Transcripts For CNBC Squawk On The Street 20150316

Downgrade, and Disney Cinderella casts a spell at the box office, but btig stepping in the role of the evil stepmother cutting to neutral after a volatile week on wall street the euro near 12year lows. A lot going on. A lot to watch. Yeah. I was kind of hoping that this would be a nonentity week because theres not a lot of companies reporting. But the companies that do report tend to be very big, like nike fedex. Fedex giving you a view of the economy on the same day that the fed speaks. And oil trading at levels that are worrisome to some, not me. But it just turns out theres just no quiet weeks anymore. And we start off with a rally, it looks like that is like from where . From where . I dont know. The dollar for 30 seconds didnt go down . I mean, didnt go up against the euro . The euro carl it trades erratically in the middle of the night. Yes. Right off the bat last night. Fell straight below 44. And i just find myself riveted because it must be so thin. And the dollar shoots up on nothing. I mean the currency guys i dont know how much real liquidity there is on the largest market in the world. Well, we knew over the weekend i mean you could walk around this floor on friday afternoon and get all kinds of rue rumors of putin. We finally do get a picture of him today. Better than the alternative, not knowing where he is yet again . I felt that when we had another dictator go in venezuela things would get better. Who knew there was someone worse. Theres always someone worse at the bad places always someone better at the good places. Some pictures here with the president of kyrgyzstan. Some are trying to argue he looked a little puffy, looked a little sickly. Oh my. Lets put him under a sun lamp and make him look great . I mean honestly, the guys around. Ukraine seems to be getting worse economically. I think that we have to stay focused on russia but really stay focused on brazil where they had a Million People turn out. And that governments got to fall. I mean that government there was a list of 50 it was like mccarthy. 57 people who we know are corrupt. That country is on the daytoday. Yeah, shes got some issues to deal with. Yeah, shes got some issues. She doesnt look as good as putin. Meantime, this fed meeting begins tomorrow. Theyre going to look past the weakness and set a path for june, do you agree . I think that they are so data dependent that they literally can do i think theyll just stick with it. This whole idea of patient, nonpatient. Saying maybe they come up with a new language. In the end, february was weak. It was just weak. So, i mean the idea of taking action if you looked at the february data is kind of not if the february data were strong, it would be a very big difference. But there wasnt a number that i could pick out other than employment. Terrible. I mean terrible. And empire. More of that today including new orders. We had the weakest month of the developed countries. Meantime, some downgrades today. Share of netflix falling in the premarket. A sell rating reducing its target from 450 down to 380. What it perceives to be an intensifying competitive environment for netflix, as amazon hulu, snap chat discover all find ways to get content. I have trouble with this because this was an analyst who was not recommending on the way up. Had one of the absolute great runs. Now the competition obviously its a signup situation. If you missed it this is a new thing i see analysts doing. We missed it lets go to a sell. You know what . You missed it just say you missed it. I find that some of the times the analysts are best to say hey, you know what . I sat this one out and its really gotten too far. Im going to stick with the hold. Maybe it comes down. When you go to the sell what you are now saying to guys like me is hey, i got it wrong, i got it wrong. Youre not getting away with it there. Its kind of like our role. Evercore has had a neutral for a while. That was unhelpful. That was kind of like if youre watching the ncaa and the bracketology, youre saying hey, you know what i really put everything on unc getting the first seed and im sorry i was wrong. Now im taking unc. Do you disagree with the fundamental analysis . Yes i do. I think netflix is in the capper seat. I always say the same thing, which is this is netflix driving it. They do have the right programming. They are taking the world by storm. I think netflix could raise its price dramatically like amazon prime, like costco. It wouldnt matter. A lot of discussion about sony selling the rights to seinfeld. I mean are we at some sort of Inflection Point where someones going to pay too much more than they should . I think that could happen. But worried about the Balance Sheet, they could sell like 50 million shares and people would snap it up. Im just not a bear on netflix because of the signups. Its an international signup story and its a very compelling offering at these prices. And thats why the bear you know the bears keep losing. I dont like it on an earnings basis. Its one of the cult stocks. Amazon, netflix, tesla. Theres a tweet today about a meeting. And that tweet that stock could go up ten points. A tweet about a meeting where theyre basically saying listen well tell you when your battery life ends and the stock will go up 20 on that. I mean colts, stay colts. Thats what colts do. Were going to talk about that tesla meeting on thursday in a few moments. But if you didnt like the netflix downgrade, youre going to love the disney downgrade, of course ruling that north America Box Office over the weekend, cinderella took in 70 million. Shares are near full value based on very robust expectations over the next couple of years. Heres the problem with that. Its had a big run. I could understand that someone might say its fair value. But what are you supposed to do . Unless youre a hedge funds, which goes forward today because the fed does something wrong. Well, how do you get back in . Is that worth doing . If youre someone at home and have a longterm horizon, what are you going to do get back in at 101 . While youre at work, going to call your husband or wife and say wheres disney oh yeah lets go back in . You cant. Its too cute by half. The last disney downgrade that we had was 89 going to 82 because of ebola. I caution people that you cant really trade disney. I just doesnt work. And by the way, the company is in there every time you do trade it buying stock. You saw cinderella. I did not get to see it this weekend. I did see it. Everyones going to see it within the next four weeks. Ive got young daughters, as you know. We dont have a choice, we saw it. As i was saying to you before the show there are movies you take your kids to that you can ignore and movies that sort of make you watch. Its like immunization. Some people are going to choose not to be immunized. Theyre not going to go to cinderella. We worry about those. We dont want our kids with the people who dont see cinderella cinderella. We dont want some sort of immunelogical problem. You will admit things are going right for disney. All you want is each quarter to have something big. Last week at the meeting, bob iger basically said listen were going to stage this this this, this this. And he gives you another frozen. Gives you an expanded star wars schedule. A bunch of things you wouldnt even know about. By 2017 were just going to use our apple watch and go right through. Last week you and david had nelson pelts here on the floor, as you know, getting a tweet this morning from carl icahn. Which reads like this. For those interested in Corporate Governance issues the pelts interview with david faber and jim cramer is a much watch. Great points made. And it includes a link to that video. We were very proud of that. Subsequently, when you go speak with the people involved. Obviously, david did the lions share of that. Talking about what would happen if nelson pelts were to leave. I think just say defeated or go. I thought it was very interesting to see the Merrill Lynch note on dupont which is they go buy to sell at merrill. So what happens, if pelts loses, does he take his bat and ball and go home . If that happens, you have a 72 stock. Which is not what you want. Im saying that peltz creates value. Theres a look at peltz as he came to the floor and answered criticisms that he has targeted female ceos and a lot more. I know. And he found fault with our charting. Which i thought was a new level of directing . Do i get a kick out of nelson peltz . Absolutely. Do i think hes done terrific things for investors . Definitely. If you bought stock after he announces you made money and dupont is probably the best evidence of thats the case. Carl, thank you. We all come out as professionals. If someone who you respect says hey listen you did a good job its like hey, thats a pro telling you that you did okay. I like it. Absolutely. Icahn, its not his first rodeo. No its not. When we come back greeces Prime Minister feels the heat and walks away from a cnbc interview. Youve got to see this exchange. Later on well go to south by southwest, talk with Walter Isaacson. The dax this morning got above 12,000 for the first time. Premarket here looks pretty robust. More squawk on the street from post nine at the nyse when we return. Say youre a finance guy. A farmer. A researcher. You used to depend on experience. The internet. Your gut. Today you can use ibm watson analytics. It can make sense of all kinds of data. Uncover hidden correlations and new opportunities. And give recommendations with more confidence on who will buy. What to make. Where to plant. Which helps you make smarter decisions. Theres a new way to work and its made with ibm. Jim mentioned tesla shares on the rise this morning thanks to some news that elon musk announced using his personal twitter handle. About to end range anxiety via ota Software Update. Affects entire model s fleet. So that leaves the rest of us to figure out how a Software Update is going to end your range anxiety. Well, anything i guess that shows a more accurate you know something that goes off or something. Look, hes a shrewd stock manager. The stock has been drifting down and its time to give the stock a battery jolt. I think thats what it will do. Kind of get in the way of the shorts. I think he really likes that. Plays the game better than most. I still think they need to do a gigantic financing. Each day, hell give us a new tweet. Stay tuned, stay tuned stay tuned. He is a tweet per share guy. Yes. Same guy, though, who called the price expensive not too long ago. He said chinese sales were going to be 30 not that long ago and turns out they sold ten. I mean the guy is the master. When you Say Something bad about tesla i love the car. Thats what im saying right now. Until i hear what he has to say, ill say i love the car. Deflect. A politician. What do you think of the stock . I love the car. Ill be like frank. Frank underwood. You laugh i love the car. Lets get Industrial Production and go to rick santelli. Hey, rick. Hi carl. February Industrial Production up. 1, but heres the fly in the ointment. January originally up. 2 now down. 3. Thats a half of 1 swing. Lets look at utilization rates. 