Transcripts For CNBC Squawk Box 20150203

Up. Well come up with anything wont we . Its outrageous. Im not paying 51. That looks like a little huffington there. Its the other lady. Yeah. She used to go to buffets thing all the time. Oh i know who wrour talking about. Its outrageous. There you go. In the meantime lets tell you about other big stories to watch this morning. The nations auto makers will be reporting january sales. Theyll drive demand for pick ups and suvs in all of this. Also other major companies. And well be hearing this morning and disney and chipotle interactive. One report of note december factory orders will be released at 10 00 a. M. Eastern time. Here are some of todays stocks to watch. The wall street journal reports staples and office depot are in advanced talks to merge. No word on the proposed terms and activist investor starboard called for a deal last month. Utx, i dont know why we need two of them. Tint we lose the other one already . Office max . Whatever happened to office max . Theyre now part of office depot. My life did not change. At all. A pair of scissor is going to cost you a lot of money when this is all over. No you have amazon still. I dont know if you can gouge Office Supplies really. What do you need things to hold paper together for. Its not a paperless society. We looked around our set. Theres paper and staples in there. These are the guests on the show . Yeah. We have all of this information about the guests that are if only you knew ahead of time. Are you kidding me . How do you act like a viewer that its new information if you already know all the information . It seems to be more spontaneous if you dont prepare at all. And natural. Thats why youre so good at your job. Thats why im so good. Utx is increasing its dividend by 9 . That raises to 64 cents from 59. I was going to quickly give you a yield on that. Whats it yielding now . What was it yielding before . Was it a yield stock or not . Yielding 2 . So better than that and shares of rentacenter. I saw this last night. Down 15 . The company posting Quarterly Results. It fell short of estimates while also issuing weak full year guidance and cliffs Natural Resources getting a boost. The mining firms earnings held by a 26 jump in u. S. Iron ore sales. Shares of computer hardware maker stratsys slammed. Cutting its 2014 profit view for a second time also warning the 2015 revenue forecast is going to be short of where wall street was at this point. We should also tell you about other news from a couple of big nshlg names. Fourth Quarter Results fell short of wall streets expectations. Company was dealing with a collapse in kudcrude prices. Bps results were better than expected thanks to downstream results. The company is cutting its Capital Spending by 20 . The ceo sat down with cnbc this morning to talk about the results and the overall oil market. I think its just going to take time. It could be a long time. U. S. Production is still growing. Chinese demand of course has great growth in china. Not as high as it was. We have stock levels filling up all over the world. Tanks are filling up. It wont be long before we see people putting them in ships. That takes a long time to work its way off. Dudley also says the dividend is firmly established as the First Priority within the financial frame work of the company. Australias central bank cutting its cash rate to a low of 2. 25 . Breaking an 18 month break on stimulus. Were going to talk about european markets because they are higher today on news that greece is softening its stance on a debt write down. Michelle is here. So the big headline is greece backs down. The asterik is greece backs down on some things. A lot of Market Participants think its why the dow moved 150 points in the last hour. This news comes as the finance minister was in wow. I like the way you say that. Youre not used to that now . You saying things correctly . If i said that wed need a delay. Sensor. Please look at this video. The markets were focused i wanted you to see what he was wearing because twitter was obsessed with what he was wearing. Guy on the right. The guy on the right. He showed up. One more time. Slow. [ inaudible ] yeah the sensor is be in the headlines at 7 00. Twitter was obsessed with what he was wearing. Little casual. Just like this country, all right. A little aol time warner. That worked out. As hes in london he gives an interview to the ft and he said the big headline is theyre no longer going to demand a full write down of the debt. They wanted it written down by 50 the debt they owed to other countries. Instead hes going to propose a swap where they give the other European Countries a new bond linked to gdp growth in greece. Its something weve talked about on the show before. Thats the one big move that hes made. He still wants the ecb to reprofile the debt that they owe to the ecb. Thats going to be incredibly difficult. Even though this is a concession and we have talked about this before you want bonds linked to growth in greece, that might never happen so it might be the same thing as basically writing this off. Is this palatable . So that would be the second concession that we havent heard much about which is the reforms that they supposedly want to do are not seen as reforms. They want to reinstate Public Workers and rage the minimum wage and salaries and pensions et cetera et cetera. That would be the next thing we have to see them back down on. We havent seen that yet. However, they do have a habit now in the last several days of backing down because this guy we just showed you had been telling people that when it came time in july and august. The Prime Minister of the country came out and said dont worry. Did this over the weekend. Were going to pay back the right. So trying to calm everybody down because their banks were under a lot of pressure. If you look at greeces three year yield which is the best way to look at greece at this point you can see that the number of the yield had gone to 20 due to the big fears we had seen. On a three year. Up from 10 before the election and now today is back down. You can see around to just 18 . I know hes been promising theyll pay back the ecb and the private investors. And the imf. Who gets hosed in that deal. The other European Partners and taxpayers. Other countries that extended bilateral loans to greece during the crisis direct country to country loans thats where they want the write down and thats who would lose. The other european taxpayers. How does that play in germany . So thats going to be a lot easier because for whatever reason they think the populations in europe dont understand if it takes me longer to pay you back with a lower Interest Rate youre losing money. We understand that youre not getting paid back. We understand this intuitivety. Its easier than a 30 year higher Interest Rate or whatever. They dont have to say that there was actual write down. That they forgave dpreess debt. Instead theyre giving them longer to pay it back. Kind of like savers in this country. Thank you. Thank you. That worked well. One thing, remember greek debt is complicated. Theres all different kinds of it. Do we have the wall chart we can show you . The biggest amount they have, nearly 200 billion to their other European Partners. Theyre 24 billion to the imf and then 38 billion to the private sector. The fourth cube in from the right. Thats whenever we show you the chart what is the greek yield is doing it reflects that pile there. That is the only tradeable debt in that big pile. The 38 billion of the private sector four cubes to the right. Thats the only stuff that actually trades. They also reiterated dont worry were going to pay that back. They reiterated that. Still when you look at a yield of 17 on a three year that tells you that people are still worried it could be a possible. They are . What are the chances now . I still think like 20 or 30 . Thats it huh . You could have a banking accident because the ecb could cut them off and then youre at a situation where the greek population has to take out about 100 euros a day and cant transfer any money like a little more than a year ago and then you have to decide are you going to actually buckle to all the demands or print your own money . Were pulling for them to stay in right . Im not pulling one way or another. Its not because i like to watch the world burn its because the euro experiment is just like a joke. I cant imagine it ever works. So many mistakes along the way. We need to hope for a positive outcome for all of us you dont care. And then were not happy they elected a full on socialist in greece. Do you know what the Prime Minister named his son . Ernesto. After a murder. Yeah and really admires the revolution in cuba even though the people in cuba are living worse in what way does he admire . I asked him how on earth can you see what happened to the soviet union and whats happening in cuba and believe in socialism. They say that wasnt real socialism because it wasnt a democracy. You should be happy. Im thrilled. I take that as a compliment. You know. To me thats great company. You dont have an answer for me. We have to move somewhere. We have to go. Nice to see you this morning. Have you got any plane tickets right now . No but we have plans. Visas. You do . Yeah. But at this point you dont i thought i would have to be in greece around february 28th. The way theyre back pedaling in the last couple of days we may not get there. Thats good news for people that are hoping for some calm. Lets check on the markets this morning. The futures are higher. We saw big gains at the end of yesterdays session. The dow traded in 330 point range. Earlier in the day it was down 127 points because of weak numbers from ism. Get help later on by what michelle was talking about. By the end of the day the dow was up almost 200 points and this morning the dow pu tours are up by about 66 points. Nasdaq is up by 16. 5. In europe and the early trade theres also green arrows there. Youll see that in france and in london and in germany the markets all up by better than 1 . The greek market up by about 9 . In asia youll see that things ended higher in china. The nikkei was down by about 1. 25 . Oil prices again a very big story we have been watching. Rebounding above 50. Now trading at 5142. The ten year note looks like it is yielding 1. 717 . Slightly higher yield than yesterday at this time. It looks like the dollar at least at this point is down across the board dollar yen is at 11735 and gold prices at least at this point look like they are up by about 4. 80. 1,281. I wonder if the ten year starts, the yield starts rising. Is it because of the oil linkage . I wonder if all of these things got so extended and that we looked at every day i wonder if you see some other things but i also wonder whether people that made a little money from 46 back to 51, are they covering . It is going back to 70. If you talk to some of the Major Oil Companies theyre planning for oil in the 50 range for years. We can only hope. Stocks looking to build on mondays gains. The major averages all closing up around 1 or more. Investors now starting a countdown to fridays big jobs report. Its always big every month. Continue to keep an eye on crude as we said is back above 50. Here with us to pick up the pace ben pace. Chief Investment Officer and partner at hpn partners and Michelle Myer that does not run yahoo no she doesnt. I still dont. Maybe one day. To make it endlessly confusing, who is that that runs yahoo now. Marissa myer. Youre Michelle Myer. I am. Well you have absolutely nothing to do with her. Maybe i do and i just dont know it. What do you think about the aol deal . Do you think they should merge or what . She is u. S. Economist at bank of america global research. So we have so many things to talk to both of you ben ill start with you. 200 points yesterday. Partly because of greece and partly maybe because of oil. Has the market seen enough sideways action and you can make gains in 2015 . No we have seen over the last three years, we havent seen a full correction. Everybody is waiting for that but weve seen these 4 to 5 pull backs that get cash off the sideline. Maybe were seeing a little bit more than that but we are nervous this year. Theres other issues. Theres geo political issues and earnings slow down that may bring about the 10 correction but we think this is a secular longterm bull market and that should be used more as buying opportunities than anything. You feel the same way . The economy is certainly on a healthier footing to be consistent with greater Revenue Growth and a stronger market. The disconnect is on the growth side the numbers are continuing to come out strong. Around 3 gdp growth. The challenge for the economy is the struggle with disinflationary risks. Thats what the issue is and thats what is probably the bigger theme for the markets is this concern about continued low or even disinflation. I just dont understand why youre saying the 3 is the norm for gdp. Didnt we only have one print above 3 . Last year was 2. 6 when you added it up. Q4 came in at 2. 