In perhaps, germany and spain, some more muted declines. U. S. Equity futures are looking a little bit better this morning. At this point, the dow futures are up by about 46 points above fair value. But i dont think how much faith you put in these implied opens at this point. What is indicated now is not necessarily how the day ends up, but it is certainly something to watch and see. The fed did decide to trim bond purchases. It was the Central Banks first unanimous vote on policy since june 2011. The fed made no reference to the selloff in emerging markets. They didnt talk about that, they didnt mention the cold weather. But the fed stood pat and this is an enormonormous decision. Joe, you are looking righter and righter on that call. And im not happy about it. I dont want the globe to slowdown. No, no, no. I just did the math. 75 divided by 1850. Were at the s p were at 1774. So its down from 1850. So 7. 5 divided by 1850 is exactly 4 . When you put it in those terms, a decline of 4 from the highs, it doesnt look particularly surprising. When you do it that way, people usually want to wait for more. Usually they wait too long and it goes back up before they can. So were at a point where it either gives you an opportunity, down 7 or 8, which would be we havent had anything close to that in two years. Even with the 10 pullback. If its going to be 15, you dont want to buy when its down seven. Dollar cost averaging, right . Yeah. You can do that, assuming you have enough to do that. Its very difficult to do. The ground shifts under investors. Turkeys Prime Minister saying it could be lower. Also saying the country is not considering any sort of capital controls as it battles to defend the lira. I want to find out. Michelle crusoe cabrera joins us now from istanbul. She has the latest on all of this. What are they saying, michelle . The tensions here are high, andy. They are angry about the lira. Theyre angry about the rate hike. And theyre especially angry because, take a look at the oneweek chart of the lira. It continues to weaken. Its now at the worst levels that we saw earlier in the week for the central bank to call that emergency meeting in the middle of the night. But certainly considering how massive the rate hike was, the Business Community here expected a better response from the lira than what they have gotten. It has dampened expectations for the market growth. And i have to tell you, this is happening in a lot of places in the world and any of these countries with current account deficit deficits, we are seeing issues with their currency. The Prime Minister flying back from iran, which by the way, he described when he was there as a place that feels like a second home. He told reporters that he was planning some kind of d or c in case the economy did not improve. That is what led reuters to speak with an unnamed Government Official to say this doesnt include capital controls. Capital controls is one of those things that if you have to deny it, i think its right, its quite possible. They instituted capital controls and they were quite fine with it. Now we all seem to be relieved that china has capital controls. Let me show you whats going on with newspapers this morning. This is an antiPrime Minister newspaper. This is the first morning. Because the Interest Rate hike was announced in the middle of the night. This one says Interest Rates are higher, 10 , but the lira is lower. This one is supportive of the Prime Minister and the headline reads, lobby wins, people lose. That would be a reference to the Interest Rate lobi. Theres the Interest Rate supporters of the Prime Minister and the Prime Minister himt believes theres some kind of conspiracy among the Interest Rate lobbies of the world. And then this newspaper here, as well. The head of the central bank, early last year, promised that he would break the back of the dollar. Of course, he didnt. And they love to remind him of that failure, that he hasnt done it. So that is what the situation is here. Guys, back to you. I may have lost ifc. Look at that shot, though. Its a great shot, but it looks like its either a cloud that keeps rolling behind you or what is behind you . Its steam. Theres a steam pipe. Along with the music that we play, thats and thats a very cool is that a minoret there . To your camera right. And what im sort of it is, absolutely. Theres a mosque back there, yes. What im sort of impressed with is management that quickly pulled the trigger and sent you over there. There are a couple of times we didnt know, it seems like things were happening. And i thought they were fixing this a little bit. But youre there right when it reaccelerated again. And it worries me that management was so correct about this. You know what i mean, michelle . Well, you know, we debated. Do we go to turkey, should we go to ki argentina . I was in favor of argentina. But this is a much bigger important economy and they had a big event coming up with the Interest Rate meeting, so we ended up here. Im going to go ahead and give kudos and say good job, nick. Instead of the praise and hes awesome. Our boss is awesome, yes. He is. That was smart to send you there. Is it cold . It looks cold. Yes, it is. Puerto rico is looking really good right now. So she was lobbying for puerto rico again. Hey, you know, those bonds are still going down every day. Both stories are important. I can just hear you. Its summer in argentina. Well check back with you. Good job. Shes on her way to the olympics. That, too . Yeah. Thats kind of on the way. Shes much braver. Much stronger. A much stronger person. I love the olympics. When it was in l. A. , we worried about the olympics. Not for the same reasons, but we thought it was going to be a disaster. Right after 9 11, people were worried about that and it went off really well. Putin, you know, i dont know if id sell him short on he has a lot invested in making sure. Right. And i wouldnt id be afraid to mess with putin. These guys are who knows. Earnings and the economy on the corporate front, were going to see Quarterly Results from dow components exxon mobil, 3m and sri ka, which i forgot was a dow component. Other Companies Reporting before the bell, conclude nike is, too, include eli lilly, u. P. S. , auto nation, Harley Davidson and viacom. And after the bell, techs will take center stage. Amazon and google are the two headline names. As for todays economic calendar, at 8 30 been we have weekly jobless claims which may be a little more important after that last tepid report we saw on that first friday or i think it was that second friday, wasnt it . Yeah. And a first read on Fourth Quarter gdp, pending home sales, forecasters expect a Fourth Quarter gdp of 3. 