It for amazon. Its wednesday, january 30, 2013. And squawk box begins right now. Good morning, everybody. Welcome to squawsquawk box he cnbc. Today we have the four bs ben bernanke and the fomc holding their first meeting of 2013. Investors watching carefully for any change in strategy to boost the economy. Blackberry 10, research in motion is unveiling its latest and greatest device in hopes of saving the battered company. Boeing, the dow component releasing Quarterly Results around 7 30 a. M. Eastern time. We will have instant reaction and more on the dreamliner battery drama. And last but not least, the bulls going on another run. The dow jumping another 72 points to close just 46 points away from 14,000, just 210 points away from its alltime closing high. We have a big lineup covering the rally, the fed, and the economy this morning. Ed keon of Quantitative Management Associates and dan greenhouse of btig will be serving up the markets for us. Fed watchers will join us at 7 40 a. M. Moodys chief economist, mark zanby will have the adp report at 8 15. Former National Bureau chief Marty Feld Stein will wrap it up at 8 40 a. M. Eastern time. A big lineup. Andrew, over to you. Thank you. The big news, the National Transportation safety board is asking boeing for a full history of the lithium icon batteries used in the dreamliner jets. The ntsb made the request after learning of the incident thats occurred before the battery fire on japans airlines jet back at bostons Logan Airport on january 7. Al nippon says it replaced batteries on its 787 jets ten times after they failed to charge properly or showed other problems and told boeing about the swaps. And an ana flight was forced to make an Emergency Landing on january 16. And phil lebeau and aviation expert michael boyd will join us. Well be gearing up for boeings Quarterly Results coming at 7 30 a. M. Eastern time. A lot to get to. You see that story on the front page of the New York Times and other places. The fact that they knew about it, it was a bigger problem makes me more anxious, but i know you think im anxious about planes no, i think at this point things people are starting to get concerned about what the issue is. They still havent been able to identify it. Thats a bigger problem. If you can find the problem and a it, you can get toward fixing it. And at this point, theyre still looking around. Hopefully when building a plane like that, as new as it is, i bet you could find data and concern about look at whats happening in the fusel e fuselage. Wow, look i bet you find, you know, microanalyzing the whole plane. You can find things that look like concern that would just be the normal thing. Flying the plane for millions of test miles already. Knowing there is more to it is that what you think . Have they been grounded at this point . Its not the normal bugs. Still, if you did it on percentage basis, its within six sigma guidelines how often its happened. Theres been a lot of flights, hours logged. And its been did sno no, with the number of hours logged, you would think you would find the issues. They did, and i think there was some you know, now theres whistleblowers, too. I saw the guy. He looked like a freak. He had a ponytail every whistle blower is a freak of some sort. And you never know and thats why theyre whistle blowers. So well again, well talk to people. But i read the article on in the journal about, you know, what theyre trying to do. Theyre looking at batteries that didnt charge. On the same flight versus the ones that did. And theyre you know, theyre looking at the chemical composition down to like the molecular level. And it just shows you they havent found anything yet. Circuit boards, they they havent got dont know what it is. Two weeks already, they dont have a clear idea. Thats the concerning part. In the meantime, flights are grounded and they cant deliver more of them to the carriers. Yeah. All right. Amazon meanwhile, we alluded to earlier, Fourth Quarter profits down 45 from the year ago. But amazon, thats not what you look at. Higher revenues failed to keep up with what the company is doing. Thats spending on new warehouses, Digital Content, new distribution centers. The results were below expectations. However, the First Quarter outlook was shy of estimates. Gross margins, thats what people are keen on. Better than expected 24 in the quarter. Possible sign that amazon starting to benefit from all of its investments and expansions. This is like deja vu all over again with amazon. You see this again and again where you cant can you imagine starting a company from scratch . The guys still young, still got that vibrant laugh. A lot of ideas, too. Yeah. Starting from scratch, where youre going to buy anything you want, name it, and im going to get it to you like right away. Im going to have a place that will deliver it to you immediately i cant imagine trying to build places now with its a daunting task to try to do that. And hes pulling it off. Yeah. Ceo jeff bezos laughing all the way to the bank as he always does. Highlighting the strength of the kindle business, grew 70 last year. Amazon shares jumped in late trading 22 points. Look, over 8. 5 . If i had a nickel for every time barons said some was going to zero. Yeah. Whats the thats the price to earnings multiple. A comparison of the price where the stock is trading versus the earnings. Yeah. Divide the price and you can come up with such a smart aleck. Showing thank you for the definition. Somebody messed with the computers. I said what is the actual what is the actual as opposed to the do you do snath. Occasionally. But math . Occasionally. But why dont we pick it up off the board. You will say to be clever not to be clever. We need to figure the p. E. Out after this latest number because it was 45 below expectations, below last year. Youre going to need to figure out a new one. Ill give you, you want this years earnings, next years, or trailing earnings . Forward looking. Basically, im looking it up forward looking. Im not i dont know how they calculate it. Its 3,476. Is that possible . All right. Heres the deal. This is what youre dealing with with all the Different Things that go into amazon. 