Transcripts For CNBC Squawk Box 20150102

Begins right now. Good morning again, everybody. Welcome back to squawk box here on cnbc first in business worldwide. Im becky quick with brian sullivan. Joe and andrew are off today. General motors have announced new recalls with an ignition lock. The number is a relatively small 83,000 vehicles. But it comes after their record year of recalls in 2014. Elon musk and his wife are divorcing for a second time. They first married in 2010. They divorced in 2012 and remarried in 2013. And a total of 30 bodies have been recovered from the crash of the airasia flight last weekend. The year is starting off with a loss. Former political icon mario cuomo has died at the age of 82. Cuomo served as the empire states governor for three terms from 1983 to 1994. Some democrats did push him to run for president. He died just hours after his son andrew cuomo was sworn into his second term as new york governor. The averages closing out 2014 with gains and multiyear winning streaks. Ended with a gain of 7. 5 the dow. That was its sixth straight positive year in a row. But it couldnt close above 18,000 after losing steam. The s p 500 rose more than 11 and the nasdaq had the strongest performance of the major averages. It was up more than 13 . Both the nasdaq and s p 500 are on threeyear winning streaks. Lets look at the futures this morning on this first trading day of the year. You can see right now there are some strong factors pushing things higher. Dow futures up 69 points. And the nasdaq up by about 17. Also if youve been watching crude oil prices at least at this point wti is still slightly higher trading at 53. 37. The Retail Sector struggling much of the year but ended 2014 on a high note thanks to what else . All the Holiday Shoppers out there. Dom, you and i among them im assuming. Absolutely. We spent all that money and the u. S. Economy is about driven by Consumer Spending. When we spend money, Retail Companies do well and they stocks maybe do well as a result as well. If you look at retails rock stars over the course of the Fourth Quarter, huge names have come up. First of all on the big box side of things target was up 21 during just the Fourth Quarter alone. So recovery here from what happened with the cyber attack over the course of the past year. And then take a look at another one here. If you talk about the automotive sector hitting highs this year. People are also fixing up their old ones. Oreilly is up 28 just in the Fourth Quarter alone. And the single best performing stock in the entire s p 500 Retail Sector over the course of the Fourth Quarter was staples up nearly 50 during that time. Of course thats an activist investor story. Jeff smith at star board value and his fund took a stake in the company. But overall the sector has been an underperformer year to date up about 9 . It got most of those gains in the Fourth Quarter alone. Back over to you. All right, dom. Thank you. In just a couple of hours trading will be getting underway for the year. Are we in store for an uncomfortable bull ride or will the bears take charge in 2015 . Joining us is chief Investment Officer at capital and a cnbc contributor. And an executive Vice President at bemo private bank. What do you think . What does 2015 look like . It feels like it looks like last year. Thats pretty good. And quite frankly i thought the s p 500 would be maybe 8 to 10 . Wound up coming in a bit ahead. My view is more of the same which is continued positive surprises in Economic Growth improving employment but not enormously robust. Just at the margin getting better. But the change youre seeing and you spoke to what im talking about in the Retail Sector. Theres enough positive going on in the employment front that we think Consumer Spending which has been lackluster for the past two years will drive further profit growth. Would you agree with that . In general i would. Im using the late 90s as a blueprint for whats going on right now as we see weaker Commodity Prices a strong dollar, a strong u. S. Economy relative to the rest of the world. And huge foreign flows coming into this market. So if thats the case our market can continue to move higher and get perhaps into bubble territory. When i would say the price to sales ratio gets to be over two times. Then i would say that were in that same bubble territory that we were in the tech bubble of 1999 2000. I understand low gas prices help consumers. Theyre great. Put more money in our pockets. But i refuse to believe theyre a net positive for everything. Margins are coming down. Earnings will come down. Isnt there a downside from the energy price decline . There is, brian. In fact, if you told me that oil prices were cut in half over a threeyear period id say hallelujah. But when you see oil prices cut in half over a sixmonth period the problem is now weve got im imbalances in the credit markets we dont know about yet. There was a lot of debt done. There are a lot of derivatives struck when oil was over a hundred and even before the first Coupon Payment weve now seen oil in the 50s. So i do think that there are lingering problems were not aware of. Very similar to the late 90s where the ruble was off by 7 at that time. Now its off by 50 . Venezuela in a world of hurt. We will start to see some of those this year but we have to see how severe they are. Allison, what are you worried about in 2015 . Interesting you should bring that up. With Oil Prices Dropping so rapidly that there could be the risk of some type of credit issue similar to what we saw in the late 90s with russia being a problem out there, so i think thats one risk. But the other thing i had not really thought there was any risk of the fed raising rates. But when were seeing the Economic Growth numbers trending the way they have recently the drop in oil prices and consumers picking up spending there is the risk that somewhere maybe over the back end of the year we have a negative surprise on the inflation front. So i think for the first time it could be a concern and the fed could be a little bit behind the curve. Does that sound it makes for a much more volatile year . Yes, it does. Jack . Yeah. I think that was really the catalyst ultimately was 2000 2001 fed tightening which was the catalyst that really rolled that tech bubble over. That could happen some time this year. Especially if we do get a growth or inflation scare. So if youre both agreeing this is potentially a more volatile year what does that mean for investors . Should they not be indexing . Volatility is usually your friend. So sit through it if youre owning strong companies. If youve outsourced to money managers, have trust in them. But sit tight. Trying to trade around and get every penny the trading profits i always think is crazy making and doesnt get you good returns in the long run. Hold tight. Own good strong companies. Probably more internally focused industries rather than more global industries. And you should do well. The equity markets should be at the end of the year be up around 10 . Wow, allison. I believe you believe the fed will raise rates some time in 2015 . Yes. Probably more because of strong Economic Growth and in that type of environment youre not going to have multiple expansion but it shouldnt hurt when people are still in bonds to a large degree. And so i like your indirect conclusion. The fed will raise rates yet stocks will go up. Weve heard so much of this talk that once the fed begins raising rates, everything is doomed. You clearly dont believe that. No. My sense is right now weve actually had almost too much easy money. The fed Balance Sheet is too large. The fed starts tightening starting to see strong Economic Growth trends. Equities tend to be better places to be compared with bonds. All right. Jack allison, i want to thank you both for joining us today. Happy new year. Thank you. Thank you. Happy new year. All right. Up next move over Silicon Valley. America has got a whole bunch of new hot tech towns. And you can run into Warren Buffett if you land in one of them. New names on the list and the reasons why some of these cities are going to be hot for tech. Plus 2014 so last year was a big year for ipos. Gopro hit the market and posted big returns. So did alibaba and true car. Will the new year bring a new wave of offerings . Youve got to stick around to find out. ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so when a market move affects one of your positions, tdd 18003452550 schwab can help you decide what to do. Tdd 18003452550 with tools like free livestreaming cnbc tv tdd 18003452550 that give you the latest Financial News and trends. Tdd 18003452550 and bubble charts and price charts that let you see exactly tdd 18003452550 how market activity is affecting your positions. Tdd 18003452550 so when the time comes to decide whether to scale in tdd 18003452550 or scale out you can make your move, tdd 18003452550 wherever you are. Tdd 18003452550 and start working on your next big idea. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 tdd 18003452550 call 18777292379. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 welcome back to squawk box. Looks like we could have a good day to open up the trading year. The Dow Jones Industrial futures indicating a gain of about 71 points. Move over Silicon Valley. There is a tech boom going on all across america and some unlikely cities such as omaha, nebraska, are gaining traction as new key tech hubs. Joining us with the new hot cities for tech talent katie thompson. Got a piece of cnbc. Com that as we say in the biz, just went live a few moments ago. Check that out but only after this segment. Or if youre driving, wait physical you get to your destination. Are some of the hot new destinations besides omaha and why is omaha on the list . So its interesting. People said the reason theres new tech hubs emerging or one of the big reasons is because every company is basically a tech company now. They need tech workers. Omaha has some fortune 500 companies and its sort of rising because it needs these companies there. Its rated the number one place in the u. S. For tech workers to be working. Does it have to do with cost of living . Cost of living and the way the stutd was done was the average wage compared to the tech salary. And the cost of living in the city. Cohnnagraconagras there. You ever to omaha . That was a joke. You got to move all that ham around. You know what i mean . Get the ham from conagra onto the train or into Warren Buffetts plate. I dont know. One of the two. Who else is hot . Miami is also on the list. Miami is interesting because its an international hub. Or theyre trying to position it as an International Tech hub. And the diversity there is huge. Imagine leaf which is a Virtual Reality startup actually secured a 500 million round. Some of the top leasee firms. If you ask students who are graduating where they would want to live, most of them would still say Silicon Valley palo alto, around those places because of the other Technology Companies that are there, the chances that youd be able to work at one of many different companies. Yeah. Not to mention its a nice place to live. Its a nice place to live but its not for everybody. And its interesting because even though a lot of startups look at Silicon Valley at the beginning saying we need to be based out of there. Its geologically good for what theyre listing. Silicon valley is a spectacular place. But if youre a cop or School Teacher, you cant afford to live there. There are people that live 80 miles away because of a two bedroom teardown is a million bucks. And 80 miles is not an 80minute commute. No. Probably three hours. People in fresno commute to Silicon Valley. Dallas is another big one, actually. And the reason for this is dallas has a lot of restaurant and retail chains there. So its a hub there. It also has a huge sort of accelerators that are big and sort of driving talent and trying to grow the startups there. Accelerators what do you mean . Like business generators. Tech accelerators. So that sort of nurture the talent and mentor them. What about a place like an austin or a boston where we used to think of like the 128 . Theyre still huge hubs. Theyre just ones we know more about. Austin is actually leading in texas as the tech hub and south by southwest we know about that. Although miami is launching their own south by southwest emerge america that is coming there. And i think the big surprise on your list my mothers original hometown st. Louis, missouri. Yeah. St. Louis, missouri. It actually had the highest growth for funding last year. Theyre attracted to the arch. Mcdonalds river boat. St. Louis, im trying to think whats there. St. Louis had a lot of older companies that moved out. Struggled for a long time. It struggled for a long time. Since then its become a sort of thriving entrepreneur center. For different companies. And its interesting. When you look at this, the map of the United States and you think Silicon Valley, if you actually look at where the dollars are going, most of them are going to california and cities there. But theres these little hubs and st. Louis is one of those bigger bubbles on the map. What about detroit, did that make the list . You mentioned the Old Companies moving out. Detroit has a lot of opportunities and pushing things there. Detroit is growing its interesting. The only reason detroit wasnt on the list is because thats something weve heard a little bit more of. But detroit, yes. Absolutely. Theres money pouring into that city. A lot of cool things happening downtown especially. Theyre getting those Old Buildings and theyre really trying to grow it from the core. A buddy of mine works for a company there called galaxy solutions. They moved workers from india to detroit. It was cheaper. Yeah. I actually believe that. Because real estate costs bottomed so much that they could actually say all in quality of the worker, cost whatever. Our Balance Sheet says its less expensive. So private company. Giving a shoutout for creating jobs in detroit. Absolutely. And theres Tech Companies that are related to the Auto Industry in detroit as well. So its sort of interesting to watch it all sort of grow. Cadie, it was a pleasure. Thank you. Watching st. Louis, miami, omaha. Check it out this year. When we come back jeff bezos couldnt wait to see 2014 end. Find out how much the billionaire dropped in net worth with the fall in amazon stock. And the table is set for College Football championship. There will be many os headed to dallas on january 12th but will the new system pay off . That is coming up in the squawk playbook. Welcome back to squawk box, everyone. Last hour we were talking about the ceos who could be the on the hot seat in 2015. We mentioned jeff bezos. Of course hes starting the new year with a clean slate of taking a big hit in 2014. Amazon shares fell over 22 . That was its worst loss since 2008. Amazons chief executives personal fortune fell by more than 7 billion still he has an 18. 