♪ good morning. welcome to "worldwide exchange." i'm sara eisen. >> i'm wilfred frost. good morning to you from me. it's throwback thursday. we're throwing it back with a super bowl theme between some of the best half time show performances in history. >> have you ever seen a half time show? >> i have. >> on tv. >> do you watch the super bowl in the uk? >> people do but you have to stay up late to watch it. >> it's the highlighted of the game for non-football fans. first the half time show, then the ads. >> which also trend widely. >> i have seen some of them, but not all of them. >> you will tell me which ones? >> coming up. i don't remember a lot of them. beyonce was a highlighted. gaga this year. >> congratulations to beyonce. >> yes. >> pregnant with twins. >> we'll lead with that instead of the markets. >> nice to mention it. we will move on to the markets because i don't have much else to say other than warm congratulations. let's check in on the markets. they are lower. 72 points on the dow. the s&p down by 8 points. nasdaq down by 23 points. we did see fractional gapes for u.s. markets yesterday. very high volume as well, which is no surprise given the amount of information coming out, whether it's politics, company earnings or the fed. and that slight positive tone was flattened by reports by apple. main take away from the fed was that the market expectation of three hikes as opposed to two slipped slightly, but no clear conviction outside of that. ten-year treasury note, didn't move much. that's partly why i say that, nor did the dollar move much. 2.46 at the moment. we've been around that sort of 2.45 to 2.5% level for the last couple of weeks. >> they didn't send strong signals about whether the next hike will come in march. they've just sort of in wait and see mode, which is this fed's default position. jpmorgan said 20th and c street, the most boring address in washington. that's the address of the federal reserve. >> paul donovan writing this type of release is not long enough to answer the questions we got which is so focused on fiscal policy and politics. that's the swing factor for the fed. a simple statement, they dodged the bullet in terms of what they think about politics. it's hard to know. not a groundbreaking change in opinion from investors. >> because they're waiting to see whether there is a real change. this is a market mover. facebook, the company reporting quarterly results that topped estimates. the results were bolstered by a 51% increase in overall revenue. 53% in ad revenue. we'll break down the results with facebook follower in just a moment. the metrics continued to blow away expectations. the key, that revenue growth number high double digits. and monthly average users, 1.86 billion, 17% increase from last year. >> people focus on the numbers, and worth mentioning that the share price jumped significantly when they came out is now slightly negative ahead of the open. we'll dive down into the explanations of why investors have changed their tune over the last 12 hours. breaking economic data, eurozone ppi rising 0.7% on the month, 1.6% on the year. both numbers hotter than forecast. uk construction pmi dropped sharply in january. mark carney will be a great person to draw all of the late of the uk data together and give his forecast for the year. 7:00 a.m. eastern time is the bank of england decision. the press conference comes later. no expectation for a change or any change in interest rates at the moment. the latest qe package expired yesterday, and not expected to bring on another new one. european markets today, slightly negative. quite a lot to of owni inearnin coming out. lots of banks reporting. some moving sharply the other way. earnings in europe picking up the pace this week, having a diver divergent performance. >> volvo was good yesterday, siemens was good. consumer confidence in japan increasing to a 3 1/2 year high. the nikkei down 1.2% following in the footsteps there of the dollar/yen. hong kong closing lower a half percent. china remains closed for the lunar new year holiday. australia and new zealand down a bit lower. >> australia down a little bit after extraordinary comments from malcolm turnbull and president trump. as for the broader markets, oil prices, let's look at that this morning, jumping a half percent. 54.2. moving on to the dollar, which did move a bit yesterday. up around 0.1% following the fed. as i said earlier, not a huge change in sentiment following those minutes. we have had three negative weeks in a row for the dollar and we're lower again this morning. could be set for a fourth negative week in a row for the u.s. dollar. the big mover today is against the yen as sara said. that hurt the nikkei's performance today. the y yesterday's clear vote in parliament that mps are carrying out the will of the people and invoking article 50. that sense of clarity that the government will have a strong negotiating position and not be ham strung by its own mps allowed the pound to rally yesterday adding 0.3% today. gold to round things off, flat yesterday. up about three quarters of a percent today. gained in the last half hour. now up 1.3%. 