Transcripts For CNBC Squawk Box 20150508

Tornadoes and flash flooding. Before that lets take a look at the market. The u. S. Equity futures shaping up to a positive day with the bulls if they stay for the early trends. S p fauutures up by 3. 5 and nasdaq up by 14. Lets tell you the big stories were watching this morning. The april employment report due at 8 30 eastern time. Forecasters say the economy added 228,000 jobs last month. The Unemployment Rate is seen declining to 5. 4 to a near 7 year low but of course there are lots of varying views on what this could all mean including some much higher estimates and also much much lower estimates. Also Billionaire Oil man boone boonepickens say oil will hit 75 by end of year. He notes Oil Inventories peaked. And the New York Times reporting that Taxi Service Uber submitted a 3 millioned by for nokias map business. Its a competitor to google maps. Theyre teaming up on an offer for that service as well. Google bought waves too. Ways still has its own app. They have their own app. The current uber system relies on the google map. So if google were to ever somehow pull it these are sort of the issues. You dont want to be reliant on one mapping service. Apple has its own mapping service. Started out of the gate not so great. But i ended up in weird places. Like a bridge out or a road that a road that didnt connect that was supposed to connect. There was a guy following gps in northwest indiana about a month agatha drove off an unfinished bridge that had been unfinished for ten years. You should use the mapping but pay attention. Watch the road probably is a good idea. Yeah. Google takes into account all the different changing traffic and it just seems better. Google is better because it integrates ways. I use google more in the winter. I dont know why. I was doing that thing where you flip the arrow. Where ever you are in google you put in your destination and it assumes where you are and it takes you in and gives you three different and i know how to go back and forth. Now that you know all of that about me. I use google for city driving and on the highways i tend to use ways a little more. I never volunteered any information. Youre on your own. Only when im a passenger. What about cops. Nobody likes a rat. Nobody likes you know you will say theres a cop there and the poor cop is like really hidden. I think the cops are now using ways too. Theyre like youre the guy that just ratted me out. Its cool when it says theres a pothole coming up. Thats where our world is now. Thats neat. It is. Stocks to watch this morning, syngenta is rejecting a takeover offer. This is an Agro Chemicals firm. It doesnt take into account Regulatory Risk for the offer. Monster beverage taking a hit. Shares of sprouts, Farmers Market also getting hit hard. The organic food retailer with weaker than expected earnings and sales and offering some disappointing full year guidance. Other stocks on our radar this morning, cbs results topping wall streets estimates. An increase in subscription fee revenue offset a decline in content licensing and distribution sales. Ceo moonves will be on squawk on the street this morning. Also Nuance Communications beating the street. The company also increasing its stock buy back plan and warning that its Current Quarter revenue will fall short. Theyre blaming weak pc sales and a stronger dollar. Lets get a check on the markets again this morning. Futures are looking better. This comes after a day of gains for the major averages. The dow brought back about 82 points. The s p yesterday was up by about 8 points and nasdaq up by 26 points. If you take a look at the early trading this morning in europe youll see at least in this hour the major averages there in the green. The ftse is up by 1. 7 after that surprise massive win for the conservative party in the u. K. Well talk more about that in just a little bit. In asia overnight, youll see that yeah things ended higher there as well. The nikkei was up by close to. 5 . And the shanghai composite was up by 2. 25 . Oil prices this was an interesting story yesterday. The crude oil sector was down across the board. It was the only sector lower for stocks and that came as crude oil dropped by 3. 3 . That was the worst day in a month after hitting its highs the day before. This morning prices up slightly. Above 59. 59. 03. Check out the ten year because the yield versus been on a tear. Yesterday was the first time in nine days that we had seen a down day for treasury yields. At this point you look and youll see theyre still sitting well above 2 . 2. 195 . The dollar this morning, the dollar index coming off a multiweak low yesterday. The dollar is up against the euro and yen. Euro at 11238 and yen at 11937 and gold prices 1,185. 80 an ounce. British i Election Results showing that Prime Ministers David Camerons conservatives ready to return to power. Wilfred frost joins us now with more from london. Good morning. Andrew good morning to you. Yes, a resounding victory for Prime Minister David Cameron and his conservative party relative to expectations. Just 14 or 15 hours ago before we started getting any of the results people were expecting a Hung Parliament with labour and the conservative party to get around 280 seats each. Well short of a majority which is 326. Yet we have conservative with 321 seats. Its likely theyll get the overall majority. The big stories on the political front here are the snp. The Scottish National party surge. They have over 50 seats which is an astonishing result for them. Although that had been priced into expectations. The surprise coming in england with labor and the liberal democrats doing much much worse than expected. The leerdaders expected to have to resign. This has been taken well by the markets. Sterile chg had been as lowhigh as 151 this week. It crossed the 7,000 market. Financials and utilities have done particularly well because those were sectors that the labor party may well have hit. Its important just to state overall the reason why the market has rallied is not just because the conservatives have won rather than labor but because we have gotten a clear result at all. We were expecting coalition discussions for days or weeks. But David Cameron expected to secure an overall majority in the next hour or so and markets taking that well. Thank you very much. Well be talking more about that later this morning here as well. In the meantime though the markets here in the United States anxiously awaiting the aprils jobs report. Were more than two hours from getting this market moving number. Joining us is jerry webman. Michael is a Senior Vice President of investments at ubs. Welcome to both of you. Jerry, what do you expect from the jobs number because guesses are all over the map this time. Guesses are guesses but i think getting to this 225, maybe 250 range it seems right maybe on the low end of that. You know the Labour Market has been weak. Its weird. Were not firing people. Really low numbers on new unemployment claims but reluctance to hire too. So i think were kind of in this kind of nobody knows where to go. Earnings arent okay. Revenues arent great. People arent spending. So well cut a few more paychecks. Thats the critical thing. Well get another, you call it 225,000 new paychecks for the last month and thats supportive but its not great momentum. What if we get a number like we got last month. Something that surprises to the down side. I think that is i dont think bad news is going to be good news in this instance. I think theres a lot of worry about the momentum of the u. S. Economy coming out of this First Quarter. Wed like to see that things picked up a little bit in april so i think the market would take that as sy significant disappointment. Well watch a lot of what happens to the revisions of the march numbers. One of the things i always think and i always tell people when we get an outlier number you can put your odds on getting a revision. If it doesnt and we get a weak number this time we have to be concerned about how much growth momentum there is