78. 9 so we lost the 79 handle. 79 was expected. 79. 5. But we still retained it last month. 79. 4 does turn into 79. 1. These numbers are a bit disappointing, but once again, theyre still in the hunt theyre just not in the hunt on the aggressive meter. Were slipping below 210 in somewhat quiet trade as we get ready for the fed meeting and everybody beginning to continue to monitor whats going on in the euro and in crude. Carl, back to you. Thank you very much. Meantime the outspoken greek Prime Minister in the middle of a fire storm. He is facing criticism for a spread in french publication paris match, which shows varoufakis in a rather comfortable lifestyle while a lot of greeks are struggling. Our julie chatterly questioned him over the weekend and heres what happened. Are you a liability, though for this government because you are trying to promote a serious message and these things are distracting . Are you a liable for your channel . I try not to be. So do i. Are you a liability for your channel . Interview Jason Statham, you get a Jason Statham answer. People dont understand this guy. When he wants to be tough, he can be tough. When he wants to be funny, he can be funnier than anybody. You go against him youre going against a guy whos really an idol. I think hes been heading this thing very right. Hes got the germans on the run. Hes got the greeks being able to get their way. Hes the man in the middle. Hes doing a pretty darn good job. And this shows you dont take me on. What hes saying is dont take him on. We dont want to take him on because that seems wrong. When you say the germans are on the run how do you mean . Everyones complaining that the process is a logistical waste of time right now. Well because the germans were supposed to cram them down. And there he is. Hes still out there. Saying stuff. And the germans did not come after him. We all felt that the germans had this basically said listen, youre not going to get any more money and theyre giving them the money. At the end, theyll get 35 40 50 years to pay off what they want. And this all goes away and we should really be focusing on other areas. Because i think this guy is the master. Hes the master. He has proven to be politically savvier than a lot of people. Does it with a smile. Stilettos. I have been so impressed with this guy. I know that initially people felt he was a bit of a cartoonish character. I think the germans dont know what to make of him. Why . Because hes crazy. And, you know theres nothing worse than an opponent who is crazy. Meantime the euro did hit 1. 457. We talked about perry last week. 90. Really . I just think they want it back to where it was when they started. The germans are just making so much. The germans you know they may not have played greece right, but the germans are just making fortunes. This is great for their cars great for the industrials. Theyre the big winner once again. The germans keep winning. At a certain point, i think theyll have to show a little more largess. The german stock market is on fire. Look at that 12,087. I remember when getting over 10,000 was a big deal just a couple of months ago. They have raising numbers, every german company, maybe with the exception of basf. I dont know. These German Companies are on fire. And their numbers are all way too low. Volkswagen is doing very well. Its very impressive. Youre in the german stock market, youre just making a fortune. One company with a lot of exposure to europe is microsoft. Nadella is speaking at the convergence conference this morning. Hes announced im told office 2016. Also has announced skype for business. Which he is previewing right now. Earlier on in the morning, Russell Wilson onstage talking tablets. Really . Believe it or not. Does he mention why . Does he say why . We want to hear why didnt you give it to marshawn . Ubs does cud numbers this morning on microsoft. On weak pc demand. Yeah pass. Honestly i think microsoft is not going to make the numbers. They need to do something. Look intel, hewlettpackard, theyre telling you that the most recent microsoft generation isnt doing that well. Microsoft is an inexpensive stock, but i think its a bit of a value trap. Its not going to be skype for business. They need to break the company up. You are not its simply not their time. And i find that this that he came in with a blaze of glory and made a deal with a lot of people. Like sales force. That was something that ballmer refused to do. Apple. Yes. Now its stalled. Instead what were stuck with is the numbers and thats the worst thing to be stuck with. Because theyre not going to make them. The number cut that we got is still way too high versus the street. People have to come down and they have to come down now. Im waiting for a lot. Im waiting for goldman to cut numbers big. Im waiting for some of the major firms to come out and say listen im not going to make it. I think those would all make sense. Any other headlines from nadella, well pass them on to you. Hes not a showman. I mean, tim cook is a song and dance man compared to this guy. When we come back cramers mad dash. Well count down to the opening bell. Take one more look at the premarket with dow futures up almost 100 points. Back in just a moment. Theres nothing more romantic than a spontaneous moment. So why pause to take a pill . And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating 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. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com its more than a network and the cloud. Its reliable uptime. And multilayered security. Its how you stay connected to each other and to your customers. With centurylink you get advanced Technology Solutions, including an industry leading Broadband Network, and cloud and hosting services all with dedicated responsive support. With centurylink as your trusted Technology Partner youre free to focus on growing your business. Centurylink. Your link to whats next. I know youre watching biotechs. Yes, thats very important. They presented some new anticholesterol class drugs. Showed tremendous success. Its a class. I dont want to say ones worse than the other. This stock is breaking out and remains my favorite in the group. Regeneron last week. So i like both of those. Collision avoidance in your car. Its very interesting. Goldman went hold the buy last week. Goldmans the lead manager in the 14. 5 million shares and goldman is also sharing shares. Its a very goldman day. Yes. Isnt that terrific . Speaking of being in your car, we should mention garrman. You know you love your garman, but now you hook up your iphone it tells you pretty much what garman is going to tell you. This cardiology conference. Met he knows better than anyone. They have a device that makes you not have to crack open the chest cavity. Its going to keep winning. Edwards has been the real winner. Their scientific editor. Ew youre not going to go wrong. I think eventually e. W. Gets acquired. It is such an amazing company. I really love these guys. Theyve been on they are terrific. Theyre the technological leader. The doctors love them. And theyre great guys. Yeah all the action around heart valves this week. And then cardiology is going to save lives. Its really terrific. As you get older, more and more people are having heart surgery and they cant tolerate the chest crack. All right. Well get a lot more after the break. And of course the opening bell on this monday. Dont go away. 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. The lightest or nothing. The smartest or nothing. The quietest or nothing. The sleekest. Sexiest. Baddest. Safest,. Tightest,. Quickest,. Harshest. Or nothing. At mercedesbenz we do things one way or we dont do them at all. The 2015 cclass. See your authorized mercedesbenz dealer for exceptional offers through mercedesbenz financial services. Do you want to know how hard it can be to breathe with copd . It can feel like this. Copd includes chronic bronchitis and emphysema. Spiriva is a oncedaily inhaled copd maintenance treatment that helps open my airways for a full 24 hours. Spiriva helps me breathe easier. Spiriva respimat does not replace rescue inhalers for sudden symptoms. Tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. These may worsen with Spiriva Respimat. Discuss all medicines you take even eye drops. If your breathing suddenly worsens, your throat or tongue swells you get hives, vision changes or eye pain or problems passing urine stop taking Spiriva Respimat and call your doctor right away. Side effects include sore throat cough, dry mouth and sinus infection. Nothing can reverse copd. Spiriva helps me breathe better. To learn about Spiriva Respimat slowmoving mist ask your doctor or visit spirivarespimat. Com youre watching squawk on the street live from the Financial Capital of the world on this monday. The opening bell in just about 90 seconds. As we kick off a busy week nike and fedex, a twoday fed meaning, israeli elections and a lot more. For the time being, some mna stories. Endo saying we wish salix all the best, continued success. And there it goes. Exactly what david said on friday. Foregone conclusion. I think the value goes higher on this. People love these combinations because of the inversion rules. What can i say . Thats the way it works. Meantime we just mentioned your interview with nelson, and now we have a new letter to dupont. Yeah, tea leaves here. This is a letter that says after having met with stockholders of dupont over the last few weeks, believe in having a a trian compromise. He said over and over its got to be peltz. Its not going to be john meyer. Theyre willing to have john but this has got to be nelson. And if thats changed, there will be a deal. But that sure wasnt what we said last week. Lets get ready here for the opening bell on this monday. Get a look at the s p at the top of your screen. Down here at the big board, its csop Asset Management celebrating a launch of its ftse china. Therapeutics focusing on neurological disorders, celebrateing its 20th anniversary. You know what struck me this morning, jim and we covered some of these, but these downgrades come in waves. And today it is a garmin netflix, disney and win downgrade kind of day. Winn makes so much downgrade. 