1.244. the white house putting iran on notice an apparent threat in retaliation for ballistic missile tests. the launch went against u.s. security council resolutions. flynn pointed to president trump's disapproval of the obama administration's agreements with iran calling them weak and ineffective. president obama inked a deal with iran to lighten sanctions in exchange for not developing weapons. an uncertain outlook between president trump and angela merkel, very different than president obama and merkel. >> that's the big surprising one across europe. it's an odd fight to pick. why are you making a fight with an angela merkel. there's the nato issue, but that can be solved easily. given the warmth he has shown to theresa may, why is he favors them with brexit out there. it's causing a lot of consternation across europe. the other one, australia. saying it's a dumb deal that obama made taking refugees from mideastern countries that made their way to australia and suggest suggesting that would be torn up. >> another key ally. >> these are not the countries he need to negotiate with. people fear is this really his point of view. it's not like with china and mexico, where a deal may need to be struck. >> the hardest part for all of this is what investors do with this. clearly it's a big change. we're not used to this kind of leaking of information and contentious relationships with key allies. the currency markets have been the forefront of where the geopolitical tensions have paid out. harder to gauge the impact on the stock market, especially in the middle of earnings. >> absolutely. the interesting one is the navarro comment did lead to a surge in the euro. that is something we have to take note of. if you're moving fx markets -- >> all of these factors get mixed in, and they're moving, and they have an economic impact and they're being used as political weapons already from this administration and from other countries. >> one man that might pick up the slack of some of these international negotiations can rex tillerson. he was sworn in as trump's secretary of state last night. it follows the closest confirmation vote in a half century. speaking at the swearing n the president said it is time to bring a clear focus to foreign affairs. he also addressed the middle east. >> though you inherit enormous challenges in the middle east and around the world, i do believe we can achieve peace and stability in these very, very troubled times. >> wilfred just eluded to this, but let's tell you what happened. we're learning more about that contentious call between president trump and the prime minister of australia. the conversation happened last weekend. reports say trump told his australian counter part their conversation was the worst call of his talks with foreign leaders by far, before abruptly ending it. trump blasted the australian prime minister over an agreement he made with the obama administration to allow about 1200 refugees into the u.s. saying i don't want these people. he tweeted last night, do you believe it, the obama administration agreed to take in thousands of illegal immigrants from australia. why? i will study this dumb deal. >> the starting point of this deal, australia had huge immigration issues itself. seen as coming from a lot of middle east issues they didn't create. that's why this deal was struck. it's a small number relative to how many australia has already taken in. a president strikes a deal with a country, that's meant to stand. the speed with which he apparently is willing to unwind it, as we said earlier, a key ally. that's what i think is worrying people around the world. >> i would point out on the economic front and the trade relationship, usaustralia not o of our major trading partners, but the u.s. is a big trading partner for australia, a bigger one is china. anything that moves some of these countries closer to china, the u.s. stepping out of tpp, leaving some say china to have more of a super regional trade deal. australia moving closer to china. we have to watch these things. trade deals and politics have geopolitical complications and vice versa. it may be harder for australia to move closer to china than the philippines or other countries. >> reports surfacing about the president's phone conversation with his mexican counterpart. trump said he was ready to send u.s. troops to mexico to stop bad hombres down there. mexico is denying that president trump made that threat. >> to some corporate implications of the trump administration's policies. politico reporting that the iraqi government is warning a pair of pending deals with general electric could be at risk from president trump's new travel ban. ge already has significant interest in iraq and hundreds of employees in that government and the baghdad government was preparing to sign two more deals with the conglomerate. but the travel ban calls into question whether g ese and the . could be reliable partners saying