in the u. S. Economy. This number is important for today and an important indicator of where this economy is headed. How much do you think the market is going to be waiting on this number . A lot. Its the most important jobs number of the year because youre catching market where is theres been significant damage to fixed income and theres been an increase in Inflation Expectations and not in growth expectations. So if you have a number thats real low, youre going to have a concern that theres weakness in the economy and youll not have seen growth in the economy. So when you look at Corporate Bond levels. You look at 30 year treasury levels, ten year treasury levels theyre all in tenuous positions currently. So you could use a weaker number to try to bolster those numbers but if you get it too weak youll have concerns that the economy is slowing and Inflation Expectations are rising. Is there a number thats perfect for the market or is the market going to be concern first degree this number is hot or cold . It may be that goldilocks is a pretty picky pickle this time around. I know its not just the jobs number. Youre watching oil prices currency and what Central Banks are doing. Theyve been the big movers. Theres Higher Expectations across the board. Higher energy prices. A little bit of a come back there but youre seeing the material sector on the stocks. On the stock side looking stronger. So youre seeing reflections of that. I would say that stocks have had a Pretty Healthy pull back response to a pretty Unhealthy Development on the fixed income side. Fixed income prices looking weaker. Looking more tenuous and if you see higher Corporate Bond rates for example, you may see a rush of mna activity on the stock side because folks may be saying, you know what everyone in the pool we have a short time line before rates go higher to pull these deals off. Yesterday the ten year, were you watch . I caught the end. Got to like 230 for awhile and the german bund got up to like 75 in the chart. From almost 0. From 0 to 75. Which 75 basis points sounds like nothing until you realize how quickly. Yeah and we talked about it. If something moves from 6 to 675, people are on the wrong side of that trade. It doesnt matter whether its low. Its the velocity of which way its going. But it all happened with the backdrop of weak Economic Growth here. Suddenly rates spiked after we had all of these weak numbers. We made the point that its because europe is improving. We have the benefit of Europe Holding us down when we thought we were growing faster. Now its the reverse situation. Rates are going up because of them and we suck all of a sudden. Is that an overstatement. Its an overstatement. But thats maybe why this number today is so important. But we didnt know how good we had it. Oil was at 40. Now oil is at 70 or whatever. 0. 2 gdp. And the market was able to go up on all the good stuff. What did you take with Janet Yellens comments. You got a dress rehearsal on this yesterday. Its just looking at the irony of us not being able to make an advance in 2015 when everything was great. If we get a great jobs number today does that negate that . If its a good number youre worried about inflation. If its a bad number the rates are still going up because of europe. People look at this average earnings number which tells you something but the employment cost index we saw last week thats really important to focus on because it holds the mix of jobs steady. What it told us is people are actually getting paid for more the same jobs. The average Hourly Earnings it gets influenced by the mix of the jobs were adding or not adding. So it tells us were paying people for more the same jobs so theres a little bit of the pressure were looking for. Theres a fear that theyve created this instability. So we tell them that. Thats what irritates me. Is the fed orchestrated a rise in asset values to try to get them going for the economy. Looks like these are kind of valuations are high. We did it so the 04, 06 was to make up for 94. Now they want to make up for it. We have a guest coming on later that said this. I forget who it is. Because this is largely a supply situation that we could see inflation that creeps in before we know it. Yeah i think that is beginning to start and its not clear whether the fed is going to be in the audience or on the stage. You are seeing rates move higher without the fed making a move yet and even expectations on the fed making a move on the curve are not reflecting stuff until september or later. That could be the case. I think that thats true and it means we better generate growth or markets are going to have a tightening experience without a growth experience and youll get more volatility. Your house is burning. We have to point that out there right now. Looks like that is actually starting to consume your house. They orchestrate the overvaluation. But thats their job. Their job wasnt to inflate assets. It was to try to get the Unemployment Rate down. So they say. What was the other tool they have . You say so they say. They didnt say they had another tool. Keeping rates at zero puts more money out there. Theyre hoping that it filters into the overall economy. Has it . This is the 6th year of 2 . Im surprised that you dont believe in trickle down economics. Thats trickle down Monetary Policy. Thats true. Its not trickle down growth. Its trickle down government which is what you love. You have 1 labor force growth. How much growth can you generate in an advanced economy like this. All of a sudden this is good. 2 . I didnt say it was good. I just said lets not point to the fed. Theyre not impressive. People think if the government got out of the way wed be doing 3 or 4 . People think that so britain is almost exactly the same pattern since 2010 in low productivity, low unemployment weak growth. And europe has been slow too. Well were not europe. We used to be exceptional in regard to europe relative to europe because we did things differently. They tried the opposite. Got them the same result. People can say whatever they want. Thats one of the problems and what critics are saying is causing the low growth. You can get a better meal. Now youre not talking about england. Youre talking about france. Coming up when we return fitbit filing to go public. Well have the details next but first heres a look back at this date in history. You can call me shallow. But, i have a wandering eye. I mean, come on. National gives me the control to choose any car in the aisle i want. I could choose you. Or i could choose her if i like her more. And i do. Oh, the silent treatment. Real mature. So you wanna get out of here . Go national. Go like a pro. If you want to succeed in business, mistakes are a luxury you cant afford. Thats why i recommend fast reliable comcast Business Internet. They know what businesses need. And theres a nomistake guarantee. If you dont like it, you have thirty days to call and get your money back. With comcast Business Internet you literally cant mook a mistick. I meant to say that. Switch today and get the no mistake guarantee. Comcast business. Built for business. Change fees in 2014 . Delta. The airline collected more than 875 million from these fees. In much of the nation middle of the nation bracing for more dangerous weather today. Dave malkoff joins us from bridge creek oklahoma where beckdybeck becky lived for awhile. No, broken arrow. Shes lived everywhere. I saw more videos last night of tornadoes tornadoes. Everybody has a way to take videos. But that looks horrible behind you. Yeah, theyve got the Storm Chasers out and they have the ability to send those videos back live. About 40 tornadoes on wednesday. Hand full of injuries. Now the weird thing about that fatality is it happened in an underground shelter. This is one of those sheltders but theres an interesting story about this one. Theres a family of five. Theres three kids and two adults. Mom and dad down here in the shelter. Now not only did they have the tornado pull their house on top of their shelter, the garage door and