50 situation. Very tough to own that stock. Disney i think again thats just kind of like all right, i want to call a top. Thats been a real bad idea. Microsoft, got to be really careful there. If microsoft does come out and say listen we cant make the numbers, the stocks going to go to 35 36. The wing call by the way, morgan stanley, which cuts it to equal weight doesnt expect a Market Recovery until 2019. More structural loss demand than weve bought. Yeah. You cant fight the fact that the communist party seems to really crack down on these things and thats just very important. On the dupont downgrade, you know whats going to happen peltz is going to lose. I think thats what people have to recognize. John myers would be a terrific addition. Thats the guy from ge capital. But apparently thats not been enough because i know that ms. Coleman has basically said thats okay. This one is going to end badly if some deal isnt made. Dupont is by far the worst dow component and its the worst s p component. All the tellchemical stocks are doing badly except for that one. The ag business isnt that good. A lot of the core businesses in dupont are just okay. But that has to do with the fact that its just okay. Every one of these companies, theyre not that good. Ges in the green along with a lot of other dow components. The letter comes out today. I was hoping to get a hold of that earlier. I would have loved to have seen it in time. Maybe later on today. A Consortium Led by krr. 6 billion. You always try to figure out how far flung is ge. Turns out theyve got a gigantic business. You know, in the meantime the last two big acquisitions, which is energyrelated infrastructure its got some other. But that was not so good. An oil patch play. This company is widely perceived as it sells anything its more and more an oil company and oil service companies, when you see schlumberger, and haliburton thats not where you want to be. Lets get bid on the record. Tad smith leaving. Hes so great. That guy is a very, very smart guy. Everybody loves tad. Hes just a remarkable guy. He is going to help sothebys. Robert frank arguing that the art world needs to get to know him. Theyll know him and love him. Hes just a smart man. On oil, the u. S. May soon run out of storage, and when that happens, do you still see 42 holding . Look, that is the big issue. The refineries are running full out. Could use all the gasoline that they make. It has to do with the backup of cushing. Theres no real place to put it. Really putting a lot of this crude from canada that we thought was going to come through keystone its going right through ambridge. Theres so much from actual mexico coming in. It is a case of storage. Watch the day rates for the shipping companies because theyre trying to put it on big ships, too. Its anywhere we can place it. We cant export because of the rules. There are real issues. Real issues with oil. Because it just turns out you cant refine enough of it fast enough. Running like the Northern Canada refineries are running flatout. You cant run refineries at the pace theyre running without something going wrong. These are dangerous places. So be aware. And once again, delta and southwest, its like clock work in the top 15 s p gainers. They can raise prices. And their biggest swing is going down. It doesnt get better than that for those guys. They are raising prices at will because theres very little competition. Bp investing 12 billion in a project in egypt that will produce the equivalent of 3 billion barrels of oil. Bps got to get out of the oil business. They are trouble. All of these companies are in the same boat which is the big ones, they do not have the oil that does well. Remember, if you have an eog, theyve lowered the break even cost big. Bp, exxon, these guys have gigantic projects. Really very expensive. Chevron, very expensive projects. They basically go to the different Drilling Companies to say hey listen pal, you cut your rates. We know you have a lot of extra capacity, so were going to start drilling make 29,000 a day go to 20,000 a day. Could be eight days. Theyre going to make a lot of money. Theres no cessation yet. There was no bottom in growth. Permian and balken. Balken is the expensive. Mike santoli had a great point. The s p year to date is flatish. But think of all the markets that have had wild changes, the entenyear the euro oil, gold europe japan. How does that work . All these crazy things going on and yet were basically making up for a weak january, strong february. I think that theres a couple of very big cap stocks that are getting the money in and retail does very well. Restaurant does very well. But the international companies. Technology is a gigantic partner in the s p. Technology is not doing well unless you sell into cell phones. The banks are doing well but not doing so much. Finance is a big part of the s p. Theres too many parts of the s p that are questionable here. And the big problem is the internationals. You know cocacola. Like where is the upside in cocacola . The strong dollar headwinds. I was doing work on avon. I mean they have 12 headwinds. They beat latin america. If you sell overseas and you sell on countries like venezuela, youre just losing money every day. Thats a terrible terrible thing. You know whats the biggest gainer . Edward. They got a better mouse trap. Wow, you know what . Ive been waiting and waiting. All the cardiologists tell me over and over again, this is the company thats got the silver bullet. St. Jude had some good stuff. Im never going to sleight medtronic. People are so slow to recognize that someones come up with Something Better to save lives. You cannot perform that kind of surgery with people in their 80s without the edwards. Its just too dangerous. Edwards has got a solution. Theres baby boomers this is the baby boomer heart device coming. Its fantastic. Again, great guys. Totally nonhyped. Ive had them on i want them to say this is the greatest thing since sliced bread. They wont go there. They just wont go there. Theyre conservative people. And nice people. 6 gain does the speaking for them. And its followed up by bsx right behind, almost 3. 5 . These Device Companies are very very good. They all tend to be good by the way. St. Jude is a great company. Its really one of the best things we do is medical science. We dont get enough. These are Great Technology numbers. We are in a golden age, as some might argue. Right now, a pretty nice gain for the dow. Lets get to bob pisani on the floor. Happy monday everybody. Im a little encouraged by today, because its true the weak sectors not surprisingly are energy and materials. And put up the major sectors, you can see that. But oil hit a new low. And on that new low, i was anticipating that we would be heading towards new low for many of the big energy names out there. Im watching some of the big names like eog, for example, big Exploration Production company. Thats just hovering just above its 52week lows. And yet, it started negative and went positive today. I think thats very encouraging that we hit a benchmark, new lows on west texas, and we are not seeing corresponding declines in the exploration and production names. So keep an eye on that. Overall, very bullish start to the week. Meantime, speaking of bullish you see what happened in shanghai . If you doubt the effect that stimulus has on stocks did you hear what the premier said over the weekend . China was prepared to take action to stimulate the economy. The government had a host of policy instruments. As close as you could get to Mario Draghis whatever it takes statement. And this is from the premier of china. Thats a new high in shanghai sitting up towards multiyear highs. Europe is also rallying. Take a look at that, the weakness in the euro. But the euro today rallied. 106 or so. The stimulus being provided by the European Central banks. Look, its another new high over in germany. Were at sevenyear highs in france. Fouryear highs in italy. You get the idea. If you have any doubts that the stimulus talk is helping european equities just take a look at fun flows. This was one fund flows. European equity 35 billion in inflows. U. S. Equity funds, 35 billion in outflows. Exact mirror opposite of each other. You cant blame everybody. Everybodys just following the money. I think you guys were referencing this just a couple of minutes ago. Look at the returns for the year. This is one of the strangest quarters i have ever seen for global equities. Germanys up 23 for the year. France is up 18 . Japans up 10 . Chinas up 7 . The s p is flat. Down 0. 3 . That is a very very strange mix. And of course the key element there is all of them are involved in stimulus or qe of 1. 4. Last week, another week of relative outperformance for the small cap russell 2000. The outperformance on the month. Russell is flat s p is down and on the year. Here you see the russell up 2. 3 . S p down. So its not so much go long europe and sort the u. S. Its partly that but its really go long small cap, and stay short big caps. So thats the important thing. Finally, tomorrow is st. Patricks day. Those of us who have suffered through another weekend, please know how does everybody do on st. Patricks day . No surprise, anheuserbusch is up 1. 1 in the next four days. Every single time since 2005. 