Transcripts For CNBC Squawk Box 20140512 : comparemela.com

you. ibm is holding the annual analyst meeting on wednesday. in an interview with "the new york times," the ceo virginia ramedi says the computer giant is facing rocky times but the company has a clear vision in how to pursue another round of growth and transform ibm for the next decade. last month ibm reported the lowest quarterly earnings in five years struggling with fallen demand for the software. warren buffett made and big investment in ibm. >> a clear vision. >> a clear vision? you're suggesting it's a double -- >> no, i'm just saying i would like details on what the clear vision is. >> it's very hard but we have a clear vision on what we need to -- what is it that you need to do? not that i would understand? >> transition to a cloud base. >> we'll see. hopefully division is the right one that you can implement and you wonder about competitors. it is hard to reinvent ibm. it is not just medium old tech. >> for quite a while, you wonder is that the right strategy or a different one. are they continuing to stay the course with that. what we think of generation, experts would say microsoft is old tech. i b ibm is dealing with microsoft and google. and now they are dealing with facebook and -- they have to come all the way around. and i just don't know whether -- >> have you talked to warren about that? >> he says he would sell it -- he's buying more but he's saying if he ever lost confidence, he would be quick to move. >> he said he would consider buying more. not right now but maybe more. >> maybe it was me that thought he was implying, knowing buffett, if he really saw that it was on the wall. >> i was surprised by, a, he was buying more beer. and he was fighting for this year. you would have to say if it went down and bought more. it was one that he was in until he wasn't. so we'll see what happens. >> i was surprised at how resolute he sounded that he felt this was a good investment at this point. >> he would never give us body language. >> he has. he surprised me in the past with proctor and gamble and said, maybe not. same thing with moody's when stuck in that position, too. >> yeah. some day. anyway, the british prime minister david cameron says very good progress was made in securing guarantees from pfizer about the. to buy astrazeneca, pfizer already has given a five-year commitment to complete astrazeneca's new research center building in cam bridge and retain a factory in northwest italy. this is a win/win for shareholders and will face them on tuesday to address opposition to the offer. thigh they are the ones with onation and not us is behind me, the toddlers decided to go swimming this weekend. >> the other one broke. you need to combat violence with $47 million in cash and house. you can see glaxo smith kline, it's the tax advantage that ryan had that allows me to get so much. the business bid was april 22nd if you want to share those. and reportedly bill allergan has made almost $1 billion in paper profits. the paper says the allergan gains were $1 billion and they make about $4 billion in purchasing the portfolio. so you anchor a million and it pays to get a billion. it was some of the gapes of the billion dollars needs to go to a place. but i think it was only a deal, like a dollar. is it -- >> some of them will give gains back. >> it's a great way to do business, and i can't believe it's legal. >> how can you do hostile takeover if you can't buy the stock. >> he's buying stock. and if it falls apart, he loses money. he has all the legal money on et cetera, et cetera. but going into that room i frantically know the balance in advance -- >> the minute you are amounting to hostile, there's a bid. you buy the stock in advance knowing you're going to do it. >> that's the most risk-free thing he could do. >> no, because the deal may not happen. >> why is it more refrigerating than anyone else decides. >> if they have a poison pill, screw everybody, we're not doing it. he loses. >> it is like they banded together to try to acquire the company. >> i know what they did. i just think from the public policy to the public market. >> michelle is here to talk about another issue we have been following closely through the weekend. violence marking the pro-separatist vote in eastern ukraine this week. the referendum should be okay. both helds over the weekend. by all accounts extremely chaotic. not a lot of people voted in one time or whatever we knew this was how we were going down to see what does. he is not so quick this time around in the complex with the perplexing announcement on thursday from him where he seemed to be in terms of totality, maybe not action, but pulling back from higher levels of come foration, confrontation. presumably if he was aggressive and said we will give him the choice of joining russia, then likely we would see another round of sanctions even harsher from europe and the united states. that's presumably what he wants to hold on. right now there's violence in eastern parts of ukraine. there was one point where the you crepan national guardsman opened fire. and he saw two people on the ground. one of them is dead. presumably when you have violence, vladimir putin has the right to say, see, we need to go in to protect the russian speakers. he's not wanting higher tensions, but if they vote to say we would like to be closer to russia and russia doesn't follow-up on it, does he lose popularity at home? >> yes. i don't think eastern ukraine is as important for region as a crimea. the next things are the election on may 25th where ukraine ended just past new laws which means if they can't hold them in the two regions. it doesn't matter, they can still say the ukrainian public voted for the current government that's in place in kiev or whoever they do vote for. the election will be the same as you might expect. so what we expect, we just wait for the next step. >> yes. if we're going to see lavrov come out to say the results should be respected, but remember he and vladimir putin play good cop/bad cop. vladimir putin is the good cob and lavrov is the bad cop. it seems predictable. hello, everyone. we'll talk later to the former treasury secretary tim geithner. his new book is being released today called "stress test. "a former mitt romney adviser says geithner is lying. we'll hear from him on this book and at 8:00 a.m. eastern time. you are a cnn contributor and the person, glenn hubbard, so that will help. >> your wife -- you need to explain what the contention is? >> contention is in 2012 when geithner and hubbard rap into each other. they both weren't embracing the plan enough when dorf telling us what to do. >> we are wondering if raxing taxes is the same as creating revenue. isn't it? >> if he says we're going to raise back can is, and you said we need to raise revenues. where is your glasses? can you see me? >> i have glasses now. the glasses you were able to start pouring, they do make contact lenses. >> i have not gotten those yet. >> you are not doing it right now. i at not surfing for it right now. >> i think it's a great deal with a former romney adviser claiming to be. the school could have been vegetarians saying i didn't get the politico app yesterday. whether he would have said no, that's not 8:30, step with him. >> it is a surprising to put something into this that's obviously going to be controversy. why hasn't he responded to it yet and said, okay, it's a misunderstanding, he said x and not y. >> he also said we just can't say we're raising taxes right now. that's a step beyond raising taxes and revenue. that's also him saying we have to keep this on the down low. >> there's secretly a republican idea in the moderate to right wing conservative movement. but you can't be honest about it because it's part of their basic montra that under no circumstances should you lie. >> you read the book over the weekend? >> yes, i get a copy of it today and feel like i've read it all. >> what was your big takeaway? >> i was surprised in your piece you quote dean baker saying if we allowed the banks to fail, we would be free of the awful banking system. i don't know what you do in lieu of a banking system. what i've taken away from it is geithner is not going to con vince that -- it's a false narrative. >> the three people you decided to criticize, elisabeth warren je you need to bail out the banking system. it would be nice to -- >> i don't disagree with you. >> why are you defensive about it? >> because he's not enough of criticized. look, the pavement says you are not thinking clearly. the thing about timothy geithner is he made money on anything. >> he did live inside the prison that is his own brain. and he lives in a very difficult place, which he thinks he did a mitzvah for the world, a great thing, and really can't fam tho -- he's trying in his own way to figure out what to do about it. >> i think that's legit. it does have people who come up to a -- >> read krugman and listen to mpr. if you love in this world, geithner said also that we would have done a lot of really great progressive things if the republicans had not stalled us. >> there's that. so he's not -- if it were a true capitalist, i think he would say it loud and proud. does anyone work in the private sector until now? >> the problem for kite ner is geithner is to ease this populist anger at the fact that the people got bailed out and still got big bonuses. maybe you do more with citigroup. >> why would you even try to appease the anger that's totally misplaced of occupy wall street? >> you can't go all the way to occupy wall street but there are legitimate things that you need to know the money on and he did that. >> he also said, we would have done a lot more progressive things if we could have put the nastier public in there to stop this. but you on the left think we are not moving fast enough, we're sorry. we tried to do more but he is much more of an accolade on the left. >> in his time at new york city, he did not adepress that. not enough to address leverage building in the city. >> you read the quotes. >> that's right. >> he said he missed it. >> but did you think they were overleveraged? >> he said he missed it and that's a big deal that he missed that. and he comes from a school of the democratic party very pro-deregulation to allow the build-up to build up and said at one point he was never a mediator. >> i will say this, i thought he was surprisingly honest. the book is a relatively honest portrayal of a guy who clearly is having all of these issues even though he says he's not and doesn't care what people think about him. it clearly does! you have to remember that he saved the system but there's a whole group of people who don't believe the in the system unto itself. the way it is structured today, make it never should have been saved. >> if i can immediately dismiss -- >> there's good reason. i wish instead of writing a review. >> we are more in tune with the actual reality instead of the revisionist narrative that we have now that we have had for five years so your whole argument is based on alicia's nep ati-- you can dismiss that all the criticisms of geithner or the ones of himself which are legitimate and that he did not do enough. >> man up. here we are, the dow is -- things are good. i mean, you know what is weird? you