2010, they earned 253. 2011, 1. 37. 2012, minus nine cents, a loss. 2013, 1. 69. 2014, expected to earn almost 5. 2015, expected to earn 7. 61. 2016, expected to earn 11. 58. You tell me the numbers its infinity and beyond or negative. Im going with the minus number. Going for the five no. I wouldnt probably i would probably put you look and what is the potential . You know, go between 1 theyve earned 2. 50 in the past. Theyre expected to earn 4 in 2014. Go is so go with somewhere ar 3, 4. Now its trading 2. 83. I thought it was my computer yeah, youre right. 2. 60 plus 14. More than now, 2. 80, 2. 75. Some growth that people are discounting looks like. The fed wraps up its policy iiday policy meeting with the latest policy Statement Due at 2 15. W watch for that. Bernanke and the fomc expected to stay the course. A piece in the journal that was worrisome. I thought they were making huge dough on their holdings. And the journal piece says the fed could face big losses. And deferred paymentses to treasury. They cant always be on the right side of the trades. It will renew its pledge to keep levels at historic lows until it drops and maintains bond buying at 85 million a month. Doesnt sound like much anymore. Weve gotten those add up to a trillion a year, whos counting . There are new voter on t new voters on the panel. Esther george, Kansas City Fed president , viewed as a hawk. She might dissent against further q. E. The boston dude, eric rosengrin, fed chief, has led the charge to keep it up for bondbuying thresholds. Why dont we check the market this morning. We told you yesterday the markets were up again. Dow up by 72 points yesterday. In fact, at this point, the dow is 46 points away from 14,000. If and when it crosses back above 14,000, that would be the First Time Since october 17 of 2007. This morning, futures are fight higher once again. The dow looking like it would open by about 18. 5 point from here. S p futures up by 2. 5. The nasdaq futures up by over 7. 5. Oil prices up another 33 cents. Wow. Oil continues to move higher. 97. 90 for wti. That is going to impact prices at the pump. You wonder when that will pinch consumers. The yield on the tenyear note, 2. 032 . We are above 2 . Weve been talking about that because its been a long time in coming. Pack to april of last year back to april of last year since weve seen above 2 . You see that the dollar is down against the you are, 1. 35. 56. Dollar up against the yen, 91. 32. Gold up 4, 1,664, 90 cents an ounce. Now to kelly evans on the Global Markets report from london. Good morning. Becky, good morning. I wanted to show whats happening across the euro stock 600. A generally quiet session. Were down. 3 so far in trade this morning. That might have more to do with something happening here at the bottom of the index. The absolute dogs in the europe stock 600 this morning are the oil services. We can show you whats happening. Look at the saipem shares once we get through the borses. Saipem shares down in the range of 35 . This comes after they took a couple of hours to open this morning. Let me show whats happening. 35 for this company. Its europes biggest oil Services Provider by market cap. Last night came out and warned about the profit outlook its seeing for 2013. Now itselfs looking at revenues sorry, of earnings of 750 million euro, down from 1. 7 billion that the market was expected. This is based on review of contracts based mainly in the leaf, nigeria and the middle east, nigeria and algeria. Order backlogs, more worry about that. Delay of major contract. Bottom line, this Company Comes out in barclays, for example, calling it the fall of the king. This was a wellloved name among a lot of institutional investors. Now theyre completely changing their view. Theres been a raft of down grades, a raft of cuts to price targets, and you see the response in shares today. Thats been a major component weighing on trading generally. Italys Biggest Oil Company is a big shareholder. Would be hit on the news its likely, but it doesnt help the fact that they have direct exposure. Theyre saying the news out of saipem last night will be a 100 million hit. The cfo saying a 200 million hit for any shareholders. He expects a significant recovery in 2014. But those shares are down 4. 5 today. The italian index is underperforming. Was down about 1. 5 the last time i checked. Everything else is generally quiet. I want to mention, too, in earnings news, roche despite generally meeting forecasts, there are worries about its drug pipeline as are so many pharma companies. Shares down 1. 7 for that company. Focus on that, as well. If theres a point to all this news this morning, its maybe that were not talking about the macro picture. Yes, spain gdp came in disappointing. But youre not seeing the market react. It is a still microspecific story. Stocks seem as is the case with the u. S. To want to climb higher back to you. Thank you. Another piece of news. Chesapeake Energy Cofounder and ceo Aubrey Mcclendon will be stepping down in april. The move caps off a tumultuous year for the second largest natural gas producer. Last spring a series of reports triggered civil and criminal investigations. Regulators in chesapeakes board are looking into mcclendon crossed the line by mixing personal and Company Business and possible trauflt violatiant violations. Shareholders stripped him of the chairmans title. The stock is moving higher on the news. Actually, a lot higher. 