100 of the time. Maybe not that surprising. Others Like Boston Beer Company also up almost 90 of the time. So a little bit of move on st. Patricks day. Right now the dow up 102 points. Thanks a lot, bob pisani. Rick santelli at the cme. Good morning, rick. Good morning, carl. Today were looking at a parallel shift on the curve. Those are always interesting. We have a four basis point drive in fives, sevens tens 30s. Usually when theres no curve implications at a time when theres tremendous potential for Curve Movement and a twoday fed movement, most likely everybody is somewhat thinking the same. At this point its you know dont fight the notion that Interest Rates have a lot of sponsorship and a lot of scarcity, even though the fed may be talking about raising rates. As you look you can see yields are down. Down from significant levels of major importance, whether it be settlement of last year or some of the areas that we experience trading right around the december holidays. December 1st charts for the next several. You can see on the tenyear. Heres an interesting one. Tenyear jgbs. Theyre actually at 42 basis points. Kind of interesting. This is why you dont use percentages for yields. Up 100 like three four weeks. They were 20 basis points. Basically kept the same low yield as bund rates. Not necessarily exactly the same day, but darn close. Want to Pay Attention to this. Theres a lot of talk the japanese are going to be buying a boat load of treasuries the grab some yield. Weve heard that song before. Heres bunds starting on december 1st. You could continue to see yes. But many thought the leadin to lower rates on the ecbs Quantitative Easing Program would be the first chapter. Its looking like half the book at this point. If we look at whats going on in the spread between our bunds, we shaved ten basis points on that distance. It was at 190, now its at 180. Many believe were going to test 200. Maybe well get down 170, 175 before we do. If we switch gears to currencies, euro versus dollar its actually having a bounce. As a matter of fact, every single currency, major currency on the landscape is doing better against green back, but the dollar index did reach 100 on friday. If we look at the big picture, of course, friday we are flirting with the in terms of the euro the best level of the dollar against that currency, going all the way back to january of 2003. And of course with that fed meeting, theres been a lot of talk about what may or may not happen with things like the yield curve and short rates spiking up. But i will continue to tell you, whether you look at tens minus twos as your template, its actually been widening or steepening so we need to continue the look for all of those. Not as to what the fed is going to do, but what the market will do as the fed tries to normalize. Carl, back to you. All right, rick thank you very much. Oil meantime trying to recover after hitting 43 and change. Lets get to Bertha Coombs at the nymex. We are back near the lows of the morning, here below 44, a sixyear low on oil. And its interesting, weve got opec coming out with its monthly report saying they dont see producers really cutting production until the end of the year. They think thats when its going to catch up. It could be opec talking its book, not wanting to have to do some sort of emergency meeting before they meet in june. But one of the interesting things is that the international benchmark, the brent benchmark, has held up a bit better than the wti nymex crude because of these concerns of a glut of oil in storage already and that the u. S. Could get tapped out as far as its Storage Capacity. That has made the brent premium really jump over the last couple of months double from a sense of being at par with wti and brent, and now its 10 above. And that actually is spurring more of a carry trade. Some folks in the stock market are seeing it worthwhile to take our oil and ship it all the way to asia and compete on price with opec to try to sell to those customers there. Very interesting die. Thattics in the oil market these days. Back to you. Well come back to you later Bertha Coombs. When we return jack ma gets in your face. Well explain that. Also ahead, the cofounder of comecore. Dow hanging on to a 110point gain. Were back in just a moment. First impressions are important. Youve got to make every second count. Banking designed for the way you live your life. So you can welcome your family home. For the first time. Chase. So you can. Hello. I am technology that is changing investing forever. I am a fully automated Investment Advisory service. I can help you choose the right portfolio. Monitor it. And even rebalance it. Ive been called innovative. Revolutionary. And just plain smart. Id blush at the compliment if i could. But i cant. So. I wont. Say hello at intelligent. Schwab. Com forget your mobile payments Alibabas Jack Ma says you may soon be paying with your face. Speaking in germany last night, he demonstrated a Payment System that uses facial recognition for security. Ma called the technology the future of buying things online and used the demonstration to bay a buy a gift for the mayor of hanover. Interesting. Although stock hasnt been above the 200 level since january. I continue to like yahoo. Youre seeing yahoo valued at almost less than nothing now. I just feel like that what happens is they will give you their theyll off load their alibaba and whats left is a very inexpensive company. If you do want to play alibaba, please buy yahoo. Are you interested at all in what their ambitions may be outside of china state side . No i just find china i know that there was some squawking this weekend. Theyre determined to keep the growth rate high. But i dont want to be levered to either china, the domestic or the export. Just not a great place to be levered to. Their stock market has been redhot, but i just think when you start buying these Companies Based on fundamentals, it doesnt hold up. Yeah, especially now that theyre starting to off load some steel. I spoke with dan demico, used to run new corps talked about how we are being wiped out. The Steel Companies are just theres just endless dumping of steel and our government does not stand up for it. Maybe that will change. Well find out. Well get stock trading with jim. Dow up 158. Dont go away. 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 . 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. Back and forth, back and forth. The dow and the s p positive for the year after losing their gains over the past few weeks. Well heres two that i think are terrific. Haynes brands added to the s p, they just did a 4 for 1 split. This company, i know the chart looks a little daunting. Do not be put off that the stock can go higher. They are an amazing manufacturer. They have their own plants, by the way. Dont worry about sweat shotps, at least according to them. Im a big backer of harman. This is auto infotainment. Those are both big winners. Youve liked that one for a while. Oh yeah. Did amazing things. A lot of people say we want to get into cars. They are the Cyber Security car. They are the most forward looking company in the space. They are not just great sound systems. They are the connectivity king. They have the biggest intellectual property in a car right now. I look at the action jim. Dows got your attention, up 172. But the transports are raising some eyebrows, too. We havent had the new high since december. We need to. Absolutely right. What happens tomorrow the euro is weak well give up everything here. People say jeez we knew that that was going to happen because the transports didnt confirm. This is all about the euro. The euro is weak tomorrow what you see on your screen byebye. Its really unfortunate, but thats where we are. I think we did get an upgrade of unp. Yeah, there was a unp upgrade. I thought it was a weak upgrade. Theres a lot of things going on in the energy space. And Union Pacific has a lot of fracking sand. Thats why people are tepid on Union Pacific. Norfolk southern and coal. Coal was going down. These are all happening at once. Theres a gigantic pipeline thats opening natural gas to the chicago area and thats going to really hurt coal. One of the few pockets of coal still being used is the midwest. Whats up tonight . Were handicapping. Were going to do some everyone else is doing the ncaa. Weve got it. Weve got your brackets. Youre going to love it. Its going to blow your mind. Im going against that. If you go with kentucky, whats the point . Everyone has kentucky. Its like going to the racetrack to get 2. 10. Not for me. Stay tuned. Cant wait, jim. Well see you tonight at 6 00 p. M. Eastern time. When we come back, breaking news on home Builder Sentiment. Dont go away. Sometimes the present looked bright. Sometimes romantic. There were tears in my eyes. And tears in my eyes. And so many Little Things that we learned were really the biggest things. Through it all, we saved and had a retirement plan. And someone who listened and helped us along the way. Because we always knew that someday the future would be the present. Every someday needs a plan. Talk with us about your retirement today. Its more than the cloud. Its security and flexibility. Its where great ideas and vital data are stored. With centurylink you get advanced Technology Solutions from a trusted it partner. Including cloud and hosting services all backed by an industry leading Broadband Network and people committed to helping you grow your business. You get a company thats more than just the sum of its parts. Centurylink. Your link to whats next. Good monday morning. Welcome back to squawk on the street. Im carl quintanilla. Stocks are green for 2015 once again, as we have a nice rally under way. Dow is up 166 points. Oil, though, continues to be a sore spot breaking below 44 as some renewed pressure takes place. Microsoft ceo unveiling new products for businesses at the companys conference in atlanta. Find out what it means for microsofts future. Plus new info on how much money is being spent shopping on mobile devices and how the apple watch could boost it further. And tesla trading higher after a tweet from elon musk. He says he has the cure to the range anxiety surrounding the model s. Weve got the details on that. Lets get over to diana. Reporter home Builder Sentiment down two points in march to 53 on the National Association of Home Builders monthly sentiment index. 