checks may feel fatter i wonder if they're going to feel comfortable enough to say i'm buying the motorcycle or let's get the boat and part of that might involve some financing >> and i do think that will be the case i think we're seeing accelerated auto activity for sure equity even though the tax consequences are a little different, it is strong. i think -- and mortgages are certainly going to continue to go forward less refinance activity but a lot more new homes i think it's positive aross cro across the board. >> you have good seats >> yes >> enjoy it's a fantastic stadium we're looking foerld to sunday night. >> it's going to be an amazing, amazing night. thank you so much, andy. melissa, over to you all right. we want to send it over to jon fortt with a look at what is

coming up on "squawk alley." >> apple and amazon heading in two completely different directions this morning. apple, the iphone x it turns out did better than a lot of people expected some bad information was out there ahead of enis.arng we'll dig into that coming up on "squawk alley.

seeing a reversal in bitcoin today. seema mody joins me with more on the big moves. >> the volatility continues. bitcoin was down as much as 10% on the day on on track for the worst week since april of 2013 but as you were just pointing out, bitcoin staging a bit of a comeback still below $9,000, a level they haven't traded at since november of 2017. still down about 30% here in 2018 i have been told by genesis trading their ceo that it's basically retail participation that has been driving the recent price activity in bitcoin over the week what is also interesting is we're seeing the cryptocurrencies and ripple is higher by 4% lytecoin and ether also coming off the lows they're down about 2% today. i will point out next week there

is one big event happening on tuesday and that is the sec commissioner jay clayton and the chairman will be testifying in front of the senate in washington, d.c., on tuesday, february 6th the top sick virtual currency. the comments we hear from both of those gentlemen will clearly be something that cryptocurrency world will be watching very closely. guys, back to you. >> seema, these levels are important though because these are right around the levels of thanks giving, right, when a lot of people started getting in that's when we saw the huge rise in the number of wallets created or coin based accounts being opened >> it was around thanksgiving when they revealed interesting number on the accounts they accumulated. it was around 11 million since then, i've been asking them for an update on the number of accounts. but they have declined to reveal that number. but i clearly the retail trader has been a big part of the later stage in bitcoin's boom. that's something we saw really around the holiday season. but since then, of course, it's

been really a rough start for 2018 >> all right seema, thank you seema mody carl, over to you. all right. thank you very much. when we come back, he raised more than $37 million for hurricane harvey relief and is now one of three finalists for the nfl's man of the year award. we'll check in with luce ton texans linebacker j.j. watt in a moment we'll also have more on the selloff as we continue to see equities under pressure on this friday so a few years ago, me and my wife were actually saving for a house. but one day we were sitting there and we decided that, you know what? something needed to be done about what was going on in our inner-city. instead of buying a house, we decided to form this youth league. what is he doing wrong? he should shed the block. exactly. it's volunteer, we don't get a paycheck.

it's one hundred percent from the heart. football shaped my life and i'm praying that it will shape these kids' lives as well. ♪ ♪

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