cooperation could be hurt by this new visa policy. learning more about the corporate implications of some of these policies. back to the top corporate story, that would be facebook fourth quarter earnings beating forecasts, revenue rising 51%. mobile accounts for 84% of facebook's total ad revenue. that was 80% a year ago. 1.86 billion average users, up 17% from a year ago. on the call, mark zuckerberg said he expects to ramp up hiring and spending this year as facebook invests in more video. >> we're looking for ways to grow the ecosystem of video content on facebook. we want people to think of face book as a place for interesting and relevant video content from professional creators as well as their friends. we're planning to do more in 2017. >> yesterday we found out that a jury ordered facebook's virtual reality unit oculus and other defends to pay half a billion dollars to a video game publisher over allegations that facebook stole its technology. it is said that the company is considering options for an appeal, but the suit is not material to financials. richard kramer joins us. what did you learn from the call? all the analysts were asking about metrics, how to measure where facebook wants to move the ball to video. anything new out of that beyond those core numbers, which surprised and impressed to the upside again? >> thank you very much for having me. i think the call was an endless series of repeated questions about video, which is still a very early phase for facebook. as wall street tends to move on to the next thing, somewhat ignored the fact that facebook grabbed $10 billion of incremental digital ad spend this year and had an unprecedented 52% margin. i think the question now is with $30 billion of cash, in which directions do they move? i think video is one part of what they're doing. the $7 billion they'll spend in c capex for data centers is the first step on the road to building the video business that everyone is obsessing with. >> sticking with the video point, making progress there. 10 billion of ad revenue, but some suggest this is at the moment the kind of low hanging fruit in that space. to take this meaningfully further over the next five years, they need to boost the quality of their content. what's your view on that and how expensive that might become for facebook? >> it is a good question, though to say that a business doing 27 billion or $28 billion of sales is plucked, low hanging fruit is absurd. i would say there are a number of areas where they can grab further time spent by consumers in which to show them advertising. our view is that they should look to make acquisitions, for example, spotify i think would be a great fit. activision might be another one, because gaming and music along with video are the big buckets of time spent. the problem with video is you're competing not just with all the traditional studios and networks, but also with netflix, amazon and apple, all of whom stated the same aspiration to go and find the highest quality professional video content, and to capture that all important detention paid to video. >> the best news for facebook, yes, they had good earnings, might have been this. the cover of the "new york post," the beyonce instagram post that she has twins. 7.5 million likes. the update on monetization of instagram especially as we look ahead near-term to the snapchat ipo and what instagram has been doing to compete on stories. >> that's been a very interesting sort of response to snapchat by facebook, instagram stories now has 150 million users. they have gone 400 million daily active users on instagram. clearly it provides a richer content platform for brands and celebrities than certainly the long-forgotten notion that these celebrities would be tweeting all the time on twitter. it is a big challenge to snapchat and the proposed ipo. it's interesting when you think of a potential acquisition of something like spotify, when you look at a taylor swift who has 100 million instagram followers, beyonce. this is the only place they can go to aggregate, and if you look at an adele video with 1.5 billion views, that's the target for facebook to take on that youtube video usage inside instagram. >> richard, great stuff. richard kramer joining us there. the stock up 0.8% in the premarket. >> emaculate conception. >> i posted a selfie last weekend, it got over 200 likes. >> is that a record? >> i think it might be. moving forward. another earnings story. deutsche bank falling in european trading this morning as the company posted a bigger than expected fourth quarter loss. germany's biggest lender was hurt by costs for legal fines, and losses from the sale of it's abby life business. deutsche bank agreed to pay more than $7 billion over the sale of mor mortgage securityies, down 5%. three quick takeaways. another loss for the quarter. another loss for the year. that just rehighlights the profitability crisis they face. added to that, this comes in a quarter where their fellow u.s. global investment banks killed it. they did see some gains in