50 is the line between positive and negative. We were at 46 a year ago in march. Up to 59 in september. Now declining for three straight months. Again, to 53. The builder citing supply chain issues, law and labor shortages, and tight underwriting. Of the three index components current Sales Conditions down three points to 58. Buyer traffic down two points to 37. That one still mired in the negative. And sales expectations were flat holding at 59. Home Builder Sentiment was down. In the midwest, it increased, but in the west it dropped the sharpest, down seven points in march. Again, for more, you can see all the numbers at realtytech. Cnbc. Com. Were now green for the year. Ahead, of course of tomorrows fed meeting and Janet Yellens News Conference on wednesday. Crude continuing to slide with wti touching its lowest level since march of 2009. Joining us now, funds strike Global Advisers founder tom lee. Good morning tom. Good morning. There will be some people who have taken your bullishness hard, who will be disappointed that we havent made better gains during the first three months of the year. Ive been disappointed myself. Its okay. You know because weve were sort of flat for the start of the year. And whats happened is good news now is not really seen as good news in the u. S. Because i think investors are worried that if things are too good, the feds going to tighten. The dollars been too strong. Oils been too weak. Theres a lot of concentration. My positive take on all this is one, the u. S. Economy is still short oil. Were not net long. So lower oil is still good for the s p. But more importantly, the economy is a lot more levered to housing and investment activity than it is to energy. So i think people are sort of forgetting bigger picture. Theres a bigger housing story taking place this year. Right. Obviously last week the dollar for many people was front and center. Have you like others, taken down your earnings estimates for the year and therefore where you think the market should trade because of the strong dollar . Well simon, its another good point. If the dollar stays at this level, its going to be a headwind for earnings for the rest of the year. Because we know theres a translation effect. And we know theres going to be an effect on inflation and gdp. One of the things that i think is uncertain right now is really where the dollar is six months from now. If investors think its stronger, there is going to be a headwind. Ive never heard you come on the platform with such doubt, tom. With doubt . With doubt at this level. Well, im probably wearing the wrong tie today. Am i riddled with doubt . I want to acknowledge the headwinds out there. But im very confident investors are overlooking the investment story in the u. S. I think theres a lot of evidence that theres pent up demand. Even with a survey today on Home Builders, tight conditions is the reason why were not seeing better numbers. I think these are going to ease over the course of the next couple of months. Not to poke too many holes into the bullish story but the economic numbers are not going your way. Weve seen so many misses. Soggy data really on everything except for jobs. Yes. Doesnt that make you doubt that u. S. Investment story and the fact that the u. S. Economy had been looking so strong coming into the year . And again, it is interesting. I mean i guess data doesnt improve in a straight line. What we have to keep in mind is if the data isnt improving linearly i think it does take pressure off the fed to necessarily move up its date. So its not a necessarily bad thing to see data mixed. You think theyre going to remove patient from the language on Interest Rates this week . You know, im not a fed watcher, so i think the key to watch is really does the fed seem to have more deliberate arguments to move forward. And i still think theyre going to be patient. So let me pick that up. Is it possible for the market to rally, if they remove patient from the statement, which we think they will. Most people think theyll remove patient on Interest Rates from the statement. If the dots the speed at which they think theyre going to raise Interest Rates perhaps is lower. Because of the lack of inflation. Is it possible for the market i mean obviously theres going to be volatility. Could it rally through that do you think possibly on the view that the fed isnt going to tighten as many times moving forward . Well generally, i dont like to be shortterm focused. But its a story for the year in fairness. A yearlong story. But heres the observation id make. The markets going to always be surprised, right . Whatever people anticipate is going to be discounted. And ive heard many clients tell us theyd rather see the fed move forward because its proof that the economy is strengthening. So i think in some ways, you could make the argument that if the fed is confident to alter language and the dots move its a bullish signal. But more importantly, i just would say when i speak to clients, theyre really focused on this europe on proxy trade, the opportunity that qe is taking place in europe. So i think there is money flowing into europe outside from the u. S. Are you suggesting thats what people should do invest in the eurozone over u. S. Equities . Well i principally focused on the u. S. I just i would say that a european rally, which we do see taking place, is not bad for u. S. Stocks. I think investors shouldnt look at this is a tradeoff between u. S. And europe. I think equities are rallying. Good to see you tom. Tom lee there. As we mentioned, oil at the center of the action dropping to a sixyear low. Traders are eyeing u. S. Production levels and also highstakes talk this week with oil producer iran over its nuclear program. Richard hastings is a strategist with Global Hunter Securities focusing on oil. Rita tsen is chief oil analyst. Is that thiswhat this is about . Were focused on u. S. Oversupply and stockpiling, which is also reaching very tall levels . Yeah i think most of this is to do with the u. S. Stock levels. Also remember this is seasonality. Every year we get a really big drop in oil prices around this time of the year, and this year is no different. Weve been saying for a few weeks that we do expect some downside in oil prices not just in the u. S. But also global brent prices. I think that is what youre starting to see now. I think theres more to go. Just in todays action alone, were seeing more than 2 declines on both wti and brent, richard. There was a report out of opec a monthly report that said that production levels in the u. S. Are going to start to slow down in the second half of the year. That was completely ignored. So do you agree that the bias is to the downside further here . Oh completely. Completely agree. Were expecting that month over month production in the u. S. Will start to decelerate to 0 growth on a month over month basis. If not in may 2015, then certainly by july of 2015. And i dont think the market is looking at that. The other thing is that while were all very focused on the bloat in crude Oil Production and then the storage hypothesis that theres so much crude oil in storage, theres only about 29 days of supply of crude oil in the united states. Thats a month. I mean, this is a joke. Gasoline is about a month supply. Even if we go from about 450 Million Barrels of crude oil and you go to a hypothetical 650 Million Barrels of crude oil, you wind up having about 45 days of supply. So some of the idea that the market would be permanently oversupplied is nonsense. So whats going on . Well these are just you know, theyre consistent ir rorerrors in judgment and observation. The same thing we see in natural gas. I dont want to change the subject, but youre going to send the season at about 1. 3 trillion cubic feet of storage and theres a Maximum Capacity of about 4. 8 trillion cubic feet of working capacity storage for natural gas in the united states. How does that describe an oversupplied market . So getting back to crude oil, theres the rig count hypothesis. Theres the storage hypothesis. And one after the other, they dont hold up to scrutiny. Were going to start to flatten out in production sometime during the summer and then the market is going to start to wake up. Interesting. Amrita there was a note out saying that Retail Investors had been premature to boy into emfs, which is what weve been doing, and that we could see that money flowed back out, because people couldnt understand the lags in the system and the effect on inventory inventories. Would you agree with Goldman Sachs . No i think thats exactly it. I dont disagree with whats just been said in terms of fundamentally the market is oversupplied, sure, but its not that oversupplied. We should get like a 20 correction. But i do think that there are two or three things going on at the moment. One being that inventories continue to build despite being already at pretty high levels. By no means am i saying that were going to run out of Storage Space. Theres lots and lots of Storage Space available, but it does mean theyre still building molecules. Second thing, the market positioning, like goldman said as well. Etf buying has been very very high. These investors came in early on in late 2014 when the initial price drop happened. The thing is yes, we will see u. S. Production fall. We are going to see other production fall as well, but it takes time and now this is again, were going to see a pullback in prices. And when prices come off, these investors are going to look at their returns and realize hang on, weve actually not made money, but we are now losing money and you might see that exacerbate the downside. And the third thing which we tend to forget is the u. S. Dollar. The dollar is strengthening tremendously, and thats putting further downside on oil prices. Very quickly, what kind of level are you looking for now that weve taken out the january low on crude oil . I think for brent, we can go back down to the early 50s and low 40s. I dont necessarily think were going to breakthrough the 40s on the lows that weve seen earlier, but wti is very possible that we go back down to the low 40s and maybe touch the late 