6 . Were tracking above that. Q3 came in at 5 and q2 came in above 3 as well. First quarter. First quarter was a negative. See that was negative. Because you had a pay back. I think well be around 3 as well. The data thats come in is all kind of adding up to about a 3 economy. Even though we wont see that fuelled by Profit Growth because thats going to be basically is it going to be flat with last year because of the oil sector . Not flat but slightly up were thinking. Do you know what were thinking about earnings . You saw the bad of strong dollar and Lower Oil Prices. The Energy Analysts were quick to increase estimates. The other stuff takes longer. It takes awhile. The analysts there are just waiting for corporate guidance. Corporations are going to have an idea soon of the benefit of that so we think that earnings estimates are going to come down and stay down. Were thinking 122, 123 for the s p 500 which is slightly higher than what this year will probably check in at and that will allow multiples to expand a little bit. The fed must be thinking this and hoping for this with their fingers crossed. Still talk about mid year. Our thought is if they delay it will be september and theyre going to wait for numbers but maybe theyll push that out a little bit. Were still saying officially june. Mid year seems a bit challenging at this point because they have to start signaling to the markets probably by march. You mean its challenging to do it by mid year . I think so. We may go up a quarter but do we want everyone to be ready to go up a quarter. I think in terms of what yellen is communicating and what se thinks about the risk profile its the case that shes in Risk Management mode and she cannot check all the boxes that the economy can handle. That goes back to lloyds point. From a Risk Management perspective thats what the fed should be doing. So maybe its an argument they can understand. He likes lower Interest Rates. Go slow. He also wants a steeper curve. Does he . Yeah. Who doesnt like thats what i was saying. The fed is afraid to say these spoiled brats for six years had all of this free money. All the move in the market with that initial move. When the first rate hike comes it doesnt matter how low or how long. The adjustment is going to take place then. Just like it is unprecedented the pull back is going to be just as unprecedented. You think it will be more. It should be worse on the way back. That sign of tapering a couple of years ago. Look at what happened to rates. They shot up 100 basis points in what seemed like five minutes and you had that tantrum. A really exposed Duration Risk in portfolios and that was a lesson the fed took. But yeah joe i agree weaning ourselves off of this addiction to monetary ease is something that i am looking forward to. But was the lesson that they actually have to do it slow or was the lesson that look at what it is and maybe we should rip the bandaid. No. Maybe theyre going to realize. I think think the lesson is more for portfolio positioning to make sure that you dont have a lot of Duration Risk and portfolios. Your bond positions are fine. You know what your average maturity is. A lot of people ease into equities and theyre the ones that could get hit if you see another bump up in the yield curve. Okay were done do you have a final comment . Im going to pass on that. Pass. It was a good move. Seemed like a good move. The spin off . Yeah why not. Hey, you did it. If you did it yourself. Congratulations to me. Koujous move. All right. Thank you. She died her hair or something. I dont know whats going on. When we come back this morning we have big news today for fans of disneys hit frozen. Plus word this morning that the fec is getting closer to imposing strong rules. A lot of media news when we return but first take a look at this date back in history. I am never getting married. Never. Psssssh. Guaranteed. You picked a beautiful ring. Thank you. Were never having kids. Mmmmmm. Breathe. I love it here. We are never moving to the suburbs. We are never getting one of those. We are never having another kid. Im pregnant. I am never letting go. For all the nevers in life state farm is there. Welcome back to squawk box. Alex wallace joins us from the weather channel. It wasnt too bad alex. I didnt see any black ice or anything. Well, thats really good to hear but we still have to be careful. Theres still some areas where of course anything that was on the ground may be on the frozen side so still have to be careful here through this morning. You can see the temperatures still very cold expected for us today. New yorks 26 degrees. Thats all your manage. The warm spot is going to be down around d. C. Near 40 degrees but even there still below average. Now tomorrow a little bit of a warm up for some of us. Yeah well get up to upper 30s around pittsburgh but look by thursday quickly we see that change in cold air comes in back to the eastern lakes interior northeast and eventually well see that cold air spread toward the east coast for friday. So a little warm up and then things chill right back down and the potential for more snow. Heres what the set up is for us through midweek. Cold air with a big dip in the jet stream and riding along our storm track that jet stream will be a storm system that will quickly move toward the south and east and along its path will spread in a bit of snow. Starting today across the Northern Plains midwest region and places like minneapolis and chicago seeing a lot of snow. Then well see it press its way into new england moving into tomorrow. The good news at least with this particular system its not going to dump a ton of snow. Along its path 1 to maybe up to 3 inches of snow but for some of these areas that have seen 2, 3, 4 feet of snow over the last couple of weeks we dont want to see anymore. Guys back to you. Thank you for that. Talking about snow and frozenness we got a sneak peek of frozen fever its a seven minute short from the animated hit musical in 2013. The latest story line will show in theaters before disneys live action cinderella. Elsa will be throwing anna a Birthday Party but then comes down with a gold and thats when as you imagine surprising things happen. A lot of kids im sure if they werent going to see the live action cinderella will be running to see the seven minutes before unless that shows up online first. I guess somehow it winds up on youtube. Before live action cinderella. Or at least as soon as live action cinderella hits. Somebody will video tape it. Somebody will video tape it but its going to be a moment im sure. It is. In other media news the wall street journal reports the fcc is close to proposal strong Net Neutrality rules. He is said to be going fibromyalgia a significant expansion of the agencys power to regulate broadband providers. The fcc would be trading firms like Telecommunications Companies and would subject them to stronger rules especially when it comes to how they manage traffics on their networks. This is something we have been signaling. He mentioned this has been the direction. Its a bit of a back and forth on it. We had parsons that thought it wasnt going to go this far. But randall the last time we talked to him it was a very different stance. They hoped they could reach a compromise. The last time we talked to him he said this was going to be going through the court system for years to come. Hopefully your sort of indeering about whether there are independent agencies versus can you believe that . He said the same thing. He thought wheeler would have to step away from it. I thought wheeler wasnt going to go this far on it. The good news by the way its embarrassing for him. Even though theyre talking about the title two issue they will still allow these deals where netflix already made deals with comcast and verizon and others so some deals can still happen. The distinction is theyll be regulated in a way they were now. It almost reminds me of when they did the credit card thing. Its obvious where its coming down. Its like saying george h. W. Bush would have been elected again. If he was able to pull greenspan to lower rates. I thought for sure he would have to take a step back just to make it look like there is independence. What i am seeing in todays article is the legislative action that the Republican Controlled Congress is likely to propose. They were already trying to figure out ways of legislatively challenging it. Thats one of the reasons i say go to title 2. Thats one thing you really cant get around theoretically. We will see what happens. We will. What else is coming up . The fierce fight. This is beckys favorite story. A great guy with a great book coming up. The fierce fight over the 529 plans. President obama walking back his tax proposal but the debate raising new questions about who should be using the savings set up . Well talk to the author about that. He just wrote that big piece. He thinks that you should tell your children how much money you make. And we should talk about why he thinks that. First as we head into a break a look at yesterdays s p 500 winners and losers. Were back in just a moment. Theres confidence. Then theres trusting your vehicle maintenance to ford service confidence. Our expertise, technology, and high quality parts mean your peace of mind. Now you can get the works, a multipoint inspection with a Synthetic Blend Oil change tire rotation, Brake Inspection and more. 29. 95 or less. Know that chasing performance can mean lower returns and fewer choices in retirement. Know that proper allocation could help increase returns so you can enjoy that second home sooner. Know the right Financial Planning can help you save for college and retirement. Know where you stand with pnc total insight. A new investing and Banking Experience with personalized guidance and online tools. Visit a branch, call or go online today. Good morning. Welcome back to squawk box here on cnbc. Im joe kernen with becky quick and andrew ross sorkin. Alibaba teaming up with lending club. Theyll office financing to u. S. Businesses that want to buy from chi niez chinese suppliers. Apple wants to convert a failed sapphire plant in arizona and at t is selling data centers worth about 2 billion. This is the latest sale by the company which has been shedding i assume assets. No one wants to shred assets purposefully. Do they . I would think that that you would rye reading the prompter. Dont you assume that things are going to be typo. If they tell me that at t has been shredding assets we need to talk to randall and ask him whether that was part youre right. You were smart. You saw it shedding. I am smart . You are smart. Were going to talk money and kids right now. President obamas 529 plan flip flopped igniting a fierce debate about how americans are saving for country. Ron tackled the issue in his weekly column for the New York Times. Also a new book out today. Its called the opposite of spoiled. Raising kids who are grounded generous and smart about money. We thank you for being here. Lets start with 529s and then another heat dead bait to have. But given the president s flip flop do you have any anxiety on investing money in the 529s . Meaning down the road do you think somebody in washington may change the structure of these deals . All the somebodies in washington have learned their lesson from this incident that you do not mess with Parents College savings plans ever again ever. So once its out there. She was very upset about this. Well, look i just think its important more than anything if you Start Talking about changing College Plans it throws things into flux. It makes people more reluctant to put money into these plans and studies have shown if you are saving for your child for college that child is much more likely even if its only a small amount that winds up in the account theyre much more likely to go to college because they know thats the plan. They know it for a long period of time. I think thats absolutely true but what i think happened here is this hit people in an emotional place. Its one thing to go messing around with retirement plans or other taxes that hit individual grown ups but when you start changing the rules for my kids College Savings account and i have invested a lot of money. I have made sacrifices and then it looks to me like youre trying to take money from my children. Youre changing the rules after the fact. I have to say on twitter somebody pointed out a good point if theyll throw out the idea of 529 savings changes being changed how safe do you feel about your 401 k plan. People said its your own money. Its not a pension youre relying on somebody else to give for you but if you change the rules on that youre in the same position. I worry about these things too. I particularly worry about it with the roth iras but i think we learned a lesson here where lets remember what this was. This was not even a trial balloon. They knew that the broader package of tax cuts and tax raises and changes almost had no chance of passing and this was a little tiny piece of it. Thats why its even stupider. Exactly. It was never going to happen and yet there was this up roar and he had to go on the front page of the New York Times to say were not going to do this thing. It was stated in the wall street journal and its not to be partisan in the issue but they made the point that sooner or later the president is going you cant tax only rich people to do all the things he wants to do and you can say im never going to raise taxes on the middle class but sooner or later you need to get down to people that are considered middle class for all the Spending Plans that they have. You can take 100 of the 1 s money and its not enough to do what you want to do. So its going to come home to roost. People that benefit from the 529s, are they what . The upper what 20 . If you look at the gao number. Is it 20 of income . But its outdated i think too. Its been outdated by a couple of years but as the markets have grown. 70 are for people making 200,000 or less. Of unit accounts. So theres a debate. If you keep these accounts available it will encourage more people to save. Whats the money . 20 . We talk about 1 ers. There are different the top 10 to 20 . Those people he wants to tax more. Let me ask you a different question because this was the debate we were having before you came on. We werent debating this. I was debating it. In yourself. Youre conflicted or something. I want to do this. He has written this book and one of the main thesis in the book is that you should tell your children how much money you make. They don even know what money is anyway to understand exactly what youre talking about. In my family i still to this day could not really tell you how much money my parents made or grandparents. I would try by the way. I would try to find out and nobody would ever tell me. Did growing up in scarsdale did that give you a clue at all that you were wealthy . I knew we were doing okay. Andrew you were rich. You didnt have a spoon, you had a ladel up there. Youre from scarsdale. Let me paint you a little picture. We did fine. You had money. Youre rich. But i didnt know youre still rich. Youre richer now than you were. I didnt know what the numbers were. I still dont know what the numbers are. Theyre large. The reasons for telling your kids how much you make are . I think its important for kids to know what it is that it actually takes to maintain a scarsdale life style. A lot. Its not when theyre little kids. Whats the age . In their teens. But only after ten years of making them ready. How old . 