charge it enough. the far right thinks we shouldn't bail out the homeowners or the banking system and the system would clear out. you would see warren buffett buy wern werner. >> thank you, sir. >> thank you. >> i want to see this interview. >> i was searching for my feelings after reading the peace. and annoying was not enough and i thought -- >> you thought a lot about it. >> well, i will -- hazelton, pennsylvania, finding a brick of heroin and cutting it up with a big sting operation. the guy who couldn't find $400 and took her in handcuffs. anyway, i was a hockey game until 1:30. it was unbelievable. >> i saw you were getting tweeted. >> i think this is a good idea. the race is on to build a casino in japan. i want to get some of the contact lenses that you're wearing them. that looks beautiful. did they leave any of the light? the landmark suffered serious damage in the area. and david rubenstein matched the public funds to fix the mock yumt. he'll come home and we'll thank you him after making a dent. it is now 6:22 a.m. eastern. alright, that should just about do it. excuse me, what are you doing? uh, well we are fine tuning these small cells that improve coverage, capacity and quality of the network. it means you'll be able t post from the breakroom. great! did it hurt? when you fell from heaven (awkward laugh) ...a little.. (laughs) im sorry, i have to go. at&t is building you a better network. welcome back. two u.s. billionaires are betting on japan for casino projects. the country is considering legalizing casino gambling which could make it the third largest gaming destination after mccaw and the united states. the plan would be to put it in place by 2020 when the olympics will be held. las vegas gaming tycoon sheldon agleson is putting his way behind a tokyo resort and the two are betting to see how comes out ahead. now emerging in the race to succeed, the top of aig, the walter journal reports that the company's directors have narrowed the field of internal candidates to two. peter handcook and jay wintrop. just a few months ago, mr. hancock runs the company's property casualty business and was considered by many analyst investors to be a favorite of the internal candidates to take over, but the performance, people are rushing to the tv. they are running the life insurance policy and set up a two-way horse race that was not evident to investors. he plans to step down early next year to spend more time with his family. he's offered us to do the show from there. we should take him up from there quickly in that vineyard. he's also been treated for cancer but is doing well. >> it doesn't have a picture, it just says that he's there. sightings. someone sighted there. what does that mean? game of throne -- oh, i am sorry, the game of throne brothers were there having drinks at the bar overlooking the aidriatic. i didn't see him there myself. >> were you talking about sterling. >> yeah, i guess so. his estranged wife says she will fight to keep his share of the cl clipper's comments. the nba has responded to shelley's statements saying controlling the opener's interests being terminated, the other owners are terminated as well. we heard of this after anderson cooper and oprah had mrs. sterling on. >> i thought she had the lady with the -- she had the girlfriend a week ago. but i think she just had the wife, yeah, yesterday. >> friday is her last day. >> friday is her last day on "the view." i think she was on "snl. >> bill mawr did a thing on his show friday night. >> defending him? >> not defending himself per se but saying inside your own home is there no code of silence, can you not hang out in your own bathroom and tell your friends something. >> i don't know he said he felt really bad that he was some of the people to twist their horrific ideas. >> sterling said that was a bad rollout. >> why did he say that? he said, i'm sorry, but this is magic johnson. >> he said he had not done enough for minorities. >> look, that's a wrap. i'm not going down there, but where were you going on this? >> i understand because i feel uncomfortable with the idea that you can start taking property away from somebody because you don't like something they have said, particularly when it is said in his own home. at the same time, you don't want to look like you are getting things out of control. >> he would defend people's rights to say whatever they want. i thought it was very interesting. and somewhat persuasive powerful point. >> here's the hotel. here's a picture of it. the view looks to be straight out. it looks like it is straight out, a game of thrones, interesting. you can understand why the brothers, per se, will be right back. >> i must've dated her for one night. >> if anyone has anything to spoil for you, don't. i am a little confused as to where everything is. this marjorie is going to marry -- >> i'm a couple seasons behind. >> i just loved it that they are not going to be back, but th they -- when we come back, another round of earnings and economic reports on the way. as we head to a break, look at last week's winners and losers. >> everything is running smoothly. >> i'm sorry, dave, i'm afraid i can't do that. the performance review. that corporate trial by fire when every slacker gets his due. and yet, there's someone around the office who hasn't had a performance review in a while. someone whose poor performance is slowing down the entire organization. i'm looking at you phone company dsl. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business. predibut, manufacturings a prettin the united states do. means advanced technology. we learned that technology allows us to be craft oriented. no one's losing their job. there's no beer robot that has suddenly chased them out. the technology is actually creating new jobs. siemens designed and built the right tools and resources to get the job done. white chocolate loversividual. don't like dark chocolate. milk chocolate lovers don't necessarily like dark or white. before we couldn't really allow the consumer to customize their preferred chocolate. we needed the scalable cloud solution allowing them to see all 800 products and select what they are looking for. now there is endless opportunity to indulge. that's keeping you from the healthcare you deserve. but if healthcare changes, if it becomes simpler... if frustration and paperwork decrease... if grandparents get to live at home instead of in a home... the gap begins to close. so let's simplify things. let's close the gap between people and care. i see the clippers won. i'm getting updated. are we live? >> yeah. >> excuse me. i saw this was awesome. the rangers -- hey! hey! good morning. welcome back to "squawk box." mother's day, it was great. i'm joe kernan. that's becky quick along with andrew ross-sorkin. when are we doing the geithner stuff, man? >> 8:00 a.m. >> okay. i'm going to tune in for that. what time is it now? >> 6:36. >> here's what's happening this morning. i was out until 11:30, sorry. officials are looking for the blessing in the takeover of astrazeneca. he's british, i think this is a big conspiracy as they are all working together to take our company and taxes over there. pfizer says -- a false protest, you mean? >> he's over there and they are winking and nodding, cameron, hey, ian, what's happening? pfizer says the combined company will be in england and 20% of the company's workforce will be in the u.k. fizer is widely expected to put forward an improved bid this week. and telecom is part of an idea to merge its t-mobile unit with sprint. the journal reports the key sticking point. and nissan is predicting a 4.1% increase in profits for the fiscal year to end next march. that's short of where the street was. analysts were. it's also forecasting that profit margins are a little lower than japanese this aggressive expansion plan. and hillshire foods is buying pinnacle shareholders. they will get $18 a share in half a share in hillshire brands. $6.6 billion, although that does include pennical's look. >> i did my work, i'm done. >> becky and then back to me doing something else. we'll take a look at the economy. the co-director at the john hopkins center for financial economics on the markets with david bianca, the chief strategist and deutsche bank. he correctly predicted the shots of the stock market. the blast performance. we have definitely nailed people when they call it -- it was a great girl. what happened there? okay, so what does the first quarter number be and what will the revision be? >> if you add zero to it and add two, that will probably bring us the -- 3.5 second half, you will get roughly three. >> so you think 5 second quarter? >> yeah. again, if you add up five and roughly sere joe in the first corner, then you look at the peril numbers, those are better to look at. if you look at year to date taking the bad weather and good weather combining them, you are running at $215,000 a month. it's uptick but not moving, that's for sure. >> is that a good backdrop for stocks, still? >> the second quarter will be at least above 4% gdp growth, but there are two things investors on the note a couple met restriction we were concerned about whether there would be decent long-term growth. we want to see healthier growth with participation to get better. then we also need to see interest rates start rising. >> despite things moving around the world. high you have mentioned the participation rate. i would mention the additional entitlements that we have glared on over the past -- how many people can be on disability and food stamps before we have a problem? >> the lion share goes to people retired and not getting food slys. >> and then if you look at the data on the budget deficit, in 2011 the estimate was the primary deficit 30 years out would be 6% of gdp. the estimate now is 1.6% of gdp. the only thing it looks to be a deficit problem is because interest rates -- would you consider that in europe? >> sure. i think so. if transis 50 and we're 25, we're 22, you want from a percent a percentage in the government from gdp to near 50. do you think that's okay long-term? >> between 19 and 22, that is cra crazy. >> there's important incentives to get productivity up and participation up. i like to see things die on dip and the u.s. needs the adopt to a territorial system. >> time is the productivity. we are longer on the long-term incentives with room for improvement. >> you think the participation rate is just pure ly she was working younger. it's the youngins who got out of the water. the participation is going to go like this and then suddenly it goes to $219. the job growth collapsed. >> at there is a small cop gin tension -- why would the young people not come back in? >> the young people, if you look at what happened, if you look at up employment by age cohort, everybody who got fired traded down because they had to pay the rate. you testimony the -- you are still living at home with mom and dad. those are the people who are not going away who will continue to show up. >> right, no, the owner has jobbed and the point he's making is you have a better -- does the economy, if we don't do some of the stuff structurally that we need to do, it will only do well in 15, 16 and 17 and could do really well. >> that's right. >> you have to think that. >> the economy, you don't