30s. But again, thats unlikely. Lets call it late 40s for brent and low 40s for wti. Richard, your level . Whats your low . Very quickly. U. S. Crude could break down to about 38 bucks per barrel later in the summer. Could start to rally all over again. All right. Thank you both for weighing in on the crude drop which were seeing pretty much exacerbated. More than 2 declines on brent and wti. Good to see you both. Quickly focusing in on the worst performer in the dow this morning, that would be dupont. Due to nelson peltz issuing yet another letter this morning to the company saying its unfortunate that dupont has decided not settle the ongoing proxy contest. He adds that his firm trian remains open to realistic solution. David faber and jim cramer spoke to peltz about his battle with dupont in an exclusive interview thursday. Heres what he said. The most efficient way to get rid of the 2 billion to 4 billion of excess corporate overhead, and its mathematical and i can show it to you. The most efficient way is to break up the company. But i said that we have an open mind. If management can convince the board, and youve got to convince the entire board that they can achieve the metrics of the stand alone comps, whether it be on sales growth or margin if they can achieve those metrics and keep the company together, were all ears. Both sides digging in their heels. Another famous activist investor carl icahn took notice of interview. He tweeted, for those interested in Corporate Governance issues the peltz interview with david faber and jim cramer is a mustwatch. Great points made. Obviously you can find it on cnbc. Com. Yeah, carl actually gives you the link. Very nice of him. When we come back, nadella bringing you a conference and well bring you the details on that. Later on, after a lot of speculation, putin making his first public appearance in more than a week. But where exactly was he . We will get a live report from moscow when squawk on the street continues. Barbara just bought a bike. She wrote a tweet about it. You cant learn much from that. But take data from millions of tweets combine that with your companys supply chain and sales data. Apply ibm analytics and expertise, and all of a sudden, you can learn which bikes to build what to make them from, where to sell them. Because barbara and the world just told you how to build a better bike. Theres a new way to work and its made with ibm. Microsoft ceo nadella addressing the Business Community at a conference in atlanta, outlining the companys new plans for data. Josh lipton joins us with some details. Good morning, josh. Good morning, carl. Nadella spoke before an audience of 12,000 people from 70 countries. His speech focusing on how big data and analytics are now transforming virtually every sector of the economy. The most interesting thing starts to happen once you have all this data. It is the transformation in the Business Model around these things. What you are now going to start doing as the provider of that service, it could be insurance, it could be a manufacturer of a device. Every one of these businesses now is going to become a software business. Nadella announced the availability of a series of new products and services built by microsoft to help industries and organizations make better use of their data. But more broadly at this convention nadella is reminding Business Owners as well as microsoft investors that this tech giant is undergoing a big transformation. The company is moving to and capitalizing on faster growing areas such as mobile Technology Cloud software and yes, big data. Nadella is telling businesses that when they look to spend money on big data tools and services, they should look to microsoft. For example, Microsoft Offers Data Products like its sequel server, which is already a 6 billion business. Now the question is whether nadella can keep winning over businesses as well as investors. Back to you. And the cameo, of course by Russell Wilson. Thank you, josh. Microsoft shares meantime, are flat right now. Up next new data about mobile shopping. Find out just how much money people are spending from their phones and their tablets. Plus how apple watch could be a complete game changer for mobile commerce. Were back after a quick break. Sfx engine sounds introducing the new canam spyder f3. With a cruising riding position and the most advanced vehicle stability system in the industry. Youll ride with a feeling of complete freedom and confidence. Visit your canam spyder dealer and test drive one today. The new spyder f3. Riding has evolved. under loud music this is the place. Their beard salve is made from sustainable tea tree oil and kale. You, my friend, recognize when a trend has reached critical mass. Yes, when others focus on one thing you see whats coming next. You see opportunity. Thats what a type e does. And so it begins. With e trades investing insights center, you can spot trends before they become trendy. E trade. Opportunity is everywhere. New data released to cnbc from comscore revealing mobile accounted for 60 of all online shopping. Joining us in a cnbc exclusive is gian fulgoni, who joins us at post nine. Good to see you back. Thank you. We know its growing. Youre actually looking at just how much and through the prism of Discretionary Spending. Whats it like . Looks pretty strong. It was up about 33 in january, whereas desk top spending was up 9. If you look at total Discretionary Spending it was up 3. So its growing at a much more rapid clip. Its pretty clear that its accelerating from brickandmortar stores. Percentage of time spent versus the percentage of retail dollars spent . Yeah theres a big difference there. Its not unusual to see that kind of a difference. We call it the montization gap. So if you look at the percentage of time now online, 60 of it is with a mobile device. But if you look at the spending its 13 spending with a mobile device. So it doesnt argue for less time spent. No it doesnt. No, thats not going to happen. Its going to be more spending. And the reasons are interesting. Because research that weve done shows there are two factors that are concerning people most with mobile device is the screen size and security. And the security issue seems to come along when theyre off on a public wifi or a wireless connection. The screen size is interesting, though because with the iphone 6, apple in a sense is addressing that particular challenge. Consumers are saying they cant see all of the product detail easily with that small screen. And so the bigger the screen the more likely that somebodys going to buy off a mobile device. I think security is the other security is the other issue, right. Thats being driven by accessing content via some kind of a public connection generally in a store. And so i think a lot of people maybe while theyre doing the showrooming in the store with a mobile device, theyre waiting until they get home to bay off a desk top. And its pretty clear, if you look at the unit price paid the higher the unit price, the greater the likelihood theyre going to buy off of a desk top. So does that argue that the watch is in trouble because the screen space is so limited . Thats a good question as to whether its going to help mcommerce or mobile payments. We suspect it might be affecting mobile payments maybe more than its going to be affecting mcommerce buying. Its a lot easier to buy off of the apple watch than if youve got to take out your phone and switch it on and all of that. But another factor that comes into play there is where that Communications Technology is installed, and it looks like only about 10 of the retailers have it which might give samsung an advantage with the loop Pay Technology they bought which doesnt require nse communication. What are you seeing right now in terms of digital ads spent . Because we hear that ads spent in general is still under pressure. Its growing at a pretty rapid clip. Its growing at about four to five times faster rate than total ad spending. Should grow somewhere around 15 against this year. And mobile also . Mobile is just on fire. Its growing at about 70 . And then youve got video on top of it. Which is growing at about 20 . We keep hearing about people wanting to get a better return on enterprise mobile. We were just hearing from nadella at microsoft. Obviously youve got the appleibm partnership. Over the weekend, i think it was blackberry making a lot of the partnership that they have with ibm. Where does that leave you, if potentially were using tablets more at work and presumably therefore that has a knockon effect generally to how people will behave . Yeah. Its interesting, if you look at tablets, in the Fourth Quarter of last year global tablet shipments dropped for the first time. So at the same time youve got still the phone installations if you will growing at a rapid clip. So its going to be interesting to see what happens there. But we might have reached a kind of plateau with tablet where is the replacements are not coming in at anywhere near the rate that were going with a phone or maybe now still with the laptop. Whats your sense on mobile payments . Do you think that theyre really being widely adopted here . Do you guys track how many youre using now that apple pay started . Yeah we used to say that it was a solution in search of a problem. At least in the u. S. Because i think that the u. S. Consumer is really used to paying with a credit card and theres a habit that has to be changed before mobile payments really become the norm. So its beginning to be interesting to see what happens as we go forward here. Chicken and egg. Its like chargers and electronic vehicles. Exactly. You dont know which one to get first. Good to see you. Thank you. Gian fulgoni. Straight ahead, the storm dollar front and center. The euro losing 5 since the beginning of the month. Parity with the dollar on the cards, but could the fed change that this week . Well be right back. Does a freshly printed presentation fill you with optimism . Then you might be gearcentric. Right now, buy any two hp inks and get the third 50 off. Office depot officemax. Gear up for great. In my world, wall isnt a street. Return on investment isnt the only return im looking forward to. For some every dollar is earned with sweat, sacrifice, courage. Which is why usaa is honored to help our members with everything from investing for retirement to saving for college. Our commitment to current and former military members and their families is without equal. Start investing with as little as fifty dollars. 