3 stake in the company. Its now worth 26 billion. So, yes, this is something hes ridden the ups and downs before. Not sure he pays all that much attention to it. Over executives there may pay more attention than he does. Not bad for a liberal arts major. Not bad at all. Studied english at princeton thats why amazon started with books. He likes to read. According to a report in the daily mail the World Health Organization is investigating reports that some isis fighters have contracted ebola. Isis militants sought treatment for ebola at a hospital showing signs of the disease those reports are unconfirmed. No word from the Iraqi Government on the story. Not surprising isis has been in control since june. So isis militants contracting ebola. Oh. On deck, new rules for the new year. How about a law against taking a selfie with a tiger . Plus is there any company out there that can top alibabas historic debut . The ipos to watch in 2015 coming up. And as we head to break, lets look at u. S. Equity futures which are indicating a higher open on this first trading day of 2015. Were going to say that a thousand times in the next 90 minutes. Were back after this. Little meatloaf there on your morning. Happy new year. Welcome back to squawk box. 7 27 on the east coast. Here are your headlines this morning. Yahoo ratheredly looking to get into the cable tv business. Telling Business Insider that the Internet Company is considering the business of Scripps Network and perhaps even cnn. U. S. Drulg approvals hitting a high last year. 41 new medicines compared to 27 in 2013. Nearly 40 of those approved drugs treat rare diseases. And 30 victims from the air asia crash have now been recovered. An official telling metro tv that some were still belted into their airplane seats. The french government quiet quietly killed its payroll tax on the super rich. The tax failed to raise significant revenue and was accused of driving high earners away from france. Frances economic minister said that the tax was, quote, cuba without the sun. The tax expired at the end of 2014 without being renewed. No word yet on whether gerard is planning on running from russia. On another news Thomas Piketty refused a nomination because he doesnt think its the governments role to decide who is honorable. He also said if the government would do better to concentrate on reviveing Economic Growth. Of course that was mr. Piketty here on the squawk box last year. Thats joes favorite right . Yeah. He focused more on the study of inequality than on his solutions for battling it. Thats why thats controversial. It was multiple interviews basically in one. I tried to get through the book. Its tough. Its dense. I made it about 65 pages. 60 come on. Get to triple digits. I skimmed. Just skip to the back. Also we should tell you 2014 was a big year for ipos. 275 Companies Went public. 55 of them in the technology sector. Some of the biggest winners of the year were true car who was up 154 . Gopro which was up 163 . And Radius Health up 386 . Will 2015 look the same . Joining us with her forecast is jackie kelly. What do you think . We expect 2015 to be a great year again. Were obviously following on a fabulous year like you talked about. Technology was Strong Health care really was the dominant sector. But energy and a lot of other great sectors are going to be present again. Energy could have a tougher go this time around. When youre looking at oil around 55 rather than 107 how does that change . I think lower fuel prices are just building up consumer confidence. I think that obviously there could be an impact potentially on the Energy Sector but i think well see that drive a lot of growth in other sectors that will want to go public. Other sectors instead of energy you think theyd be focusing on places Like Technology . Technology but i think Consumer Products we have a number of Retail Companies that are private equity backed right now. Theyre going to look for exits. Thats a sector weve been tracking and we expect a lot of activity from this year. Why do you think 2014 was a strong year for ipos . We have a lot of agreement fundamentals in the u. S. Id say the u. S. In general attracted not only the majority of our domestic companies, but International Companies from across the world came and listed on u. S. Exchanges. We had just strong consumer confidence. Low Interest Rates. Overall really stability in the market thats really positive. If theres anything that would throw a wrench into things, where would you be looking, what would you be concerned about . Were on alltime highs really. Valuations, whats fabulous is valuations are strong but how do you sustain those . A little bit of turbulence would have an impact on the markets. I think were heading into a strong at least first quarter, probably second quarter. Well see where it goes from there. Weve been talking in the last several weeks about how they expect 2015 to be a much more voltive year. Just because were coming out of a period of incredible low volatility volatility. Central bank starts to look towards raising Interest Rates, maybe that makes things more volatile. What does volatility do to the market . High volatility can be a stumbling block. We are used to seeing the u. S. Operate in a volatile market. We have gotten through things quite quickly. So even some stumbling blocks in october we really quickly moved through that. And ipos continued through the end of the year. Uber. Airbnb . Its an interesting market. Not only are we strong in ipos but m a is back and companies have a lot of options. So brand names are going to be really popular. Obviously the ipo markets would love them, but i think a lot of other companies will too. In the shake shack story, its getting a lot of play because we live in this area. Most of america is like what the heck is shake shack. This is one of these east coast centric stories. Is this a name that would get a favorable reaction or just a niche thing for new yorkers . I think that i mean if youre in des moines youre like what is shake shack. Who cares . I think its a great name right . And i think its going to get a lot of attention. And i think that this is one of these retail Type Companies that were looking to see a lot out of this year. Was there anything that really surprised you in 2014 just in terms of some of the ipos that came whether its alibaba or gopro or Something Else . These were really Mature Companies. They had very strong leadership teams. Visionaries, the potential with these companies to grow has been fantastic. What i will say is we had a lot in health care. And i do think we still are seeing those Companies Come out. Thats going to be a sector to watch. Jackie, thank you for coming in today. Thank you. Happy new year by the way. Get yourself a shake shack burger later today to celebrate and take an uber to do it. Up next new years means new laws and for some reason doing this is not only stupid its now illegal. Jane wells up after the break to run down the dont list for the year. And the firstever College Football playoff. It is o versus o. Dave briggs is here to break it down. The ducks versus the bucks. Were back after this. You beat the number one seed . You just have to win 70 of your points at net. And keep unforced errors under 10 . On the ibm cloud, the us open analyzes 41 million data points from 8 years of competition to uncover key insights. Data can help show you how to win no matter what business youre in. Today theres a new way to work. And its made with ibm. Tdd 18003452550 [ male announcer ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account, and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so if you get a trade idea schwab can help you take it on. Tdd 18003452550 were getting a lot of questions tdd 18003452550 about organic food stocks. Tdd 18003452550 [ male announcer ] sharpen your instincts tdd 18003452550 with indepth analysis by schwab experts. Tdd 18003452550 and if you want to run your idea tdd 18003452550 by a schwab trading specialist, tdd 18003452550 our expertise is just a tap away. Tdd 18003452550 whats on your mind lisa . Tdd 18003452550 id like to talk about a trade idea. Tdd 18003452550 lets hear it. Tdd 18003452550 [ male announcer ] see how schwab can help tdd 18003452550 light a way forward. Tdd 18003452550 so you can make your move, wherever you are tdd 18003452550 and start working on your next big idea. Tdd 18003452550 tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 call 18776703357. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 all right. Welcome back, everybody. This is squawk box. Take a look at the futures this morning. Again first trading day of the year and right now it looks like the dow futures are indicated to open up 80 points above fair value. S p futures are also higher. Nasdaq up by 22 points. This comes after a year of gains again for all three of the major indexes. The nasdaq was the big winner. They were up by 13 . The s p closed by 11 . The dow was up by 7 . Of course its six years in a row of gains for the dow. The new year bringing new laws. Jane wells joining us with a look at the more unusual rules taking effect and she is joined now by are those your basset hounds, jane . Of course theyre my basset hounds. This is Princess Leia and this is eeyore. There are new laws. And one here they like to have dogs. That has been illegal. Now it is legal for restaurants who want to have dogs to let you bring your dog as long as they follow certain rules. Also in california people who are here illegally can now get drivers licenses and that means theyre going to have to have mandatory insurance. And the Insurance Industry is gearing up for 1. 4 million new customers. Remember when Jennifer Lawrence said there ought to be a law after her nude selfies were hacked in the cloud and posted online, now there is a law about that. Also other new laws include mandatory sick leave in california for any employee whos worked here at least a month. Also on College Campuses getting state aid. You have to affirmatively agree to have sex now. No means no is no longer enough. And the standard of proof is much lower than a criminal court. And if you think california is weird, well in new york starting today or yesterday, no more tiger selfies. No more pictures of you posing with the big cat. And no more animal tattoos. No, i dont mean tattoos of animals. I mean no inking or piercing your pet which apparently a thing. No longer legal in the state of new york. Thats a thing . Getting your pets tattooed . Should i get a little piercing here and a little nice no, never. Lets go back to the real issue here. First off, those dogs they need a little exercise. A little chuby. Are you mocking my basset hounds . I have two dogs. Theyre fit and trim. If anyone needs a little exercise brian sullivan. Im not saying i dont. Im not saying i dont. Okay . Ive got an electric collar too. I try to leave the yard and get shocked. Im just saying. Are they brother and sister . Are they twins . What is that . No no. Theyre both rescue dogs. And completely separate. Didnt know each other until we got them from the rescue and they love each other more than any two dogs. And you clearly like princess more. Shes gotten all the petting. Oh, no. I like well thats because she keeps looking at me. Hes just mad at me because its cold out here. Thats the other thing. 40 degrees in los angeles. Jane, did you get any snow like a tinkle . I heard in north ridge of all places they had a little bit of a flurry. And i didnt know when thats happened last. I saw you tweeted from the games late last night. You were watching. You were up late too. I know. That was so awesome. I mean yesterday was probably the best day of the year total for football. Especially College Football. So many good games. So many close games. Then the games that were supposed to be close were blowouts. Oregon destroying Florida State. It was fantastic. I love this new system so much better. I think its going to be great. You spent time in oregon at the campus. I did. I did. Im a huge fan of marcus mariota. He is such a classy young man and he really was just amazing yesterday. Itll be great to see them and ohio state. That is going to be a fantastic game. Quick prediction. Are your trojans going to do better than 84 this year in 2015 . Yes. Yes. Sark going to turn it around . Yes. Im going to believe. And how about Virginia Tech . What about you, sir . Ki fear my hokies might be in a prolonged down slide, my dear. I hope im wrong. The side view of princess leiya, shes rather sleek. Shes now left the scene. She needs to leave get a little sleeker. Drop a few pounds in the flower bed. Oh man. Morning, jane. We are done. Jane thank you for joining us. You got it. Boy, oh boy. I dont know what kind of morning routine you have. About 18 cups of coffee. Morning the other stories were following this morning google planning to build a new campus in boulder, colorado. The city council approving plans for a campus including three four Story Office Buildings with Fitness Centers and cafeteria and parking lot. It will increase their workforce to 1500 employees. Meanwhile kim jongun saying he is open to talks with south korea. In a speech delivered on state tv, the communist leader paved the way for a potential dialogue with south koreas president cryptically saying, quote, depending on the mood we have no reason not to hold the highest level talks. Little double negative there from kim jongun. Blah blah blah. Its also a big week for College Football as we were just talking about. But check this out. Baylor displaying some unusual play calling against Michigan State. The bears lined up guard mcgowan as a wide receiver. Mcgowan is 67, weighs 390 pounds and he rumbled into the end zone. 18yard touchdown. That score put baylor up 4121 in the Third Quarter. But Michigan State actually came back to win the game. That waspretty amazing to watch. Up next College Footballs playoff system off to a spectacular start. The ducks flying high and the buckeyes calling off a huge upset. Dave briggs will join us next to talk more about it. Thanks. [ male announcer ] fedex® has solutions to enable Global Commerce that can help your company grow steadily and quickly. Great job. mandarin cut it out. See you tomorrow. Another day and its going once again. Crude Oil Prices Sliding once again after moving higher in yesterdays session. Wti down by another 93 cents. Thats a drop of 1. 