have to debate everything, but you can look at the market and say, what is it debating the most itself? at 17 trailing earnings, 16 time this is year, i don't think the debate is whether we got or our prices. it is really good you have all the stuff holding the market back. >> no. you used to be -- >> those who can do to the forecast that the economy is -- there is no structural problem. >> i'm talking about the entitlement state where it makes as much sense to stay home and not have a car, not shave. >> the lion share of the entitlement spending is the -- e financial noise financial noise financial noise financial noise as the company that's all about printing. but did you know we also support hospitals using electronic health records for more than 30 million patients? or that our software helps over 20 million smartphone users remotely configure e-mail every month? or how about processing nearly $5 billion in electronic toll payments a year? in fact, today's xerox is working in surprising ways to help companies simplify the way work gets done and life gets lived. with xerox, you're ready for real business. beautiful shot of the capitol right there. coming up, institutional investment ranking the largest firms and we have the list when we return. ♪ [ dog barks ] ♪ [ male announcer ] imagine the cars we drive... being able to see so clearly... to respond so intelligently and so quickly, they can help protect us from a world of unseen danger. it's the stuff of science fiction... minus the fiction. and it is mercedes-benz... today. see your authorized dealer for exceptional offers through mercedes-benz financial services. re-leeing the rarplargest h fund firms. >> i have the list. it's not in my hand. last year was another in which the hedge fund was dominated. also returning money to investors in that year to keep trading positions more manageable. they tend to refer to it as being nimble. the influx created a gravitational pull. bridgewater topped the list of largest funds with more than $87 billion in total. its assets rose despite the famous all weather fund designed to perform well in any scenario 5%. asset manager of jpmorgan in second with $59 billion. >> brevan howard in third. there were new comers. aqr, lone pine and viking. aqr had huge growth, which helped it to make the jump. in a year where the s&p rose 30%. it will be interesting to see if it bears out. vehicling and lone pine have been amid the sufferers as the tech stocks have taken a down turn. for the first quarter it's been a battle. >> this fund has gone up. do you think it actually stays that way? >> aqr has a version of it. there are certain scenarios where it doesn't work. >> how is it going this year? >> i don't know what it is year to date. it was down 4.6%. they came back a little bit. they were down 8% through may or june. i forget what it was. so i think it will probably have some resilience. >> we've got to run. but fees, do fees matter in any of this? do guys have higher fees than others? does that weigh on size. >> i think 2 and 20 is still the standard. as you know, there's downward pressure. >> right. >> we have seen people say we're going to shave it down a little further. >> thank you, kate. appreciate it. why delaware's governor is concerned about pfizer's play for astrazeneca. and our guest host is jeff rosenberg at blackrock. link proe it services like multi-layered security solution to keep your information safe & secure. century link. your link with what's next. 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[ female announcer ] the x1 entertainment operating system. only from xfinity. tv and internet together like never before. good morning, everyone. welcome back to "squawk box" on cnbcc. our guest host, jeff rosenberg from fixed income at blackrock. great to have you here. >> great to see you again. >> look at what's happening with the futures this morning. after the dow closed at record levels, a new high on friday. the futures are indicated higher. in fact, they have picked up the last hour or so. they look like they would open 53 points above fair value. s&p would open by seven points. nasdaq, by 18 points. we have been watching the 10-year. the kwraoed on the 10-year note is 2.688%. and pinnacle foods being bought for an 18% price. duncan hines, mrs. paul's. also pfizer is pushing hard to win support spore its effort to buy astrazeneca. the pfizer bid has so far been rejected. pfizer ceo ian reed will be appearing before parliament to defend the bid. they are pledge to go keep jobs and operations in the uk. there have been those who have been unhappy with the proposal in the united states as well, including several governors. we will be speaking with delaware governor a little bit later to talk about his concerns. allergan has been rebuffed by four other companies. it has been resisting a $47 billion offer by valeant backed by investor bill ackman. they reportedly made inquiries to johnson & johnson, glaxo smith klein. >> an update from the chief international correspondent michelle caruso-cabrera. >> a very controversial election. let's start with ukraine. referendums over the weekend. it happened yesterday. chaotic by all definitions according to reporters who were on the ground. the fast overwhelming majority of people voted for greater autonomy from kiev. this is all a side show. what we want to see is see what vladimir putin does in response to violence that did happen over the weekend. ukrainian national guardsmen opened fire on some individuals. conflicting reports. russian agencies say at least one dead. the russian market rallied dramatically on thursday. that's the last name we heard from flat mere putin. he took a much softer tone about ukraine. pretty much holding on to the big gains we saw thursday and friday. let's get to india's markets as well. the two marriage indexes at all time record highs. it is expected when we get the exit polls in an hour and a half -- no. polls close 8:30. in india, 6:00 p.m. there. a half hour later, we will get the exit polls. that's why we see the major indian stock markets rally. this is a month-long voting procedure. exit polls today. they start counting thursday or friday. we hear the results later this week or early next week. >> the turnout is supposed to be near the highest we have seen. 66% is where it's tracking right now. >> you see the coverage of barron's. at times it has been negative towards investors. retroactive taxes. >> just trying to break through the bureaucracies. >> yes. >> we were told four or five years ago a ceo said he would rather do business in china. >> this is the guy head of central bank who comes on our show as a market master, it could do great things. in ya, in spite of everything, is doing well. >> china advancing because of the government and india advancing despite the government. he is extremely controversially. >> socialism has reigned -- even though it looked like 20 years ago, it was going to become much more free market oriented. it keeps rearing its head. >> you could use them of being snobbish along the way. they took attacks at moby saying he was the son of a tea man and they were making attacks on him. >> you would like to see advancement in all parts of your population. that's a very american way of thinking. >> well, it used to be. now we sort of love our income in equality. >> you're right. >> we used to hope for other people. >> this is still a great place. a place i would rather be more than any other. >> talk to andrew. preaching to the choir. >> michelle, thank you very much. >> good to see. >> you too. jeff rosenberg is chief investment strategist for fixed income at blackrock. we have been completely confused by 10-year, why it is yielding where it. it was 2.6%. we can't figure out why that is? >> we are having a conversation about a yield on the 10-year at 2.6%. if you go back and put up the chart, we hit 2.6% at the end of january. what a lot of people are forgetting is why we got to 2.6% at the 10-year in january. that's because we had a down 6% equity market. nobody was questioning it then. now we are questioning it. >> the dow with a new high on friday. why is the 10-year 2.6%, which is right? >> and the market sold off. that's when the fed first decided to taper. but thing the cart before the horse. >> the point i was making is the value of fixed income was reestablished when you started the year at 3% on the 10-year. and you had a down market in equities. and what you saw was the attraction of having fixed income. so big reason. there's lots of reason. the weakness in first quarter data hit after you hit 2.6 for all intents and purposes. what we saw on fixed income is people had not enough fixed income to begin the year and you wanted to own more fixed income. >> it was a crowded trade and they never go the way you think they will. >> we expected yields to go higher. >> so you were blind-sided by this as well? >> everyone was blind-sided by the idea that the first quarter would be as weak as it was. everybody was overly optimistic about what we saw happen at the end of last year and extrapolated that into the beginning of this year. so positioning matters a lot. and i think that's another good reason for why you saw the about big decline in yields. >> we assume that the bond market is smarter than the equity market. we figure it is a better indicator of where things are headed. you're saying maybe that's not the case. >> that's the question. that's what a lot of people are asking. hey, if bonds are at 2.60 and equities at all time highs, which market is right and which is wrong? so 2.60 -- there's a number of reasons for it. one is exactly what we were just talking about. >> but you're still -- you got back up on the saddle. 3.25 to 3.5 by the end of the year. >> we think the second half will get better. you're already seeing it in terms of the data. what happens in that environment, now you have gotten positioning more square so people are more on sides and you can see higher rates on that environment. >> bob was here this morning. he thinks 5% essentially. second quarter, 3.5%. does that sound like a fair -- >> 5% growth for the second quarter may be a little higher. >> a little? how much is a little? >> maybe double. 