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. Good morning, everyone. Im sue herera. Heres your cnbc news update. Secretary of state john kerry and his iranian counterpart resumed talks in switzerland. There is a march deadline for political agreement. Kerry has urged the iranians to make concessions that would allow the six world powers to reach a nuclear deal. Boeings production czar says the plane maker will not make the same mistakes as it prepares to lift output by 24 . Back in 1997, it was forced to stop assembly of its 747 jumbo jet due to parts shortages. A record in boston for snow that is. 2. 9 inches fell in beantown making it the snowiest season ever, or at least since records started being kept in 1872. Presently, 108. 6 inches have fallen. And whats it like to crash . Whoa, look at that. Going 280 Miles Per Hour . Just ask the nhras larry dixon. The threetime champ making a qualifying run at the gainsway florida raceway over the weekend. Saw his car split in half there. The rear went airborne but dixon thankfully walked away from that crash. And that is your cnbc news update at this hour. Back to you guys. The dow is up 163 points. Dollar still pretty much going strong, especially against the euro, which hit a new low earlier in the session. A 12year low. Question of the week will the Federal Reserve put the brakes on a surging dollar . Lets bring in kathy lee. Bet you were surprised at how fast we got to these levels. I have to admit, im very surprised by the velocity of the move. Not the direction of the move. I think were going to see another 5 move higher in the u. S. Dollar which means were be up higher than the euro. However, i think the fed is beginning to put the brakes on the dollar rally this week. You do . I do. And the reason for that being patient in . I actually think theyre going to remove patience. But theyre going to lower their expectations component. The most important thing to remember is theres three months between march and june. Yellens greatest fear right now is getting the market to think the rate hike in june is guaranteed. I think the stronger dollar makes the decision even more difficult. Thats why i think shes going to take a back seat. A little bit more relaxed at the next meeting. In other words, shes going to remove patience but signal patience . Exactly. I think thats going to lead to a correction in the dollar. Which i think will be a beautiful opportunity for traders to jump back in. Because you see parity when . In the next three months. Pretty much by the june meeting. Going to have a pause here on the fed. And theyre going the shoot up and go back down. Exactly. Its just a matter of time. So calls for 90 cents, calls for 80 cents might be right but you think thats a longer term story . I think so. This week will be a fabulous opportunity to start getting back into the dollar for that type of move. Whats your advice to companies we had i think it was utx on last week. Saying i forgot what their forecasts were, but they were changing by the week and now they look ridiculous in retrospect. What is a corporate 4x treasurer supposed to do . Im continually surprised by how corporates have had such a difficult time hedging. I think they have to be much more on top of this. I think everyone is talking about the possibility of euro dollar moving to more parity. You have to be much more aggressive with your hedging these days. Its become much more important, even though you see these courtesy effects year after year, and quarter after quarter, they cant seem to get it right. I think its just stop taking speculative bets on currencies and start hedging much more aggressively. In fairness to people in the market, they saw the euro far higher than a lot of people thought it should be for a very very long time. What changed that now it went into i dont want to say free fall, but it moved so rapidly . A lot of people were suggesting it was the Asian Central banks that for years were still diversifying away from their intervention straight into euros because that was how they should benchmark themselves. Now that the ecb presumably has said effectively theyd like the euro lower, is that the trade that changed fundamentally . I think its that. When you have such a significant move over a short period of time much more importantly, people hedging. Theyre selling into the move. The combination of so many different factors, on of the of the overall theme. This huge divergence ofrealizing the dynamic has changed. As we see the sharp currency moves, more people are getting involved, asking about etfs. Do you get client calls about some of these currency etfs where you can essentially buy them like a stock. Do you recommend people do that . Yes. Because were getting these large percentage moves, i think the etfs are much more interesting than in the past. But were looking for a 5 move in the etf. Thats sizable. I think that as a result, etfs are a nicer opportunity. Are you really suggesting that Retail Investors should attempt to bet on currencyies . Do you really think the Retail Investor should be in on currencies, with the experience that you have and your knowledge on how they turn around so rapidly . I cannot prevent them from doing so. Thats why i think the etfs are a safer vehicle than probably spot itself. Wheres the big opportunity beyond the euro . Weve also got a big bank of japan meeting. The swiss bank is also meeting this week. I actually like the Australian Dollar lower, because it has minutes being released this week. They tell us the door is still open for another rate cut. I think if we do get a little bit of a tlardollar decline it may be a trade lower. How concerned about brazil before we let you go . Brazil is always on my radar. I think we always have to be aware of possible additional action by the central banks. Did this weekend do anything to make it markedly worse . I think its definitely its a mess . Yeah its a mess out there. Kathy lien bk Asset Management. Meantime Vladimir Putin has finally appeared in public this morning for the First Time Since march 5th. But theres still no explanation really for his absence. Cnbcs jeff cudmore is live in moscow with the latest. Where do we think he was . Reporter thats a great question and it remains unanswered. For the last 11 days no one has seen him in public since he last met italys Prime Minister on march 5th. So the speculation has been and one private tv station stated this that hes had some kind of illness, possibly flu. What we do know is he hasnt been seen until today, simon, and he did appear with the president of kyrgyzstan a very formal press event. He joked with the media about the speculation, which quite frankly, has been rife in the international media. He joked and said well the world will be boring wouldnt it, without gossip. But it hasnt got us any closer to knowing where exactly hes been for the last 11 days. But clearly, he is alive and in relatively good health judging by the pictures. There are a few disturbing things, though simon, that have come out of the last 48 hours here in moscow. One is on sunday this documentary about ukraine where the president talked about his willingness to go to the Nuclear Option over crimea. If it had come to that. And the other is just hours before this press appearance today, we learned that the Northern Fleet is going on military maneuvers. Thats a mobilization of 40,000 russian troops. Nobody can quite understand why this is happening, but what we do at least know is that the president is now back in the public eye. Watch the oil price though. Its a much more meaningful story to the ruble or to the market here than the president s absence has been. Back to you, carl. Geoff cutmore in moscow. Thanks so much. When we come back what elon musk said on twitter thats send tesla shares higher. Later, Walter Isaacson will join us from south by southwest. The dow is up 163. Dont go away. Go to cnbc. Com for the online segments later today. Catch the live action version 2 00 eastern time on power lunch. More squawk on the street back right after this. Organic food stocks schwab can help. With a trading specialist just a tap away. Whats on your mind lisa . Id like to talk about a trade idea. Lets hear it. [ male announcer ] see how schwab can help light a way forward. So you can make your move wherever you are. And start working on your next big idea. Its more than a network. Its how you stay connected. With centurylink as your trusted Technology Partner you get an industry leading Broadband Network and cloud and hosting services. Centurylink. Your link to whats next. Elon musk used his personal twitter handle to announce some news. Phil lebeau with that. You know how this works. Elon musk sends out a tweet and people immediately start speculating, what is he up to . Heres the tweet he sent out yesterday morning. Immediately afterwards, you heard a lot of people on twitter as well as on the internet saying hmm, i wonder what this Software Update is. Tesla press conference 9 00 a. M. Pacific Time Thursday morning. About to end range anxiety of overtheair Software Update, affects the entire model s fleet. So you might be asking yourself well what is the range of the model s right now, and how can they end this short of establishing a battery life that is longer for the vehicle . 285 miles is the current range. Fully charged for a model s. The super Charger Network has been developing over the last several years to help people ease their concern about running out of juice when theyre driving great distances. Perhaps across the country. Theyre also testing out battery swap stations. Its believed this announcement will not have news regarding battery swap stations. Theres some speculation that tesla and the Software Upgrades that its beginning to be announcing involve Battery Management software change. Essentially allowing the car, the vehicle, for you to manage the energy that is coming out of the battery pack inside the tesla model s. How much that could extend that range beyond 285 miles remains to be seen but certainly people are going to be watching this closely, because the longer you can extend the range of not just the model s, but any electric vehicle, it really does remove the barriers to people saying okay, im ready to buy an electric car. The idea that they can get in there. So well hear about this thursday 9 00 a. M. Pacific time. Until then let the speculation begin. Thanks a lot, phil. Phil lebeau covering tesla for us this morning. Lets get over to dominic chu. They are on the rise by about 1. 