75 Percentage Points. Brent crude dipping as low as 55. 48 a barrel nap is the lowest level since may of 2009. West texas crude hasnt yet hit multiyear level lows. Brent down there 1. 55. Meantime a major new cancer study shows that chance plays a major role perhaps the biggest role in determining who gets cancer and who does not. Researchers at Johns Hopkins university found that twothirds of cancer incidents can be blamed on random mutations. Sometimes were heavily influenced by the risk factors. However, they attribute about 65 of cancer incidents to biological, quote, bad luck. Thats not an argument though. I read the study last night. My wifes mother and her grandmother both died of breast cancer. Figure theres genetics that play a role. Yeah. We also know genetics do play a role in certain ones. Like breast cancer. You know there can be some connection. Actually its i read most of the study last night. It is heredity is everything. Its just more so than some but basically what they called biological bad luck is the primary reason people get we know things like smoking and whatever leads to smoking. But the study said it may contribute a little bit, but how youre born genetically is ultimately going to determine whether or not you likely get cancer. So youre born with it or not. And this opened up another bag of worms to the genetic testing argument im sure. If you get tested whats your likelihood. Then youll pay rates based on that. Its a fascinating new study. People should check it out. Lets look at stocks to watch this morning. Jana partners selling in civeo. Plunged this week after cutting spending and a weaker than expected profit forecast. Linn on account of falling oil prices. Cutting its annual dividend as well. And cliffs natural completing the sale of its coal assets in West Virginia for 174 million. And i will quickly point out with regards to linn and others. I was in the bakken in the last couple weeks and we reported this. Everybody we talked to is asking far 25 cut in pipeline. Youll see more companies i suspect. Are they getting it . The guy we talked to said he was. Now, was he playing gamesmanship there knowing people were watching saying this is whats going to come. Im going to ask for a discount. He said they were getting it. Well see. Time to talk squawk sports. Its been a huge week for College Football fans. Yesterday marking the firstever playoff games at the highest level. Plus plenty of action over this wild card weekend including a grudge match between rivals. The steelers and ravens. Joining us to break down the action dave briggs from nbc sports. What a day yesterday was. You didnt have to move off the couch at all. The biggest story, ohio state shocking bama . Even ahead of those big games that were fantastic football games, Michigan State had a big win and wisconsin had a big win. Continuing an amazing week for the big ten who everyone had left for dead. But i think this is total redejs if redemption for the College Football playoffs. We would have had Florida State alabama under the old system. Instead we get oregon ohio state. And yes, that is a huge upset that ohio state pulled off last night with their third string quarterback. Almost 300 yards rushing. What an effort. They get 28 straight points. Seems everybody could throw the ball for the buckeyes these days. And urban meyer, were excited for jim harbaugh at michigan but urban meyer still the best coach in the conference. I also think weve learned you cannot still overrated without the words s. E. C. Wow. For the first time in nine years im ready for the tweet hate out there, but the state of mississippi is great. Everything. Bad for football. Just a terrible Mississippi State did not represent in football at all. The conference has looked ugly. And for the first time in nine years we wont have an s. E. C. Team playing for the national title. Look at these five games. Auburn, alabama, mississippi, Mississippi State, and lsu loses to notre dame. So the conference got crushed and the big ten came through with three huge wins. Missouri did win. We wont forget about mizzou. But it did not look pretty for them. And it didnt look good for jameis winston. The heisman winner a year ago. Five turnovers for Florida State. The boogeyman strips him in this ball game. A defining game for him. Super mariota all over them. This is the second worst blowout in a bowl game for a top five team ever. What was up with the team not coming out to shake hands after . Not all of them 70 of them i think went to the locker room. Most of them left. That became the big story after this game. Poor poor sportsmanship. Jameis winston, though, took it like a man. Went up, talked to marcus mariota. But Florida State really looked bad after that game. Then winston gets up and says i think to the reporters you all saw this game could have gone either way. It was 5920. It wasnt 2421. Lets be clear though. Three straight trips to the red zone early in this game nine points. If they hadnt, this would have been a different game. I dont know as much about sports but i know if you score fewer points to the other team you have a darn good chance of losing. I think what jameis meant and let me just try to channel channel it before the game start snd. Two nights ago we had a good chance. This Florida State team is a better Second Half Team than any team in College Football. It looked for a moment in the Third Quarter they had a chance of turning the tide. Yeah. The second worst blowout loss for a top five team. Oregon dominant. They were the favorite against ohio state. Youre not going to take a pot shot at your competitor espn, however, they launched the s. E. C. Network this year. Now youve got no s. E. C. Teams in the championship. You wonder if that will hurt them. I dont think so. The bowl system is incredibly healthy. Television ratings are through the roof and no one will ever stop watching the s. E. C. Whether or not its the best conference this year up for debate. But they will remain popular. A business story on this all state did very very well in the sugar game last night. They showed people how to be a sponsor. Dont slap your name on a bowl game and walk away. They had a Viral Campaign with the mayhem sale trending all night on twitter. They had the guy from major league out at the coin toss. He was trending on twitter. All state really showed companies how to sponsor a bowl game. By the way, this is hugely successful from the commercial standpoint too. Not just for the Companies Involved in sponsoring it but the schools are going to get the payoffs. Much bigger payday. Huge payoffs. 300 million expected to go to the conferences. The playoff a huge success so far. Unless youre a tcu fan. You probably are angry this morning. But it looks like it worked out perfectly. And lets look ahead to wild card weekend quickly. We mentioned ravens steelers saturday night on nbc. The question is will joe kernens bengals win the playoffs for the First Time Since 1990 . Wait wait. He disowned them. Is he off the bandwagon . But they started winning as soon as he got off the bandwagon. So bengals want him away. If youre a colts fan, you want joe back on the bandwagon. They have not won a playoff game and it wont start any time soon. How about the Carolina Panthers . 781. Second team ever in the playoffs under. 500. Theyll get a win and it will be first for newtons career. I feel bad for the cardinals. I thought they were the best in the league for the first half of the year. Palmer gets hurt. Then stanton gets hurt. You know dont count them out there. Third string quarterback in there. Its tough. By the way, throw in the hokie. I went to Virginia Tech. Put the big boy in. How many people counted ohio state out after they lost a first and second quarterback. And who was their one loss to . I want to hear dave say it. Virginia tech beat them up early in the season. Good for you. Bruce arians unbelievable coach pep. Where did he go to school . Is he a hokie . Hes a hokie. Its all about Virginia Tech. When joes here its about Skyline Chili and the bengals. And colorado. And shake shack burgers apparently. Dave, thanks for coming. Happy new year, guys. When we come back, we have a roundup of the tech stories. The editor of fortune, the Deputy Editor in chief will be joining us after this. 3w4r57. Yahoo reportedly interested in buying a Cable Tv Network. Outpacing the dotcom boom. And were kicking off the hour with a tech and media round table. Top editors will join us on set as the third hour of squawk box begins right now. Welcome back to squawk box here on cnbc, first in business worldwide. Im becky quick along with brian sullivan. Joe and andrew are both off today. Brians here. Were having fun. It is resolution time. Thank you. Yeah. We are. Its resolution time. According to a study by the university of scranton weight loss is the most common new years resolution. I could have guessed that myself. Of the 45 of americans who make resolutions, only about 8 succeed. My fitness pal is a new app that aims to help people keep those resolutions. The ceo will join us at 8 40 a. M. Eastern time to explain how it works. If youve already broken your new years resolution, i know its only the second but you could have. Share your shame with us. Tweet us the resolution and how you broke it. Maybe a timetable of when you broke it too. You can tweet it to squawkcnbc. The major averages closing out 2014 with gains and with multiyear winning streaks. The dow ended the year with a gain of 7. 5 . That was its sixth straight up gleer year in a row. Lost a little steam on the final three trading days of the year. I almost called it friday. The wednesday the last trading day of the year the dow fall was the worst final day of the year since 2001. 13 years. Usually the market kind of goes up or people say go out on a high note. Bad day. Were going to look at the dow Top Performing stocks. The s p 500 had an even better year. It rose more than 11 but nobody topped the nasdaq. It had the strongest up more than 13 . Both the nasdaq and the s p 500 are on a threeyear winning streak. And we could continue that. S p futures, dow futures, and nasdaq futures all indicating a fairly decent open for the first trading day of the year. You know what i meant. I know. Ive been confused all week. I was thinking its monday. Its friday. Its just the holiday throws you off a bit. That and the 90 minutes of sleep. Doesnt help. Were getting through. Among the other stories were watching at this hour uber will suspend operations in spain. Ta moves follows an injunction. Spanish taxi drivers filed a complaint citing uber for unfair unfairly competing. And jeb bush has resigned from his corporate and nonprofit positions on boards. It is the latest indication that he is planning a president ial run in 2016. Also snapchat announcing it raised 486 million in the last fund raising. Snapchat could be now worth as much as 20 billion. Few people are on the table laughing. Theres no justice in the world. 