3% for the second half of the year is more in the realm of possibility and probability and what people are expecting. i think in that environment, joe, that's what we're talking about, a 3% yield. >> you would be shocked if you were 2.6% by the end of the year. >> we're not going to be shocked. we have had four or five years in a row where we expected better economic growth, been disappointed. expected higher interest rates except for last year had lower interest rates. >> now you're back to saying the 2.6 we're able to do it because the economy hasn't been strong. what will move them higher is a stronger economy. people think the fed has kept rates where they are. >> that's a big part of it. we're exiting quantitative easing. that's leaving some of the pressure. >> when they raise the short end, the long end finally goes up in your view? >> it is really the raising of the short end. we talk about the 10-year. we tend to focus on that. it is pricing 35, 40 basis points. you talk about a normalization of the fed of 400. the bigger increase in interest rates that we will see is not on the back end. yes, we think it will go back to 3%. >> when do you expect that the fed will actually raise rates? spring of next year? summer? >> it's probably later than that. mid to late 2015. the fed is going to wait as long as they can before they start raising interest rates to see the recovery in the data, to see inflation. we will talk about inflation data. the first increase, the fed will be happy to see. that's what they want to see. the wait through that process, longer before they start. >> it seems really sensitive to these small moves. and it's really important to the 3.5% in the second half. do you think that eventually either people decide, okay, it's not so bad where it is and historically it's a great time. or people aren't buying houses. there's a lot of reasons why structural housing seems sensitive. >> it directly affects the cost. we had an uptick last year. what you need to see the off set of the interest rate sensitivity is the other side, wage inflation and income. how much am i paying versus how much can i afford to pay. if you see the strength in the economy it will off set interest rates and allow housing to stabilize and not committeely only be sensitive to the interest rate. when you don't have wage inflation, the interest rate -- >> is that a crazy 19-year low mortgage, housing, the numbers. >> it was the mortgage applications plummeted. a lot of it is because refinancing got stripped out of it. >> refinancing went down very much because of the big increase in interest rates. there's no more incentive for refinancing. >> you look like a boy wonder to me. are you 35 yet? >> i am over 40. >> you look like a genius rocket scientist. >> andrew and i. both boy geniuses. >> what about the guy -- >> who is the guy who was the boy genius? >> oh, we do. >> we have a guy that comes on that calls himself boy genius. >> jonathan geller. >> thank you. >> jeff will be with us the rest of the hour. we'll have much more from him >> next, stateside resistance to pfizer's bid for astrazeneca. delaware governor raising his concern to ian reed. he will talk about his biggest worries about a possible merger after "squawk box" returns in just a moment. welcome back, everybody. the dow opening up by another 46 points. that comes after big gains last week where the dow closed at yet another record high. a quick check of shares on allergan. it rejected the takeover from valeant. it says the bid undervalues the company and is not in the best interest of shareholders. it is down 1.3%. >> the governors of delaware and maryland voicing their concerns about the proposed takeover from pfizer of astrazeneca. great to see you, governor. >> how are you? >> i'm great. we have talked many times in the past. and you are someone that has figured out that a lot of jobs come from the private sector, don't they? this is like an important thing to consider, is it not, what happens with pfizer? not just in terms of jobs but they will be domiciled in the uk and paying uk taxes and not taxes here, right? why is this happening? >> well, right. first of all, it is certainly something we have to figure out. we have in delaware an rate talking below the national average. job rate exceeding the challenge. but we have employees here in wilmington. and in maryland they have about 3,100 employees. the company is making specific commitments to policymakers in the united kingdom about jobs over there. we're not hearing any of those commitments here in the united stat states. that's a significant concern to us. >> that's because we are trying to buy astrazeneca. they need clearance. they don't need clearance -- i don't know why they don't. over here there seem to be these inversions. it's almost like when you watch toyota move from california to texas. it's like watching one of our components move out of this country because of our in equitable corporate tax, governor. you're not even talking about that. you're just talking jobs. >> it is obviously a significant issue. what's really unfortunate is we have seen both president obama and the republicans in congress say they ought to reduce corporate taxes. but grid lock in washington prevented that from happening. i think this is an example where it has a potential effect on american families. and so i think that clearly has to be dealt with. but at the same time, the image of the pfizer leadership, making these really specific equipments about job growth there and not making any here is a real concern to us. >> pfizer is doing this for a specific reason. obviously they want to buy the astrazeneca. synergies with r&d. they see some attractive things as well. they want to redomicile over there. i don't think they necessarily would have any reason to change in either delaware or maryland. they haven't indicated those jobs are at risk. that's all they need to do is say, yeah, they're not at risk and you will sign off on the deal? >> you just mentioned they will be seeking synergies. it is not a very coated word for savings. if you look at this, and i have done plenty of mergers and acquisitions. i understand all about fiduciary responsibility to shareholders. my job is to use every tool i have available to protect american jobs. the fact that these commitments are being made in the uk and not here raises a red flag. tuckly for delaware and maryland is a particular issue. >> the answer in the short-term and long term. something needs to take place long term. short-term, people are pushing to effectively block or stop inversions. >> right. >> where do you stand on that? >> i'm supportive of senator widen taking a hard look at this issue. some think it ought to be dealt with in a larger tax form rebate. but in the meantime, when you have companies basically saying we're going to do the inversion as a way to make sure u.s. -- the united states treasury doesn't get the benefit of funds which otherwise would come to the united states, i think that's a big issue. >> they're not deliberately saying i want to make sure the treasury doesn't get my money. they're saying i can't be competitive. the rest of the world is going to pass them by essentially. >> well, i'm certainly agreeing, as i mentioned a moment ago, with the need to do corporate tax reform as well. whether they ought to be done as a package. i haven't spent enough time the on the issue. but in the meantime, i am most concerned about 2,600 families here in delaware. there's so much uncertainty what this may lead to for them. can we just go back. would you be prepared to block inversions broadly? before getting to the tax -- >> these are decisions that are made at the federal level. i'm obviously primarily focused at the state level. what i want to do make sure everybody in this country is aware of the potential threat and think through what the policy leverage may be. in the end, there's no question. we want to do everything we can so these companies can be highly competitive right here at home. and i think that's a funneled mental responsibility that we have not only in this industry but in many industries. we want to make sure we're doing it in a way that's not just a race to the mom. >> yeah. >> and certainly one of the things the companies care most about is the adequate of the workforce here in delaware and in maryland. >> governor, thank you for joining us from wilmington. we appreciate it. good luck. and we hear you. i hear what you're saying. as governor, all you can worry about as jobs. i don't think you can introduce legislation. >> they don't let us do that. >> i wish a governor could do more. thank you. >> >> i asked tim geithner about it. we have a lot more coming up on squawk in just a moment. we're moving our company to new york state. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies. e become the next business to discover the new new york. financial noise financial noise financial noise financial noise welcome back, everybody. "neighbors" starring setting rogan and "the amazing spider-man" 2 on top of the box office. "neighbors" had more than expected. at $51.1 million. it is a universal film. >> and a shout out two my two friends in high school who wrote that movie. very excited for those folks in scarsdale, new york. literally my neighbor from a block away. >> is it like animal house? >> from what i have seen from the ads, it's a nice family, a fraternity house moves in. they get upset with the late hours and they call the mistakes. >> he looks good with his shirt off. >> hand some man. we all have to go to the gym. >> currencies in gold. nfl draft is a great success. and now the league has cities lining up to host the event. what's up with directv. 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[ female announcer ] the x1 entertainment operating system. only from xfinity. tv and internet together like never before. welcome back to "squawk box". hillshire is buying pinnacle foods. it's worth $36.02 a share. 18% premium over friday's close for pinnacle. didn't blackstone buy it? i have to go do a little homework on that. allergan rejected a takeover from valeant. it says the bid undervalues the company. it is not commenting on reports that it is soliciting alternative bids from four other companies, including johnson & johnson. apparently rebuffed thus far. already a winner in the battle for allergan. it is said to have a gain over a million. >> mounting tensions in ukraine remain a point of focus for currencies and gold prices. and phil from rgo futures. gold prices has certainly been influenced by what's happening around the globe. is it up 7% this year? >> we saw it get a bump up. a lot of it has been ukraine developments. we saw more developments over the weekend. the turnout was two-sided. they were calling that the turnout was great. but the westerns were always knocking down the voting because it didn't seem all that serious. gold prices getting a boost on that geo-political news. if you look at the larger picture, the u.s. economy is still improving. we will see interest rates rise. the fed is continue to go taper itself. gold on the short run, you want to look at purchasing short call options just so you have that rush in play in case something does develop. long-term prospects will go lower because the need just isn't there. >> i wonder what fair price is? you're looking at gold below $1300 the an ounce. in a normalized world, what do you think is a fair price? >> we're stuck between 1320 and 1270. really i think if nothing develops with russia, we will see them break in the down side. we will retest around 11.78. everyone will be calling for $1,000. if world war iii breaks out, you will see them explode to the up side. still, it will have head winds. the larger picture is you don't need it in a rising interest rate environment. >> cathy, that's not what's been driving the markets. they were a pretty big deal. >> that is certainly dragging the euro down. we have to appreciate the fact that the dollar weakness itself is boosting gold prices. and i think the dollar is due for a bounce. take a look at how it is tend to go trade before fed tightening. we tend to have a narrow range. so i think it is a little bit of a ralry there. q1 was depressed by weather. that put a pressure on yields. as you mentioned, we're starting to see a sick cal shift to monetary policy like the eurozone, canada