bricks were on top of here and they were trapped inside but if you look in here what do you see . Theres water down here on the ground. Do you see that . Because water was pouring in. There was a flash flood after the tornado. So theyre trapped in here because of the debris on top of them. They cant get out and theres a metal door and theyre trapped on here because of the water pouring in and debris on top but they also have look at this i almost wonder if thats a design flaw. Theres a latch that latches them inside there. So they had to have a hero neighbor come across and pull everybody out of here. Got the garage door out of here. He pulled it off with his bare hands and took a crow bar and got everyone out of here. But if you look around this neighborhood guys every single house has some sort of damage like this but nobody was killed. Not one person. Zero. Thats a good number to end on. Zero, right you guys. Dave thats a terrifying story. How long were they trapped down there. It was probably a good 15 minutes or so they were in there. Their kids were kind of freaking out because they didnt know what were going to happen. The parents said the main thing they were freaking out about and this is another thing where its good to be 7, right . The main thing they were freaking out about was the loss of their star wars toys. Not the loss of their life potentially. They were upset they were going to lose their star wars toys. But mom and dad were keeping them calm. Did a really great job keeping those kids calm inside there. Thats an amazing story. That latch is crazy. That has to be a design flaw. It was brilliant to make it a sliding one instead of one you lift up because of the debris on top. Why not have the latch on top but it saved their lives. Yeah. Yeah theyre going to think twice about putting the storm shelter under the garage next time. Some people may have those again but for this family just because of that situation they went through, theyre not going to do it again. Theyre going to put in a different kind of storm shelter. Dave thank you. We have so happy to have a story with a wonderful happy ending like that. Thank you very much. Yeah. And as they were pointing out last night a lot of the houses that were destroyed were new because they rebuilt from the last one. Its just weird that theres hotspots. Its tornado alley. I lived in broken arrow and when we lived there we did have tornado sirens. But the tornado sirens would wake you up constantly in the spring. How does the insurance work. That i dont know. I mean im sure that they cost more in tornado alley. They price it properly. We had them in ohio but not quite as much. I went down after one. Its unbelievable. Looks like the entire community is put through a blender. Nothing is bigger than like you see washing machines its very weird and very scary too. Im surprised that there arent. More deaths. Because of the advanced Warning Systems it helps tremendously. Why dont we talk about Corporate News as well. Chicken ands by biscuits restaurant change bojangles pricing its ipo at 19 a share. Fitness tracking device maker fitbit files for ipo. Saying it could raise up to 100 million. Founder group is the largest stakeholder. They now have a huge piece of the market. Im not wearing my jawbone at the moment but fitbit is where is it . You know what the new one not as good as the old one. I was so excited about the new you were excited. You remember how excited i was and it doesnt work as well. You use it to see if youre sleeping right. I do it for the sleep. You dont wear the apple watch. You cant wear the apple watch to sleep because you have to charge it while youre sleeping. Okay. Too much. Too much. Anyway, coming up new research this morning says that 30 of tender users are married. Great. That story next. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Talking about some stories in the papers that have us squawking this morning. The story that has me fascinated is the story about tender. This is the site for singles. You swipe one way or the other way. Online hook up. We think its an online hook up site but aapparently its not for singles. This is the part of the story which is research is showing that 30 of tender users are actually married. Also we should tell you that 12 are actually in a relationship in addition to the 30 that are married. So be ware before you use this app. Beware a little bit. Youre looking for something. Unless youre looking for that. Maybe theyre married and looking for each other. In europe there was a big controversy. They didnt know whether to ban on buses these ads for a service which was designed not for single people but designed for married people. There was one in japan too that was a huge issue because it was only for people who are married and wanting to hook up. Wanting to hook up with other people. We were talking about key parties in the suburbs. Its tender apparently. 62 of the users are men. 38 are women. Its a hook up scene. 30 of the total they say are married. 30 of right. Im married and i have never even tried i dont have the thats good to know. Buttingputting it out there. Do think maybe she is watching. No but im suggesting i was going to explain that you can do it i think within a block or two radius. Its location sensitive. Weve heard barry diller explain it. In new york you can do it within a block because theres all highrises. A billion people in any direction. In the burbs they wouldnt be within a block unless youre really lucky. You saw liar liar. Yeah, years ago. Can you imagine if every time you said something it had to be exactly what you were thinking about someone. No. Wait a second that is kind of you. I really do have if you actually knew what i was thinking sometimes youd know how good my felterilter is. To only screw up a couple of times in 25 years is pretty good. Think if i had 5 billion and didnt give a crap about what i said. And that explains dan. To know him is to love him. Hes a little bit of that. He speaks his mind. Hes out in vegas at the salt thing and he says someone brings up warren buffet and he says i love how he criticizes hedge funds. He had the first hedge fund. I love how he criticizes activists but he was an activist to some extent. He criticizes Financial Service companies and likes to invest in them and my favorite comment, the one i always said he thinks we should all pay more taxes but he spent a life really avoiding paying any taxes. Now wait. But he immediately thought, uhoh, thats a pot shot and took it back but everybody in the audience of a bunch of Hedge Fund Guys were already aplauing and cheering and i guess buffet is criticized hedge funds but also people may be tired of sort of the uncle, you know the way that he has cultivated this when we know that throughout his Business Life he was a very savvy and im sure ruthless business man and now hes sort of well what i will point out with that he did have a partnership that resembled and come in with a 2 and 20 where you make money whether or not you perform for your investors. His own partnership was different than that. If he made at least 6 he made a quarter on top of that. 20 and 20. Its ridiculous. Hes never really been an activist. Hes now doing stuff with 3g which is different. He did start out doing activist investing. That was a real power play and a squeeze but he said on our Program Monday he doesnt like to live that way. He doesnt do it now because its just not fun to be Walking Around in situations like that. With taxes, yes youre right. He said he will take advantage of the tax laws that are there. He advocated that they change them but we all said its patriotism to avoid paying taxes you dont own. The entire construct at berkshire is a great beneficiary. Is a corporate entity of not being able to reallocate the capital without paying taxes. Its a fantastic way to do it. Watch the parts of liar liar. He is walking through the office and each person is walking by and he says you, you. What happened to your hair. The large person walks by and just it is mothers day weekend coming