5 . Thats after the analysts at macquarie cite valuation. They think the price target is now 132. It was 134. Union pacific does remain their top pick in the u. S. Rail universe era. Back over to you guys. All right, thank you very much, dom. Lets get to chicago. Cme group. Rick santellis got the Santelli Exchange this morning. Hey, rick. Home run hi, sara. Id like to welcome charles beaterman. Thanks for taking the time. Good to be here. Just because weve been discussing this for years doesnt mean that anybodys going to pay any more attention. And of course im referring to the supply and demand of stocks. Having such a huge influence in where theyre pricing. Maybe you can tell viewers why this is important as fed normalizes. Well since the end of 2011, the number of shares in the u. S. Stock market has been shrinking, declining steadily primarily due to companies reducing the share count via buybacks and as important, cash takeovers of already public companies. Its equal both of them equal to reducing the share count. So what do investors do with the money they get because theres less shares . They have to reinvest in a smaller pool of shares outstanding. So more money chasing fewer shares. Duh. The markets gone up dramatically and it has nothing to do with the economy. Okay. Now, charles, two different exits here. The first exit is the money that has gone into these programs for companies, where would that have gone if the economy was truly truly firing on all eight cylinders, question one. And question two, if and when the fed does normalize, what will the stock market valuations and ultimate price of the indexes do to this dynamic . Two questions. Well one, if the final demand was actually increasing companies would much prefer to expand their operations and grow their businesses. But with final demand not really growing and actually slowing, the growth rate slowing, theres more and more stock buybacks occurring. Because what else can they do zero Interest Rate policy means that the cash on the Balance Sheet is almost like an anchor. So on the second question does that have to unwind or can it be a condition that will remain even through a normalization of rates . Well, at some point in the history of mankind, markets reverse. And when Companies Start selling more shares than they buy, that will happen. Will higher Interest Rates or creating some economic value for sures stop the process . Could be. If, on the other hand what also could stop the process, if the u. S. Economy does take a downturn and companies see that hey, maybe cash on the Balance Sheet is a plus given theyre not sure about where future revenues are going to be coming from, that could also alter the buying pattern of reducing the share count. In the last five seconds, give me a simple answer does this make stocks more vulnerable . In other words, all things being equal, if Interest Rates double or triple from the current zero Interest Rates, and the dynamics of the economy remain exactly the same will stocks go up, sideways or down . Final answer. Probably down. All right. Charles, i like oneword easy answers. Thank you for being our guest this morning. One dow member thats moving up is Procter Gamble. Lets send it to dom for a quick market flash. In mid morning trading, you can see the chart there. We are spiking, this on the heels of a bloomberg report that Procter Gamble may be looking to either ipo or sell in a single transaction a number of its Beauty Products brands. Those could include herbal essences shampoo as well as covergirl makeup products. They have been on a campaign to shore up brand position. Its shedding noncore brands. A bloomberg report. And thats whats sending these shares higher. They may be looking to sell some of these big beauty brand names. This is part of a strategy to sell off a number of brands. We saw it from duracell and others. The package, its considered not just individual olay or herbal essences. Crude oil what does it mean for the stocks moving forward . More on that when we come back. 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. The lightest or nothing. The smartest or nothing. The quietest or nothing. The sleekest. Sexiest. Baddest. Safest,. Tightest,. Quickest,. Harshest. Or nothing. At mercedesbenz we do things one way or we dont do them at all. The 2015 cclass. See your authorized mercedesbenz dealer for exceptional offers through mercedesbenz financial services. U. S. Crude benchmark slipping to its lowest level since march 2009 this morning as investors remain focused on the growing excess supply. Meanwhile, oil stocks remain mixed despite crudes slide today. Its a continuation of a broader move. Joining us now on the phone, oppenheimers managing director. Whats going on here . Is this that were running out of Storage Capacity now . Its all an exaggeration. Yes, we are close to being full in terms of storage, but that does not justify the crash in crude oil prices. This is a temporary effect that will definitely depress crude oil prices in the next couple of months. But people are exaggerating this move. Some of the bets here is that we are going to see crude oil prices below 30, which i do not believe is more likely. There are some serious heavyweights who believe that that is achievable, though fadel. But unfortunately, some of the heavyweights, without mentioning names, the people who were betting in 200 oil in 2008. So two wrongs dont make right. I mean its exaggeration. Its obviously music to the ears of hedge funds and traders. But its for people who are investing longer. There was a call to action for the gop over the weekend in an editorial in the wall street journal that said republicans really should be making more of the fact that 74,000 jobs have been lost in the industry since november. What would happen if the president were by executive order to reverse nixons ban on exporting oil . What would happen to prices . What would happen to gasoline prices . Well, a couple of things would happen. It would definitely bring gasoline prices much slower. Because gasoline prices are basically determined by brent crude, not by our benchmark crude. Because brent crude is the global marker. So gasoline prices in the u. S. Or europe or anywhere will be reflecting the brent prices. Now, lifting the Oil Export Ban it is really overdue. This is something that we took 42 years ago, it is not valid anymore and it is just exerting more pain on the domestic producer. But having said that oil prices have collapsed, and even lifting the sanction is not really going to revive oil prices. Its a global phenomenon and we cannot say that oil u. S. Can dictate where oil prices will go. Fadel, i just want to highlight the very important point that youre making here because this is key in that decision. If your professional opinion, if by executive order they end the ban, gasoline prices in this country would fall correct . Correct. Because the differential between wti, our benchmark, and brent, is basically exaggerated by the inability of domestic producers to access the global market. That is not the case for gasoline. For example, we are now one of the largest exporters of gasoline but the government is deciding who wins and who loses by not allowing domestic reducer from accessing their smart market. Which if they do that will basically bring more balance to instead of having wti at a ten dollar discount to brent, it might be only 4 or 5 and its good for gasoline prices in the u. S. And obviously its not going to i mean it will benefit the user because they will be able to access the global market. They will compete with higher crude prices. I want to ask about these companies that are selling off. Some of them more sharply than others. These are the companies you cover. Obviously the gut instinct on days like today is to sell on these sharply lower prices in oil. What is your strategy your recommendation for the group, which many have said have been much more resilient than many people would have thought, seeing this price collapse in oil. Correct. Because Oil Companies will adapt very quickly to lower oil prices. Many companies now are saying 70 oil will give them the same return as 90 oil. Some companies more recently said 60 oil will be more profitable than 70 oil was say six months or eight months ago. Thank you for your time fadel, its good to talk to you. Now lets send it over to kayla with a look at whats coming up next on squawk alley. We are live from south by southwest in austin where walter Isaac Isaacson will join us to talk about whether a correction is needed in the private market and what to make of all these startup valuations. Weve got one eye on the equity markets. The dow up some 160 points as we have an eye on the fed meeting later this week. Whats in store when that statement comes out. And finally, meerkat has only been live for less than a month, but twitter has decided it doesnt much like it. How the starter founder responds to the social news giant. All thats next on squawk alley. [ male announcer ] at northrop grumman, we know in the cyber world, threats are always evolving. At first we were protecting networks. Then, we were protecting the transfer of data. And today its evolved to infrastructure. Finance. And military missions. Were constantly innovating to advance the front line in the cyber battle, wherever it takes us. Thats the value of performance. Northrop grumman. Good morning. It is 10 00 a. M. At south by southwest in austin texas. 11 00 a. M. Here in wall street. Squawk alley is live. Welcome to squawk alley for a monday morning. Joining us from south by southwest in austin texas, is walter isaac son, ceo of the aspen institute. Good morning to you, as always. John fort is out