and new zealand. that could provide a boost for the dollar. gold may be benefiting from the geo-political uncertainties. in the longer run, i do also believe that the trend is lower. >> we have watched a lot of different things. what's favorite currency for the year? there have been major shifts we are expecting. >> right. i think the big story will be the british pound. we have a quarterly inflation report due this year they could signal they may start to unwind some of their stim list. it's been a significant rally. there's been more up side there. bearish euros. it's a clear signal he's sending about easing in june. >> and the risk factor, how do you put any of that into context? >> i think it's important to realize we're still in a risk averse environment. investors are weary on loading up or carrying anything high risk. that could choppy markets. >> our guest host is jeff rosenburg. you hear what they're talking about when it comes to currencies, gold. how do you figure relatively speaking what that means for the bond market? >> it's interesting what was said about the relationship between gold and reprising of interest rate expectations i think is critical. another message that you get from the currency markets this year was the expectation that the dollar was going to be stronger on the relative movements of central banks. fed is tightening, euro supposed to be weakening. it's by surprise been the opposite. but i think the big issue both for currencies and gold is interest rate normalization. are we going to get it? yes. when? everybody wants to know how long before you actually start tightening. that's a major shift for all the markets, currencies, gold and interest rates. >> cathy and phil, thank you both for joining us. >> coming up next, an emotional mother's day for marty st. louis of the new york rangers. i was chanting marty. scored the first goal. i never had a hockey team. people say i should like the columbus, ohio team. but i don't. and the executive vp of nfl media joins to us discuss the draft and the role of social media. and tim geithner. find out what life was like in the white house during the financial crisis. whaesd as we head to break, here's a preview. >> you could hear in their voices the pressures they were facing. but these two people were enormously strong, courageous people. and they, like the president did, were willing to put the political pressures aside. 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[ male announcer ] see if your business qualifies. veteran forward martin st. louis lost his mother at only 63. he knew yesterday's playoff game fell on mother's day. he knew it would be an emotional one. it was 3-1. even though the rangers woman the first one, they looked really bad. yesterday was a must win for new york. 3-2 is what the series was at. st. louis broke up the scoring right at the beginning of the game. he deflected a puck. everybody was emotional. lundqvist was as well. st. louis lost his 63-year-old mother on thursday. she died of a heart attack in montreal. and he returned to play for the rangers if game 5, just a day after the unexpected death. and the new york post summed up last night's game for st. louis, mother of all wins. setting up a game 7 tomorrow night. it's going to be in pittsburgh with the hated sid crosby will be playing. he was so nasty last night. doing terrible things. at least as a rangers fan that's what i would thought. anyone would want him on their team. the rangers have been down 3-1 16 times and never won. they forced a seventh game only one other time. they are still feeding off this whole thing and playing for him. it's amazing to watch. >> the rules are like soccer. >> high stickng. >> but the rules are like soccer, which you constantly complain about. >> i don't like soccer. >> same rules. >> he's in charge of broadcasting. nfl network. nfl.com. sponsorships. he did most of the tv deals that kick off this year. and working on the sunday ticket deal with direct tv which expires this year. >> thursday night i was doing other stuff. >> nbc does a great job sunday night. >> they do. >> only a one-year deal. just keep it in mind. >> we'll know more after this year. >> thursday night? it was much more than money. >> it was more about -- >> look, cbs does a great job. and i don't -- >> nobody does the better -- >> there's a lot of reach that cbs achieves. >> you watch al and chris versus jim nantz and phil simms. seriously? >> we're in a fortunate position where all our broadcasters are coming up with all the right -- >> it's true. we benefit from having many broadcasters produce many great games. >> you have great properties. i can't believe the draft. i can't believe i was watching some of the draft. people were watching the last round to see michael sams get pecked. >> we were up. >> how much? >> 30%. 45 million people were watching over the three days. it's a confluence of a lot of people. people who love nfl football, college football, people who love the emotional swrourpby these guys take. >> they all cry. it makes me want to cry. is it going to move to boston? >> it has become one of the most viewed. it is one of the most engaging things we do in the off-season. it used to be a wasteland. we have had a lot of interest from different cities. we have heard from 12 cities who have an interesting in carrying the draft. >> that's the the only mayor with season tickets to a football team. >> is that right? >> i think that was one of his reasons for wanting it to move up there. >> boston is a good football town. >> we have heard from los angeles, orlando. we have heard from a lot of different places. they realize it not only puts a city on television but a way for fans to come out and do things in the off-season. they love it. you see there is this pent demand that people are log for a release when they find it in the draft. it sometimes surprises me. >> how did that work with the twitter stuff where you tweet out the heights all over the league? >> it's worked great. >> twitter headache any money from that? >> twitter is making money. we're making money. fans are winning. we did it more in the draft. we tweeted every podium pick. roger is hugging the guy. there's a red carpet they came into radio city with their moms. that was heavily tweeted. we had 10 million tweets. >> good to have roger there with the players. he looks like he is 5'6". he's 6'4". he's huge. they come can up to him and give him a big bear hug. >> these guys are amazing athletes. when you see them in person, even without pads. >> 18 or 19 years old. >> some of them, yeah. so, look, again, you mentioned it before, they have this emotional release. they have had this lifetime journey that this is their goal. they are used to the spotlight. >> i'm worried about the 21 teams that did not pick johnny football. i think it's cool that he's going to cleveland. i do. and i don't like cleveland coming from cincinnati. i don't know. >> do you think he's going to do well? >> i do. he's a gamer, isn't he? he's small, though. but so is joe montana. >> this guy has won everywhere he went. it's amaze to go watch people gravitate towards him. >> everywhere cleveland goes is going to be a huge tv deal. >> i think people gravitate towards teams and players. and zony manziel's story is a great one. but there are a lot of stories in this draft. i think people will love watching michael sam and what he accomplished. i think it will be wonderful. every player has a story. it's all unique. >> wwe, which i know is a totally different sport, has gone over the top. they are doing netflix for their sport. more entertainment than sport. i know you have your own network obviously. >> we are launching in august nfl now which is netflix for nfl football. it's cross platform, cross device. you can get customized highlights, customized nfl films, archives. >> do you think that's where this is going? >> it is going that way. people are becoming increasingly diagnose theic. >> there are so many networks paying effectively for than the true worth in terms of advertising dollar because it does the so much else for them. so could you do it solo? >> well, when it comes to live games, we think television is the best way. we have made our bet. but that is not the sole consumption of our support. a lot is highlights outside the game. >> on the olympics, who won? did ioc get nbc or nbc get ioc? it's out to 2032. >> i don't know who won or lost? any time it can lock uprights out of that value, it's beneficial. >> if we're part of russia by them, geo politically, they come over and annex us, there might be all summer olympics. >> it is 50 cents on the dollar. >> is that what the math is? >> not exactly. remember johnny bench. the most he made was $300,000. things go up. >> there's always been a long-term, especially in sports rights, to lengthen the term as much as possible. >> i think the ioc was comfortable with nbc. that goodwill bought a lot of value. >> does not mean does not make a deal that far out. >> we may think about things differently. >> they're very good. >> you have to be very objective, don't you? >> has the added benefit of being true as all our broadcasters are doing. >> coming up later this week on "squawk", woody johnson. are you sure geno is that good? you don't pick anyone else? really? >> coming up, tim night tpher revisiting the financial crisis in his book. later, david ruben stein co-founder of the carlyle group. reopening the washington monument. you're running a business. century link provides reliable it services like multi-layered security solution to keep your information safe & secure. century link. your link with what's next. . time to take care of business with century link's global broadband network and cloud infrastructure. we constantly evolve to meet your needs every day of the week. welcome back. let's get more thoughts from our guest host. jeff rosen berg is chief investment is strategiest at blackstone. the comments about the s&p, and that's not obviously the bond guy. but you're saying something isn't quite right. either the 10-year isn't quite right. i'm wondering whether that's true. i think your contention is the 10-year seems to be indicating an economy that's not great. so the stock market might be overvalued. i would look the other way. if rates can stay low and these guys can get out and extracate themselves, you deserve higher multiples as the rates stay low. >> i don't think it's so much the stock market is wrong and the bond market is right. as we talked in the earlier segment, i think we saw the value of fixed income get reestablished. you saw it offset your losses. it did better in stocks. people had to get a little bit more in their bonds. >> as a whole, what does blackrock think? >> a tphoef thingnumber of thin. it probably has -- >> for the stocks the, i mean. >> stocks? >> have stocks outperformed bonds? >> absolutely. we think that's an easier call because we think bond yields are so low. they have a prospect of going up. you're looking at 0%, 1% in fixed income. certainly it's an environment for stocks beat bonds. >> most people would have said that about the last six months. instead it did 10%. >> well, the backend did. >> right. that can't happen again? >> it certainly can happen again. the key is whether you get more disappointment on the economic side, inflation side. again, we'll have inflation numbers this week. everyone expects it to go higher. most importantly, we're going to get the economic data to be a little bit better. that kind of environment will be challenging for fixed income. >> what is high yield been doing or indicating? >> high-year-old has done well in terms of total returns in terms of the asset class. >> is it over for that asset class? >> what's over is price appreciation. you think about the big double digit returns in high yield the last couple of years. that's really not in the cards going forward. what you have is you have yield. that's basically what you're looking at for the returns. 