Account information stolen during the target Security Breach is now being divvied off and sold regionally. Two mexican citizens were arrested at the u. S. Border in connection with 96 credit cards. Federal Officials Say there is no connection between those arrests and the retailers credit card data theft. Lenovo has reportedly in talk toes buy ibms server unit. And an experimental roach schizophrenia drug misses two gomes in late stage trials. Its kind of hard to read serious stories as the Peoples Court theme is playing here. You have to keep your game face on. It was a test of your professionalism. Its the equivalent of playing the super bowl in 20 below or Something Like that. You really did well with that, i think. Thats why im here. Ive got to ask you, theyre beating on the revenues, but missing on the profits . I dont remember ever seeing that. Usually its the reverse, right. The top line has been weak, the bottom line has been weak. They do every to offset to the to the bien line. Theyre beating on revenues, its just theres more activity out there. But why theyre missing it, maybe, maybe theyre hiring folks. That has a tend to be a shortterm drag. And that will be good news for the economy, as well. There could be inflation out there. It could be theyre missing on execution. It could be 10 of the company is reporting too early to make any conclusions. From a macro and a market standpoint. People have been talking that the only way youre going to extend this rally and get Margin Expansion is by having top line growth. Weve been waiting years, havent we . It is finally arriving. Its important to point out. First of all, gdp was much stronger in the second half of the year. Theres more dp dp, theres more activity, theres more money to profit from. The percentage of total gdp is in Corporate Bond and a lot of analysts think it has to come off because it has been so high. On the other hand, one other quick thing, theres a thing called operating leverage. Should be should be exquisitely attuned to better revenue growth. It would mean operating leverage would suggest if they get more top line growth, profits would soar on ovunderneath. Last week was the kickoff. Lets see what happens this week. We have a huge amount of very important conditions. J j, texas instruments, imm, and those are just a few. Last week was mostly the banks. China, lenovo and the possible purchase of that division. Thats a big deal. We continue to see this wave of money leaving china to invest, whether youre an individual investor or youre a company that wants to diversify, the ministry of china in commerce thinks this is the firsts year where outpound is drik you knew you would see it that way, yes. But think about all these years where weve talk about so many right. Trying to invaeft est in chi. Now china is looking out wards overly and overly again. They have a ton of money. They want to diversify away from china. As individuals, i think a lot of them are frighten dollars about instability coming in the future, whether or not this is going to be issues like weve seen 20 some years ago. You had issues with corporate governance. By the way, have you seen the it sucks living there. It sucks living in beijing. Syria, ukraine, its great michelle is here with a ton of earnings, its great scott is here. What exactly im doing is the question. Its a natural segue which you just threw out. Liquidity makes the argument that its been dramatically undershipmented and no one is even passion attention to it. The pboc dumps money in. Asia is up as a result of that and everybody says hey, its fine. What happened happened in june, everybody wab terrified. I think its because maybe people think they know whats going on there now that this back and forth is going to map with the central bank easing atlant liquidity. I think theyre learning as they go. Scott asked me before the show began are we underestimating the risks . I said i dont see china poetsing some kind of banking meltdown. But it is a risk to investment and its a rifkt to Economic Growth. Isnt a china issue going to have if credit mass a major country size there are bearish people who look at that and agree with you and then there are others who say look at the entire country as a balance sheet. And i have more than 1 trillion to throw at the problem. The question is at some point do you want people to learn a lesson . Theres also an issue of interconnecting this. Are Chinese Investment and derivatives and loans so intertwined into the Banking System that fears of failure would create concern . I dont think so. And this is not meant to be an insult. They have an infantisle Banking System. The transmission mechanism from cutting rates and the impact on the economy, it is so not what we are used to in the United States. Its alps and oranges. So lets continue in the markets mow. Chbing with oil, 94. 67. Brent at 107. 80. Rbob, 2. 66. Well see if we get some relief on that. With a storm coming, we want to follow the natural gas futures, up just a little bit. 4. 34. Tenyear, 2. 86 . Something to watch. Its been right in the mid zone in the post taper world. And the dollar had been strong. It is up against the yen. Down against the euro. So 1. 35. The euro a little stronger against the euro, weaker against the yen. And checking gold, 1248, down 3. 