trading, but meager compared to the u.s. it does suggested they're losing market share and makes it harder to boost that profitability when they get through this. the silver lining, the capital position is the best in three years. one analyst saying he felt they prioritized capital as opposed to profitability this quarter. small silver lining in what is a bad quarter. disappointing numbers for them. uk consumer giant reckitt benckiser is confirming that it is in advanced talks to buy baby food maker mead johnson nutrition for $16.7 billion. the stock clearly is surging on that news. big play on the chinese baby market in terms of baby food. when we come back, a slew of earnings out late yesterday. we'll round up the big movers, not just facebook. you're watching "worldwide exchange." this is where i trade andrs. manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you. welcome back. corvo taking a hit after weak guidance for the current quarter. smartphone delays are expected to hurt over the course of the quarter's earnings. shares of cirrus logic getting punished. the company beating the street, but guidance disappointing. all state posting mixed results for the quarter. profit rising 29% following a drop off in catastrophe losses. up 2.6%. when we come back, we'll reveal who is making a comeback and flipping the coin at the super bowl. we'll be right back. at bp, we empower anyone to stop a job if something doesn't seem right, so everyone comes home safely. because safety is never being satisfied. and always working to be better. good morning. coming up on the show, the top stories, and a round up of global markets under pressure today. >> and our top trending stories. we'll tell you about the co who lost a bet and ended up with a tattoo on the back of it. you're watching "worldwide exchange." what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley good morning. earnings alert. facebook beats the street. washington watch. president trump reportedly berates the australian prime minister and then hangs up on him. that story coming up. and markets now, futures pointing to a lower opening on wall street. you're watching "worldwide exchange" on cnbc. ♪ good morning. welcome back to "worldwide exchange" on cnbc. i'm sara eisen. >> i'm wilfred frost. it's throwback thursday, throwing it back with super bowl themes to the best half time shows in history. >> this is a good one. >> the boss. >> a look at global markets this morning. u.s. equity futures under selling pressure following in the footsteps of europe and asia. dow futures down 71 points. picking up some steam here. s&p down 8.5. nasdaq down 22. what we saw yesterday, s&p closed just barely positive. that was enough to break a four-day losing streak on the s&p 500. the dow and the nasdaq outperformed thanks to apple, which rose 7%. that was good for almost 50 points on the dow. as for the early action in europe, it's red. we saw a 1% move higher on stocks amid better earnings. today european stocks giving some of it back. france flat. the ftse 100 is in positive territory. italy is up a percent. the big announcements over the next few hours will come out of the uk where we will get an interest rate decision on the boe. no change expected. news conference a half hour later, 7:30 a.m. eastern. quarterly inflation report. it is all padded by what has been some pretty decent data out of the uk. >> apart from construction data, but you're right, the summary of the last couple of months has been encouraging, albeit with inflation picking up. inflation forecasts for the year ahead, and what that means for interest rates. >> big decline in japanese stocks following a stronger japanese yen. the exporters not a fan of seeing that. the nikkei closing lower by 1.2%. hong kong lower by a half percent. the chinese stock market is still closed this week for the lunar new year holiday. australia and new zealand closing in the red. australia had some good trade data. that's boosting the aussie dollar despite new tensions between the u.s. and australia. oil prices up today by about half a percent now. 0.7%. 54.3 for oil. the ten-year treasury note, didn't really move too much following the fed. nor did the dollar. it's in and around that same level. it's been -- it was higher yesterday. around 2.48. 2.46 now, not a marked change in sentiment. the dollar didn't move much yesterday. up about 0.1%. we have had three negative weeks in a row for the dollar. that is set to continue if these moves hold. we have the yen higher by 0.8%. the euro and the pound both higher as well. all eyes on the pound dollar cross as we approach that boe decision. gold, which was flat yesterday, up a percent today. the takeaway from the fed, as far as fed meetings go, this was a snoozer. that's probably exactly what janet yellen and team wanted. they didn't have their news conference. they upgraded their assessment about the economy, citing con if confidence boost in surveys, but did not give a hint on rate hikes. >> trying to get away from the politics, the question is how long can they