13 14 15. Depends on the kid and i think girls are usually ready earlier than boys but between 13 and 17 most kids are ready. You give them the exact numbers. But only after you have spent years working on allowance and introducing them to the Family Budget and all the things that you spend and save. What you give away. What it takes to maintain the life that you have. Yes then by the time theyre teenagers they ought to know. They have a better understanding as they go out on their own. The black box. Remember that were asking kids at the age of 16 or 17 to make six figure decisions about college. This is lunacy but somehow in the last 10 or 20 years we have gotten to a number that high. Twothirds of kids are graduating with student loan debt. Were asking them to go into hoc at the age of 16 or 17 to make those decisions before we have given them any context. Im going to make it more complicated. We have viewer who is forget about scarsdale rich are in a completely different sphere given what they do with ceo titles and other things. If you make 5, 20 25, 30 100 million a year and we have viewers that do that should they tell their i mean some of their kids can probably read about it in the papers but how do you have that conversation . Well, first of all, if you think they havent figured out a lot of this youre sorely mistaken because they are googling your name and your address. They are picking up the zillow estimate of the 4 million house. Not to pick on people that live there. But zillow is the first thing that pops up when kids google their address. Didnt you ever ask the footman, the first footman or the second footman or the valet when you were you never asked anyone. I would needle him all the time about this and he just he shutdown. Id just come out and ask them. I used to try to bribe them. Give them a little extra cash. From out of the trust fund. Still didnt tell me. Still didnt know you had money. I couldnt figure out the number. Scarsdale. Yeah. Im going to take you to this side of cincinnati some day. Who else did that . People always play up their i was fine. Im kidding. Neither were you. No. You gave me a great excuse for joe to rib me this morning. We appreciate it. The book is called the opposite of spoiled. Go out and get it. Its a fascinating mommy, how much money do we have . Mommy . Ron lieber everybody, john kernen by the way. Its a ladle not a spoon. That holds more doesnt it . Its also silver . Silver plated. Totally stealing your line. Use it. I steal all mine. Coming up a story for our loyal viewers. Im so happy. I cant believe this because ive never tried to run a marathon and i have been right all along. Details on a new study that says when it comes to jogging, less is more. Its like music to my ears. Now with the xfinity tv go app, you can watch live tv anytime. Its never been easier with so Many Networks all in one place. Get live tv whenever you want. The xfinity tv go app. Now with live tv on the go. Enjoy over wifi or on Verizon Wireless 4g lte. Plus enjoy special savings when you purchase any new Verizon Wireless smartphone or tablet from comcast. Visit comcast. Com wireless to learn more. Coming up zomibe land. How tech is wrecking sleep for teens. But first check out some of the mostclicked stories on cnbc. Com. Were back in just a moment. Were in the chairs. To be perfectly honest with you youre not perfectly honest with me normally . I try to be. But i always thought the human body was not designed to run 26 miles. I know what happened to the first marathoner. He died when he got to the end of the race. The very first guy, he yelled he finished he was an ahenian and then he yelled niek key and then died. I did always sort of think that thats a lot of strain especially training for it. And we think well thats just what doesnt kill you makes you stronger, but isnt there something to the notion that you put a lot of miles on a car, doesnt the engine get sort of worn out and used . So i have always just run three times a week maybe four. Ive slowly gotten down to where to be comfortable where i just dont want to where i can just pace going next time again. The endorphins help the first time. 35 minutes, does three miles. Thats exact will i what you should do according to the study bhop knows whether thats going to be revised. But what it says is that those people who do that live a lot longer than the sedentary couch potatoes but people that do the marathons at the same death rate at the people who sit on the couch. So all this time that youre out there early in the morning, going god this is so painful, oh, my knees. The person sitting eating on the couch has the same mortality rate. Is it just about running or any vigorous exercise . Are you making this some kind of a sex thing . No. No where is your brain . Andrew was wondering because he was limping when he came up here. Im talking about other you were limping from sex . No. Like if you go on a bicycle or an elliptical machine or rowing machine. I cant imagine how you hurt your leg nlts your downward facing dog though. Its your heart because you are straining it and as a result your arteries are strained. Thats my question. So i originally thought it was about the knees. But if its about the heart, it should be all vigorous exercise. Cant be great for your knees though. Were talking all vigorous exercise then. We always assume youre giving them a good workout. What about just doing too much of something thats strange . Remember the great marathoner, one of those guys he died at like 52 or something. I dont remember exactly. Dont exercise too much everybody. We like that. I dont know how much time your kids spend on screens small and large after school. Screen time. It concerns me. Now theres a study out that says that teens who bury their faces for a long time have a tough time sleeping. If you are spending more than four hours a day on screens, you tend to sleep as little as five hours a night. You have a harder time staying asleep. And theyre saying this is really a bad idea because between the ages of 14 and 17 you should be getting ten hours of sleep. And this isnt just the issue of does it matter when you go online or use the screen . They werent able to determine a time of day that mattered more. If you have at least four hours a day that youre using people say not to look at a screen right before you go to bed. I have this new app called flux which changes the coloring of the screen as the sun goes down the screen gets redder so it doesnt feel as its supposed to help you fall asleep. How did you find that . You were reading about it or something . I was reading it and downloaded it. On what . I dont know. One of my crazy life hacker. Do you go on those . Yeah. Squeak out every last minute. Finding information. When we come back the biggest automakers today. Well talk to the man who runs the biggest autoretailer. Plus House Budget Committee tom price sounds off on president obamas Spending Plans. Squawk box will be right back. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Theyre coming. What do i do . You need to catch the 4 10 huh . The Equipment Tracking system will get you to the loading dock. There should be a truck leaving now. I got it. Now jump off the bridge. What . In 3. 2. 1. Are you kidding me . Go. Right on time. Right now, over 20,000 trains are running reliably. We call that predictable. Thrillingly predictable. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Raising demand for bigger vehicles. But can automakers keep up . A special report from phil lebeau. Plus breaking numbers from americas largest auto dealer autonation. Plugging oil prices the sliding ruble forcing to prevent collapse. William brouder is going to join us live. Vaccinations becoming a flash point. Well cut through the rhetoric and bring you the facts from a special disease expert. Live from the beating heart of business, new york city, this is squawk box. Welcome back to squawk box here on cnbc first in business worldwide. Im joe kernen along with becky quick and andrew ross sorkin. Dow gained about 200 yesterday. Fair value down about 13 up 60 on the futures. The s p has called up 11. In the nasdaq indicated up almost 18 points this morning. And this is all happening with the backdrop of some firming in the energy patch. There it is. We are watching oil prices this morning. Take a look at whats going on. Now up 11 over the last two days. Among the catalyst for the increase in prices pointing to Energy Giants cutting expenditures and reducing rig counts. Large part they say is the reason for all this. Bp announced it would slash expenditures by 13 this year down to 20 billion. Other headlines to bring you this morning. A potential retail deal in the works. Office depot and staples to merge. No word on the proposed details just yet. Joe was saying that we shouldnt worry about prices going up in paper because paper is going away. But i dont know if thats totally true yet. Also the Measles Outbreak turning political as the possible president ial candidates weigh in on whether children should be forced to get vaccinated. Heres what rand paul said yesterday on closing bell. I think theyre a good thing, but the parent should have some input. The state doesnt own your children. Parents own the children. It is an issue of freedom. Last night Hillary Clinton jumping into the debate on twitter. She wrote, the science is clear, the earth is rounding with the sky is blue and vaccines work. Lets protect all of our kids. Grandmothers know best. Notice that was retweeted 11,319 times. Favorited more than 12,000 times. Wow. Whenever i hear the science is clear, it gives me a little edge. Thats the only problem. Ill go along with that. I would go along with that. Im saying there are times when the science is not that. I also see at least the rationale where youd say i think its a slippery slope in terms of the nanny state if you are going to mandate certain things that you must do. And id hate to come lets think can we come up with anything in the past that we thought was really good for you or not harmful. Im glad they didnt because i dont know about that. I went back and read something that dahl the author wrote in the 1980s his child died of measles. And he wrote a letter to britain at that point because the u. S. Was mandating these vaccinations and britain wasnt. He said for his daughter it wouldnt have made a difference because there were no vaccinations approved at that point. But he went through the numbers on what it meant, Something Like one in a million children have a reaction to measles vaccinations. But he went through the numbers of what happens. Think of polio. Right. Theres a case to be made for that. Youve got to protect society. There are people whose immune systems will not allow them to get these vaccinations. So if you dont vaccinate your child, youre putting them at risk. Whether its people who are sick or have had other issues along the way. Whether its children not old enough to get them. You dont get them until youre 12 months old. And theres probably we could probably come up with a hundred things where its just not a definitive yes or no answer on how to approach things. But for the same reasons you didnt want people with ebola being allowed to go on the subways, i think you have to vaccinate your kids. I think its the same its a very sort of straight up right now its Public Schools that Public Schools dont allow you. Although there are some states that will allow you the majority of states that will allow you just for personal choice not to get the vaccinations. Low gas prices are raising demand for bigger cars. Phil lebeau joins us now with more. The numbers are going to be coming out within the next couple of hours. Were expecting relatively strong numbers. Keep in mind january is the second slowest month of the year in terms of pace of sales. Nobody is going to lose a lot of sleep here in terms of whether or not it shows a dramatic up tick or down tick. When you look at the big automakers theyre going to have solid numbers for the month of january. Heres the estimates from edmons. Com. Its within the numbers being reported, were going to be looking for a couple of things. First of all, Consumer Confidence. Is there any indication at all when you look at the pace of sales or the type of vehicles being sold . Did it start to flag at all . So far what ive heard back from dealers around the country, no. Theyre seeing the same amount of confidence from people coming in. Strong suv and truck sales will continue. Thats partially helped by the lower gas prices nap means the mix is going to skew towards bigger vehicles. Limited storm impact. We did have the storms that rolled through the northeast last week. Might have impacted sales for a day or two in the Northeastern Region of the u. S. But generally speaking we should not see a huge impact from those storms. Youd have to see storms last over an extended period of time before you see an impact. Ford is going to be the stock we watch today as ford ramps up production and sales of the f150. Going to be curious to see what the commentary is in terms of the take rate so far. We talked with mark fields over the past couple of weeks. He says they cannot keep the new fseries pickup trucks on the dealer lot for more than five six, seven days. Basically as soon as they get it in, its already been ordered, its sold. So well see what ford has to say about whether or not the pace of that demand is remaining red hot for the new fseries. Back to you. Thank you. We should also tell you folks about autonations january sales. They are just out and the countrys largest auto retailer reporting the increase. With the company also posting Fourth Quarter profits, that was 11 cents better than the street was expecting. Revenue coming in at 5 billion. Thats up 12 from a yoor ago. Joining us is mike jackson, ceo of autonation. These are strong morning. Becky, how are you today . Great. Well the Fourth Quarter was our best quarter ever. 1. 