5 bucks. Time for the Global Markets report. Ross westgate is standing by in london. Ross, theyre talking about Deutsche Bank over here, over there and it seems everywhere else this morning. Yeah. Deutsche bank surprised yesterday, came out with numbers ten days earlier than expected. They made up a quarterly loss. Even when you stripped out the exceptionals, only a very small profit from fixed income trading, as well. Basically, huge litigation rolled into that. They said 2014 is going to be fairly tough. They will hit their target in 2015. But look, its a bumpy road ahead for deutsche. Today we rebound from those losses, 6 to 4 at the moment. Advancers currently outpace decle decleaners. The ftse is barely flat. Got up 0. 4 for the ftse mib, as we well. Back of them expected. Unilev unilever, its competitor of procter gamble, of course, had come out in the Third Quarter with a profit warning, its first in ten years. Today, it was nice for investors to see something that was better than expected, stock up 3 . It will be interesting to see how this compares with procter gamble. One other thing to point out here, we didnt think it would happen this soon, but irish borrowing costs, 1. 64 on the five. Year that year, 1. 7 will so ireland now is revealing both more than the u. S. And the uk. Back to you. Ross, that is amazing. Irish yields, are they the equivalent of u. S. Yields . Crazy. On the fiveyear, theyre lower. Wow. Good restructuring will do for you. Thank you, ross. Yeah. The World Economic forum is being held in davos, as we mentioned. Joe, becky and andrew are there. Joining us to discuss the Critical Issues likely to dominate the agenda is charles dorva. Mr. Delora, good to have you here. Good morning, michelle. Its a pleasure to be with you again. I dont know if you just heard Ross Westgate reporting live from london, but irish yields are now lower than u. S. Yields on the five year. I dont know if youve seen whats happens with italian yields and even some greek yields. You were at the fer front two years ago. Now what do you think . Everybody is expert in europe, right . Well, i think, it is xwris i ive. There is a disconnect and Market Pricing and lift. That doesnt mean that these yields reflect fundamental improves in the underlying economy, does it . No. Especially if this starts to invert that the economy is not growing fast enough. In fact, theres concerns about whether or not theres a deflation problem in europe. Based on where you are, are you worried about deflation in europe . Globally, i do not think inflation is a big issue. I am worried about continued sluggish growth in europe. I do think the risk is quite high that we are embark on an extended period of sluggish growth. Everyone is talking about the bottoming out of the u. S. , of the European Economic situation, the modest improvement from the outlook. But on current forecasts, michelle, european unemployment in 2015, after another year 1 2 of growth is expected to be higher than it was in 2011. This is not a recovery story, certainly not adequately strong in order to boost the underlying prospects for these economies. Charles, Steve Liesman. Good to see you this morning. We were talking about global systemic risk. Is greece off the table as the kind of thing that could bring down Financial Markets globally . And what are your thoughts on whether or not we should be concerned about china from a global perspective . Steve, good morning. Good to see you, as well. I do think greece is off the table. That assumes, however, that europe is prepared to continue to support greece and be a bit more on generous in terms of the financial support. Greece has gone through a tremendously painful period of adjustment. I think its time europe recognized this. Theyve done a lot particularly on the financial front. Globally, i do not see china has posing a significant systemic risk, but i do think that china has the potential to lead to instability in Global Markets this year. Not enough to destabilize the Global Financial system by any means, but the fact is that most chienl auto chinese Financial Institutions went on road shows in the last few years, raised a good bit of stock in global market. They each have a cod berry of shareholde shareholders. It raises the question as to whether or not regulation has gone too far and banks, particularly in europe that dont have as much ability too spread credit like weve seen here in the United States and the capital markets, has it gone too far . Are we seeing now the results, the other end of too much regulation . Well, i think it has gone too far, michelle. I think the pace of it is a problem. Its not just the magnitude of regulatory reform, but it is the pace of on it. If you look at the reality of the credit markets in europe today, theres still very little significant credit growth, particularly into the small and medium sized enterprise sector. Its no wonder that the european economies, by and large, including large economies such as glance, remain so sluggish. Not only have they pursued an inadequately robust structural reform agenda, but they dont have credit moving through these economies and that is due in part to the substantial capital. Capital are to be ranked, but why is that cost . There has been deleveraging and shedding of assets, trults of which are that borrowers in the european economy are still struggling for credit despite the relatively low prices. In that environment, its not surprising that growth has been virtually stagnant. Absolutely. Thanks for joining us, charles delora, who we saw so much during the greek banking crisis and thou with a private equity firm out of europe. Good to see you this morning. You know, one more note on Deutsche Bank real quick. Well have been worried about Deutsche