5%, 6% is about as good as you're going to get. the risk is that you don't have much cushion in any of the credit asset classes. >> do you have a preference jim nantz, phil simms, al michaels. >> they're all good. >> no one comes close to allen. >> chris is a former bengal. al is a "squawk box" fan. >> but other than that -- >> i get a cavity when i'm listening into jim nantz. hello, folks. i like him and everything. but sills, got to be a giant. we have to go. thank you. >> thank you so much. >> good to see. >> you when we come back, two big interviews. his memoir hits the shelves today. >> a momentous day for david ruben stein. 3 years, $15 million later, the washington monument is ready to open. we'll speak to him in just a bit. we're moving our company to new york state. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies. entering the eye of the financial storm. >> what's the best way you can reduce the risk that financial firms take on too much risk and whose collapse might be damaging to the rest of the economy. >> former treasury secretary tim geithner telling all in his new book hitting book stands today. what life was like at the white house while banks were on the brink of collapse. a special "squawk box" interview ahead. a momentous day for the washington monument. david rubenstein. three years later, it is ready to reopen. we'll speak to him about philanthropy. which player will be the biggest surprise. as the final hour of "squawk box" begins right now. welcome back to "squawk box" here on cnbc. first in business worldwide. i'm joe kernen with becky quick and andrew ross sorkin. the nasdaq got hurt. nasdaq was down for a while. everything else near high. the dow jones will maybe gain a little bit this morning as well. >> pinnacle food shares are jumping in premarket trading. they make bird's eye vegetables, mrs. paul's as well as other things. hillshire is the company behind jimmy dean sausages and sara lee cakes. again, this is one of the situations where the acquiring company is seeing gains in stock as well. that's been something we have seen with a lot of m&a activity the last month or so. allergan rejecting a takeover bit from valeant. it says that the bid undervalues the company. it's not commenting on reports that it solicited alternate bids from johnson & johnson, novartis, glaxosmith klein. rometty's comments. >> we are now going to talk about the interview. i sat down with tim excite tpher about his new book, stress test, reflections on financial crises. it comes out today. before we get to that, new controversy. some calling him a liar in which hubbard privately told him republicans would have to raise taxes after the election. geithner responding to the accusation he made in the past hour. mr. geithner's spokesman said his memory is crystal clear. he stands by his account and stress test. hopefully we can get him on to respond to that. i asked mr. geithner to respond to this quote from senator elizabeth warren from her new book. she wrote geithner believed the government's most important job was to provide a soft landing for the tender fanies of his banks. listen to his response. >> what's the best way to think about it? i don't know. your in a plane. you're in the cockpit. the engine is burning. there's smoke filling the cabin. you have a bunch of terrorists on board. people who built the plane somehow messed it up. they want you to come out of the cabin and beat up the bad guys. you have to make sure you land the plane first. when you land it safely, you have to bring a measure of justice to the people responsible. but your first obligation and the only way to prevent mass damage is to make sure you are protecting the people most vulnerable from the fallout from the panic. >> you landed the plane safely. but when there was an opportunity for reform, to truly reform the system, fundamentally change the system, you didn't take it. >> i don't agree with that. i understand the perspective. but we did transform active reforms to the system. much stronger consumer protection. much better authority for the cops can than we had. and risk taking that make it a much more stable system. now, there are people on the right who think we ended capitalism. we brought a socialist agenda to end the market economy. there's people on the other side who thought we should have done more different things. we just try to figure out, put the politics aside, just try to figure what was the best thing to do to buy americans, to give americans a measure of protection in the future against a risk of catastrophic financial crisis. >> if today some people would suggest the banks are too big to fail, 245eur bigger than ever, true? >> i think that americans should be much more confident today, that we have a system where, again, we can be indifferent to, safe from the failures of individual films. we're much lowers than we were in time in the last 30 years. they are forced to run much more capital. we limit the size. no individual bank can be more than 10% of the banking system through acquisition. that's a much tougher constraint than exists anywhere around the world. i think our system is a much more resilient system. we're still in the future. americans should be more confident that that concern is less pressing, less damaging and dangerous to us. >> when i saw you at harvard, we talked about too the big to fail. maybe we will always have to live with it to some degree. >> the biggest thing is there are -- there is the rare extreme, really unimaginable risk of panic. and in a panic, like what we saw in the fall of '08. remember what it was like then. we were three days away from people not being able to access their atms. in that context, as we saw in the fall of '08, you can't be in different to the risks that individual failure creates the risk of collapse of the system. that's the dilemma. you're in the operating room. and the patient is dying. and the lungs aren't working. can't get oxygen to the body. you know, you got to make sure there's oxygen to the bead. >> there is a point in the book before you go to visit bill clinton. talk about a couple of things. one being whether there's a way to persuade the public perhaps that what you are doing is the right thing. what did he tell you? >> he said the basic reality, and this is the human thing, is that people wanted blood. and you could take your pick. you could take out your favorite investment banker and slit their throat in the alley and the next day people would want more. >> he said that about lloyd blank fine. >> the amount of damage was enormous. it was tragic. we're still living with the scars of the crisis today. and he was making the observation that that amount of danger is something that you can honor and try to fix the problem, get the economy growing again. it's hard to honor and satisfy by going out and shooting people. but of course it's important for there to be accountability and strong deterrence against these kind of things. it's important to make sure people sitting in custodians as people's trusts -- >> to the extent that part of your job is persuading the public that what you are doing is the right thing. >> this is kind of hard for me. i wasn't that successful at it. >> if you could go back and do it again, is there something you would do differently? >> i don't know. think about it this way. it's not my natural talent. how can you convince people -- it was terrible. the worst recession in our lifetimes. could have been worse. it's hard to use a counter factual argument to convince them was necessary because what they experienced was a terrible thing. and we have this other burden things that you have to do are going to look terribly unfair. it looks like you are rewarding the arsonist. >> the conversation always started with the banks will help save the guy on the street. was there a way to turn the conversation around and start with the guy on the street the will be saved if we save the banks? >> well, that would be a good way to say it. and i think we tried it that way. let me try it a little differently. just to look pack at the full scale of what we did in that context. the president, who is very good at making the tough, hard long decisions where the politics are difficult, he committed to get, and the congress gave it to him, substantial authority to put money directly in the hands of the american people to protect from the risk of a worst recession. the scale of the fiscal stimulus was larger than what roosevelt did in the great depression in relative terms. it's not like our strategy can be described as many have described it. they left people to fend on their own. that is unfair to the people who work for me. and definitely unfair to the president. >> you've said in the book that you had a bit of a selection bias in terms of how you felt about wall street. you said i didn't think these people were crooks and idiots. >> i said both sides of it. i said i didn't think it was a negotiable or ethical profession. >> you don't think it was? >> i do not think it was. nor do i think it had a disproportionate share of people who are ethically challenged. it was partly the people i had worked with or seen up close were probably the best part of that system. >> we're going to have more of that interview in just a second. one of the things that's so interesting is he says in the book one of the reasons he gave citigroup to some degree a pass was the fact that he had a relationship with bob ruben. and it's a group think situation. he started with larry summers and then worked with bob ruben. and said to the extent that he was partial to the view the wall street wasn't crooks and idiots, as he says. interesting issue. >> it's wrong on so many different levels, though. you go to clinton, who under -- i think -- the didn't he have cuomo as his hud guy. totally greased the wheels for getting the 70% home ownership? to look for who you want blood from and to be tar and feathered should barney frank have his -- all the mortgage -- >> he blurbed this book. >> i know. in a speech by hillary clinton, bill's wife, it was a societal phenomenon that you see in a housing bubble. made inflated by cheap mope from the federal reserve, by individuals flipping houses. everybody was at the punch bowl. everybody complicit. they managed better than any other firms. for clinton to mention -- i don't know. it's weird for me to call out -- >> i don't think he was calling him out. >> i don't think he was calling him out. he was pointing to the idea -- >> why not mentioned franklin at fannie and freddie? the government enabling of this entire bubble to happen. >> that's