02 earnings per share. Up 23 . And that is our 17th quarter in a row of double digit gains and for the full year last year 3. 49. 17 our best year ever. And as far as januarys number i agree with everything phil said in his report and for autonation we were up 20 . The only thing additional that i would add is that the comparison is very easy. If you recall january and february last year were very poor for auto sales. Absolutely flat in the month of january. A selling rate of only 15. 2. And everybody back then was scratching their head as to whether the economy was slowing down. I think gdp for the First Quarter last year was done. So the comparison is easy but the message is clear. The Auto Industry is off and running to break through 17 million unit sales this year. I think youll see strong reports from all the manufacturers today. You know mike around the holidays i think it started with black friday really we started seeing ads that you hadnt seen in previous years. That were people talking about i fought up a morning to buy this television. And this guy says i got up late and went in and saved 5,000 on this car. I just wonder if those ads were really effective and you think thats part of what helped. Well the period from black friday through the end of the year is just about one of the strongest selling periods of the entire year for auto sales. And every manufacturer becomes a symbiotic relationship. There with all kinds of programs and incentives to make sure they get their piece of the pie. Customers expect it and theyre in the market place. But i have to say overall the levels of incentives are very reasonable. To be expected. I dont see anybody doing anything extreme thats not sustainable. And the fundamental drivers for the auto sales remain strong. Why was the quarter so strong . Average age sits at 11. 4. For us as far as achieving 1. 02 per share, you mentioned on revenue of 5 billion, we had double digit increases in every part of our business. New vehicle sales, used vehicle sales, service, parts, finance, insurance. So it was strong across the board for the company. It was just our best performance ever. Would you tell us a little bit about the type of sales youre seeing . Are these lower gas prices really driving people into many more trucks and suvs than cars . Becky, theres absolutely no question about it. The price of gasoline determines the type of vehicles customers buy. And they determine that on the price of gasoline at the moment they buy. Not what they think its going to be, but what it is when theyve decided to buy. And look at this. Truck sales have gone from 47 of the mix a year and a half ago to now over 55 of the mix. And the trend absolutely continues. So while the customers all say they value fuel economy, unless theres an economic underpinning for that and thats driven by the price of gasoline they are going to be more indulgent around the size of the vehicle that they buy and the speed of the vehicle that they buy. Thats just human nature. Im not saying its right or wrong, but thats the way the marketplace works. So what do you do in terms of stocking the vehicles on your Car Dealerships . Its got to be a situation where they want to buy based on what the gas prices are that day. Are you assuming the gas prices will be low for time to come and as a result youre stocking much more of these trucks or are you making sure you have the cars there lined up as well . So becky, heres the way to think about it. Were currently at 2 a gallon. I think people really need 3. 50 upwards a gallon to value it. We could see gasolines under 3 a gallon for this entire year. Now, i think were at a low. I think youll see gradual increases in the price of gasoline because the production costs go up to meet epa standards starting in february. So youre going to get a 25 to 30 25 cent to 30 cent increase that will be passed through over the next several months. And that will stabilize oil around 50 a barrel. Probably means weve seen the low point on gasoline prices. Okay. But we have a long way to go before people go back shift back under 50 truck mix. Its always a pleasure talking to you. Congratulations again on quarter. Thank you becky. Great seeing everybody. Up next reaction to the president s budget. New House Budget Committee chairman tom price joins us after the break. Then russian officials scrambling to prevent economic collapse. William browder weighs in. And Measles Outbreak stirring up vaccination conversations. Before we take a break, check this out. As super bowl mvp tom brady won a new truck heres seth meyers reaction last night. Brady said the truck handles great after he let some of the air out of the tires. President obama laying out his 4 trillion budget saying it will help working families. Hes got a plan to pay for it all. He says its now up to congress to get the job done. I know there are republicans who disagree with my approach. And ive said this before. If they have other ideas of how we can keep america safe grow our economy, while helping middle class families feel economic security, i welcome their ideas. But their numbers have to add up. Rarkseaction to the budget representative tom price. Hes the chairman of the budget committee. Chairman, its good to have you on this morning. Good to be with you. Its not the first time weve seen, i guess, a democratic president say ill raise the feds spending but i want you to raise social spending at least as much or more. Its just this is just what, you know, birds got to fly, fish got to swim right . Well look. The president s words would be good news if these policies have worked in the past. This has got us the slowest recovery ever. His budget never balances. It spends more taxes more borrows more. Every one of those dollars that is used for taxing and borrowing is a dollar that cant be used to buy a home buy a car, pay your rent pay your mortgage send a kid to school. This is moving in the wrong direction. We think theres a better way to do things. Well youll have some say in what finally happens, but obviously we want to try to arrive at some type of budget deal eventually. Sure. Wheres the Common Ground . Is it is there anything with the repatriation of funds or anything with infrastructure where Common Ground can be found . I think there are two areas. One that you just mentioned. One is tax reform. Modernization of our tax system. We believe that modernization and bringing the tax code up to 21st century needs to be done. We need a healthy economy creating jobs. Theres a inwithwindow there. And you have to prioritize spending for infrastructure in this country. Not just maintenance, but to expand capacity especially in the metropolitan areas in our country. So there may be grounds for opportunity to discuss right there, but the president needs to be more than just a my way or the highway. Which tends to be what hes been in the past. Right. Both sides i get. I take issue when i see people on other networks say the republicans at this point, you know, theyre putting up all these things that will never pass. They completely overlook a lot of the proposals put up by the administration, you know we did have an election. Elections have consequences. Its a republican house, its a republican senate. You cant all of a sudden its not business as usual. You cant just put out your wish list of what you want to have happen. Its both sides. Thats right. Thats what helps the American People. Obviously you both have valid points, but that doesnt help get anything done. And thats what they said in november. The American People said we want divided government. We want a branch thats united. We want the executive branch and legislative branch to Work Together to solve the challenges we have. Because theyre huge. And we firmly believe if we can get on a path to a balanced budget where the federal government doesnt spend more money than it takes in if we can put in place programs that will actually save and strengthen and secure medicaid instead of them going broke which is their current trajectory, and if we could put in place progrowth policies like tax reform, like energy policy. A program that would create jobs and increase American Energy and the president seems to oppose that, it doesnt make sense to folks back home. Its amazing a couple of years ago the entitlement explosion thats on the horizon was front and center. And we had a commission and talked about grand bargains. This budget it isnt even mentioned how to rein in medicare or Social Security or anything else. Social Security Disability Insurance Fund goes broke next year 2016. Not 2030 not 2033. Goes broke next year. And the president doesnt even talk about the kinds of things that we need to be able to say and secure that program for the folks receiving appropriately receiving those benefits. Same is true for medicare and Social Security. Those programs are destined to be insolvent in a relatively few number of years. And the president completely ignores it. We have to believe the president thinks the path were on is what he wants. Thats not what the American People want. Again, we think theres a much better way to do it. So i dont want to none of us are interested in making sausage, but how will you what will you go back and say and how will this grinding progress be made between, you know congress and the administration . What can we expect . Well the president s budget is the first step. Thank goodness he brought it out on time this year. We will go back to our committee in the house of representatives and work on our budget. We will pass our budget through the house. Probably in the last week of march which is the appropriate time for the house. The senate will do the same. Then the house and the senate will come together and work out any differences that there are there. And then we look forward to working with the administration on moving forward with these policies that are so vitally important to get more jobs and opportunity for our country. I guess its a concession to some extent that maybe the world is still dangerous and maybe we should not allow our Armed Services to sort of atrophy given isis ukraine, and Everything Else that we thought all that was settled didnt we . Or at least we were told it was. Theres no doubt that the worlds a dangerous place. What we challenged the president to do is to define a mission. Define what the strategy is. Then well find the resources to be able to fund that mission. The problem that we have with the white house is they seem to define the budget never define the mission. Then try to cram the mission into that budget. We think thats backwards. Its a dangerous world and we need to do our number one job which is to protect and secure the United States of america. Congressman, thank you. Whats your city down there in georgia . Which district . The sixth district we live in roswell. All great territory just north of the city of atlanta. Okay awesome. Great. Thank you. Appreciate it mr. Chairman. Well hopefully see you again at some point. Thanks, joe. Take care. Still to come this morning, what is in the Dietary Supplements youre taking . It could be powdered rice and house plants. Well have the details after this. Breath in. And. Exhale. Aflac and a gentle wavelike motion. Ahhhahhhhhh. Liberate your spine. Ahhhahhhhhh. Aflac and reach, toes blossoming. Not that great at yoga. Oi d my claim in just four days. Ahh four days . Yep. See why speed matters, at aflac. Com. The real question that needs to be asked is what is it that we can do that is impactful . What the cloud enables is computing to empower cancer researchers. It used to take two weeks to sequence and analyze a genome; u thats what id like to do. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. The new York State Attorney general is taking on fraudulent herbal supplements. The Attorney Generals Office accused four major retailers of containing not what they claimed. Often contained powdered rice, asparagus asparagus asparagus, and house plants. But the a. G. Sent cease and desist letters. Walgreens has already announced it will pull the products in question from its shelves. Im sure youll hear similar things from the other retailers soon. Coming up when we return the slumping ruble. Low oil prices and economic sanctions forcing russia to scramble to get a discovery package. Can russias cash reserves hold out along enough to rebound . More in just a moment. E financial noise financial noise financial noise financial noise welcome back to squawk box, everyone. In our headlines this morning, verizon is reportedly close to deals to sell more than 10 billion in assets including cell phone towers and parts of its landline phone business. Also the Justice Department will not prosecute news corp. Or 20th century fox. And a u. S. District court ruling in wells fargos favor. Groundhog days a weird tradition. They put the rodents and politicians in uncomfortable and close proximity. This is hard to watch. Check out this grouchy groundhog giving the forecast to the mayor of sun prairie, wisconsin. He says whoa wow. I mean id grab that thing after that and pull a de blasio on him. Spike him. Adding insult to injury the mayor botched the forecast. The handlers say he saw his shadow predicting six more weeks of winter and the city issued a statement saying that only the mayor can translate the groundhogs prediction any way he wants. Has there been a groundhog in 40 years that hasnt seen his shadow . When you set up all the lights and cameras, it doesnt matter whats going on. Is it where you mess with the experiment by throwing yourself into it. Look at that. Look at that. Its a little mike tyson almost. Right to the ear. Its a tetanus shot after that. Dont you think . Number one, dont hold a wild animal up right next to your ear or any other part that you want to hold onto. Always taking it there. Okay. No. Fingers, nose eye. Why what are you thinking . I was thinking johnny knox when you mentioned that. We got a guest who watched the shadows behind him all the time. Russia facing its worst stupid. Terrible. Worst crisis since 1998 with the ruble hovering now near historic lows. The economy in tatters as oil prices and manufacturing slump to the lowest level in five and a