10 higher. And kay kelly will have more details later. I should note, there was a report in reuters this morning that in terms of the compensation hes going to get out the door, it may be that the company doesnt owe him money but that he owes the company money. Interesting. You never want to see a headline like this. When youre a ceo and lead chesapeake shares soar as chief quits. It is up 10 . Only 2 on a 20 stock. The strange part, he was the ghie made the company. There is a flip side to all of this. Im not defending him. Im saying i like the money that jeffries got. What are you talking about . The money that handler got. Yeah. Handler did very well with the deal. Richard handler. The market cap of jeffries i guess its come back. A couple million bucks . Yeah. I mean, hes making four times what blankfein 45 million. Led the wall street to out of three years. Say that loud and proud. Say 45. Thats got to get youve got to be irates about that, dont you . As a shareholder . No, as somebody who values fairness. Driving buses for 48,000 a year. The world is not fair. I learn that every day. Yeah. Coming up, another b. The unveil of the blackberry 10. Were doing this for becky quick. Then a daily double of stocks to watch. Reactions to amazons results, and a preview of facebooks results out after the close. Check out the nikkei. Now at a 33month high. Weve got more on squawk as we return. [ man ] ive been out there most of my life. You name it. Ive hooked it. But theres one. One thats always eluded me. Thought i had it in the blizzard of 93. Ha never even came close. Sometimes, i actually think its mocking me. [ engine revs ] what . quattro welcome back. The u. S. Equity futures are fight higher. Dow futures up almost 15 after closing up 72 points yesterday. 13,954. 46 points away from 14,000. You see the green arrows still helping things out this morning. Lets get the National Weather forecast this morning from the weather channels danielle banks. Good morning. We are definitely very, very active. As you can clearly see, new tornado watches that we have out and about. Some are going to be expiring sooner than othersment we want everybody to know about the latest. Were going to pull further out see you can see the grand picture. And you can clearly see that we have watches which are going to be going in effect until even just after the lunchtime hour. Some of these storms are moving through at a very good clip. You can clearly see that we have a brand new tornado warnings out moving south and east of louisville. Certainly we have a lot of active weather going on. Not just tornado warnings but severe thunderstorm warnings. And you see were going to go to alabama. You see that many of them are occurring along major thoroughfares including interstate 65. Heres a look at the big picture. I mean, its a huge, huge line of thunderstorms. And certainly in its wake we had a lot of significant weather which has led to flooding because of all of that water coming down in one place. And then of course on the back side of this, were talking about the wintry weather. Even stemming into the northeast today, were going to be concerned about some icing out there. Places in vermont, new hampshire, stemming up into maine. In terms of the Severe Weather aspects, again, damaging winds, gusty winds, as well as hail threats and isolated tornadoes. These are the areas that are under the gun. We want everybody to be extra cautious. Back to you. Okay. Thanks for that report. It is did you see how foggy it was there this morning . It was. Crazy. Usually just up on the hilltop. This was everywhere. Covered in fog. This could be a make or break moment today for research in motion. The companys going to be unveiling blackberry 10 smartphone at a News Conference today at 10 00 a. M. Eastern time. Our own john ford will be covering the event live. Hes going to join us in the 7 00 a. M. Hour with analysts to talk about the big challenges facing r. I. M. The stock, of course, has rebounded over the last year. But its seen better days. Big questions about whether this device is going to take off or not. Theres a number of people around the table who at some level are rooting for this to work. Didnt have a keyboard, did it . I thought the early one didnt. Theres a new one one has a screen. One has a keyboard. I think well see both. You see the keyboard one, right . And both look promising. Mixed results. You hear mixed things. If you play with it for a minute or two, its fantastic. If that has to go on the yearend reel. Play with it for a minute or two its fantastic. Thats got to go on can i this brought to you by Andrew Ross Sorkin. Some people have said that in t might have been early software. Those who play with it after ten minutes, it gets boring finalli, right . Andrew, do both of them have brick breaker . Thats a great question. I dont know. Well talk to john ford about that at 7 00 a. M. 7 10. John ford. Hell have all of the answers about do you think we could get john to play with it on air . Perhaps. I know you would. What time is it . My gosh. News on no news on anthony weiner, either, his intentions. Amazon out with quarterly result. That hand after the bell with that happened after the bell with rising earnings mix. Nobody seems to care. Joining us is director and tech analyst at evergrow partners. Thank you. I know youre youre slightly scared at this point. Thank you for indulging us this morning. Sure. Your sense of earnings, they did miss. No one as i said, no one seems to care. I think youre looking through the revenues to look at really what is the gross profit potential. On that line, they beat and so i think the when you step back and you look at the fact that much of their business is going from first party where they dont make a lot of money to third party, plus they have their web Services Business doing well, both businesses are high margin. I think investors take heart in that because the two things they care about most as tech investors is really competitive barrier and high Gross Margins. And i think as long as the overall growth story remains intact, seeing those Gross Margins is encouraging. What do you make of the tax issue which is starting to hit this is one of beckys big issues. Shes been writing about about this how many years . The tax issue . The tax issue. The tax issue the the sales online sales tax. California an