what clinton was doing. >> let's pick a banker, though. you could literally literally murder the -- the and it wouldn't matter. >> to save the economy, you can't save the economy without saving the banking system. you can't. >> you and geithner are together. >> he doesn't the say -- the. >> he still feels like people have a point. he almost seems defensive in explaining it. >> if you go on the internet right now, people hate what he did. >> when we come back, we do have more of this interview. we have a response from hubbard. this is his response to what geithner said in this book. we'll be right back in just a moment with more on tim geithner. drivers want to go further with their electrical vehicles. but you can't take a trip from lisbon to stockholm if you can't plan and re-charge along the way. the european commission is using cloud to make this possible. creating a single charging and billing network across 28 countries. so drivers can travel as far as they want to go and when they want to go. e financial noise financial noise financial noise financial noise >> welcome back to "squawk box". we just received a statement from former mitt romney economic adviser dean glenn hubbard. yesterday a reporter asked me about the veracity of a claim in former treasury secretary timothy geithner's new book. i have not read geithner's book, so i do not know the context of his story. the statement, though, is simply not true. neither mr. geithner nor his publisher reached out. what incentive waoeuould i have to make a statement to the other side? my view now is the country needs to go through a plan with tax reform. of course lowering marginal tax rates and broadening the tax base and entitlement reform. my conversation with geithner is if the plan raised revenue, romney plan could be accomplished with similar tax cuts. i believe and believed that the current trajectory of federal spending endorsed by the obama administration will require greater revenue. the romney plan had a lower spending skwrebgtry. trajectory. his book as read to me was not accurate. >> the original version lowered marginal rates. >> there was more revenue along the the way. >> it was borrowing on marginal rates. >> in the meantime, we get back to tim geithner. he looks back at the financial crisis. in equality. interesting conversation with bill clinton and his new role in the private sector. he hints there was disagreement between him and ben bernanke and hank paulson over what to do about lehman brothers. here's what he had to say about that tense weekend. >> if you think back to that moment, all the political pressures on his at that time were to stand back and let the fire burn. monday morning the editorial pages rarely agree, were thrilled that it had failed and we had not prevented it. it praised us for us. until three days later that were clamoring for us to come in and put out the fire. the overwhelming political consensus on the right and left was you guys should stand back and let the fire burn. but they were competent, courageous people and they were not willing to listen to those voices. >> just for the viewers to understand what the disagreement was. >> people in washington had been coming out and saying, people who worked for hank, saying we will not put any public money at risk in helping prevent the failure of lehman. that was a -- they felt that was justifiable because thought it was going to be in negotiation. that was a sensible aversion. but there was no way we were tkpoelg goi going to solve the crisis without doing that. >> three days into your job you tell a story, which i'm hoping you can tell the viewers about an experience when you went over to the white house. what happened? >> well, i went to the white house for a meeting with the president. it was my first one-on-one meeting with him. and i walked in. on the way in, my colleague gave me a set of talking points they wanted me to read. they were going to bring cameras in after the meeting. and suppressed concern, outrage against the quite outrageous announcements by the major officials of the country that they were giving large bonuses after the country -- when the country was is he end of the abyss in economics. i said i wasn't going to read them. the president can read them, but i wasn't going to read them. i wasn't any good at it. he was the president of the united states. he was standing next to me. and i didn't feel like i would be able to satisfy the concerns about that. so i said i wouldn't read. >> how did the president feel. >> wasn't that comfortable doing it either. he had to find a way that was comfortable, authentic, natural to him. and i think he found it. he had to find his own way of doing tight too. he was better than i was. much better than i was. >> you talk how you were reluctant to become the treasury secretary. there were points at which you wanted to step down and push the president to try to find a replacement for you. what was that about? >> well, when i first met him, i -- and he said i might have to ask you to come to washington. i said you shouldn't do that. he said i thought there were better choices. if he chose me, he would be burdened by the choices i made already. i was proud of those choices. he asked me to do it. i'm lucky he asked me to do it. it's true once we put out the financial fires the economy was growing. and we passed financial reform. i thought it was time for him to get somebody else to come in. >> it sounded like your wife hated you being there to the point where the president had to convince her to stay. >> he took her for a in the rose garden during a birthday party and told her why he wanted some he to stay. which was a gracious thing to do. my wife didn't want me to do it but she supported me through the whole thing. i wouldn't have done it if she said you can't. i wouldn't have done it. >> it's been a year since you left the job. a little more than a year now. what do you make of where we are in the economy? and what do you make of the markets? >> i think the country still has a lot of challenges. we have high rates of poverty. median income has not been growing. it is hard for the country. people have this tremendous fears. we're a stronger country. they were getting stronger. we're healing the damage left over from the crisis. in a relative sense, relative to any of the challenges any of the major economies face we're in a stronger position today than we were before the crisis. >> do you have a take on the markets now that you're getting into the finance world? >> i try not to have a view on the markets. but if you listen carefully you see a steady, gradual improvement in confidence. you can see how they are behaving in businesses around the world. people feel more confident now. we have had four and a half years of relatively stable growing. not strong growth but stable tkpwoegt given the challenges we have faced. we're not still living at the edge of the abyss. >> is there enough confidence for janet yellen to fully taper all the way? >> i don't have any views on the choices she has to make going forward. she's a tremendously capable person. i worked alongside her five years. >> you probably saw pfizer is trying to buy astrazeneca. from a u.s. policy perspective. if you were still talking to the president, what are you telling him he should be thinking about this? >> we put out framework for corporate tax reform while i was still in office. it was to try to create a system where there was lower overall rates. there's still a case for that. this is an example why that makes so much sense. how you can do more than that. or you can still do things to make it harder to do these types of transactions. >> do you think that's a good thing? >> i do think we should be. >> have you ready pickity's book? >> i have not. it should be focused on the fact that for a country as rich as we are, as fortunate as we are, we have an appalling number of people in live in poverty and a middleclass that hasn't seen incomes grow in real terms very fast over time. and we have a deep in equality in the level americans face. think about it. where you were born today, the color of your skin, how poor your parents are has a huge effect today on the quality of education you tkpwerbgts the quality of health care you get and the opportunities you face. americans should error about that a lot. there are a lot of things we can do as a country to make that better over time. not just sit there and fight with each other. >> how do you feel about carried interest? >> i have a lot of views on the carried interest. but i have to leave those challenge toss my successor. >> before you spoke out against them. >> i'm going to try to abide by a basic tradition that i very much respect in public life. when you have serve in these jobs and you leave them, you leave those challenges to yourself successors. even when it's inconvenient to do that. i'm going to try to do that. >> before i let you go. on pinkus, tell me about how you decided to take that job. there has been a critique and criticism. effectively you have sold out. >> i spent my life in public service. it was such a privilege for me. i loved my work. but i couldn't do it forever. and i certainly have had my share of interesting jobs in public life. i wanted to do something new and interesting and distant from what i used to do. i wanted to work with a group of people that were ethical, i respected and doing something valuable. and i believe that about this group of people. but i was worried about the perception you raised. i thought quite a lot about it. i did not want to go and was not willing to go work for a firm that we had regulated or we had rescued. i know that doesn't the heal the the perception completely but i was very conscious of that when i made my choice. >> okay. tim geithner, thank you. appreciate it. >> as this interview was going on, you're saying he worries too much? >> he worries about how everything looks. man up. you make your decisions. say it loud and say it proud. panty waste. >> he's listen to go people on all sides. >> i thought the light was really good. did you sigh how good you looked? >> very handsome. >> so did tim. i love tim. great guy. he gets hit so hard. >> he gets hard on the left and the right. >> if you listen, they will turn on everyone no matter what. you have seen it. people that are heroes of the left. >> joan greg writing in about what happened on those lines. this back and forth between geithner and hubbard. he said the original reduced 1 trillion in a year. >> chains. >> 100 billion was used to reduce deficits and debt. maybe that's where some of this back and forth comes in. >> i'm wondering if the group of people that are really ethical and really doing good wok. so i go to a hedge fund. i thought that was funny too. >> he didn't say private equity firm. >> another private equity firm david the rubenstein. co-founder of the carlyle group. there's a new way to buy a car. it's called truecar. and truecar users... save time and money. so when you're... ready to buy a car, make sure you... never overpay. visit truecar.com today. welcome back to "squawk box", everyone. in our headlines this morning, a big deal in the food industry. both stocks are moving higher. hillshire foods is buying pinnacle foods. an 18% increase premium for pinnacle