half years. Joining us with more is william browder. He is the author of a new book called red notice a true story of one mans fight for justice. There it is on the screen. Congratulations on the book. Its your story of everything thats happened to you over the past eight years. Getting kicked out of russia then your lawyer going to prison and then dying in prison. It should be a movie, is what it should be, in addition to the book. It will be a movie. Were just promoting the book now. But the movie is in the works. No question about that. Let me ask you about the news first and then well circle back to the book. When you look at whats going on in russia and i know you have your own views about mr. Putin and what hes done to you, but do you see any hope for this country in the next 24 months in terms of what happens to the ruble . Lets go through whats going to happen. The first thing is theyre going to impose security controls and capital controls. You cant have the ruble continuing to devalue, people continuing to take flight capital out of the country, and the reserves continuing to get drawn down. So every day that they say theres not going to be capital controls is one day closer to them imposing capital controls. Thats the first step. Second thing that happens is when they impose capital controls what does any smart russian do . Figure out a way around the controls and take more money out. So theres going to be no money in the country. What happens then . Youre vladimir putin, theres no money in the country. Youre not used to being in this situation. And what youre going to do is figure out ways of nationalizing more companies. And so when i look at russia right now, i say to myself this is some people some investors say you made your money in russia when it was cheap. Im saying now its cheap for a very good reason. But you dont look at this and say maybe theres an opportunity here . No. You wouldnt for your own personal reasons but no no. Putting aside any animosity i have towards putin or russia its a value track right now. Low price earnings ratio only helps you if you actually get those earnings in the end. None of that money is going to come to you. Youre either going to lose it from capital controls appropriation, or from fraud. Which is how many people are. How much of this is a bet on what happens to oil . Its about half of a bet on oil and half a bet on ukraine. And what is your bet on oil . Nobody knows whats going to happen to the price of oil. There were a lot of people on a year ago not telling you what was going to happen. So i dont know whats going to happen to oil, but i do know the likelihood is that oil prices are not going to go back to 100 because thats a large rise. If they dont go back to 100 russias in bad shape. A lot of people said while we dont want a super strong russia we also dont want a weakening russia. That has officials incredibly worried. If you back somebody into the corner, theyre more likely to try drastic and harsh other situations to get out of it. What would you say to that argument . Nobody backed putin into a corner to invade ukraine. He just he saw his ukrainian counterpart get run out of the country and said we need a massive distraction and thats what ukraine is about. Ukraine is a brotherly country that was doing nothing and all of a sudden they get invaded by russia. This is not you know no one backed him into a corner. But from a larger perspective, the United States needs russia when it comes to syria when it comes to figuring out other issues in the middle east. Where do we want russia . And is your problem with putin or russia in general . Im not sure if it would disappear right away but theres 140 million good russians and a million bad ones occupying the country. As far as syria and the United Nations go i dont think that putin has been particularly helpful in any of these areas. Hes basically using it as an opportunity to hijack the world. Talking about hijacking the world, where do you think the eurozone is right now . What do you think of putins role in greece . Putin would love the eurozone is an extremely useful collection of countries. There hasnt been a war in europe in 50 years because of the eu. Theres a strong and historic reason to keep it together. I think theres a lot of people who have a very big vested interest in that. Putin would love to pick everybody off against one another. So hes out there he was trying to do this with hungary. Hes trying to do this with greece. Where he was the first visit to the new Prime Minister was a Russian Ambassador with a message from putin. Thankfully at least at this stage of the game greece has got enough sense not to go along with that plan. But putin is trying to mess up the eu. Hed like to mess up nato. Hed like to figure out a way to make the nato Mutual Protection treaty not work. Hes playing this chip wherever he can. I dont think theres anything we can do to make him worse. Hes as bad as were going to get. Given all the bad news youre providing, as an investor where are you putting money right now . Is there an opportunity out there you see . Weve known each other for a long time and aye made all my money in emerging markets. And i have no money in emerging markets right now. This is the emerging market right now for you. So many actions taken around the globe and Central Banks . So you have currency problems, political problems economic problems in a lot of emerging markets. I think people were way too dismissive of the types of risks emerging markets have. You have a rule of law, stable political system and some economic growth. So i think that youre going to see this being the safe haven of the world. Even with equity being expensive, youre going to see them being better here. So the book is being called red notice, is it being published in russia . Thats a good question. Anyone we presented it to has grabbed onto it. But theres not a publisher print or online in russia that will go near it. Respectively been banned in russia. Can you get it over kindle in russia if you have access to the internet . If you have access to the internet and have a u. S. Amazon account, you could download it because we have translated it and published it in russian for people who have access to systems outside of russia. And your lawyers nervous about anything in there . No. The russians will come after me. I spend a good part of my life deflecting attacks from russia. Most recently they came after me with interpol with the third request to put me on the system. Theyre not after the lawyers. So the russians, you know theyd like to see me go back to go to prison in russia. They sentenced me to nine years in prison in russia. Thats scary. But you are never setting foot in russia again, i take it . Im not while putin is in power. Youre an expert on putin. Do you think that we should spell it putn just so people do not say putin . If we do it putn, do you think people will say it right . Say it. Give it a shot. Who you talking to . What if he came to manhattan . The book is called red notice. Thanks for being here this morning. Thank you. When we come back this morning, Top Health Officials testifying on capitol hill today about this years flu season. And also address controversy over the vaccines and Measles Outbreak. In the meantime lets look at equity futures. Right now the dow futures are indicated up by about 55 points. S p futures up by 8. 5 and the nasdaq up by 14. 5. Stick around. Squawk box will be right back. I bring the gift of the name your price tool to help you find a price that fits your budget. Uhoh. The name your price tool. Shes not to be trusted. Kill her. Flo it will save you money the name your price tool isnt witchcraft and i didnt turn your daughter into a rooster. She just looks like that. Burn the witch the name your price tool a dangerously progressive idea. Welcome back, everybody. There are more than a hundred confirmed cases of the measles in 14 states across america. Last year was the worst year for the measles in 14 years with almost 650 cases reported in the United States. Raises the question of what steps we should be taking to stop things from getting worse. Joining us right now is dr. Gayle schutz. She is from mt. Sinai. Shes also assistant professor of pediatric and Infectious Diseases at the school of medicine. Thank you for joining us this morning. We want to talk about this today because suddenly there is this huge politicalization of whether or not kids should be getting vaccinations. Yesterday Chris Christie and rand paul said they favor parent choice. What do you think . I think the most important thing to remember is it really is not just a personal choice but a Public Health issue. If someone decides not to vaccinate their child, not only are they potentially putting their Childs Health at risk but theyre also putting other people at risk who dont have the benefit of getting the vaccine like people with a compromised immune system or babies who arent old enough pregnant women. The measles has some severe side effects that go along with it. It can cause death in certain cases. It can also cause brain swelling that can lead to issues along the line blindness showing up in situations like that. We thought we had gotten rid of this. But last month over a hundred cases. There are pockets. Why is it happening . Because people are choosing not to get vaccinations . So thats correct what you said for the most part in this country we had eliminated it. But its still a worldwide problem. Most of the cases that come in are from foreign travelers or people in this country who go to other countries and bring it back in. There are pockets of populations in our country where people are choosing not to vaccinate, so that helps to spread the infection. I think even rand paul or Chris Christie would say everybody should get vaccinated. I think they would say that. I dont know that they would for everything . I think they would say that. I think the point they were making is its just a you know its a slippery slope to make it like a law. Right . Would you agree with that . I cant speak to the Public Policy for it. Again, i think for the General Health of the population, i think its really you remember the original polio vaccine. Yes. You remember it was contaminated with the virus 40. Luckily it didnt hurt humans. So, i mean the science is never completely set. I think about for awhile we didnt know what hepatitis c was. We didnt know it existed. Now its hepatitis c. We didnt know it was in blood transfusions. For years it was these are safe these are safe. You can say it until youre blue in the face but when parents are thinking about their children im not saying autism has anything to do with it either. But when the government mandates something, its a slippery slope. Which vaccines do you use . The nonlife threatening ones . Just ebola vaccines mandatory . How do you do it . Its a tough one, isnt it . It is. It is a tough one, i agree. Everybody should get vaccinated, i think they would say that. A situation like ebola, we talked about how hard that was to contract ebola. Measles is highly contagious. Exactly. Its one of the most contagious Infectious Diseases. And i think youre right. You can never say never. But the overwhelming Scientific Evidence at this point shows that these vaccines are safe. And even though occasionally you can see some side effects, theyre far safer than the potential of contracting these illnesses and the possible problems from being infected. I think you made the point earlier, doctor in the notes that theres something called herd mentality where its okay for you not to vaccinate your kids as long as the majority of people are doing it. 90 people are vaccinating. If thats the case youre safe. Where are we now in terms of the population not vaccinating . And whats the level that were actually seeing to get these pockets . So the general population again is still probably 90 or higher. Which is great. Its just that in certain communities, its falling below that threshold. And the trend is going the wrong direction in your mind. Or are we just talking about it more . Whats happening here . I sense a little bit of both. Were definitely talking about it more now that we see measles here. But again in certain populations, in certain communities. The trend is going so the one that comes to mind now is in certain counties in california. In part though thats because this current outbreak started at disneyland. Hpv is not mandatory yet, is it . Its not that its mandatory, but its on the recommended schedule. And then you get into the crazy, you know religious ramifications about whether i dont know what those are. But why would you not get a cancer vaccine for people if you know that that virus does cause cancer in certain cases . Why wouldnt you get it . Yet, its still not theres not a law that says every child has to get hpv either. Right . So, i agree with you. I think part of our job as medical professionals is to help educate people. I think theres a lot of Bad Information out there. And i think it can be scary. But at the end of the day most people want whats best for their kids. I dont think most people are saying i want to hurt my child and therefore im not going to vaccinate them. But maybe they dont understand why they work and how theyre important. Rand paul said ive seen cases of walking, talking, normal children that ended up with disorders after vaccines. Is he right . I think that that is a generalization. I cant speak for what his intention was with that statement, but again, the overwhelming Scientific Evidence shows that these vaccines are safe and theyre effective. And i think that for the health of children and our community, theyre important. When you combine them all, there are some that have three or four together. And we were debating early on five six shots at the same time. Is there any way that the immune system could be overwhelmed . That we could do it wrong . That we could put too many together . Is that possible . So again, never say never, but that is a common concern of parents so im glad you brought it up. Thats not how the vaccines work. Its not a matter of your immune system is going to become overwhelmed by these vaccines. And one thing thats nice side effects, but probably nothing that serious. One thing thats nice about the combinations is theres fewer shots. Understandably some parents or a child might not want to get five different injections at a time. Doctor thank you very much for joining us today. When we return big movers this morning. Your list of stocks to watch is coming up after the break. Then many the next hour, new challenges to uber including high profile competition. You know the name. You use it for search. Stick around. Were back in a moment. U. P. S. Just out with earnings of 1. 