up and we spent time with our friends over at sprout presenting a little bit of research to the chica show. We have very important charts we have brought along. This is what moms are telling us interest gains in sleep. From 2014 to this year 2015 the interest has done nothing but skyrocket. Moms are interested in sleep. Its very important. You guys know about bedtimes. We do too. You love bedtime. Give me a high five. This is the sunny side up show. This is getting to spend a little time with the sprout folks and to say happy mothers day to everybody. Did kyle get to see this . He did. I wasnt going to bring him with me originally but he woke up early and he is a big fan of chica. So he was thrilled he got to meet the real chica. He got a glance back at the puppeteer guy beneath. He said its the real chica but not really. I see her in the back of new York City Taxi cabs. You dont ever use taxi cabs. Sesame street was after my time so i finally got up to speed on that. Yeah. Theres like four letters of generations between me and that. I think i might be a baby boomer. When we come back a billion dollar start up is ready to revolution revolution revolutionize the job search. Well tell you about that when we return. Just because im away from my desk doesnt mean im not working. Comcast business understands that. Their wifi isnt just fast near the router. Its fast in the break room. Fast in the conference room. Fast in toms office. Fast in other toms office. Fast in the foyer [pronounced foyyer] or is it foyer [pronounced foyyay] . Fast in the hallway. I feel like ive been here before. Switch now and get the fastest wifi everywhere. Comcast business. Built for business. Welcome back to squawk box this morning. Were talking about jobs and skills. The skills gap with a billion dollar start up you probably never heard of. The ceo is on this years forbes 30 under 30 list and big time firm is an early investor. They match up Software Engineers with freelance giggs and it also has plans to expand to other areas of the jobs market. Its killing it. It owns this market. Here with us for his first tv interview ever. Have you ever been on tv before . I have never been on tv before. He is the cofounder and ceo of the company. Thank you for coming by. Thank you. Dont be nervous. Hes not. He looks laid back. Its impressive. Tell us what this business is. I tried to explain it in a nutshell but maybe you can give us a better view. So sure so we find the best Software Engineers all over the world regardless of the country and vet them based on english, personality, skill and prescreen them to contract them to companies all over the world. So well create engineering teams as well as contract out individual engineers to companies all over the world. So when people say today that there are not enough engineers in the United States, is that true . Are there not enough talented engineers . Thats absolutely true. We mostly find good talent outside of the United States. And thats mostly because the war for talent so to speak is or the war for talent in San Francisco and new york is so competitive and so fierce that people dont have the recruiting infrastructure in other countries. They dont have the pipelines. They dont have the know how to tap into these networks and get that talent to the right people. So we have built those pipelines. We have built those processes and weve also built a brand in those countries. So in croatia or argentina we have a user base because of the fact that we changed their entire do you have staffs of people in these locations . Are they physically interviewing these people . How does it work . So we have a team that interviewing them via skype with algorithm tests. Semiautomated interview processes but the things that differentiates us is were actually taking the time to look at each individual on a more rigorous basis where as you have other job platforms that are having automated tests that arent as thorough and rigorous were vetting them on a more fundamental level. Once you find these engineers on other countries do you contract them out to those tries to do work in those countries or do you try to get visas and bring them to the United States or somewhere else. 95 is done remotely and since its software and digital theyre able to work on the internet. When i asked you whether you said most of these engineers come from outside of the country. Is that because u. S. Companies are trying to play a price differ differtials. Thats a smaller component of it. The main component is usually the quality. My question is do we because we have such a large market for these guys and were a big country so we need a lot of them per capita are we educating as many engineers as the other places or the perception i have is i dont want to take engineering classes in college and were fat and lazy and the other countries are ready to work to get to a certain point. Are there more per capita coming out of other countries. Im not sure of the per capita, but theres surprising areas where theres a surplus of engineering talent and theres not a demand for it as there is in the United States. We dont know if theres a greater supply there than here. Thats correct and by flattening the Playing Field were able to look at it like you would on a form on the internet. Just so i understand because the music is playing dare i ask, are we smart senator mean rg ing are the best engineers here or best engineers there better. Weve had some people a fair amount get h 1bs and end up in Silicon Valley companies and new York Companies and work with them full time. So i would say its a global Playing Field. Fair enough. Thank you for coming in. Congratulations. Thank you. Coming up, john harang getswoodgets gets harwood catches up with one of the newest president ial candidates. Great theres a new one every day. Well see who that is when we return. And when you bundle your home and Auto Insurance through progressive, youll save a bundle [ laughs ] jamie. Right. Make a bad bundle joke a buck goes in the jar. I guess thats just how the cookie bundles. Now, youre gonna have two bundles of joy im not pregnant. Im gonna go. [ tapping, Cash Register dings ] there you go. [ buzzing ] bundle bee coming it was worth it saving you a bundle when you bundle now, thats progressive. Good gthe gop president ial race dr. Ben carson. John . People talk about american exceptionalism. Ben carson is exceptional, but just like you wouldnt expect babe ruth to be an ice skater or lebron james to play the piano. Why should you have the confidence or the feeling that you can be exceptional in this other field, which you have to do if youre going to be president. We have gotten into this arena where we think the only people who can handle kind of decisions that need to be made at the state level are people who are steep in politics. It sound as if your preferred alternative both to obama care and to medicare is a system of selfreliance in which you would be responsible for your own care and that of members of your family. Thats how you pay for it. And you could replace both the medicare system and the obama care with that system . Absolutely. I think when people can see how much more flexibility they could have, it will be a no brainer. Obama, you referred to him as a psychopath. I said remind you of a psychopath. Tell me how. Because they tend to be extremely smooth. Charming people who can tell a lie to your face with complete looks like sip searty tysincerity. Do you think he is a liar . I think he knows full well the Unemployment Rate is not 5. 