3 for the that were looking for. And the fed announcing plan toes trim its bond purchases, as you know, joining us is drew mattes, deputy chief u. S. Economist at ubs and thomas teaser, director and head of fixed income at strategis. Should i ask you whether youre speccing it or, you know, your calls about the last taper, you didnt think oh, man, we made one mistake in september and did you think they were going to taper this time . Taper the taper . We did think we were going to taper this time. I think if you look at the wall street journal report earlier, with the ground shifting beneath the feet, i think thats one thing weve been on top of, which is arguing despite the fact the transition is lining up, fed transitions are rarely seeking events, most people move into a more risk averse mode as you move into a fed transition. Its weird, there seems to be some dislotion location ex here now. Everybody knew this was going to happen. Can they not square the positions beforehand . Or do they think its not going to happen . Or it just is inevitable that not everybody is going to be able to get out of the position . Its not that people are going from invested to not invested. Its if they have a decision about whether or not they can wait an extra week or two, theyre going to wait the extra week or two. Let me get you to make a prediction. Will there be one of these meepths where they dont taper . Because were at 2. 6 now on the ten year. What if it goes to 2. 4 . What if it looks like theres a slowdown . Well, honestly, if theyre seeing falling yields, they should taper. I would say theres not going to be a slowing in the tapering. I think the economy is doing well enough and the payroll report from last month was a why are we at 2. 69 . I think were at 2. 69 , a, because the risk aversion is in the midst of a fed transition. But also i think because of the emerging market story, which may be related to the fed transition. Everyone just getting more nervous at exactly the same time and it happens with every fed transition. That is what we talked about. Six months of the fed transition in the last six, seven years. People all become a little more cautious. And that is back. Then it depends on how will the fed is perceived to be dealing with whatever situation theyre dealing with at the time. Do you think, tom, that this would be its already in written in stone that every time they have a chance they do 10 billion and they get to zero by when they said they would or could something throw that off . Yeah, i would agree with that for the most part. I think the ohm thing that would cause the fed to delay purchase reductions would be, either, one, the Economic Data changes and thats going to take another one to two months to get that data or you get an escalation of the emerging market scare, it becomes a crisis and it begins to impact u. S. Or a western hemisphere credit markets. I think the easiest avenue for a crisis in turkey or brazil or africa, the easiest impact would be through puerto rico. Puerto rico has a bond teal theyre trying to get off the in the next month. Beyond that, i dont see the fed deviating. Credibility is very important to the fed. So we talked about if it were a problem in emerging markets, it would take a while. In terms of affecting our economy, it would take a while for slowdowns to hit it. But youre saying the way the contagious could hit us in the credit markets, there is a way and thats through prooek. That is interesting, actually. Do you think that would be a big enough issue to where we would have to worry about that . As time passes, the risks that puerto rico begin to substantially impair the market probably diminish. Much like we saw with greece. The longer a greek resolution took place in europe, the less damage that was done to other issuers, like italy or spain. Youre almost certainly to get at least one, maybe a twonotch downgrade from rating agencies. That could be a catalyst for the fed to say, wait a second, were counting on the local government to ramp up spending in 2014, 2015. If they dont, thats perhaps another quarter point basis drag that we had in 2014 that were not expecting. So there is an avenue in emerging markets to impair u. S. Growth. And puerto rico is one reservoir with which that can spread. You talked about the limited benefits, maybe not qe, but at least qe3. Limited benefits and maybe some of the negative consequences. So what did why did the u. S. Stock market go down 189 yesterday and we went down 300 the other day . Is it going down just on general nervousness because it needed to because its been up so much or is are we timely sort of pulling the curtain away from why it was up in the first place, which was maybe qe . I think theres an argument to be made for qe having boosted the equity market. So where it shouldnt be . I dont know that. I can what qe did was it took away a lot of the risk of investing, rather than and the money had to flow somewhere and i think it flew into asset prices. I would say as we look forward, though, one of the things i expect to happen is now ta we have the potential for rate increases at some point, that will prompt ceos to start making decisions. Right now, theyre getting rewarded for returning money to shareholders and buybacks. I think whether they start getting rewarded for investing in the future, thats when the economy becomes selfsustaining and we see the big push forward in growth. Gentlemen, thank you. Remember