20 billion. Well this kind of plays into this next story. Last year could be remembered as the year of the billiondollar startup or some cases multibilliondollar startup. Right now there are about 70 startups around the world valued at a billion dollars or more. Youve got xiaomi who became the most valuable tech newbie. It is 46 billion. Uber not far behind. And listen to this. There are nearly twice as many billiondollar startups today than there were in the dotcom boom of 99 and 2000. Thats according to the wall street journal. So the question is will this startup boom go bust in 2015 . Here now to talk about it senior tech analyst at mashable christina warren. Joining us for the next half hour alan murray. And matt murphy. Christina, ill begin with you. I guess the one thing we can hang our hat on is a billion dollars aint what it used to be. Still when i see and im not picking on the company, but a Grocery Delivery Service get a 2 billion valuation im thinking oh no. Is this time different . Tell me this time is different. I think for groceries its difficult different. Were kind of ready and the infrastructure is finally there for it to be different with groceries. I do think when we look at things like snapchat and theyre raising as much money as they have and 20 billion valuation, thats a little bit im not sure what to think about that. But a lot of these companies have real revenues. You talk about xiomi, theyre selling phones and making a lot of money. So its very different from what were look at in 99 and 2000. You could say that with other companies. They do have revenue coming in. Theyre selling products. I think this is a Dramatic Development to have this many Large Companies still operating the the private markets. And the real question is how many of them are going to be able to get out public over the course of the next year before the next recession sets in. Or are we going to find ways to see them. You have a Facebook Google apple out there spending a lot of money. Soom of the valuations with snapchat. So you can see somebody buys them. Yes. So let the ask. Does this feel bubbleicious for you three or different . I think its a bit of both. I think its an area of broader wider variations because everybody is trying to figure what works and what doesnt. Clearly some of this stuff works. Clearly youve got a millennial audience used to technology. But you also have a millennial audience that doesnt want to pay for anything. Well im not sure thats true. They buy their cell phones. These are businesses. Theres some bubblets in there. I agree on snapchat. Because thats becoming the new internet. Thats what theyre not using facebook. Thats what everybody is using. Disappearing photos. Like an instant messenger. Its becoming the platform for families. Not just people to send photos. I think thats true. But part of the problem as with facebook is to find it what it is and whats not. Nobody would have picked facebook over myspace in 2004 for instance. Snapchat in particular. I dont know if theyre facebook or groupon. It could go either way. Friendster. Exactly. And snapchat with all their different ftc and fcc problems, who knows if theyre going to matter in a year or not. Can we just make a new years resolution around this table that we kill the social from social media . Its just media now. First off theres not much social about it. But its just media now. Why do we call it lets just end that. Thats what media is now. Facebook just is a platform. Can we agree to that or no . Yeah sure. You cant call it new media because there lab newer media. Social is the latest just media. Its bigger than any tv channel. Its big. Right . So to your point, the point i was making on the grocery cart delivery, do you think then people are saying look its just like last time. Were recycling old ideas. Or are the ideas somehow better because the technology improved so they were just before their time 15 years ago and theyre still actually good idea. With groceries i think thats what it was. Thats what weve seen with pea pod and obviously with insta cart. Uber is proof of this. Its the taxi service but you can find out exactly where it is on your phone, call to it and having the logistics there and having it be on your phone and be part of your person. I think now were much more ready for it. The whole area of mobile Services Uber airbnb the Grocery Delivery Services. Thats a big change in our lives. But its very real. I noticed it with my own behavior too. I fall sbiet. I wouldnt have done it back in 1999. I do it now. I want to go back to a point you made though. The idea that how many of these companies can get out, either be sold or brought to market before the next recession or the next downturn comes along . Thats the key. How flush are these, can these good ideas get out and get funded . Matt raised a good point. One exodus to sell to other companies. There are those with cash on their hands that can buy. But the ipo market which suz so great in 2014 probably continue to be good in 2015. But these things dont go on forever. The markets very highly valued. Volatility is coming back. Thats not necessarily the friend to an ipo. If the market looks hot one month and things go goofy in the meantime, thats not great news for ipos. I would say now is a good time to get out. I think we do want to distinguish between the shortterm and the midterm. And ubers a great example of this. In the 90s you covered it. You thought about technology as technology. Now youre seeing tucknology disrupt industry after industry. So its a car company or logistics company. Yes they use a mobile app but in some ways its not a Technology Company in the same way amazon is more and more clear as a retailer as much as it is a Technology Company. Thats just beginning in lots of industries. And there are lots of entrepreneurs thinking what does mobile mean for this industry. To me that is a 20year wave. Whether the ipo market cools or not, new brands will emerge. Thats a really good point. I totally agree. I think were just at the beginning of technology. I mean we focus on all these kind of gadgets and consumer facing products. Were just at the beginning of technology, transforming the way the economy is organized, the way all Big Companies operate. And there will be a lot of Business Opportunity there is. Yeah. And we also just agree to end the email pollution. Lets end email pollution in 2015. Shall we . How many do you get a day . I dont count. Because you cant count that high . I can count that high, i dont bother. Every viewer out there knows what were talking about here. Theres got to be some app to cut through the clutter. You get 500 a day and 5 are relevant to you. I would argue the contrary which is theres a great device that saves email which is the phone. I agree. Pick up the phone and talk to people. Or meet for drinks after work. Thats so old. Nobody uses the phone. Guys thank you. Well, the murrays are going to be sticking around. Christina, thank you very much we appreciate it. When we come back this morning is Marissa Mayer interested in buying Cable Networks . Its a story out there. We will talk media consolidation and the future of yahoo next. Then a closer look at auto sales. Posting a strong finish to 2014 even though it was a year plagued by recalls for major auto makers. At 8 35, a closer look at the top stock of the dow in 2014. And then the ceo of app my fitness pal wants to help with your new years resolution. Stick around. Squawk box will be right back. Hi there [ laughs ] im flo i know im going to get you your rental car. This is so ridiculous. Were going to manage your entire repair process from paperwork to pickup, okay little tiny baby . Your car is ready, and your repairs are guaranteed for as long as you own it. The Progressive Service center a real place, where we really manage your claim from start to finish. Really. Easy as easy can be bye tdd 18003452550 [ male announcer ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so when a market move affects one of your positions, tdd 18003452550 schwab can help you decide what to do. Tdd 18003452550 with tools like free livestreaming cnbc tv tdd 18003452550 that give you the latest Financial News and trends. Tdd 18003452550 and bubble charts and price charts that let you see exactly tdd 18003452550 how market activity is affecting your positions. Tdd 18003452550 so when the time comes to decide whether to scale in tdd 18003452550 or scale out you can make your move, tdd 18003452550 wherever you are. Tdd 18003452550 and start working on your next big idea. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 tdd 18003452550 call 18777292379. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550. And welcome back to squawk box. Well call it 8 15 here on the east coast. Good morning and welcome. The futures right now indicating a higher first trading day of the new year. Indicating an implied open of 64 points. We are back with the murrays. Gentlemen, wed like to get your predictions for 2015. Before we do i want to ask you about the story weve been talking about this morning. The idea that Marissa Mayer of yahoo might be interested in buying a cable network. They even mentioned the possibility. Is this for real . I cant confirm whether that storys for real or not. I dont know but i have to believe that yahoo like all Media Companies really is trying to think whats going to make us money, whats our strategy where are we going and any company has to be doing that to be figuring out this landscape. And particularly where a longterm strategy is still unclear. But its a little bizarre. I hope i can say this on a cable show. But we know that cable is not the future. My guess is that my daughters will never have a cable subscription. Im pretty sure. They have no interest in it at all. And you would expect Marissa Mayer to lead us into the over the top delivered video land. Maybe shes going to buy a Capable Company to help get there. To get content that can live for a long time. Lets go back to that. This is a critical point youre making. Im sure they ask this what do you think of the apple industry . Do you use apple tv . Whats on there . Cnbc icon. You can get to all the apps. You make so much its just where the newspapers were 15 years ago. You make so much off the Cable Company its hard to do the transition. Right. Because its always back to the questions of digital and dimes for the dollars. And yahoo s great advantage is they dont have that legacy burden. So why would you go out and put it on yourself. The problem here is she has too much money. Is that a problem . It is a problem. Thats too much money. Ive never had that problem. I havent either. I havent worked for companies with that problem. But investors are going to get fed up. Theyre going to say just give us the cash. We dont want you making the decision. Some of this struggling to define was that is. I cant if somebody said what is yahoo in one sentence i dont know i could answer that question. Theyve asked that question for years. Theyre an entertainment company. Thats what theyre struggling with, im sure. Whats the reason for yahoo to exist. Alans right. Theres investors who want that money back. When thauf kind of money and think you can do a transformative deal im sure that a tension inside the company. Let me talk about the big themes that have surprised us this year. Two of the biggest things have to be oil prices collapsing and the yield on the 10year around 2. 2 . I wonder if you think these trends continue, what think of the Central Banks, how these things play out in 2015. I suspect every new years show you had for the last four years someone had said Interest Rates will go up. Got to say it again first week of 15. But maybe they wont. Who knows. Its amazing. I think oil prices will stay down for some time. I think the dynamics that are keeping ois prices down are in place for awhile. Is that the weakness in china and combined with the supply . The emerging market business looks like it will continue. Could be a good year for the u. S. But not the emerging markets. And second is the supply. The horizontal drilling and the huge supply thats opened up. We got news this morning that iraq is pumping out 2. 49 billion barrel billion barrels a day. Even with isis swarming all over the northern or northwestern part of iraq, their oil output has gone up. Isis needs that revenue, too, of course. You remember in the summer people said isis is going to blow up the terminals and prices will spike over 150, there were people saying that. Now were at almost 50. Forget the 150. And oil output is 2. 9 billion barrels a day. Of course that also affects the 10year because its a deflationary impact which, you know, as long as theres not really much prospect of inflation, i think the 10year is not going to the rally continues. That in turn also puts pressure on the central bank in terms of whether they raise rates as people have anticipated. Sorry, go ahead. I was going to say you first. But another the battling murrays. Another aspect which is important for the fed and the Central Banks of course is employment. And there youve got tension between longterm unemployed reenter the market. And if they do will that keep wages down . Wages are going to come back and if Employment Trends continue can the longterm unemployed rejoin the labor market without keeping wages down. Or will there be real wage growth . I think 2015 will be a year of real wage growth. I agree with you. And i suspect 2015 will be a tougher year for the fed and jan et yellen whos one of the Great Stories of 2014 will be under some pressure. The jobs number comes out, of course, during the show. Its a big deal of the economy. Theres another aspect to the jobs number i dont think we talked about enough as a network which is if 2 million more people are working, a good portion of those people are going to be saving and contributing to 401 k and retirement accounts perhaps for the first time in a number of years. So the direct Market Impact perhaps, of the job market strengthening is one that i wonder if we could measure. You know . Lets say a hundred its a pattern, right . The little guy gets in too late. Lets say youre 27 years old and you finally get a raise and maybe you start contributing 100 bucks a month to your 401 k . You dont have to be little guy, you can just be the new guy. New guy tends to be the little guy but i take your point. One other thing if were looking forward and making predictions, i predict a hot sector in 2015 will be health care. Because . It was hot in 2014. All the dynamics are in place. You have have the political debate about obamacare, but its given more people insurance. And you have Cool Technology developments happening. I think those are all going to come together in the next couple of years to cause some big upside surprises. Could Cool Technology both for Big Companies and Small Companies whats the coolest thing . The coolest thing ive seen is we put this woman on the cover, elizabeth of fehr northeast about 3 billion has developed a new way of doing a blood test. If it proves out could have a dramatic impact on the way we do health care. I hope it does. It sounds exciting. Still a lot of questions about it, but i hope it does. Thank you so much for coming in today. Alan, thank you. Great to see you both. On deck, the dow ending 2014 up 7. 