5 . He knows that. He knows that people who are not wellinformed will swallow it hook line and sinker even though theyre sitting there in the city and cant find a job. Now, this is the most unorthodox candidate in the republican field guys. Hes trying to do something that hasnt been done since Dwight Eisenhower since 1952 come into a different field and join politics. Dwight izeeisenhower did it after winning a war. And jimmy carter came out of no where sort of. Didnt he . Governor of georgia. I know. But no one ever heard of him until he ran. And i guess thats what that kind of ruined the things johnny. Lindsay graham is going to announce. I mean on both sides it was i wish we didnt have to go through some of the stuff. The real question is though joe, you know youre going from one profession. He is one of the most renowned surgeons in the entire world. And hes retired from that and now coming into an arena where the instincts, the culture, the folk ways are entirely different. That is appealing to some voters. But its a very challenging thing under the campaign to try to really break through and make it without turning a lot of voters off. He already had some controversial statements and some back lash from that. Well see whether he can survive. All right, john thanks. We got to go. Appreciate it. You bet. Tenyear treasury yields are down following an eight day winning streak. Our next guest believes that u. S. Fields have peaked. Were used to saying its not here its whats happening over there. And this seems to be a corollary of that to some extent. Rates have been rising over in europe and its almost like were the tail of the european dog. Is that fair . I think thats a fair assessment. I mean sort of track where the european yields have been over the last week or so. Pretty evident to me at least, that the selling started overseas. Yesterday alone we saw a german tenyear yields track up 19 basis points and down 19 basis points and just a jinorms range and that is coming through to affect the u. S. Markets, as well. It was great when yields were going down over there. I guess live by the sword, die by the sword. We could have the converse here. We could have slowing growth. I dont know what the jobs numbers are going to be today but not too good recently and the 0. 2 print on the fers quarter gdp seemed like an odd time for rates to be spiking after so many months below 2 . Agreed. It really did. I think many of the factors which were driving close in germany and came over to the u. S. About technical, longterm economic. One thing from talking to our clients and colleagues here. The Interest Rate is pretty negative already. Weve gone from pricing in the markets three fed rate hikes from pricing in 1, 1. 5 at this point. That speaks to a shortterm economic narrative and thats the reason we saw with last weeks gdp number not a bad reaction. I wonder if it will move slowly higher and that will also mean maybe that the people that think were going to parity on the euro they might need to rethink that too. Wonder if the lows have been seen on the euro. The correlation between u. S. Tenyear and the euro running in the 15 range over a 15day basis or so. I think as you reference the trajectory of the euro is really dependent on u. S. Yields rising faster than german yields. If we see parity, a pretty big reversal. Want to keep it short. The counttendown to todays jobs report with bob doll. Aol Ceo Tim Armstrong joins us with his results. Stick around, squawk box will be right back. [ male announcer ] your love for trading never stops. So open an account with schwab. And when a market move affects, say a Cloud Computing stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Bob doll is here on the markets expectations for april pay rolls and what it could take to change the feds mind on rate hikes. Well tell you why summer jobs are harder to come by. Everything is bigger in texas. Big and bright deep in the heart of texas including business. Ceos naming the Lone Star State invest for business. Surprising results from the uk election including a dramatic move and the youngest lawmaker elected in nearly 350 years. The second hour of squawk box begins right now. Live from new york where business never sleeps. This is squawk box. Welcome back to squawk box, everybody. This is cnbc. First in business worldwide. Im becky quick along with joe kernen and andrew ross sorkin. The jobs report. We are a little less than 90 minutes away from april numbers. The economy probably added 228,000 nonfarm jobs. The Unemployment Rate is expected to dip a tenth of a percent to 5. 4 . But this is a very big number for the markets after last months surprisingly low number. Thats why so much is riding on it this time around. If you check out the u. S. Equity futures at this hour things have actually picked up but the dow future now up above 58 points. S p futures up by 5 and the nasdaq up by 17. British Election Results showing Prime Minister David Camerons conservatives ready to return to power without the need of a former coalition. The pound rising sharply against the dollar on this news and, in fact, the market in london has been up sharply, as well. What is particularly interesting is a 20yearold Scottish Student defeating one of britains most senior politicians. Mary black will become the uks youngest lawmaker since 1667. The last time you saw someone this young actually winning like this. Shes part of a strong showing for the Scottish National party. Also, we should tell you about Severe Weather across the plain states this week. Take a look at some pictures from wise county which is northwest of dallas. Heavy thunderstorm activity. Several tornadoes reported. The risk for Severe Weather across the middle of the country continues into this weekend. Can you explain why the pound surges on the prospect for leaving the union now that because its horrible wait. Yeah. What . Its like having a ball and chain. If germany left. Being in the union. Same thing if germany left. You would see most euro files dont think the uk should leave. They think if youre going tabe part of a trading block, you should be part of it. We had people yesterday making that case. Its weird that the currency would strengthen so much. If germany left the deutchsch mark. But if it means youre breaking further away and not getting closer to it. I would also say what labor was running on was kind of the same thing progressives run on here and antibusiness, antiprivate sector. I think theres some relief over there. But i also wonder. I also wonder whether we could draw any parallels. As wilford pointed out over there. I dont know. Because weve moved. I mean suddenly you know, there was a time in the 80s and 90s where the progressive wing the Democratic Party would have been laughed right out of the room. And a guy like clinton had to come along that was more centrist to be taken more seriously. Suddenly thats main stream. Look David Cameron was already in control in britain, too. They just thought it was going to get split. David cameron is not, shall we say, David Cameron is almost like a liberal. Hes not ted cruz. Its like the euro. Its like david brooks. Hes supposedly a conservative. Hes the New York Times conservative. Hes a wonderful man. Okay. All right. Well do Corporate News for a moment. But the media and the polls were completely wrong. That is true. That is very, very true. We should tell you whats going on this morning. Swiss insectcide maker. The value undermines the company and fails to take into account Regulatory Risks. Also, this should be no surprise to anyone. We had this conversation the other day and i dont know why we did it. Reuters is reporting that microsoft has no plans to pursue sale force that contradicts reports earlier this year that microsoft was evaluating a bid and im not telling you to mark my words, but im not sure sales force is being taken out any time soon. There you have it. Monster beverage shares taking a big hit. Youre seeing that stock down in the premarket over 6 . 6. 