do that another busy day for earnings reports. before the open numbers from n conoco phillips, america,estity lauder and after the close, the big one is amazon and chipotle. weekly jobless claims and the first report on fourth quarter productivity and labor costs, both due out at 8:30. the interest rate decision from the bank of england at 7:00. and tomorrow is the jobs report. going back to the top corporate stories. facebook's fourth quarter earnings beating forecasts as revenue rose better than expected 51%. mobile accounts for 84% of facebook's total ad revenue versus 80% a year ago. 1.86 billion average users, up 17% from a year ago. on the call, mark zuckerberg said he expects to ramp up hiring and spending this year as facebook invests in more video. >> we're looking for ways to grow the ecosystem of video content on facebook. we want people to think of facebook as a place for interesting and relevant video content from professional creators as well as their friends. last year we started to invest in more original video content to help feed the ecosystem, and we're plan doing more in 2017. >> yesterday we found out that a jury ordered facebook's virtual reality unit oculus and other defendants to pay a combined half billion dollars to a video game publisher over allegations that facebook stole its technology. it is said that the company is considering options for an appeal, but the suit is not material to financials. >> looking at some of the analyst notes coming out on facebook this morning after pivotal research actually downgraded facebook. good results, they say, but an increase in spending is what they're worried about. that's the expense growth that they provided for 2017 from 2016 levels. it will be a problem for profitability. not worried about the slowdown in revenue growth. it's the expense growth. >> it's that grasp that lots of these companies are doing for more content, so they can drive the ad revenue. that's an area where people are worried about. >> that was the majority of the questions, if you're moving to a video company, how do we measure that, it was all metrics. not much on the trump administration. got more of that on the apple call the night before. >> share prices down briefly this morning, now higher again. >> they have been strong this year. up 13% after underperforming since the election. abacrombie & fitch naming its merchandising head as the new ceo. fran horowitz was promoted to the job replacing michael jeffries who stepped down in 2014. edward life sciences posting a 14% rise in sales for the final quarter of the year. the bump in sales with a strong adoption of the medical devicemaker's nonsurgical heart valve. these devices seeing a 20% rise in q4 sales. tractor supply's revenue for the quarter jumped 16.4% on a year over year basis. and the stock is getting a nice little 3.6% pop off of that. more stocks to watch. shutterfly's fourth quarter profit fell after it posted the slowest revenue grow since going public in 2006. they will shut offices in new york and santa clara, california. shares down 18%. metlife posting a fourth quarter loss by its hedging program. excluding those losses from derivatives, the insurer's results still missed forecasts on weakness in the u.s. and latin america. down 1%. royal ditutch shell's full-year production rising by nearly a quarter, reflecting the integration of bg group, which it acquired last february. shares up 1.5%. amazon plans to have more than 200 daily flights from the new $1.5 billion air cargo hub it is building near cincinnati. the airport's chief tells reuters that amazon will be a full-fledged competitor to u.p.s. making a long-term move aimed at lowering shipping costs. amazon has given few details. as a cincinnatian, the airport is in northern kentucky, and everybody in cincinnati talks about how the airport has become a ghost town since delta and northwest merged. everything moved to detroit. this is a huge boost economically. it's a boost for jobs and for an airport. you mentioned yesterday big cincinnati news, i thought it would be about that ice cream company you always talk about. >> no this is about the airport. >> there we go. moving on, political news, learning more about a contentious phone call between president trump and the prime minister of australia. the conversation happened last weekend, reports say trump told his australian counterpart their conversation was the worst call by far before ending it. he blasted the australian prime minister over an agreement he made with the obama administration allowing 1200 refugees into the united states. he said i don't want these people. creating reaction in australia for sure and some other key allies reacting to this. >> we'll see how these things go relationships with allies. uncomfortable is the state right now. hard for investors to figure out what that will mean ultimately. gold is up 1.4% now. when you think geopolitical risks. >> it's not moving the market in australia. the aussie dollar is up today. a bit of a decline in the aussie index. re/code