5 . Some of your top gainers for the year, united health, home depot, microsoft and cisco systems. But the top dow gainer of the year might surprise you. Were going to take a closer look at who that was coming up in about eight minutes time. Then well help out with your new years weight loss resolution. That means you. Means me too. The ceo of my fitness pal helps track your progress. B taylor swift who pretty much defeated music in 2014. Squawk box back after this. How do you beat the number one seed . You just have to win 70 of your points at net. And keep unforced errors under 10 . On the ibm cloud, the us open analyzes 41 million data points from 8 years of competition to uncover key insights. Data can help show you how to win no matter what business youre in. Today theres a new way to work. And its made with ibm. The all new, head turning cadillac ats coupe. Its irresistible. Taylor swift shaking off disney princesses. Her 1989 album took over frozen to take 2014s topselling album. Frozen had the lead throughout most of the year but let it go in the end. Sorry. Let it go. Let it go. Going to have it stuck in your head now. Stab myself in the eye repeatedly. When we come back the year marked by recalls and strong sales, phil lebeau will join us next. Right now as we head to break, look at the u. S. Equity futures. On this first trading day of the year things are looking good for the bulls. Dow futures up about 68 above fair value. S p futures up by eight points. And the nasdaq up by 18 points. Stick around. Squawk box will be right back. Ion about that. But your erectile dysfunction that could be a question of blood flow. Cialis tadalafil for daily use helps you be Ready Anytime the moments right. You can be more confident in your ability to be ready. And the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid long term injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision or any allergic reactions like rash, hives, swelling of the lips tongue or throat or difficulty breathing or swallowing, stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use and a free 30tablet trial. And welcome back to squawk box, everybody. Im brian sullivan. Good morning. Its 5 30 on the west coast. Well call it that. In your headlines this morning, you heard about atlantic city, new jerseys problems but a gambling mecca is having its own issues. Revenue fell in macau. It was the seventh monthly drop in a row. Also down last Year Box Office revenue. Moviegoers in america and canada bought 10. 3 billion worth of tickets. That was down 5 from 2013s record high. And one more 2014 trend of note. Nielsen music says that u. S. Sales of digital albums were down 9 last year. Individual digital song sales also down even more 12 , but audio and video streaming like spotify, pandora, et cetera jumped more than 50 . A year of recalls in the Auto Industry. But sales finished the year on a strong note. Phil lebeau joins us with more on that. Good morning. Good morning. Well get the official Sales Numbers on monday and they will be strong. A strong end in december for the year. But when you talk about whats really been the story in this last year it went out the same way it came in. And thats with more recalls. Three were announced on new years eve. Actually filed with the federal government by General Motors. Those three involving 83,572 vehicles. Mainly 2011, 2012 vehicles. A few others between 2007 and 2013. The issue being that potentially the ignition switch could lock in the start position and potentially lead to the air bag not working if there was an accident. We should point out no accidents, fatalities, or injuries were reported with this recall. But these three recalls that were announced on new years eve or filed with the federal government on new years eve by general mowtors means the total for gm for all of last year 84 affecting 26. 9 million vehicles in the u. S. More than 30 million vehicles in north america. But heres the interesting thing. Did these recalls slow down sales for gm or for the other auto makers who were impacted by the massive recalls with air bags . No, they didnt. We checked with the folks at ic cars. Com. They crunched all the retail data. There were 65 more recalls initiated by the Auto Industry last year affecting more than 82 million vehicles and yet sales in the u. S. Up 5. 4 last year. The annual pace expected to come in at 16. 5 million when final sales are announced on monday. Thats why when you look at shares of General Motors or any of the auto makers did they have a great year for investors . No, they didnt have a great year. But they didnt fall as much as many people expected. And thats because there is a complete disconnect between the recalls that have been announced mainly affecting vehicles between 2005 and 2012. And what were seeing in showrooms right now. So even though it was a record year for that its a sale pace coming in at 16. 5 million. Ive heard a couple of different theories on why there were so many recalls this year. One of them has to be that gm was being incredibly cautious given all the trouble it had gotten in because of the recalls. Making sure they were looking into any potential problems. Another is just that the Global Supply chain when it comes to parts makers has consolidated. So if theres a problem with a part, its going to have a lot of different manufacturers. Ya. Youre going to see this from here on out. You have fewer suppliers and now when youre an auto maker and lets say youre coming out with a new model, youre not coming out with a part for that single vehicle, youre making that part used in almost all of the vehicles used on that platform. As a result you have one part go bad, its going to affect more vehicles. Dont forget its not just General Motors. You had all impacted because of takata. And all automakers will tell you they realize the federal government is being much quicker to come down on them if they dont initiate a recall. Therefore theyre getting out saying were recalling 150,000 or however man my. Does that mean that 2015 is likely to be another year of a lot of recalls . I think theyre going to be higher than they were book in 2013 where i think it was about 26, 29 million in total compared to 86 million last year. I think well see a large number of recalls, but certainly not what we saw in 2014. I think that was really kind of flushing out the system as much as possible for the industry. But that commoditization of all these parts, youre going to see that more and more. And as a result of what were talking about, you will see the large recalls. Thanks a lot. Great to see you. You bet. You too. Earlier this week we told you about 2014s worst performing dow stock. It was ibm. But on the other side of the coin was the big winner of the year for the dow. And that was intel. Josh lipton joining us now with more. Well intel surging some 40 . It was the best performer in the dow. So now what explains this move at intel stock and what can investors expect this year . The one tail wind for the pc market in 2014, microsoft ending support for windows xp that prompted companies to buy new computers. Thats good news for intel who dominates the market for pc chips. The other big part of intels business is providing chips for server systems, it accounts for about 20 of sales. Revenue in that business can grow at a 15 rate. At least through 2018. So what are some challenges for intel as we move into 2015 . The company promised to get chips into 40 million tablets in 2014. But that division will continue to bleed losses next year. Though at a slower rate. Another concern, valuation. Doug friedman of rbc says intel now looks pricey at least based on some metrics. Still bulls are in charge when it comes to intel right now betting on a stable pc market and the ongoing commitment to capital return. Thank you very much. Joining us now with more analysis on intel is david geraghty. Were you surprised by intels outperformance last year and do you think intel can continue that outperformance this jeer . Well one, in terms of the outperformance, the fact that microsoft was removing windows xp which was powering 50 of the installed pc base set in motion a significant upgrade for intel which any investor following the tech sector as soon as microsoft made that announcement would have run out and bought intel. Obviously microsoft is yet again giving another favor to intel in 2015 with their decision in july of 2015 to withdraw support for their enterprise server product. Windows 2003. So if that standpoint microsoft is basically handing intel a gift which i think continues to support the stock this year. Yeah. You look now at valuation. As the price has gone up the valuation has too. Earnings havent grown as fast. According to facts im looking at right now, about 17. 2 times trailing earnings. Is intel getting rich . If we look at what sort of Mature Companies can support in valuation relative to underlying growth rate right now intel is at about 1. 35 times its growth rate. It can get up to 1. 5 times which basically says 40 is not a bad number. Also look at the near term earnings. Well have the Fourth Quarter results coming out thursday january 15th after the close. Were looking for earnings to be up year over year by about 30 . From that standpoint a bit of an acceleration to the underlying Growth Trends you were talking about. Should help the stock. What else is going to help the stock . What would be the growth driver . Windows 10 . No. I think in terms of the major thing you need to look at right now is from the point of consumer demand, obviously we do have an environment here with you know lower gas Prices Higher employment, lot of consumers out there with basically old equipment. The other element as well is that theres some gains that intel is gaining relative to the likes of samsung in taiwan that may give them a shot of getting more business with apple. As mentioned earlier in joshs spot, yes, tablets have been an area of generating losses for intel. But if you do see this market share gains of apple, things could break intels way in 2015. David, it was a real pleasure. Thank you very much. Positive view on intel. See you soon. Take care. Thank you. Still to come this morning on squawk box, an app that wants to help you keep your new years resolution to stay in shape. The ceo of my fitness pal will join us next. And if you made a resolution and you already broke it well wed like to hear from you. Tweet us your story squawkcnbc. Welcome back everybody. All this week weve been rolling out our 2015 playbook. Right now were joined by Bertha Coombs. She has the Health Care Predictions for twft. Washington will loom large over health care in 2015 with congress and the Supreme Court set to revisit Health Reform. Repeal and replace obamacare . It wont happen. The republican majority in congress will revise parts of the Health Reform law likely eliminating the 2 tax on medical device. The employer mandate will stay but shift to kick in for workers employed 40 hours a week. The Supreme Court wont undo obamacare either. There will be drama when the justices hear arguments in king versus burwell. The case challenging obamacare subsidies on healthcare. Gov because the laws wording for plans on state exchanges. A ruling against the administration could gut exchange enrollment. Expect chief Justice John Roberts to find middle ground between the spirit and letter of the law. In the big push towards consumerrelated health care, established players and new entrants are all going to Push Technology at us. Making 2015 the year of the Wearable Health gadget. But even after ls watch will struggle to dominate in a crowded market. Health i. T. Infrastructure players will be the real winners with increasing demand on data. From health to fitness, we asked you to share your shame with us if you have already broken your new years resolution. Heres one. Phil tweeted us that he ate a brownie for breakfast. He said it was there so he had to have it. If you need some help keeping your resolutions, listen up. Food and exercise tracking app my fitness pal is seeing a spike this time of year. And the first week of january 2014 the company added three times as many users as it does in an average week. Joining us is mike lee, he is cofounder and ceo of my fitness pal. I guess this is your super bowl season. Yeah. Absolutely. We are a popular new years resolution. Explain how the app works. I think it get it. But you download the app and then what happens . Basically we help you achieve your personal health goals by tracking your nutrition and exercise and showing insights to make healthy decisions. We have this massive food data base. Almost anything you eat is already in our data base. Its easy to track your diet. We also integrate with almost every wearable on the market. A whole bunch of other fitness tracking apps and all of that data flows into our system seamlessly so you can get a full picture of your health. That was my question when i was trying to figure how it works. I thought of it as a fitbit or jawbone. You work in partnership with them . Thats correct. Were a Pure Software app but work with wearables, exercise equipment, wifi scales. Basically you name it and we work with it. Brian sullivan is here and he i think uses the app. I actually well this is my question. And good morning. I do use your app. I got a fitbit for christmas. Thats probably a sign that somebody gave me a fitbit that i need some help. That aside, and i know my fitbit integrates with your platform but it also has a dash board. So sell yourself against the increasingly crowded field of competitors that do what you do. Yeah so what we do the best is track your diet. We really make that easier than its ever been before. Primarily because we have just a massive amount of data. Almost everything that you eat is already in our data base which makes it just much much simpler to track. When youre thinking about diet when youre thinking about health diet is incredibly mornt and thats what we do best. Im going to have an idea for you. Maybe i should keep it to myself because if i can invent this maybe ill be on your side of the camera. When you eat at home and have an apple or banana its easy to put it in there. At a restaurant i have to make assumptions. Is there anything that lets say i can take a picture of my plate and it might learn what that is . Is that just a fantasy in my head . No, no. We think all of that is possible. Primarily because theres so much data that we can collect, so many pictures of foods we can collect. So much nutritional information about foods. And when you have that much data, almost anything is possible. Mike, it sounds great, but go back to this question of the cooperation with the fitbit jawbone. Why dont they just do it themselves . Well, its incredibly hard to do. Weve been building this data set for over ten years. It takes millions and millions of people to be able to do this. I mean we for example, we have people eating in virtually every restaurant in the world. To accumulate that user base is incredibly hard. Thats what you need to have this much data. Youve had one round of funding and youre working with two companies. I wonder why one of these Hardware Companies doesnt just buy you. Well were not really looking to sell the company. I think we see a big independent play we can go after that were excited about. Your goal is to eventually have an ipo . Sure. We want to thank you for joining us today. Great talking to you. Thanks. Happy new year. You too. Coming up u2s bono saying he may never play guitar again. Details about the bike crash he had in november and how serious it was. Stick around. Tdd 18003452550 [ male announcer ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account, and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so if you get a trade idea schwab can help you take it on. Tdd 18003452550 were getting a lot of questions tdd 18003452550 about organic food stocks. Tdd 18003452550 [ male announcer ] sharpen your instincts tdd 18003452550 with indepth analysis by schwab experts. Tdd 18003452550 and if you want to run your idea tdd 18003452550 by a schwab trading specialist, tdd 18003452550 our expertise is just a tap away. Tdd 18003452550 whats on your mind lisa . Tdd 18003452550 id like to talk about a trade idea. Tdd 18003452550 lets hear it. Tdd 18003452550 [ male announcer ] see how schwab can help tdd 18003452550 light a way forward. Tdd 18003452550 so you can make your move, wherever you are tdd 18003452550 and start working on your next big idea. Tdd 18003452550 tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 call 18776703357. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 welcome back. U 2s front man bono says he may never be able to play the guitar again. He was in a bike crash in central park in november. He said he broke his hand his shoulder elbow and suffered injuries to his face. In a note posted late yesterday on bonos website, bono said he woke up in new york presbyterian with his humerus bone sticking through his leather jacket. The surgery to repair the broken arm took five hours and required three metal plates and 18 screws. Recovery has been more difficult than i thought. As i write this it is not clear i will play guitar again. He is in good spirits. He jokes they are depending on him play the guitar. Former new york governor mario cuomo died at 82. He served for three terms from 83 to 1994. Democrats pushed him to run for president , not once but twice. 1998 and 1992. Cuomo died hours after his son was sworn into a second term of governor. Well take a look back at the best and worst moments of last year. But im a bit skeptical of sure things. Whys that . Look what daddys got. Ahhhhhhhhhh growth you can count on from the bank where no branches equals great rates. Cute little guy, huh . This guy could take down your entire company. Stay with me. On thursday a hamster video goes online. On friday it goes viral a network choking phenomenon. Why do you care . Hes on the same cloud as your business. The more hits he gets, the slower your business may get. Do you want to share your cloud with a hamster . Today theres a new way to work. And its made with ibm. So ally bank really has no hidden fees on savings accounts . Thats right. Its just that im worried about you know hidden things. Ok, whys that . No hidden fees from the bank where no branches equals great rates. Welcome back. Lets take a look at the u. S. Equity futures. So far so good for the bulls. Dow futures are indicated up about 70 points above fair value. S p would open up eight points. Nasdaq would open 20. Dow up about seven Percentage Points last year. Nasdaq up by 13 and s p up by 11. Crude oil prices have been under pressure once again. Wti down by about 81 cents this morning. 52. 46. We are kicking off the new year today. Lets take a look back at the highlights and low lights of 2014. Good morning, everybody. Im becky quick. Whats happening here . Check this out. Are you looking at this. Its sweet heat. Thats my nickname for you sometimes. Oh my god. Look at those eyebrows. You think im cute . Its that way. I had people ask me is joes hair real . Can you see the tag . Someone said you could see the tag. Taxi. Joins me to talk about sorry. Go back. Just kidding. Okay. This is the price is right. Its worse. Its worse. What are you looking at. Stock jumping. Ill make it fancy. Holy cow. Start that over. I have no idea what i just said. Excuse me. I should know who i am. Do it one more time. Dachshund. You are incorrect. Piegza. Just stop. You can have any sex now and be totally safe. I dont know this from personal experience. Its a really big but. Watch this. Im not crazy. This drives me crazy. This is just youre a puppet. It was right there. Did you see it . Soccer. Ive seen too much soccer. Andrew was last seen at a craps table at caesars blowing on some womans dice. That is a cool shot. That is a goodlooking shot. Be still my beating heart. Youve got some with ham on it too . This is amazing. All right. There . Save that. Theres mack. Mack thank you for being here today. Are we going to sing at some point . Why are we here . National ugly holiday sweater day. This is made out of beautiful acrylic. No way. Im going home after this. Byebye. We want to thank our tape producer for putting that piece together. He works all year collecting tidbits weve forgotten about. It was great. Dean did a great job. Thanks to our whole staff. End of the year. Beginning of the new year. We are the beginning of the new year. When does the best of 2015 come out . No, no. In my opinion, this was the best squawk box of 2015. This one now . Its the best one we had all year youre right. Brian, thank you for being here with me to ring in the new year. My pleasure. Nice and early. Get a good jump to the year. I cant talk. I got about 90 minutes of sleep. 90 minutes and three hours. It does look like things are off to a good start today. Take a look where futures are lining up right now. Dow futures up about 77 points above fair value. 2014 was an up year. Oil is going to be a continuing story. No sign of recovery. Now its back down. Look at that. 52. 39. Was the low trade of the last five years just now. That does it for us today. Now its time for squawk on the street. Baby you Better Believe im back good friday morning. Happy new year. Welcome to squawk on the street. Im Carl Quintanilla with sara eisen and simon hobbs. After that sour note to end last year the worst final calendar day for stocks since 2001. Markets up in the premarket. We are reminded how ugly last january 1 was. Oil is lower, back below 53 a bearable. Today 52. 18. The 10year note close to 2. 20. Draghi comments that the ecb had more risk of missing its price stability mandate. Markets and the outlook for the new year. Will the dow deliver a seven Straight Year of gains in 2015 . We are higher in the premarket. Dont believe the hype. Fred wilson says the apple watch will not be the home run apple is looking for. Apple ended 2014 up over 40 for the year. Is yahoo going to spend the proceeds of alibaba buying a Cable Tv Network . First up, futures are higher looking to rebound from that sharp decline late in the trading day wednesday. Dow was down 160 points. Ecb president mario draghi fanning expectations the ecb will increase stimulus and oil will remain a huge focus moving lower this morning. Wti with a new fullyear low. Two years down for gold silver and copper. The playbook has to be different this time. Those big trends lower oil, weaker euro are continuing higher stock prices continue to see the market gain. Euro is the focus this morning hitting a 4 1 2 year low. 1. 2030. Folks are watching these levels. The dollar continues to roar higher. The dollar index is almost at a nineyear high. 2 from the tenyear high. It affects corporations. In the coming year what it means, how much of a hit it will be for Companies Like mcdonalds, like nike cocacola that do a majority of business overseas and what it means for u. S. Stocks. Does money continue to pour into the u. S. Which has been the outperformer in the Global Economy . Therefore into the dollar . Its more important to point out corporate never has never been stronger. No Interest Rates, no energy costs. The dollar may move. Look at the returns you had over the last three years. 21 on average when you add in dividends. Thats an astounding run. The biggest cloud if there is a cloud has to be valuations. Getting too expensive. Correct. There is nowhere else to go. Will the money continue to churn in and therefore will be up 15 20 this year. First days of the month, last year were historically negative. We didnt have an up first day of the month until april. The only ones for the year that were up for all the major averages april and july. We used to talk about new money coming in but that was not the dynamic. You have two things in january. January barometer which says that if january is higher the rest of the year is higher did not work in 2014. January was lower. The other one is the january effect. That is that the riskier small cap names are in demand because investors come back from new years, they want to buy, put the money to work after taxrelated selling. Well see if that continues. Not such a strong historical. What can we expect from the markets 2015 . Joining us is global chief investment strategist russ welcome back. Happy new year to you. There is a piece in the Washington Post today. Oped by samuelson, five big questions. What happens to oil . What happens to europe . Does the fed get it right . Do wages beat prices . And does china keep growing . Does that sound about right to you . It does sound about right. Only thing i would add is the dollar. One of the big things well see in 2015 this divergence in global economies. What does that mean for the dollar visa vie other major currencies. That is going to affect the treasury market and exporters. That is the big theme. The dollar is negative for Companies Running profits overseas. What are the main effects of money running into this country and driving the dollar higher is driving market Interest Rates lower. We could debate what the fed should do. To have Interest Rates at this level, a Housing Market that could remortgage has got to be a major stimulus for the euros. I think this is it. When you think where the u. S. Economy is. The best two backtoback quarters in q 2 and q 3 . Over ten years. Tenyear treasury is low. That is difficult to explain. It only makes sense in the context of massive flows coming into the u. S. And many of those going into the treasury market. Rotation out of bonds into stocks . It never happened. One of the reasons is u. S. Yields still look competitive compared to the rest of the world. If you think the dollar is going to continue to strengthen do you want to buy stocks overseas . If you look at the beneficiaries of that its european exporters and manufacturers. Their equity markets are better valued than ours in the u. S. Particularly japan. That is one of the markets we like with a strong back half in 2014. The valuations are very compelling. In addition in japan, youve got a catalyst which you are not going to have in the u. S. In 2015. You have a very Friendly Central Bank engaged in a major Asset Purchase Program the same time the fed is going to be tightening monetary conditions. I agree international diversification. Japan is one of our favorite picks for outside of the United States. Commodities, are they a natural buy after what happened last year . I think commodities are going to continue to struggle. I do think you are going to see some point where the supply disruption because of lower prices does start to stabilize the oil market. Youve got a couple of negatives. Youve got slowing global growth. High real rates and stronger dollar that is not a great combination for commodities market. There is a piece in the journal talking about how the market is mispricing risk. The obvious defensives are expensive at the moment. She is pointing to industrials and technology which she says actually if you look how they perform are quite defensive and are not being valued perhaps at the levels they should be. I know a lot of people would line up behind technology and health care for the new year. To put industrials in there at the same time would you agree with that . I would agree with the more cyclicals. Parts of that textor are worth a look because we expect further increase in capex. Defensives may not be that defensive. If youre worried about rising rates. Utilities are a great place to hide out. If youre worried about slower growth. That is not the issue in 2015. Youve got defensive sectors like utilities trading at a premium to the market. Historically they traded at a 20 discount. Many of those defensive sectors are vulnerable going into this year. All right. Russ thank you very much. Well see what happens as we kick this new year off. Talk to you soon. Good to see you. 30 victims recover the from the air asia flight that crashed on route to singapore this week. Kelly is in indonesia with the latest for us. Reporter good morning. 