5 right now. Lets get a read now on how investors are feeling ahead of this mornings big april jobs report. Bob doll chief equity strategist senior portfolio manager. And whenever we talk to you, bob, we try to come up with the most pertinent, timely thing. This week it would be what we saw in the bond market really globally. Has that changed your i guess, i would call it a view on u. S. Equity prices or all systems go still . Well, i think we need better earnings for the stock market to go up. Joe, if you had told me that earning expectations for this year would drop as much as they did on january 1st i wouldnt think the market would have held on as well as it has. I think the market has done very well. We need better earnings. And i think that the noise in the bond market and the noise in the currency market is all about transition, if you will. Kind of from the first half to the second half of the economic cycle. Transferring growth from kind of only the u. S. To a little bit more globally. Its a very confusing and lots of cross current times. And my view is were going to have a lot of choppiness without a lot of trend for a while. So, flat for the year. In your view you said a really good showing compared to what the markets had to deal with. So far, joe. I think we will get better earnings in the second half on basing my hopes on some better jobs numbers and some better wage numbers and i think consumers will spend some of the Energy Dividend that so far theyve mostly saved. Its going away already to some extent. Even if we do get better earnings maybe that just brings up the underlying fundamentals to the point where in Janet Yellens eyes it will be fairly valued. According right now to her and others theyre overvalued. Theyre already anticipating better earnings. Could be. My view is better earnings will make the market go higher. We dont have the issue of rapidly rising inflation. Rapidly rising rates where we have to worry about contraption in my view. I think we can hold these relatively high pes and the market go higher if and only if earnings move up. What is happening in europe, bob . Is it responding. Theyve hardly done anything. They dont have any bonds to buy. Is it really Getting Better over there or just the right time the economies over there had bottomed out anyway and it happened to coincide when when qe started . I agree. I think the announcement of qe in january was after things started to get a lot better. Sentiment couldnt have gotten a whole lot worse, i suspect. And, of course youve got the phenomenon of the currency having gone down in europe making the goods a little more attractive than the rest of the world. And thats helping. You still got the current, the fiscal Monetary Policy problem and populations topping out in many countries and under capitalized Banking System over there. Europe and the multinationals will probably do a little bit better. But im not hanging on forever in europe. It seems like we ought to be able to outperform europe with our one hand tied behind our back like we had for 40 years gdp wise. All of a sudden over the long term i agree with you. Potential growth is about a point higher than europe. I agree. But, of course as you know doesnt mean each and every year and the europe is playing some catch up. When the german was close to zero, there was a deflation, depressionary sort of mentality which seemed overcooked on the down side and therefore to get this bounce back up in rates giving a cushion for our rates to move up some probably should have been no surprise to us. What do we need in this country, bob, to do 3, 3. 5 . We just had, i heard his line before. An economist that we had on before if we were europe wed be doing pretty good and some people want us to be europe. This is not satisfactory to do 2 for six straight years. What do we need . Yeah well our demographics allow us to do better than europe, but not still not good enough. Were going to need some policy changes around regulation and taxation in order to have a shot at youre so last century. Those are, dont you know that those are the things that got nus to the problems. Those are never coming back. Thats what were going to hear again and again. Which is amazing to me. Lets try one more time. The growth policies like low inflation and, i dont know, thats what we hear now. We tried that we have to do it this other way. The way weve done it its generating no growth. Or very little growth. Bob doll thank you. Do you have a number . What do you think well do today . Do you think well be above 200 . I hope were above 200. Although, joe, the confusion out there is good news is good news or bad news is good news. Thats part of this transition. Very confusing time. Maybe good news or bad news or both bad news. Thats the other side of it. But a lot of times you get set thinking job markets terrible and then the next one comes out and thats why its an average because, you know its here. But if you get a bad one here. The next one is up here. Revisions and just a better number. You know. Anyway, bob, thanks. We got a very big lineup still to come ahead of todays job report. Well get a special report on summer employment as part of our Popular Series where the jobs are. First before we do that Tim Armstrong will join us to break down the companys Earnings Report and talk ad revenue and then the ceo of striker is here to talk jobs and medical devices. And later Texas Governor greg abbott why he says texsis the best state for business. Stick around. Excellent. Researching a hunch, and making a decision. Time for a change of menu. Research and invest with e trades browser trading. E trade. You, my friend recognize when a trend has reached critical mass. Thats what a type e does. With e trades investing insights center, you can spot trends before they become trendy. If you want to succeed in business, mistakes are a luxury you cant afford. Thats why i recommend fast reliable comcast Business Internet. They know what businesses need. And theres a nomistake guarantee. If you dont like it, you have thirty days to call and get your money back. With comcast Business Internet you literally cant mook a mistick. I meant to say that. Switch today and get the no mistake guarantee. Comcast business. Built for business. Welcome back to squawk box. Futures are indicated to bounce. Yesterday was pretty impressive although the market was down triple digits early on. Did get that reversal in the yield on the ten year and also the german boons that were spiking and also came down. We had a good session yesterday and it was obvious that is what was ailing it the day before and that is what helped it rebound yesterday. Were looking up 67 points on the dow. Looking up 6 on the s p and the nasdaq came in a very strong session so far or indicated tahave a strong session so far up 20. In corpinateorate news sand ridge this has tado with violations of antitrust law oil and gas properties. Made the disclosures in a regular filing. Aol out with First Quarter results. Beat estimates on the top and bottom lines. Here to take us inside the numbers. Aol chairman and Ceo Tim Armstrong. We saw you a week ago. We couldnt talk about the numbers then. It does seem like a pretty good quarter across the board. If there was one piece to strengthen it, what would you say it is and if there is one challenge, what would that be . I would say first and foremost the two things we really focus on are growing our Consumer Base and our supply and growing demand. I think the strength that you see in these numbers are sels essentially our ability to build strong supply across mobile video, programmatic and, second of all, as you see ad pricing going up. Were doing a good job navigating the platform shift. But thats really great. I think the area that you probably dont see in these numbers that we spent a lot of time on in the quarter was really continuing to structure the company. So, we made a pretty large structural change to update the company for where the world is going right now. Although we dont see it in the numbers, i think the team did a fantastic job of delivering a great quarter. But, really we made some really big changes inside the company which will be beneficial for a long time in the future. Currency that was an issue for you this quarter . No aol right now is really starting our global expansion. So currency did hit us a little bit in the quarter, but not really what we focus on and i think that from our standpoint our business is in a point right now where we have to not worry about currency where we have to make sure we have to continue to scale all the inner assets