the other day i said to you something about you like being famous because you want to be able to call and get a table near a waiter. That was henne youngman, take my wife, please. And i had no idea. No, you know who henne youngman is youve never heard of of course. Its a is it generational . It might be generational. So i went in to see a shrink. I said, doc, i think im a dog and he says, get down off the coach. This are all henne youngman jokes. Someone wrote in on a tweet, ill bet andrew and becky have no idea who henne youngman is. Guess who retweeted it . Henne youngman . No. Gary youngman. Its his son. It sounds like i need to apologize to the son and well, you know, i dont expect you to know anything before 1998. When was he big . Did he also say take any can you help me here . Its been big for a hundred years. I cant talk to people that dont know henne youngman or his jokes. I just cant identify with you at all. I was thinking about that guy would wanted to throw someone off do you know how many times i wanted to throw you over . We have wanted to throw each over over the balcony not over a balcony, no. How much just push each other off . You dont want to throw me off the no, i dont like the idea. This guy was supposed to talk about the state of the union. And the guy is a former marine. Hes been in here a few times. Remember . You better like him. I sometimes think we should be drinking more on the set. As a segue, were going to be getting liquored up. How about that one . The ceo of diageo is going to joining and tell us if the company is looking to make a deal in the industry. Then at 6 30 eastern time, auto nations mike jackson rolls in with his Quarterly Results. Squawk box coming right back. Announcer cast your vote tt ford most influential Business Leaders of the last quarter century. Go to cnbc. Com 25. Make your picks from our list and submit your vote. You can even write in your own. Who will be the cnbc first 25 . Vote today. Welcome back, everybody. Leno know is buying googles motorola union for 2. 9 billion. This news comes less than a week after lenovo announced that it was buying ibms low end server unit. Of course, it raises a lot of questions about googles purchase because it bought that unit for over 12 billion. But we have lenovos chief technical officer joining us in the next hour. Here is what people forget when they bought the company, it had 3 billion in cash on hand and 1 billion in tax credits. That brings the total price to 8. 5. Then they sell for 2. 4. Then the 2. 9 billion is what they were value at. Now were down to 2. 9 billion. The question is are the patents as embarrassing as they thought. Correct. But they did put them on the books as a value of 5. 5. That probably has to be written down. I dont know if you can look at the patents as a true value on any of those things. I wouldnt look at it as one of the best decisions ever. Correct. Were going to talk more about that. We have lenovo joining us at the top of the next hour. Facebook has posted betterthanexpected earnings at the close. Mobile ad sales continue to rise. Sales jumping on that news in extended trading. And the microsoft ceo search could end this week. Rico says Sacha Nadella are at the top of the race. Do you know this guy . I dont and we have spent time with elop . You dont know him, joe . No. But i know henne youngman. When i read about the evils of drinking, i gave up reading. Do we have any more symbols . You want more symbols . Ill do one more. My wife and i went back to the hotel room where we spent our wedding night. Only this time only this time i stayed in the bathroom and cried. Anyway, go on. We really do need to drink on the set. Diageo, a slowdown in sales growth in the last six months. Among the reasons, demand in china, some other important emerging markets dropping sharply and ivan is it menendes, the ce of of diageo . Menedes. Lets talk about emerging markets. Thats the issue du jour right now given whats going on in the markets. You saw this happening beforehand. Yes. Diageos strength is in global presence. Before i come to the emerging markets, our developed markets are doing rel well. The u. S. Is really strong. We have ups and downs. Theyre not a straight line. In this lakeeffect snow last set of results, weve done very well in india, brazil, the south africa, russia. But weve had challenges in places like china, in the buy due sector, where were doing very well, and in nigeria beer. So theres more volatility in the emerging markets right now. The demographics are good. Gdp growth is fast in the emerging markets than it is in the developed world. What what is the consolidation play here . Or is there a consolidation play . We just saw the deal with beam a couple of weeks back. It always feels like theres a couple of brands that are still outstanding there. Well, if you look at the history of our company, and even in the last three years, weve had made some major plays in the emerging markets, spirit and beer worlds. Wheelchair spend about 5 billion building positions in turkey, india, brazil, ethiopia, tanzania. Our footprint now is much more balanced between the developed and the emerging worlds. However, the company has a strong balance sheet. We intend to retain and extend our leadership position. And we look at everything and clearly as opportunities arise on Global Brands or in the emerging markets we will look at them very carefully and intend very much to make the Strong Company even stronger. What is the hottest category right now that you dont think youre in . Well, the good news about diageo is we play pretty much everywhere in the space. We have a participation in cognac where we have a 334 interest. But ka keel la is hot. Weve had two very exciting entries in the ka keel la space. The deleon brand and seli groso. Thats hot. Whiskey is hot and is our core strength. Johnny walker blue is running up 20 . In the u. S. , our Premium Brands are up 19 , brands like the copper run, the finest rum out there. Our single malts are doing extremely well. So the overriding trend is people are drinking