30 victims now the total brought in from that wreckage site in the java sea. Some have been brought here to the Identification Center to begin the very slow process of finding an identification and turning over the remains to relatives. Four people total have been identified. Three were identified today. Among them that young Flight Attendant people heard so much about. An 11yearold boy and a 22yearold man, all from indonesia. Those three people on top of another person identified yesterday, an indonesian woman in her late 40s who is a School Teacher going on vacation with her family. Her family members are still missing. In terms of the search a very frustrating day. The sea state was terrible for searchers. Waves as high as 13 feet. Heavy rains, winds coming and going. Made it impossible for these experts to deploy these hydro hydrophones that are dropped down to the sea to listen for the pings from the black boxes. They were not able to do that today. No progress looking for the main body of wreckage which is where officials believe most of those passengers will still be. Back to you. Kelly, thanks so much. When we come back David Rosenberg, longtime bear now bullish on the markets. Where he seeses going in 2015. Microsofts head of wearables. And one more look at futures. S p up three years in a row. Eight straight quarters of gains. 54 records last year. See if we get another one today. The evolution of luxury continues. The next generation 2015 escalade. Your old 401k is rolled over into a Td Ameritrade ira. Yes so no set up fees wooh yeah so i get help from rollover consultants . Wooh yes no rollover hassle. Great. Woah oh, were spiking things, robbie. For all the confidence you need. Thats better Td Ameritrade. You got this. The apple watch will not be successful. That at least according to a list of 2015 predictions from fred wilson of union square venture. The apple watch will not be the home run product that ipod, iphone and ipad have been. The focus on wearables will be a bit of a head fake take up a lot of time energy and money in 2015 with not a lot of results. Interesting after the 40 plus gain apple has seen. People are looking for the next catalyst given the strong sales of iphone 6. One analyst says january typically is an underperforming month for apple because those record sales from december and the holiday period are already baked in. Amazing. His comments about broader Capital Markets are interesting, too. Says the dislocation in oil prices is going to create a lot of stress. There will be a flight to quality. You are going to buy gold u. S. Treasuries. You are going to be buying blue chips. Wilson has been around the block a couple of times. Nobody is buying gold. Hes talking about 2015. I dont think anybody thinks the iwatch is going to be as important as the iphones or tablets. I saw a survey that said 5 of iphone users were likely to buy the watch. That is not that much. Thats 50 million. You have to have an iphone to get the apple watch. The question is will it bring more people in to buy iphones if they want the apple watch . I think that was the survey you mentioned. The big take away was people have to see it first before they shell out 350 for this luxury apple watch . The one you already picked out for yourself. I like the pink one. Its not as a technology thing. Its more of a luxury item a fashion item. It was already on the cover of one of the vogue internationals. Yahoo is interested in buying a Cable Tv Network according to reporting from Business Insiders. Yahoo ceo considered inquiring scripps interactionive. They describe active rumors. Investor ares including activists starboard have been pushing the company to return capital to shareholders and not make large acquisitions. You have this huge contribution coming from the alibaba stake. They have been looking for ways to reduce the tax leakage. Im sure she has run the numbers or kicked the tires on a number of acquisitions. The idea that yahoo would by the food network which is what they really wanted seems incredible really. And expensive. I wonder if thats why this collapsed. He also mentioned the price in total would be 15 billion. I think that would surprise people. Its an indication she is given up making it a musthave technology stock. The emphasis is on consent. Other people would look for technological solution, something that had monopoly status. Which is in regard to a previous fred wilson post the social media era of the internet is flat. There is as much innovation as we are likely to see. Which would fit with a bet that okay you got yahoo where it could go technologically. Shes come up a number of times. Mary thompson later will be looking at the top ceos to watch. She looks at stocks that underperformed. Yahoo has not underperformed, but people are still looking to her to figure out a way to turn around the core business. Do you think she will be at that position the end of this year . Thats the thing. I doubt it. I dont think they proved the turnaround in the core business. That is a partner of this network. Im sure. Its just very hard to read because the stock is not a good tell on the ceos performance because of the alibaba tie. And japan, as well. It was interesting in the Business Insider piece. He didnt name investors, but this idea they could split the company into asian assets yahoo, japan and alibaba and the rest of the Company Giving it a better focus on the core business. Its all very speculative. That may be part of the tax solution, i imagine. Its an awful lot of tax to pay. When we come back well get art cashins take on this first trading day of 2015. Take another look at the premarket. Looks good from this standpoint. We get the first trading session of the year. Just about nine minutes till the bell. Lets bring in art cashin. Blind squirrel tie is on. What does that tell us. Beginning of a new year. We got crushed wednesday afternoon, big sell program. Massive sell program on the close. Nearly 2 billion to sell on balance. Ordinarily the runoff at the close is Something Like 100 to 120 million shares. Explanation . Not sure. Checking around, somebody was settling up something for year end. It was not a reweighting. It was not anything in particular and it didnt look like it was one single house. Somebody was changing a portfolio in a very large fashion. Worst last day of the year since 2001 is what it turned out to be. Wiped out all of decembers gains for all three major indices. What about the buying this morning . What does that tell you . Is that driven by Mario Draghis comments . I think partially. Some is simply a bounce back. That selling at the close caught a lot of people by surprise. Not a lot of people were around. You pick up the newspaper and say, hey, some stocks were a lot cheaper than i thought they were. You are getting some bargain hunting and some reaction to draghi. December was not a good month, was it . Usually is. Historically, but it wasnt. Mainly because of that final selloff. And the first two weeks were quite rough as we had oil declining. Is that important moving forward that we didnt get the seasonal bounce you would have expected overall . It was certainly disappointing. Well find out whether it was a primarily oneday event at the end. Oil continues to look weak. That is somewhat worrying. People are still trying to figure out what the full impact is. Everybody talks about they are going to benefit the consumer but its also going to hurt businesses in other ways. Employment and capital expenditure. A lot of that was coming from the Energy Sector. A lot of chatter today that the move we saw in oil weeks and months ago, we are going to start getting the aftershocks. We are going to see the ancillary effects of people who were dislocated severely. You agree . I think youll start to see some of it. The old Warren Buffett story. Only when the tide goes out do you find out whos been swimming naked. Now the price is low enough youll see if people can sustain and live up to the payments some of the debt they built up. End of next week we get a jobs report for december. A lot of fed speakers over this weekend at the american economics institute. January, middle of january starts earnings season. What are you looking at in terms of catalyst for the next move . Im going to look to the earnings. Fed speakers will be interesting. Fomc now is very very dovish. I dont think there is a hawk on the whole area. I want to see if the earnings can sustain. Weve been fighting this record Profit Margins and the squeeze, whether you revert to the norm. That will be a key area to watch. If you had to choose one area of the world to watch, europe japan and Something Else what would it be . Russia . Right now would be europe. Japan would be a close second. They are beginning to look like they are spinning their wheels over there, too. No hope this is not going to be a year of the central bank . We are not going to lose our dependency on Central Banks . Highly unlikely. We got a number out of china on manufacturing. Came in at 50 but was one of the weakest numbers. How big a risk do you think that the china slowdown is worse than already expected . I think thats quite a big possibility. We dont really fully understand what may be happening in the shadow Banking System over there. I think the economics of it loosening up money will be important. One final question on the Central Banks. If they go full force in europe if they dont weve got a problem. And you have japan doing what its doing. Does that underwrite this market here . Does the power of that liquidity and so much will flow here underwriting this stock market . I think we first have to see when they start to do it how the money beginning to flow through the system. Youre dead right. There are things here more attractive than in other places. If there is loose money around in all likelihood it would come here and underpin it. Youve got to give it a couple of weeks. Ready to get this thing started. I certainly am. Art cashin. The first opening bell of 2015 is four minutes away. Female announcer get beautyrest, posturepedic even tempurpedic mattress sets at low clearance prices. Save even more on floor samples, demonstrators, and closeout inventory. The year end Clearance Sale is on now at sleep train. Your ticket to a better nights sleep tdd 18003452550 [ male announcer ] your love for trading never stops tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so when a market move affects one of your positions, tdd 18003452550 schwab can help you decide what to do. Tdd 18003452550 with tools like free livestreaming cnbc tv tdd 18003452550 that give you the latest Financial News and trends. Tdd 18003452550 and bubble charts and price charts that let you see exactly tdd 18003452550 how market activity is affecting your positions. Tdd 18003452550 so when the time comes to decide whether to scale in tdd 18003452550 or scale out you can make your move, tdd 18003452550 wherever you are. Tdd 18003452550 and start working on your next big idea. Tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 tdd 18003452550 call 18777292379. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 you are watching cnbc squawk on the street live from the Financial Capital of the year. Happy new year. The first trading session of 2015 will happen in about 60 seconds. If youre just joining us the dow losing 160 points on wednesday. That was the worst final calendar day for stocks since 2001. Actually pushed all the major averages into the red for the month. We had been hanging on to green month to date. As for months last year the nasdaq had more negative months than any other major average. It outperformed for the year. That had the highest percentage gain. If you tally up everything the dow rose up 7. 5 s p up 11. 4 and nasdaq up more than 13 . Six negative months dow and s p only had four negative months. The Fourth Quarter was still the strongest of the year. The s p is up for eight straight quarters. Dow up for six Straight Years. See if we can go for number seven as we kick off 2015. There is the opening bell. Store capital celebrating its recent listing at the nasdaq. Microsoft and microsoft band which tracks wellness goals participating in nasdaqs Fourth Annual fit week. Well talk to the head of wearables. Real estate trust was the biggest sector with a 36 gain once you include dividends. Reits served as utilities, partly because of the lower Interest Rate environment. That is key moving forward. Lets have a look at gainers. Bed bath and beyond up 2. 3 . Quest diagnostics making gains. It will be interesting to see what some of the las vegas plays. China cracks down in so many different ways. I think for a lot of people in the industry probably not a surprise because a lot of the data leaks out from china. All the hedge funds get a hint where some of the data is going in advance. Well be watching those at the open. Clearly, nobody is taking a flier on some of the refiners today. Once again the Oil Companies continue to lead the pack to the down side. Oil as you know by now, hanging on to 52 and change. Oil has not been below 50 since april 2009 when it was 49. 12. From 107 its mindblowing. You continue to have the same factors that dominated oil in 2014. Weaker demand. We got weaker pmi out of europe and china. China was the weakest. Watch that china slowdown story. China is the Biggest Energy consumer outside the u. S. The oversupply data. Russia is pumping oil. A lot of these countries continue to be hurt by whats been going on. The russian ruble under pressure. Chevron and exxon weighing on the dow. Scripps networks. This is the extent to which the market believes Marissa Mayer is likely to by food network from in them. The stock is higher from a Business Insider. Suggesting that Marissa Mayer did kick the tires on buying initially food network and scripps. There was chatter they might buy time warner. Scripps only marginally higher at the open. 10. 5 billion company which its own stock price did badly last year. You might have expected a bigger pop if people thought that was a serious consideration. The idea shareholders would let that happen i find incredible impossible. There you go. Gm not seeing much of an effect of the recall of some of these suvs. I dont know if you saw statistics. 