recording that alphabet, apple, facebook and uber are working on a letter opposing trump's travel ban. in the draft, the company's write directly to president trump as you contemplate changes to the nation's complex and interconnected immigration policies we hope you will use us as a resource to achieve immigration policies that supported work of american business and reflect american values. nearly 1,000 twitter employees made a donation of over $1.5 million to the american civil liberties union. more action, not just words from the tech ceos and community. you know where we had to start with top tenni intrending, beyonce's preginancy announcement. she took to twitter yesterday to announce she and her husband are having twins. it is the most liked post on instagram with 7.5 million likes. >> it's a very curated photo. >> curated, yes. you never curate your instagram posts. >> no, never. >> this is only something beyonce could do. >> next trending story, red robin's ceo just got a new tattoo. she challenged her mid level managers to improve a key quality metric by the end of 20 2016, if they did, she would get a red robin hamburger tattooed on her arm. they did it almost a year early. >> i interviewed her a few weeks ago. she was very excited and nervous. i love this. >> credit to her for following that bargain. >> way to rally your employees. it's got to be good for corporate culture. >> we should challenge our ceo based on ratings. a big "worldwide exchange" logo across his chest. >> the coin toss at super bowl will have a very presidential feel this sunday. did you hear this? former president george h.w. bush will be doing the honors along with his wife barbara bush. on his twitter page he says he is fired up. the news comes days after president bush was released from the hospital after fighting pneumonia. they're fighters, they're resilient. it's a perfect way to come out. >> everyone pleased to hear he's getting better and out of hospital. no better way to celebrate it. still to come, the must-reads. first, as we head to break, check out european markets now. they have recovered a bit in the last hour or so. je germany still weighed down by deutsche bank after a disappointing quarter. we're back in a couple minutes. welcome back to "worldwide exchange." to our must-read stories. my pick is in the "usa today" by the editorial board. hypocrisy on the executive orders. everyone's head is spinning on how many orders are getting done by president trump. the "usa today" coming out saying president obama for his part issued 18 president actions or executive orders, memoranda, national security directives and proclamations during his first ten days in office. they included measurements on government ethics, waterboarding and closing guantanamo bay, cuba, something he never got done while in office. it is not as critical as it sounded in that, but it means get used to this. >> it's critical of republicans for being critical of obama, and now not criticizing trump. i think there's lots of people making their points of view clear. yeah, 18 versus 20 in the first ten days. that's fairly clear. if the republicans were criticizing obama for doing too many -- >> the question is not the executive orders, will we get congress to actually produce some legislation. didn't see a lot of that during the obama years. will we see that now that the republicans are in control? they're not moving as fast as president trump. we are approaching the top of the hour. the team is getting ready for "squawk box" in new york. joe kernen is there with a look at what's coming up. >> we have bill miller for two hours. that's always good. i think in the last five years, his fund has once again outperformed just about anyone. he's got sort of calming, sanguined view on things. never get too excited one way or the other. looking at some of his notes, some surprising things that he says. we'll find out as much as we can from him. two hours is a good amount of time to spend with bill miller. i wanted to talk to you, wilfred, about -- i'm not sure. i don't understand. i was watching theresa may yesterday, back in the uk. and whenever i see anyone talk -- is that parliament or something? >> that is parliament, exactly. the french word for talking. >> the grumblings, everything comment she makes. everybody is yelling, agreeing, disagreeing. they're so rude. is that -- you probably don't know much -- is this the house of commons? you probably have no idea what goes on, since you're like a lord. you're house of lords, are both houses there -- >> the house of commons really is all that matters. that's where the power is. >> why is they so rude? does the queen ever watch and think here we are, we try to pretend we're high brow, sophisticated types, and they're constantly interrupting and yelling. and -- >> they are. clearly the erupting is very dependent on which side the eruption comes from. in support or not. it's good, open dialogue, joe. >> then the -- >> democracy. the queen, i think, watches, but she visits twice. >> she should be going like