and mobile assets we have. Every time youre on joe always tries to push you to buy drudge report as an off set to the Huffington Post but a piece after the big party that you had on monday night celebrating the tenth anniversary saying that huff post has yet to be profitable. Is that right . Andrew i would say one thing is you know reporters stopped me at that event and asked me about it. I think the huge news on Huffington Post wasnt the tenth anniversary, was the fact that its up to about 220 million global users. When we bought it 20 or 30 million users. It is growing quickly in terms of mobile and revenue and half the traffic is mobile and ill give you the same answer i gave to the reporter who asked me, Huffington Post probably one of the most valuable assets and we worked very very hard on that with arianna and the team there. So i dont, its joe is looking at me mouthing the word that sounds like no. Well heres the i was only mouthing it tim. You dont have to answer. I was just mouthing it. Joe, listen. Its important, joe, because youre a big user at Huffington Post. Lets get right to the tax. Huffington post in a core era where we are. The United States in video would pea be profitable but were still in investing mode. Joes mouthing we like when people are in investing mode. Thats the key to the whole business. In terms of investing mode. I know youre also investing content. We talked aboutthe last time we saw. Digital content and youve done a partnership with our parent company, comcast. What is that about . The deal with comcast and Nbc Universal is really about three quick things. One, it is really about following the consumers as they go to digital and were partnering to bring nbc content to aol consumers. Second is were going to be codeveloping content with nbc both for internet and linear. Number three, which linda at nbc has been and she was ought our new front event a couple weeks agoeand shes really thinking about the future of linear advertising and going programmatic and thinking more about the future with that. Were partnering in a very broad way and probably youll see a lot of deals in the linear space that come together. Were real excited about that deal. Tim, can i ask a dumb question. I saw one of the points what are the top five internets . Basically the top five largest Internet Companies in the United States. Aol has couple very very good streaks going. One is on consumer growth. One of the Fastest Growing Consumer Properties in the internet spaces especially out of the Large Companies for the last few quarters. Second that has allowed us to grow advertising fairly quickly and add pricing quickly. So people dont think about aol necessarily as a consumer growth property. But it is. Its very strong growth. Tim, we have to run. But my mom still has a Subscription Service to aol. I mean old school Subscription Service. How big a business is that still . Thats still a Consumer Base of about 2 Million People joe. And i would also say that that business has transitioned to more services than just dialup access or paying for access subscriptions. We have about 700,000 or so other subscription that we sold. Hopefully your mom is doing other stuff with us overall and if shes not, you can call me. He just assumed that was me. Sorkin which is hard to believe someone would be more cosmopolitan and probably know we think aol. Com address is a classic. My mom in ohio would still be on aol. I have i have told you guys many times that aol subscribers are very well educated. Very wealthy and very good looking. Thank you. Tim, congratulations on the numbers. Terrific to see you, again. Its better when youre in here, too. Even more fun. Ill be here next time. Always good thanks. When we come back this morning. Is it too late to save the post office . The u. S. Mail Service Expected to post a big loss today. A new focus on Package Delivery in may help things turn around there. A special report, next. Time now for todays aflac trivia question. Since world war ii which u. S. Stock index hasnt suffered a loss during the third year of the president ial psychocycle . The answer when cnbc squawk box returns. And a gentle wavelike motion. Ahhh ahhhhhh. Liberate your spine. Ahhhahhhhhh. Aflac and reach, toes blossoming. Not that great at yoga. Yeah, but when i slipped a disk he paid my claim in just one day. Ahh so he had your back . Yep. In just one day, we approve and pay. One day pay, only from aflac. [duck snoring] [ male announcer ] your love for trading never stops. So if you get a trade idea about, say organic food stocks schwab can help. With a trading specialist just a tap away. Whats on your mind lisa . Id like to talk about a trade idea. Lets hear it. [ male announcer ] see how schwab can help light a way forward. So you can make your move wherever you are. And start working on your next big idea. When a moment spontaneously turns romantic why pause to take a pill . And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com now the answer to todays aflac trivia question. Since world war ii which u. S. Stock index has never suffered a loss during the third year of the president ial cycle . The answer, the s p 500. The u. S. Postal Service Expected to deliver another big loss when the numbers are reported this morning, but buried in that red ink is a silver lining. A fastgrowing segment that could actually help turpn things around maybe some day. It says here. Theyre writing it in the prompter now for me morgan. Cnbc bird flu and Morgan Brennan joins us with the details off the egg beat temporarily. Off the egg beat temporarily. Thats probably for a good thing. It might be covering bird flu on some days but certainly not today and not looking to move that around the country. So were going to talk about packages today and talk about the Postal Service. Take a look at this this is a machine capable of sorting 6,000 packages an hour. Just recently been installed in this facility in a part of the facility that was once dedicated to mail. The u. S. Postal service has plans to roll out more than 20 of these across the country to help with capacity. This is just one example of a massive multibillion dollar push into Package Delivery. So its no secret the usps which is not taxpayer funded has been struggling. It has been suffering steep losses for several years now. And when you take the Retiree Health care funding aside, those woes out of it the most profitable business which is first class mail has been plunging. Weve seen volumed there drop more than 30 over the past five years. But as ecommerce has surged. Take a look at what happened to packages. Those volumes have jumped 30 over the same time period and this accounts for the Postal Service revenue. This is where the Postal Service is putting all of its initiatives right now, including testing larger package size mail boxes in a handful of markets both rural and urban. Also, it is launching a Design Competition for a bigger, more fuel efficient fleet. Thats a project expected to cost 7 billion and its trying out sameday delivery in some areas, including groceries for amazon in california. Now, all of this on top of last mile deliveries for amazon, fedex and ups. The hope is this push into packages will be the thing that enables the u. S. Postal service to essentially reinvent itself and move back towards more sustainable profitability. Back over to you. That would be good. I mean there are things we expect the government to do that were willing to subsidize, i think. That will be good unless they lose the better. Thank you and well be watching to see what happens that bird flu is not going away. Coming up summer jobs used to be a right of passage. But now much harder to come by and thats the subject of the next installment of Mary Thompsons Popular Series where the jobs are. Thats coming up right after the break. The network that monitors her health. The secure Cloud Services that store her genetic data the servers and software on a mission to find the perfect match. And the mom who gets to hear her daughters heart beat once again. Were