60 million cars were recalled last year. To put that number in context, that means its twice the alltime record set in 2004 in terms of how many cars were recalled. If you talk about Crisis Management study, tumultuous year 2014. Really turned it around and did not lose the faith of shareholders after that record recall number. It seems like is haunting them into the new year. One category was utilities. We are looking for these themes of what worked in 2014 will still work after that mont ruse rally in utilities. The lowgrowing dividendpaying group that rose more than 20 as the bestperforming s p group. It is higher. That is one well be watching to see. Thats the other thing in january. You want to know if the losers are being bought as bargain hunting. As a matter of fact, in 2014 this did not work. We saw ibm, caterpillar at the bottom of the dow in 2013 and 2014. Simon mentions yahoo and scuttlebut about scripps. At 86. 50 this would be close to the alltime close back in july. A lot else going on with time warner as we all know. Hbo go going to launch more of their over the top product. Dish is going to launch on monday a way to subscribe to dish without a dish. An appbased subscription. How does that work . They are thinking outside the box, literally. Dish is going to extreme the interview. They became the latest. Dish comcast, time warner as well as 500 independent theaters. One day we will Start Talking about it. It has been a brutal month. Dow is up 95 points. S p 2069. Lets get over to bob pisani. Happy new year guys. Looking forward to being with you again in 2015. All sectors are up at the open. Europe is looking good. One sector is not up is energy stocks. You referencing oil back at 52 once again putting pressure on some of the usual names. This has become a volatile group. Denbury usually moves how oil is. Denbury, nabors, murphy, apache. Thats typical when you see oil move in any one direction one way or another. A lot of people messages me saying why are we so interested in utilities and why was there a 4 drop in the last few days in utilities . Its been a greatly expanded class of Asset Investors in utilities as an asset class last year. I think the answer is simple. Despite the price runups, theyearolds are still very very attractive. With the big priceups, you can get 4 yields in southern and ppl and duke and con ed. With a 25 runup you get 4 yields. The other thing very important, investors feel these dividend yields are relatively safe. They dont think they are going to be attacked. Unlike yields in highyield plays out there, for example some of the oil and gas partnerships out there. Some of these have driven up high recently. Linn energy penn west the price has dropped dramatically. Theyve driven the yields up. Take a look at linn energy. That is down close to 50 . From 22 to 10. Obviously people feel some of these payouts are in danger and with very good reason. There is a distinct difference here. If you look at some of these limited partnerships, the price hasnt dropped nearly as much. This is amlp. This is a basket of Master Limited partnerships. Most are pipeline owners. A lot of people feel the pipeline ownership is a safer way to buy into highyielding stocks. Finally, i want to note there is a small group of oil drillers paying very high dividend yields right now for the same reason. Their prices have been dropping. Ill make no comment about whether they are safe or not. Big price drop with yields like this some people are concerned about that. Back to you. Thank you. Now up 113 points on the dow itself. One clear winner today is biotech stocks pharmaceutical stocks are surging. Lets get to Bertha Coombs for more. Happy new year. Sara was mentioning is what worked in 2014 working on the first day . That is true. Biotech probably among the most volatile of sectors last year. They outperformed the major indexes up 18 . Once again led by biotech and chip stocks. Those were the toughest rides to endure. When there was a pullback that got hit. Hardest. It seems to be working again. Talking about yahoo. Yahoos valuation market valuation is about 48 billion. Theyve got that 10 billion they are getting from the alibaba sale which would be where scripps valuation was at the end of the year. Interestingly, 15 years ago, people were talking about yahoo back when it had a 350 billion market cap. Buying disney or abc at the time. Everything old is new again. Since Marissa Mayer did take over the stock is up over 200 . One of the stocks that was the big losers last year was wynn resorts. As those numbers continue to look bad coming out of mccow. It used to be las vegas was bad. Mccow was the big savior. Now its weak and we are seeing wynn getting hit. What is interesting, last year the worst performers were a lot of those Small Cap Energy names. They took it hard at the end of the year down 34 yeartodate. A lot of them losing much of their market cap in the last five, six weeks of the year. They are up this morning. Likely going to be one to watch. Bob talked about linn energy. Its cutting its dividend as it cuts back on its capital expenditures. This morning it is getting a bit of a boost. A mixed picture with some of these names. Back to you. Bertha coombs, thank you very much. Lets get to the bond pits and welcome back rick santelli. Good morning. Happy new year to carl and all viewers and listeners. Treasuries are coming into 2015 similar fashion to the way they spent most of 2014. That is on the lower side. If you look at a chart of twoyear note yields. 74 basis point close on the 23rd basically last week what you see is that we are hovering at the highest yields since the spring of 2011. If we move down to fives. Want to Pay Attention to that. Outright fives are hovering at yields we just saw recently. If you look at fivemonth chart, you could clearly see that there is a bias toward the short yields to be higher than the long end. Five needs to go about another dozen basis points to get to breakout territory. If we look at the tenyear. We only need to look a few months to see it is very similar to the five but at the lower level like 30s which gives us that flattening curve. Bund yields. Lets put up a 24hour chart and acknowledge the first bits of data, pmis did not look very good. That is reflective at 51 basis points. We are close to breaching the 50 basis point level. When was the last time we were here . Never. If we look at the difference between bunds and 10s and this is the key way to welcome 2015. If youre looking to make money, this spread the difference between our yields and bund yields is 165 basis points. Havent seen anything like that since the summer of 99. Its going to draw our yields down. We want to pay close attention to that. I thought we would close 10 for 2014 at that important october 15 settlement of 2. 14. It was within several basis points if we look at a chart of the Foreign Exchange side dollar yen, the euro with their weak pmis this is just weak. Weakest since june 2010. Back to you. Stock dollar rules. On the flip side oil prices under pressure. Jackie dang Jackie Jackie deeng deangeles has more. Traders are worried about this. We are coming off session lows. 52. 96 we did touch an intraday low earlier this morning. Traders eyeing that 50 mark for wti. We havent seen that level since april of 2009 when we dropped to 49. 12. Adding a little pressure to the down side is the fact that the tensions in libya eased a little bit. Reports fires at refineries have been put under control. I want to point out eia was out with production numbers for december. U. S. Production 9. 12 million barrels. Showing we are not seeing any slowdown in production on this side of the atlantic. Certainly we know opec isnt cutting production. In anticipation of a stronger dollar is going to impact crude in the new year. That is having an impact on gold prices this morning. Getting hit hard. Gold trading at 11. 70 after two backtoback yearly losses. In the commodity pits things are looking to the down side. Thank you so much. 2014 a redhot market for the ipos market. More Companies Choosing to stay private longer. Where is 2015 going to stack up . Well, a mortgage shouldnt be a problem your credit is in pretty good shape. Pretty good . I know i have a 798 fico score thanks to the tools and help on experian. Com. Kaboom. Well, i just have a few other questions. Chuck, the only other question you need to ask is, what else can you do for me . Ill just take a water. Get your credit swagger on. Become a member of experian credit tracker and find out your fico score powered by experian. Fico scores are used in 90 of credit decisions. The dollar is looking strong today. Could take a bite out of international tourism. Marriott was one of the big winners in 2014. Shares gaining 60 for the year overall. David lobe covers the hospitality sector. Welcome to the program. Happy new year. Thank you. Before we get into the nittygritty of the hospitality sector, one of the big features of the Hotel Industry the lodging industry and why marriott has done well is this continual stock buy back you got clearly transmitted to the market clearly understood and one reason marriott did so well. Arguably why starwood didnt do so well. Can you talk me through where that industry is going, the cash its going to generate and what the difference will be this year . Marriott owns very few assets. They are generating cash from licensing their name and operating systems around the world as well as reservation system and point system. Starwood has that but starwood own as lot of real estate. As it sells real estate, its been using some of that capital to return to shareholders in the share of extra dividends and stock buyback. Theyve been less clear in the timing of those asset sales or timing and expectations around the stock buyback. Youve got hyatt selling properties. What is the best way to make money this year in your view . Actually hyatt, we think, is an interesting play. Hyatt has been more aggressive with its stock buybacks. Theyve been selling assets and buying assets. It is the most american of the big chains. They are the most levered to the u. S. Economy. They are using their Balance Sheet which is very strong to buy assets to put their brand on while selling assets they owned for a longer period of time to turn around to investors. We think that combination of relatively cheap fee as well as real estate that is we think undervalued relative to where Hotel Real Estate is trading in the Public Markets will make that the best play in 2015. As you will know but others may not, the hyatt family the commerce secretary and her brothers have controlling interest in hyatt. Theyve not run it the same way you would expect marriott or hilton to be run. They say they would take a longer term view of the industry. They can invest where others wouldnt. They have different rules. You are suggesting that will be the top pick this year. Right. The prisker family theyve been very active in running the company. They turned it over to professional managers. Theyve been good stewards of public capital as well as family capital. This year because of that valuation disparity between Hilton Marriott and hyatt on the other hand we have an opportunity to see that gap close. We think hyatt will outperform marriott and hilton and starwood because of that. David loeb happy new year. Thanks for joining us. Our 2015 Health Care Playbook with predictions for the road ahead. Meantime, the first time this year we get to say dow up triple digits. Squawk on the street will be right back. It is time for the cnbc 2015 playbook. Bertha coombs. Health care was among the best performing sectors of the year last year but this year weve got a couple of head winds, particularly when it comes to insurers and once again when it comes to obamacare. Washington will loom large over health care in 2015 with congress and the Supreme Court set to revisit Health Reform. Repeal and replace obamacare . It wont happen. The republican majority and congress will revise parts of the Health Reform law likely eliminating the 2. 3 tax on medical devices. Employer mandate will stay but shift to kick into workers employed 40 hours a week. The Supreme Court. There will be drama in king versus burwell. King is challenging subsidies because the wording specifies tax credits for plans on state exchanges. A ruling against the administration could gut exchange enrollment. Expect chief Justice John Roberts to find middle ground between the spirit and letter of the law. In the big push towards consumerrelated health care, established players and new entrants will Push Technology at us. Making 2015 the year of the Wearable Health gadget. Apples watch will struggle and dominate in a crowded margaret. Health i. T. Infrastructure players will be the winners with increasing demand on data. These health apps are proliferating the big question is whether they add something for you. Some of them arent playing with one another. Thats part of the problem with Apple Health Kit and apples watch. If youve got a fitbit it doesnt play with the health kit. Which one will you stay with now that you invested . Sounds like the battle for your living room. Thanks Bertha Coombs. When we come back David Rosenberg on where we are headed for 2015. Kara swisher talking about Marissa Mayer. Dow up 112 points. Cute little guy, huh . This guy could take down your entire company. Stay with me. On thursday a hamster video goes online. On friday it goes viral a network choking phenomenon. Why do you care . Hes on the same cloud as your business. The more hits he gets, the slower your business may get. Do you want to share your cloud with a hamster . Today theres a new way to work. And itmade with ibm. Good morning. Happy new year. Welcome back. David David Quintanilla with sara eisen and simon hobbs. David faber is off. We get the road map for the next 60 minutes. Stocks in rally mode on the first trading day of the year. Longtime bear David Rosenberg is now a bull. Will the momentum hold for 2015 . Polaroid trying to compete with gopro with its cube camera . The ceo will join us live. Lets get to rick santelli. Lets start with construction. Its older, a november number. November read down 0. 3 . We were looking for mere image up 0. 3 . We did gain from last month. Ism for december 55. 5. Thats a pretty darn big miss. Last month remains 58. 7. If you recall month before that at 59 was the best