25 a share. In line with expectations. Revenue came in line slightly above what wall street was expecting. More on the u. P. S. Results with an analyst in the next hour. And then the companys cfo is going to join squawk on the street at 10 00 a. M. Eastern. Among other stocks were watching this morning, wendys earnings matching estimates, but revenue is a little bit shy. The fast food chain says it will take advantage of low Interest Rates to recapitalize its Balance Sheet. Coming up the price of crude climbing again this morning. Have we seen the bottom now . And if so how long will it take before gas prices reverse and start to actually go back up . John hofmeister tackles those questions next. As we head to break, take a look at u. S. Equity futures a a strong session yesterday. More of the same at least on the open expected this morning. So whats going on today . News alert message email calendar update most of us admit to being overwhelmed by information at work. Thats why ibm created verse. It uses powerful analytics to uncover hidden patterns in your email, calendars and social feeds. It continuously learns how you work. And helps you prioritize the people and projects you need to focus on. Theres a new way to work and its made with ibm. Playing the oil patch. Two Straight Days of gains, but will an inventory glut put a damper on the rally . Can u. P. S. Deliver for investors . And how safe is your information when catching a ride with uber . Were going to discuss the future of the company and talk about a new possible competitor with a very familiar name as the final hour of squawk box begins right now. Live from the most powerful city in the world, new york, this is squawk box. Welcome back to squawk box. This is cnbc first in business worldwide. Im becky quick along with joe kernen and andrew ross sorkin. We are less than 90 minutes away from the opening bell. If youve been watching the boards this morning, the dow futures are up about 60 points above fair value right now. Nasdaq up by 8. 5 and nasdaq up by 14. In europe we have seen green arrows there as the greeks seem to be stepping back from some hard lines. At this point gains better than 1 for france, germany, london. Greece, the stock market up by more than 10 . Lets tell you whats making headlines at this hour. Bp slashing expenditures by 20 billion. In an interview earlier this morning the bp ceo said it may stick for some time. Also the nations automakers will be reporting sales. Well see if lower gasoline prices are driving the spending on trucks and suvs. And alibaba is trying to break into the u. S. The chinese ecommerce giant is teaming up with lending club to offer financing to u. S. That want to buy from chinese suppliers. Bob dudley. Bob dudley ceo of bp. Certainly is. A few stocks to watch this morning. U. P. S. Posted earnings in line with lowered expectations. Well talk to an analyst in about 15 minutes. Etnas earnings matches. That number still below street consensus. Aetna also being impacted by rising medical costs. The wall street journal reports that staples and office depot are in advanced talks to merge. No word yet on the proposed terms. But the activist called for a merge last month. And rentacenter taking a hit. Late yesterday was down about 14 . As you can see the Quarterly Results fell short of estimates. Also weak guidance was issued for the full year. Earlier this morning as we were just talking about, bp ceo bob dudley joined Cnbcs Worldwide Exchange to talk about the companys results and the overall oil market. I think its going to just take time. It could be a long time. There is excess supply. U. S. Production is actually still growing. We see about the rate and what its growing. Of course theres great growth in china. So we have stock levels filling up all over the world. Tanks are filling up it wont be long before i see i think people putting them in ships. And i think that takes a long time to work its way off. John hofmeister joins us now. Hes former president of shale oil usa and the founder and ceo of citizens for affordable energy. And i dont think any of us really know everything thats happening in terms of what is moving crude at this point. Obviously a lot happening with opecs decisions and saudi arabias decisions. Also things happening that we dont totally understand in terms of global demand. None of us are experts there. But we did see a bit of a move back up. Im wondering when the big money, the big hedge funds and guys maybe not making money anywhere else theyve got a lot of clout. Im wondering when they decide its time to buy and whether that could give us 10 , 20 upside. Well i think some are already starting to buy because the price is so low. And why would they miss this opportunity at these prices . I think the biggest unknown is the demand side and whats the growth going to be this year. But there are some things that we know for sure. For sure we know that Oil Production will naturally decline by 4 million to 5 Million Barrels this year. Without new production coming online. Now, the new production coming online currently exceeds the natural decline rate. Thats why we have the surplus. And what we dont know then is how long will that surplus continue . I projected in my own calculations that the surplus will probably continue at least through midyear. But by midyear, that could be july, could be august. Im using a prod definition of midyear. But when that equilibrium is reached, then with the decline rate offsetting Production Growth, now were going to find ourselves looking at a very tight equilibrium which will lead to short by the end of the year. And so what i predict is that well see low prices between now and, say, june july. Then the hedge funds, youre right. Theyll start buying lots of oil, set it in tankers. So they can make a lot of money as we move into the latter part of this year and the first part of next year with their inventories. Before we continue i just want to break in here with a bit of breaking nuss. We talked about it earlier, but its just crossing the wires now. Mcgraw hill financial and s p ratings have reached that settlement with the doj. In 19 states as well as the District Of Columbia and with calpers as well. Heres whats going on. The company is going to pay 687. 5 million to the doj. It will also pay another 687. 5 million to the state and to the different states and the District Of Columbia. Then its going to pay calpers 125 million. Were talking about 1. 5 billion all in. So thats what the settlement will be for those ratings. Of course this relates back to the financial crisis of 2008 actually really before them. The reserve at this point, you think . Most of it was reserve. And thats after tax . Thats a good question. Im assuming so. Okay. Lets see, john what was the last thing you said . Okay. Even on technical terms, we see 50 retracement. Im trying to figure out. A hundred down to 45. Its at 55. So add 45 plus 27. So thats where youd figure 70 probably is not would not be surprising to see it go back there at least. Certainly. And i suggest by probably later this year. The one thing that is true also is that the industry particularly in north america has to use a british expression the bit in the teeth on the cost. Were into the ruthless costcutting mode now. That has led to an enormous number of rigs being shut down. Faster than predicted. And now a lot of folks here in houston are raising their estimate on how many additional rigs will be shut down over the next couple of months. So when youve got that kind of production disruption that is affecting potential surpluses down the road theyre just not going to materialize. And nobody will know the date by which all this comes to equilibrium equilibrium, but i dont think its that far off. I respect bob dudley tremendously, but i dont see a long time for this to reach an equilibrium point. Just watching it come down from 95 theres a lot of people obviously in the business that wanted it to stay at 95. I mean whole countries cant pay their bills now because it dropped. So if there was a way to keep it there, there were interested parties that would have done it. Sooner or later supply and demand just outstrip everything es. Then i think about hedge funds. I dont think they can control it, but they can certainly jump on when theres a trend going one way or the other and make it go further. So i think youre right. Were going to have to see the actual supply demand dynamics change. Then well see some of these guys move in and exacerbate the move one way or the other. Remember joe, the capital cuts dont just affect 2015. Theyre going to affect 16 and 17 as well. When people put down rigs and so forth, theres no sudden resurgence thats going to come back on. So were going to see, i think, a slower Production Growth in 16, 17, 18. And if the demand growth is predicted, then well see the return of 100plus oil. Yeah i dont know. I dont know. Thatll be thats the questions thats out there that even, you know certain saudi guys in the know said we wont see 100 again. But nobody knows, obviously. They wish it was still 100 im sure. All right. John hofmeister it will be something we can watch other than just stocks and bonds. So oil prices will be interesting for the near future no doubt. Thank you. Thank you. Oil prices as we continue this conversation rising more than 11 in the last two days and adding more this morning. Oil Service Companies going along for the ride if you want to check it out now. Dominic chu joins us now with more on the move in the oil stocks. Good morning, becky. What they can expect right now is the Oil Volatility trade will continue. Thats leading to volatile moves in oil stocks. If you look at year to date winners, energy is still a fairly big drag on the overall performance of the s p 500, but there are some names where investors are really starting to nibble at with regard to at least calling maybe for a shortterm bottom in stocks. Two Refining Companies here up about 10 , 11 . Whats interesting is valero its riding an 11day winning streak. And tesoro is up 12 out of the last 13. Theres shortterm momentum going for these refining names. And the single best performing s p energy stock this year to date is newfield exploration. Up 15 . Now, there are still really big drags here as far as the sktector goes. Were still in earnings season right now. But we already know from whats reported that the blended Earnings Growth rate for this past quarter for the Energy Sector is a 19 drag. 19 drop in the same time last year. And sales growth is expected to be a 14 drop from last year. Thats as of yesterday. So its going to become clear whether or not that energy trade is going to be as big of a drag as people think. But for right now, some investors are trying to pick up some bargains at these levels. We appreciate it. See you soon. Coming up next well continue a bit of that conversation because u. P. S. Is out. Reaction well get from a top analyst on the street. And then at 8 30 the ceo of paychex. Were going to talk all things uber this morning. Then weve got jim cramer from the new york stock exchange. Squawk box live from the city that never sleeps, were back in a moment. Why do we do it . Why do we spend every waking moment, thinking about people . Why are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The xc60 crossover. From volvo. Lease the wellequipped volvo xc60 today. Visit your local volvo showroom for details. Opinions. Theres no shortage in this world. Who do you trust . Whose analysis is accurate . How do you make sense of it all . A simple unbiased stock score consolidated from the opinions of independent analysts. Is that too much to ask . Nope. Equity summary score powered by starmine, will help you execute your ideas with speed and conviction. And its only on fidelity. Com. Open an account and find more of the expertise you need to be a better investor. Welcome back to squawk box, everyone. Sales out from chrysler. January u. S. Sales were up an even 14 . That was slightly above the estimates for a 13. 2 increase. A sneak peek this morning of frozen fever. Its a sevenminute short from the folks who brought us the hit in 2013. The latest storyline will be shown in theaters right before disneys live action cinderella which will be out in march. A little taste is here. Elsa throwing anna a Birthday Party. But then comes down with a cold. And thats when surprising things happen. So there you have it. A lot of people may go out just to see the short, let alone the live action cinderella. We will see. Also u. P. S. Rolling out Quarterly Results just minutes ago. The giant earning 1. 25 a share. That was in line with what were lowered expectations. Senior transportation analyst joining us now. Good morning. Lets walk through the numbers. They are in line with expectations, but expectations had been higher and now theyre lower. There were no surprises in this in they had already announced a couple weeks ago they were not going to make the number. I was at the bottom end of the range a couple weeks ago and was rewarded for that lack of faith. We were all looking for 1. 45ish and they indeed reported 1. 