shareholders. you can see both stocks moving higher. pinnacle foods up 20%. highlyshi hillshire brands up over 3. the combined company would be headquartered in britain. jobs will remain there. we should point out astrazeneca is resisting pfizer overtures. astrazeneca up 1%. "neighbors" bumped spider-man 2 out of the top spot. "neighbors" took in $52.1 billion. >> nice surprise for universal. >> it doesn't look like it cost that much money to make. >> looks funny. >> people didn't know zac efron could carry a movie. and he just did. >> it's hard to go wrong with a frat -- >> this is when he was e having his problems, if you remember? >> what problems? >> those problems. >> i don't remember the problems. >> he had some problems. i think they were substance related. >> he's better now. up next, david rubenstein on the reopening of the washington monument. [ male announcer ] what if a small company became big business overnight? ♪ like, really big... then expanded? ♪ or their new product tanked? ♪ or not? what if they embrace new technology instead? ♪ imagine a company's future with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. welcome back, everybody. after suffering damage from a 5.8 magnitude earthquake back in august 2011, the washington monument is reopening this morning thanks in large part to our next guest. david ruben stein is co-tpourpbld aco hp-founder and co-ceo of the carlyle group. >> a beautiful day there. some distant shots of what the monument looks like. >> i did climb up a week or so. it's in pretty good ship. i'm not an engineer, but everything is in good working order. >> david, i wonder, there are so many demands for your time. so many asks for your money. why the washington monument. why did you structure your money the way you did? >> i said i would put up all the money. but they thought it would be better to have public-private partnerships of the federal government doesn't have the money to do everything it would like to do and can't do everything it did in the past. i do live in washington. i think it is a symbol of your country in many ways. i that it was a good thing to report. >> i can't even look at that. >> they're showing pictures you can't see of workers at the very top of the monument and joe is getting a little -- >> i'm light-headed. >> when the scaffolding was up, i did go to the top. if you have vertigo, it probably wouldn't be great to do. it is 550 feet. it started in 1848. a typical government projected start anything 1848, took about 40 some years to get done. it was done on budget and on time. i'm very pleased the parks service was able to do this. >> being down there at night and seeing the lights lit, did anyone say -- the was the subject ever broached -- i guess you can't improve on something. no way we can put lights on and lit it up like the eiffel tower at night. >> people thought it was so terrific we shouldn't take the scaffolding down. but we do take it down. the lighting is very good. it's the same company that did the statue of liberty lighting. it's in pretty good shape. >> all the monuments down there look good. >> like a pea con of hope. >> i'm like new york city. when you're as hall here, there's nothing else to compete for attention. it does stand out whether the lighting is like a scaffolding or not. it's in pretty good shape. >> i don't know if you remember in january, when you were hear on set, we took a picture of you wearing beats because of the new investment that you had made in beats. there's the picture. we're looking at it right now. there's an awful lot circulating. this is a situation dr. dr he e came up with a video saying, yeah, it's going to re-do the forbes 500 list. >> 400 list stkpwhrfplt it's the forbes 400 list. >> but who is counting. >> i cannot cite anything until there is an official announcement. i can only say it's a terrific product. i would highly recommend that you give your guests beats ear phones. the ones you have now are good but beats would be even better. >> can i just ask when you made the investment and how much the investment was for? >> we invested about $550 million. that deal closed in -- last year. so it's a very good investment. but i can't tell you anything more than that without going to jail. >> i have a question. it's an easy one. when you saw the video on twitter or online where dr. dre and tyrese, did you call your lawyers? what happened? >> i didn't. i was focused on the washington monument when i read it. i thought that's what i want to focus on today. so i didn't do anything about it. i hope you and your viewers will have a chance to come to the washington monument. any of you, joe, becky, on drew, when you want to come walk to the top with me, let me know. >> i do. i do! >> i'll arrange a special tour. if you need a defibrillator, let me know. i got up without one. i it takes 25 minutes to walk up. i would very much like to take you to the top. >> it is hard to get tickets. >> i want to go. i want to go. >> we will wear our beats headphones and apple devices. >> all right. great. >> david, let me ask you. you see this is a public/private model where you see the park service working together. is there another project that you think is right for this sort of model? >> there's one i'm working on. i hope in the not too distant future to say something about a similar project that i hope to do with the parks service. just wait and see. i really want to have everybody focused on this if they could. >> it is beautiful. we really appreciate what you did for the country. >> my pleasure. >> we hope everybody gets a chance to look at the new refurbished washington monument. >> my pleasure. thank you. up next, a check on the markets. mountain dew hitting new peaks. shares in the beverage is growing while other cash nated drinks are shrinking. cars are driven by people. they're why we innovate. they're who we protect. they're why we make life less complicated. it's about people. we are volvo of sweden. how much money do you think you'll need when you retire? then we gave each person a ribbon to show how many years that amount might last. i was trying to, like, pull it a little further. [ woman ] got me to 70 years old. i'm going to have to rethink this thing. it's hard to imagine how much we'll need for a retirement that could last 30 years or more. so maybe we need to approach things differently, if we want to be ready for a longer retirement. ♪ just take a closer look. it works how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review. e financial noise financial noise financial noise financial noise welcome back, everybody. let's get a check on the markets. futures have been indicated higher. the dow futures indicated up 35 points, after the dow closed at a new record on friday. s&p up six points. nasdaq by 16. oil prices have been higher. green arrows with wti just above $100. 10-year note above 2.6. the yield is 2.641%. and the dollar, if you want to take a look where it is trading is down against the euro and the pound. up against the yey. 1.377. gold prices have been a bit higher. up by $15 in fact. $1,302.60 an ounce. >> coming up, jim cramer from the new york stock change. we'll talk the week ahead on wall street and much, much more. man: we know when parents and teachers work together... woman: our schools get stronger. man: as superintendent of public education, that's been tom torlakson's approach. woman: torlakson has supported legislation to guarantee spending decisions about our education tax dollars are made by parents, teachers and the local community... and not by sacramento politicians. and we need to keep that legislation on track. man: so tell tom torlakson to keep fighting for local control of school funding decisions. . let's get down to jim cramer. it was you and some good looking younger fellow tweeted out. was that your older brother? younger brother? who was that the markets went deep in and we did pretty good. i know that espn graded us plus. deshawn jackson kind of guy i think it would have been complete. look, it was an exciting draft. we know it. we talked about it. >> are you long or short johnny football? >> i'm short. yeah, because, i come from the point point of view, russ aell wilsont didn't matter that he wasn't that strong. you can't get by in the nfl with these little guys. it is difficult for them to stay healthy this season. >> where else are we? >> what did you decide on beats? >> so far so good that they didn't do it. you want to do har min. you get much more. i of ten times feel that apple, they watch our shows. >> i tweeted out something, my kids sat down on a bench waiting for the train to go into the ranger's game. apple with beats and the guy sitting next to them a guy with beats. >> you don't want to buy a company that doesn't give you the car. >> do you hate the rangers? >> i like the rangers. look, i'm a flyer's fan. but i also like the nets. >> i like them too. i i'm nervous though. thank you. we'll see you in a couple of minutes. >> jennifer aniston. coming up. we are excited about that. it gets cool. >> are you excited? >> the morning show. coming up. the fizz behind the duo others have gone flat. this carbonated soft drink keeps on going. sara tells us why next. it's all about how fast does it run. i often sit with enterprises who ask me about how mission critical and how's the performance of the cloud. and i tell them, if you can maker gamers happy, you can make anybody happy. you've heard the doom and gloom with car bownated soft drinks. mo mountain dew, back in the 90s helping create new flavors and colors for new products. the demographics of the dew drinks around the world is loyal. take a look at cola. it is the number one most sold beverage at convenience and gas stores. diet and mountain dew fans drink it and it has out performed any other category. can pepsi leverage it's stand out brand any better? global. pakistan is the fastest growing market. p pepsi, the bottom line is with the snack business frito lay. they are less than half for the company. we have seen volumes still falling a consistent bright spot. guys, did you know, that behind coke, diet coke and pepsi. mountain dew is the 4th popular soda in the united states? >> wow. it ruins your teeth? >> i think there is high evlevels of caffeine in it. >> do you know about mountain dew mouth. >> there is almost 300 calories in it. can you tell us about jennifer aniston now? >> coming up in the 10:00 hour. she is an investor and co-owner in a hair care product which is seeing strong sales. she talked about that and also about the friends finale. she told me about who she adm e admires first. the company and the person. >> wow. >> give us a hint. >> it is someone sort of on the west coast. a thought leader. >> yes. is it apple? >> it is not apple. >> no more, you have to watch and see her new hair style. 10:30. thank you. >> we'll see you at 10:00. >> that does it for us today. make sure you join us tomorrow. right now it is time for "squawk on the street". ♪ >> good monday morning and welcome to "squawk on the street". starting a new week with futures in the green after that record close for the dow on friday. plenty to chew on today. $6 billion deal and ten year yields around 264. a lot of fed speak this week including yell lyn

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