Bank. Steve, you know this, as well. For a long time, and if they didnt have enough money to set aside litigation risks which seems to be fairly substantial and large shareholders of that bank have been worried about it for some time, are increasingly worried about it now because nobody ultimately knows what the risks are going to be. If you look at jpmorgan and the types of fines that theyve had to pay, the libor litigation risk is significant enough that people are worried about it. We have to go, but i want to ask you on the other side of this if this is something that you may be concerned about u. S. Banks or if u. S. Banks have been there, done that and Deutsche Bank yeah. So its not an issue to be of course aing u. S. Banks and their stocks . I dont think so. Coming up, windows 7 back by popular demand even as microsoft pushes windows 8. And bridgegate taking its toll on new Jersey Governor Chris Christie. What will this mean for 20 16 . First, the National Forecast from the weather channels reynolds wolf. Absolutely. Were going to see lots more. A surface low is going to be developing. Well have quite a bit of upper level energy. The Atlantic Ocean is going to play a part. With the overriding moisture, well have meant of snow in the capital. Some places up in boston, perhaps by cape cod, maybe even a foot. This will cause all kinds of travel headaches. More coming up. Youre watching squawk box. [ male announcer ] this is the story of the little room over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment welcome back to squawk box. Bec becky, joe and andrew are on the ground in davos. We have quite a best list coming up. Matt damon, lloyd blank fine, it all begins tomorrow on squawk. We can confirm that joe has arrived in davos, green hat and all. I want to keep that on tv for a little wile. Thats a heck of a very fashionable. Does that look worth it for joe, do you think . I dont know if its its like a grinch green. It covers up his hair which he considers to be his most important aspect. In other why is this other Washington News . There is no other Washington News. New Jersey Governor Chris Christie is taking a hit from brid bridgegate. There were a couple of stories over the weekend that was a complaint from the hoboken mayor that the Governors Office held some relief money hostage and then there was a denial from the Governors Office. A strong denial from not just the governor, but the Lieutenant Governor who is the one who supposedly had this conversation. This is more difficult to ais sess than the bridgegate revolutions. This shows what happens when theres bloots blood in the water, youve got a lot of people coming forward. When she was asked a couple of weeks ago about this, she said i hold aid wasnt with held for this reason. Now shes saying it was and shes offering to take a lie detector test. With all the subpoenas facing Chris Christie, were going to find out. More stuff is likely the come out. More allegations likely to comp out. Its a big mess for him. John, i was trying to think over the weekend ma maybe the Bigger Picture story is here. Here is my thought. Its almost impossible for a local politician to mistake it out of the new York New Jersey area and with stand the National Scrutiny that that it takes to be a i dont think its impossible, although if youre in the Republican Party, youre talking about a party in new york and new jersey that doesnt look like the Republican Party everywhere else. And one of the concerns for the christie people is a guy who was possible an earn certain fit for the Republican National party is hes going to look even less attractive to your republican primary voiters in maces like south carolina, iowa and other places to decide the nomination process. The governor has a speech today. Ex spets are out. Were going to see how will he can pull it off. John, the hoboken situation, it seems to me, just gives National Voters another reason to question the credibility of christie and his administration. Because this story does seem to have some legs. Was on the evening news forecast last night. No question. And because of what happens with the bridge disaster, there is a presumption that christies administration is not playing straight. Because remember, we had these traffic jams, there were these aggressive denials, Chris Christie made fun of the allegations and then it turned out they were true. So that puts him back on his heels in trying to defense himself against these allegations. Can i just point out one thing, though. Sure. We dont know that the truth is. Thats right. But the history of hoboken is not clean. They had to bring in bus toes take away corruption, there was a rabbi involved selling organs. New jersey politically, you know, its jon stewart would say we dont know what the real story is here, okay . As jon stewart would say, youve got your hoboken, youve got your new jersey, what do you pick them . Thank you, we have to go. Thanks for joining us. Notorious. Im sure in current mayor is 100 clean. I think this issue of getting out of new york and new jersey politics to the National Stage is really whats at play here. I think what it because its real, okay . Theyre real. At this point, the truth may matter more in new jersey than it matters nationally. People just question the credible of a well known public political figure. Next on squawk box, putting the markets to the test. More squawk, next. Tdd 18003452550 trading inspires your life. Tdd 18003452550 life inspires your trading. Tdd 18003452550 where others see fads. Tdd 18003452550