25. You know youll remember that in the holiday of 2013 they had a brownout in service. And u. P. S. Was very, very clear that they were going to spend whatever it took to make sure that didnt get repeated in the holiday of 2013. And thats what happened. They spent a bunch and didnt make very much. And therefore, was that a mistake . When you look at what they should do next Holiday Season is there a way to approach it differently . Well i think strategically they had to spend what it took to protect the integrity of the brand. I think we all understand that and in their defense, that was the right thing to do strategically. But tactically it hurt them. I think well see them be more judicious in their spending in 2015. So will they spend as little as they did in the holiday of 13 . No. But how do you raise the margin and make sure all the packages get where theyre supposed to be . Thats the tough part. You know part of u. P. S. challenge is they hired additional temp rare workers. Thats a workforce that doesnt have the flexibility that fed exdoes. So you think the Lower Oil Prices would be helpful. But you say the unions are a problem. You say the eurocentric business is a problem. I want to know what that means. And you say fedex is highly entrepreneurial. It is. Lets face it. U. P. S. Is a great company. It was founded in 1907 but none of the original entrepreneurs are still there. Fred smith who started fedex still shows up at the offices in memphis every morning. Its still a very Entrepreneurial Company and that extends all the way down to the operators, the ground drivers are owner operators. If they get an extra package, they get an extra stop, thats extra money in their pocket. Theyre driven in a way an hourly employee cant be. Unfortunately for u. P. S. Fortunate for fedex. If you look at whats happened in ecommerce since 98, 99, youve seen a surge in parcel volume. Flat with where it was in 1998 and 99. All of the additional volume thats been generated has essentially landed in fedexs lap. You yourself are entrepreneurial and you identify with a company that is also entrepreneurial. Okay. And then when you say eurocentric business whats the problem there . Well its not a problem as much as it is just an explanation of whats going on. Why did fedex not report currency issues . If i look at the world, there are three major theaters for air freight parcel. North america, u. S. And canada being europe and being asia. There are two dominant players in those. Obviously its fedex and u. P. S. In asia its fedex and dhl. In europe its dhl and u. P. S. So when you have a crash in the value of the euro relative to the dollar when you translate that, those profits, those rates back onto an immediate income statement, it has a negative head wind from a currency prpt i. We appreciate your perspective this morning. Thank you for joining us. The companys cfo is going to join squawk on the street later this morning to talk about these numbers and more. Coming up its not quite ketchup. Definitely not mustard. So just whats in that special sauce that makes a big mac taste so good . Well have a chance to win a very special bottle of that stuff. And the proceeds go to a good cause. Details after the break. Then its the ceo of paychex. The company set to release reads on how Small Businesses feel about the economy. Squawk box is back right after this break. Weve all had it. We know how good it is and weve all said i wish i had a bottle of this at home. None of that is true. But were talking mcdonalds big mac special sauce. I wonder what it is but i know its probably got remember the simpsons where they say take the mayonnaise out in the sun. Now you have a chance. Mcdonalds australia will sell the questionably orange sauce to be purchased. And its got a good cause. Part of a charity event. Mcdonalds australia has listed the first bottle on ebay for auction. Proceeds will go to the Ronald Mcdonald House Charities australia. And there are seven days left to bid. Currently someone is willing to pay almost 18,000 for the first bottle of the sauce that goes on the theyve got a new ronald. Id love to see money go to that. I think its a mix of ketchup and mayonnaise. Its a russian dressing. Thats what it tastes like to me. I think he knows what the secret sauce is. Isnt that how you make russian . Mayo and ketchup. It tastes like that with some pickles in it. Doesnt seem that complicated, no. Not like coke. Secret formula. Or kfc original recipe. No one will ever replicate that ever, i dont think. When we come back this morning, the ceo of paychex on what his Small Business customers are saying about the state of economy. And later, uber constantly making headlines. From new rules to ride sharing to passenger safety to Autonomous Vehicles picking you up. Well talk about the future of that company in just a bit. Meantime, though as we head to a break, look at the u. S. Equity futures. Stick looking at the dow up 66 points. S p up close to 10 point. Nasdaq up close to 15. Welcome back to squawk box. Here is whats in our headlines this morning. Standard poors has struck over ratings. It will total 1. 5 billion to the Justice Department. 19 states and California Pension Fund kal bers. Chrysler reporting slightly above estimates for january. And raid joedioshack is being delisted. And the idea of bankruptcy not far away is also circulated. New photographs of fidel castro just posted in cuban media. Said to be taken on january 23rd. Castro stepped down from power back in 2008. He has not been seen in public in about a year. His picture has not appeared in cuban media since august leading to speculation about his health. These pictures they try to make it look like its a casual setting. But theyre setting these up as proof of life. Theyve got him watching television to see whats on at that point. Looking at some newspapers. They do . Yeah, i need him to hold up a new york post. If it had the current headline then its for real. Hes not looking that great. But he seems to be vertical. Theres the newspaper. Yeah. All right. We have been trying to wonder about januarys stock market volatility. Was it a glitch or a trend to endure through 2015 . Lets get a check on Investor Sentiment with senior Portfolio Manager at the private client we serve of u. S. Bank wealth management. Eric is part of a team that oversees 126 billion in assets. Thanks for being here today. Thank you for having me. There have been a lot of weird moves over the last many months. Weve seen oil doing things we never anticipated. Bond yields doing things we never expected. And thats played out in the stock market as well. Are we near the end of that chaos or is that the beginning . Theres no doubt about it. The volatility has been extreme. If you look over the last 22 trading sessions 20 of them had had seen variants of 1 or more. While that pace may subside a bit, we still think volatility is in the cards through the rest of the year. What does that mean for the average investor . Should you keep putting away like you have on a regular basis . Should you be more picky about your spots and timing . You know if you have a longterm investment horizon, adversity could create opportunity. So we are encouraged about that. People should revisit their asset allocation. Beginning of the year is always a nice time to do that. Make sure youre not concentrate concentrated on what was necessarily the last years winners. Where would you tell people the focus is . U. S. Stocks . Overseas stocks . What kind of areas jump out at you . We continue to advocate broad diversification. But still would be for more domestic orientation. That doesnt mean were excluding international. We certainly are interested in international, but a little bit down from where we would have been a year or two years ago. And as far as fixed income is concerned, theres still opportunities out there. I know its difficult to suggest when you see the 10year treasury around 1. 7 . Right. But we do think its a very attractive opportunity especially for taxable investors in the pace space. Not even not just corporates. Youre looking at municipals as well. Correct. Absolutely. In terms of why you like u. S. Stocks better, whats happened to make you Like International less and u. S. More . Is it just the economy . Its the economy, certainly talks about the dispersion of economic reality being incrementally stronger here in the u. S. And still seeing some deterioration globally. Thats one factor. Being more domestic in the orientation. So we dont have that same repatriation issue with the strong dollar has us again focusing on incrementally more on those domesticoriented companies. Are you in the camp that thinks we have bottomed out on oil prices . Weve seen the 11 move over the last two days. Things seem to be heading back higher, but how much faith would you put in that move . Still going to be candid with you. No doubt the volatility has been extreme. When youve had more than a 50 decline. Seeing some bounce is to be anticipated. What still has us somewhat skeptical, though is unless theres a significant increase in demand in the very near term supply still hasnt been addressed. Kal Capital Spending has come down. Were starting to see more emphasis on taking labor costs out of the equation. But supply and inventories are still at very robust levels. And also looking at you know these companies now even with exxons announcement yesterday. Theres a real focus on living within their cash flow. So there isnt a sense theyre out of the woods just yet. They may see some bottoming for longterm investors it may present compelling opportunity. Were still just a little suspicious yet and still underweight. All right. Eric, thank you. Thank you. Paychex just out with its monthly Small Business jobs index. In january saw the strongest onemonth gain since the peak in april. Indiana served as the top ranked state for business. Lets get to the ceo of paychex. And this you couldnt tell from the. 09 sounds like a small number, but that is a good onemonth gain. The strongest weve seen in a awhile. Yes, it is. This is the First Time Since april 2014 wifeve seen a positive turnaround. You look at those numbers and continue to see the Central States having the strongest small employment growth. We think its a nice start to 2015. And portends well i guess for our number on friday. What is this a confidence issue . What would have caused this . Because weve seen the nfib. Theyre still they havent really responded to the improving economy from what we hear from dunkelburg most of the time. You see the Consumer Confidence is at an alltime high in about seven years. So i think the Consumer Confidence and the Small Business nfib index being positive helped. Also Housing Starts are up really for the first time in quite a few years. And i think all thats bringing construction jobs back and the energy is still helping. Might have been a drop in houston, but the Central States around energy are still positive job growth. I dont think of indiana as a necessarily as a big energy producer. Why is indiana doing so well . Well thats hard to say right now. Thats a onemonth thing where weve seen most of the states its washington state, texas with energy. Still been consistently strong. Indiana popped up for the first time. Were really not sure whats driving that. Although you do see some entertainment jobs and other things around housing bumping that may be something to do with indiana right now. Could be a onemonth thing. Any positive i mean you mentioned the oil thing. That could reverse a little bit in some of the states that are going to be negatively impacted by the drop in oil. But when does everyone start doing better with cheaper gas prices . You know what we have seen is of the 20 states we analyzed 15 of those showed Small Business growth. Some of the gasoline, reduction in the price, more spending Consumer Confidence is showing up in a number of states. Still not seeing it on the east coast too much. Still below a hundred. So Small Business growth in the east coast for the most part still below where it was in 2004. So weve had six year of relatively tepid economic activity. Does this indicate to you that we really have turned the corner for 2015 . Well i hope so. We did reach a peak in 2014. When we saw job growth at the highest rate. But its still higher than our index. The index is over you know over where it was in 2004. So i think job growth for Small Businesses has still been pretty steady and were hoping that this shows that 2015 will be a great year. Okay marty. Thank you. We appreciate it. Marty mucci from paychex. Thanks. Coming up next lots of questions surrounding Ride Share Company uber including how safe is your personal and Financial Information from drivers . Plus rumors of a possible new competitor. That and a lot more after the break. Take a look at futures as we get to the break. Dow looks like it would open up 42 points higher. Nasdaq looking up 9. 5 points. S p up 6. 5 points. Theres confidence. Then theres trusting your vehicle maintenance to ford service confidence. Our expertise, technology, and high quality parts mean your peace of mind. Now you can get the works, a multipoint inspection with a Synthetic Blend Oil change tire rotation, Brake Inspection and more. 29. 95 or less. Can it make a dentist appointment when my teeth are ready . Can it track my crews performance, and protect their heads . Can it tell the Flight Attendant to please not wake me this time . At cognizant, we see opportunities for every company. To meet the new digital demands of their customers. Can it process my Insurance Claim . Like, right now . Can it download a track while im sampling it . Can my keys find me . With the power of digital, analytics and automation now every little thing can provide even greater value. Ok, so can it tell the doctor how long you have to wear this thing . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Welcome back everybody. United Nations Agency is expected to push today for rapid adoption of new aircraft tracking proposals. This comes just short of a year since the disappearance of a Malaysia Airlines flight. New rules would call for a combo of regular tracking in normal flight and accelerated signals whenever an aircraft getting into trouble. Lets talk about uber now. Privacy policies have come under constant scrutiny. The company has been standing by its practices until recently. Valued around 40 billion, theyre expected to strengthen their practices and acknowledging that quote, we havent always gotten things right. Joining us to talk all things uber is the managing editor of recode. We also have a new competitor maybe in google. Google, right . Yeah i want to go there first. Is that real . Well lets we havent had any reporting to that effect. I think its one of the i think it was business week reporting that out there. I think its entirely possible given the fact that what is uber really . Its a software business. They dont own cars. They dont employ drivers. They contract them out. They said this themselves. We create software connect drivers with passengers. Thats it. Google is good at software too so why shouldnt they try to do it . From what we have read though, about what google is trying to do, theyre trying to take their robotically controlled cars selfdriving cars and hook them up to an uberlike service so there is no driver. No driver. Theres a different liability there. Theyve been first on that for awhile. But how they are so first on that. If we ever get to selfdriving cars, does google just own that business . Uber is worth 48 billion today, does that become zero tomorrow . Well i think thats i think the competition whether its google or whatever other company that comes down yeah. I think its problematic for them. And we see that uber is now apparently trying to invest in some kids at carnegie to do selfdriving. How far behind would they be . Is google a decade ahead of everybody else . Theyre definitely years ahead of everyone else. I dont know if its a full decade necessarily. I think part of what allowed google to do it quickly is they use a lot of off the shelf parts in the first place. Its not like detroit where theyre building from the ground up. Its the software. Its the engineering really that allows them to get ahead. Any other competitor can catch up within a few years. Does 40 billion make sense . Does 20 billion make sense . Does any of this make sense anymore . Add what it is 25 times profit before tax, thats like uber oos got to bring in 1. 5 to hit that valuation. Theyre not going to hit that market until the end of next year at the earliest. Thats still a really really lofty valuation. Also no competitor really ever shows up. That they are really the only game in town. Now what were talking about is a real potential competitor in google google. Google has name brand value. And they spend a lot on marketing. Theres about five other people trying to do what ubers doing now. And you dont use them because they dont have enough cars or wont show up on time. Or maybe youre worried about the price. Google could undercut uber. They could lose money for a little while. This is like the Auto Industry. Just because youre there first doesnt mean youre going to last throughout. Exactly. Which is great for consumers. Part of what allowed uber to grow so quickly is because theyre not hoarding any inventory . Theyre not doing payroll taxes. Right . Theyre just saying hey, sign up. Then you can start driving with people. Then segue to the privacy issue for a second. It does feel like they sort of shifted their stance if you will, around not just privacy but their sort of Public Relations efforts. Meaning weve seen travis sort of get out there and say he wants to become friendly in europe where before it was an allout war. Theres a lot more regulation in europe to begin with for all kinds of services. We sometimes clamber about it here. But in europe its more stringent. Theres more rules and trade going on over there. As much as uber and other silicon valleys are up to disrupt industries, its that much harder when youre looking at local laws local regulations. Is this a kinder gentler i think its kinder gentler. Theyll do more politicking. The new head of communications over there. But i also think thats not the only aspect as well. I think they have to actually in practice make that clear to people that theyre being transparent. Theyre not going to look at your data for the wrong reasons. Someone that isnt fully transparent yet. Thats where we went. David . Yeah. Whoa, im familiar with his work. A lot of people are. I dont know if i believe a word from uber. So they can have you can call up and get can a total beater show up or theyll make sure that no it has to be a relatively new car. It has to be within the last three years. Relatively new and no, no. Its between certain ive never gotten in a real can it be a 10yearold camry . No. It cant be more than a few years old. Can it smell . In certain places it can. Also you can rate the driver too. Every time you use the service, you get prompted to rate the service. You dont get to choose which driver comes up. You could end up with a twostar driver. Most of the time ive done it its great. More of the issue is ill call for uber and it doesnt come or they cancel the call. And the other big shift is sort of the change in how theyre approaching surge pricing. With the snowstorm they limited the surging. They capped it. You cant you know, youre not going to get gouged on a snow day necessarily. I think, you know we talked about this before. Surge pricing when that happens its a sign its not working. I think even for uber thats not what they want either. I think its tough to how do you define what price gouging is versus surge pricing . Supply and demand . Its a very difficult line to draw. Thats right. But it deters a lot of potential users. I dont know if it will cost more than i want to pay, so people are afraid of it and dont want to jump into it. I think once you start doing it on balance it ends up being a fair deal. But its still, you know theyre still marketing the service. You have to get people to understand it use it download it on their phones and play with it. I am a uber user and will accept the surge pricing. Thank you. Just some crappy looking white car can pull up. No, it really cant. No. Well it cant be a teenager. They have to be a licensed driver to begin with. Teenagers can be licensed drivers. There is a theres a vetting process. Ive never had a bad process. Im not going to airbnb or any of this. Really . No. We should do an uber. Yes. Tomorrow. We have a meeting tomorrow. To an airbnb place and hang out. I need cable and a flat screen. You need cable . And a flat screen. Thats it. A lot of airbnbs will have those. You know about that too . Yeah. We test them all out, right. All right. Thank you. Its thousand island. Its thousand island is the mayonnaise and ketchup mixed together. Something else in there too, right . You said that though. I cant remember minute to minute anymore. Up next were going to head downtown. Ive heard of this guy, jim cramer standing by at the new york stock exchange. His take on u. P. S. Earnings. Next next. Squawk box will be right back. What can your fidelity greenline do for you . Just take a closer look. It works how you want to work. With a Fidelity Investment professional. Or managing your investments on your own. Helping you find new ways to plan for retirement. And save on taxes where you can. So you can invest in the life that you want today. Tap into the full power of your fidelity greenline. Call or come in today for a free oneonone review. You just got a big bump in miles. So this is a great opportunity for an upgrade. Sound good . Great. Because youre not you youre a whole airline. And its not a ticket youre upgrading its your entire operations, from domestic to international. Which means you need help from a whole team of advisors. From workforce strategies to Tech Solutions and a thousand other things. So you call pwc. The right people to get the extraordinary done. Welcome back, everybody. Paying close attention to the squags in greece and so is the market. Angela merkel saying that her government is waiting to hear the position of the new greek government decline doing comment on reports of proposals. She has long said that berlin will agree to financial debtor countries such as greece only if they commit to tough, economic overhauls. The greek new president has been pocking back some of what hes been saying and thats why you see the strength in the euro at 1. 1438 to the dollar. Stocks on the move to check out. Advent software getting a boost, being bought for 44. 25. Wendys earnings matching estimates but revenues falling short. The chain will take advantage of low Interest Rates, recapitalize Balance Sheet and plans to sell 500 more restaurants to franchisees. Mixed quarter for adm, earnings beating by 6 cents but revenue fell short. Company raising its different dividend to 28 cents per share. U. P. S. Told us it wasnt going to be great and beat that is that what happened . On the Conference Call theyre talking about surcharges u. P. S. Is a confounding situation. My Charitable Trust owns it wish we didnt. Main reason i dont, u. P. S. Is one of those wait until next year stories. You believed in them two years ago when they fixed things they come back didnt fix. The most recent Holiday Season disappointing. And theres kind of like nothing. Whatever they do right now, i dont know how to get it back up other than a big dividend boost or a substantial buyback. Im not hearing anything structural that will make me feel like theyll do the right thing. Jim, february now, right, because yesterday was groundhog day. Mostly the earnings weve gotten, how would you you say it was pretty good . What is outlook for the year in terms of what kind of gain you think we can put up for the s p . Is it high Single Digits . I think its possible. Look, the Domestic Companies like auto nation just unbelievably good. No doubt about it they were terrific. The international is case by case. And the currency was hard to figure out. Oils a big part of the s p in terms of earnings and earnings were very disappointing, as we see coming out. You were talk go greece. Say that greece actually plays ball. Lets say that germany gives in a bit. Saw green chutes in japan because of lower oil. All this could mean as visa said a great Fourth Quarter because thats when spend willing come in people realize weve got more money because of gasoline if it stays here what happen were seeing now is the churning. But if the second half is really good, were looking back and saying why didnt we buy the churn . We could do that 2. 6, 2. 7 and end up with over 3 and we could average 3, which would be a shocker. Yes. Remember, Interest Rates are still down people only think freak out about that. I look at companies that yield 3, 3. 25 like a proctor gamble, come down really hard here. I mean proctor gambles largely a case of raw costs. Could be good in the second half. Havent seen the big gains from oil coming down. Only the Oil Companies do poorly. Down 43 from their high for the most part. I think that this is not the time to turn tail. I think there was a page turn when we went into february due to the fact that the germans are blinking. If germans blink, europe comes back on maybe china comes on. Well regret we wholesale dump stocks because january United States horrible. We dont do the nfl indicator anymore, stop doing the january indicator soon when its i think januarys been a false tale for a bunch of good years. Look, when talking about washington, i think that look, washingtons dead on arrival if we dont are to worry about taxes for the rich a tax reform that doesnt work get them off the front pages and accepting the third year of a president has always been good. January, false tale. Earnings get better as we realize the dollars going to be strong. Things get adjusted next thing you know you left the table at the wrong time. I like that. That was the most succinct person who has put that together yet, thank you. Up 60 today, after a good day yesterday, maybe. Well we havent got that far to get back to highs either. We could be there you know you blink, we could be back to the highs. Rest of the quarter reports going to be good theyre domestic. Right. Retail. Yep. Okay. Thank you, guys. See you. Guess what . I found out what the special sauce is for the mcdonalds big mac. Tell me what it is. Store bought mayonnaise some other ingredients, ill give you rest as soon as we come back. Stick around. Low fat . I dont think so. I think this is full fat. Ill tell you the rest of the ingredients. Forget your local pizza guy. Beyonce is ready to deliver dinner to your front door. Really . Tomorrow on squawk box, straight from the gut, jack welch, our guest host. Squawk box will be right back. Financial noise financial noise financial noise do y ou like to travel . Im all about free travel babe. Thats what i do. [ female announcer ] fortunately, theres an easier way, with creditcards. Com. Compare hundreds of cards from every major bank and find the one thats right for you. Creditcards. Com. Its simple. When the moments spontaneous, why pause to take a pill . Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. 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 longterm 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 symptoms of an allergic reaction stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use and a free 30tablet trial. Beyonce, apparently getting into the male delivery game. The singers partnered with her trainer to launch a new vegan Meal Delivery service. And meal prices range from 9 to 17 apiece. The companys called 22 days nutrition. A reference to the belief that it takes 21 days to break a bad habit. 21 days . Three weeks. Makes sense. Yeah . Yeah. I think ive broken that habit in three weeks. Whats in the special sauce. Special sauce, i have it its online actually. Storebought mayonnaise sweet pickle rel live remember the pickly stuff . Yeah. Its not ketchup yellow mustard, whisk together add onion powder paprika to give it the nice coloring. Thats where you get it. I dont know. Doesnt tell you the exact amounts of each. Thats where the thats the secret sauce. Glad its a secret. Otherwise it wouldnt be a secret. Right. Not going to come on any of beyonces stuff. Probably not. Better not. Make sure you join us tomorrow. Squawk on the street begins now. Good tuesday morning. Welcome to squawk on the street. Im Carl Quintanilla with jim cramer at new york stock exchange. Well hear from david faber in a moment on breaking news. A lot to work with. Euros at a twoweek high, u. P. S. Warning again, oil above 50 wiping out its losses for 20157 wti at 51. 17. Continue year back to 1. 73 or 4. Road map with oil trading higher. Bp better than expected results. We regoare going to hear