this. >> then everyone is respectful. no one -- >> they might be nice to her. and then the only person over there that is making any sense right now is nigel farage. >> he's not even in parliament. >> i know. but i saw him speaking yesterday. it's like people like tony blair, others, they think, you know what? i know i'm in the minority, because i didn't want to leave, but i'm sticking with that. i'm thinking that's -- >> theresa may was pretty strong, germany criticized her for inviting president trump. she hit back and she won her vote clearly to get article 50 invoked. of all the days for you to give nigel farage a grandstand, i'm surprised it was yesterday. theresa may -- >> i see a lot of similarities between the denial over there that nigel farage is looking around, didn't you see what happened? and over here. >> joe, i would agree with that point if it was three months ago, but yesterday mps overwh m overwhelmingly did vote to carry out the will of the people. >> i'm saying finally, finally -- you know, what is -- but over there, now they're okay with brexit, but not okay with trump, it seems like. >> but the prime minister is. she was defending. corbin versus may yesterday in terms of trump. we have to leave it there. "squawk box" coming up in nine minutes time. coming up here, alan ruskin will talk the bank of england decision, the jobs report and more. welcome back to "worldwide exchange." the dollar is weaker this morning particularly against the euro at 1.08 and against the japanese yen. joining us is alan ruskin from deutsche bank. we'll talk about how currencies impact the broader markets and the politics. such a sharp rally aftd election for the dollar. why have we reversed course? >> i think the trump rally in all the asset markets was a story about fiscal stimulus, the promise of fiscal stimulus. and there still is that promise. you know, let's see when that comes through. the deal making and the legislative piece will come through with quite a lag. you have social policy, foreign policy, those things are not helpful and international markets where european bond yields are backing up. that's part of the euro/dollar story. >> so it's not a belief that people are now changing their opinion as to whether donald trump can deliver, it's just that he will deliver later, and that these things take time. >> yeah. it was maybe a bit of overo overoptimism in terms of the timetable, particularly when you introduce things like the board adjusted tax. there's a huge amount of complexity and the timetable will be far out into the future. it's a long way if you're a dollar bull. >> what does that do to the dollar? if that gets part of the tax reform plan. >> oh. i think it's a huge story. you know, really got -- i don't know if it's icing on the cake or the cake itself. it's a story where the trade balance improves dramatically, inflation picks up, which drives the fed and pulls the fed into play. the perfect storm as far as the dollar is concerned. that could do 5% to 10% easily. does that differentiation seen against different currencies? january has been different from the first couple of months after the election. there's been more differentiation depending on the currency pay. >> in this instance, if the u.s. comes into play, there's huge divergence, it becomes a strong dollar story. otherwise we revert back to which currency has its own positives. >> we have these trade tensions emerging. prime minister abe will be visiting washington and president trump next week. the yen has been strengthening in the past few days. how does that factor in? especially if japan makes moves to cut the trade deficit. what does it mean? >> politics has been interesting in that regard. the trump administration tends to single out countries, so the chin chinas, japans, mexico mexicos. if you prod on japan, you get a stronger yen. >> alan ruskin, thank you for joining us. >> what are you watching? amazon earnings. >> amazon a big one, bank of england at 7:00 a.m. eastern. press conference at 7:30. that's it for "worldwide exchange." "squawk box" is coming up next.t , and make sure everything's clear. yeah, that would be great. being proactive... it's how edward jones makes sense of investing. good morning. a developing story. the trump administration warns iran its on notice for the latest missile test. and election bump for facebook. the company posting a beat on the top and bottom line. and $17 billion deal talk for a baby foodmaker. andrew and becky are paying attention to this. and it's groundhog day, february 2, 2017. i got you, baby. "squawk box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box." good morning. welcome to "squawk box" on cnbc. we're live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. today is groundhog day. >> this is our first groundhog day in this studio. doesn't really feel fresh. >> it's new for us. >> it is. was there any doubt we would play this song? how iconic is that movie? hundreds of years from now, it will be like hamlet

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