helping organizations transform the way they work so they can transform the lives of the people they serve. music boys . Stop less. Go more. The passat tdi clean diesel with up to 814 hwy miles per tank. Just one reason volkswagen is the 1 selling diesel car brand in america. Welcome back to squawk box, everyone. In our headlines this morning, Taxi Service Uber has reportedly submitted a 3 million bid for nokias map business. A consortium of german automakers which are teaming up on an offer. Bank of america and jpmorgan are looking to kill zombie debt. Even though they have been eliminated in bankruptcy. The change could help more than a million americans. Fitbit filing for a Public Offering saying it could raise up to 100 million. Adventure capital firm Foundry Group is the largest stakeholder in fitbit. This is a crazy story. Sending half of all their employees on vacation to france. Theyre going on a fourday french vacation. Frances finance minister says that the group has basically locked down all of paris. They have now booked 140 hotels. Not 140 hotel rooms, 140 hotels in their entirety. Entire price tag for the trip expected to be around 15 million. Tiens spanned the tourism and biotech industries. That is a nice perk. When . Youre worried about your trip. Always thinking about number one. You booked ahead. I hope you booked already. Do you already have a hotel room . Booked and paid. Do you think they chose france for this reason . I dont know how the euro i dont know either. I dont watch that closely. Paris is big enough place for everybody. Its very inclusive and what a great place. You could be crowded there no matter what. But nothing is as crowded as venice. Thats the thing. On this jobs friday we are looking at summer jobs. They are hard to find these days and thats creating a lot of problems for many teens. Who may not have college in their future or may want to have their summer job. In basking ridge, new jersey with more on that problem and a program working to solve it. Out in the burbs, look around while youre out there. I will. Joe, i have a question for you. What was your first summer job . I believe that it was going around with a big bag of circulars and putting them on you know those horrible things that you get on your out in the suburbs that you get on your door handle. Yes. Yes. You have to go doortodoor with a rubber band and either drop it and i think i was 12 or 13. We do that in ohio. No child labor laws in ohio. You know what mine was . Well joe, mine was packaging meat at the local a and p. A job far less glamorous than what the summer interns will be doing here at verizon. Testing some of these cool products that you see here in the mock room. What used to be a right of passage is much more of a rarity. It has been about 17 since may of 2008. Creating jobs for teen is one problem the economic recovery has yet to solve. And northeastern professor says that can create longterm problems for the teens that might need those jobs the most. For kids who arent going on to college, getting that summer job provides them some experience in terms of acquiring soft skills, in terms of establishing good work habits that prove to be important for getting a job later on and holding a job later on. The focus on jobs is a cornerstone at the National Academy foundation or n. A. P. Founded in James Madison high. They bring schools and businesses together to design classes for students that are focused on Industries Like finance, i. T. Engineering and tourism. The aim of these classes show students how what they learn in class can be applied on the job. But it goes beyond that. The program also shows students what jobs are out there, first through job shadowing and then through summer internships. If you think about how you have been successful as a professional, it is not just about the learning you got. It is about the professional networks of adults that you got to interact with. The hope being, of course that the summer job eventually leads to a fulltime job or at least some of the skills these students will need to land one. Now, here at verizon, they will have 50 interns this summer. Coming up on power lunch, some cool things theyll be doing as interns but why verizon believes this program is not only important for the students but for the company, as well. Thats coming up on power lunch. Back to you. You just reminded me of what the green goblin new green goblin said james franco said mcdonalds was there for me. He said mcdonalds was there for me when no one else was. And similar things that Ashton Kutcher said. When i was starting out, i would never turn down any job and all entrylevel jobs. Thats what charlie monger said. Monday on our show he looks at it as a huge training part. First he admits that he goes there, which is great. Very politically incorrect. And then he said, and i see these nice people and they learn how to do you know how to greet people. Thats true. The problem, but the problem is again, getting those teens in those jobs. You know after the economic recovery. A lot more adults are the ones taking those jobs. We need to get these kids employed because all of us had our first jobs and all the important skills we learned during that time. Right. Like having to go in and like stay there and do this. The first paying job i got wasnt like baby sitting or washing cars. Working as a salad bar girl and cleaning chickens. I think theres a whole generation of kids that dont ever do anything that dont want to do. They dont even know the feeling that i have to do this for four hours. I have to tell you that those jobs were great jobs because they made you stay in college and make you think, i am going to finish and do something else. Great to get you there and great to get you started every day. We havent heard your anecdote for it. What were you . Was it an art museum or something or you were a curator. He knew he was going to be a reporter very early on. What was your first job then . My first job and how old were you . I was probably 11 years old and i was a waiter at camp. I got paid 75 cents per meal. But i was onentrepreneurial about it. Were you a camper there, too . I was a camper. Were you a happy camper . A very happy camper. There was a doctors table. They would rotate doctors every week and i got, i would convince the doctors to tip because, the kids wouldnt tip. They had a lot of money, too. They had money and sort of an underground economy at camp. If you bought a soda or pizza. You could buy that for the bunk that was something. Did you serve bug juice . Of course i served bug juice. Absolutely. Good. By the way, i won waiter of the year. Way to go. Not two years in a row, one. Camp cedar very proud of that. What state . Maine. Cool. All right, andrew. I know you think i did. Serving food. Taking the, you know dirty dishes. All that. Good for you. I thought you were maybe teaching some of the servants english or Something Like that. Oh, boy. Thats a good story. We like it. Anyway we should also talk about striker. That has been a hot stock over the last three years. Up over 70 . The shares havent done quite as much this year. They are down about 2 . But the next ten days could be big for the company because it makes appearances at both the ubs and bank of America Health care conferences. Ahead of those event were joined on set by kevin lobo the ceo of striker. His company, by the way, just ranked 19th on fortunes 2015 best companies to work list. Thank thank you for being here. Thank you becky. Some of the big issues facing striker. Head winds like the currency issues that all multinationals are facing right now. What has that meant for you . I know you raised guidance. We had a terrific First Quarter. Great growth. Three years of growing above the market. About 200 basis points faster than the market. Striker is a growth company. Became public in 197 9. 35 straight years we had growth. Growth is on the agenda. Even though we had foreign currency head wind like all companies face. 70 of our sales in the First Quarter in the United States. A very strong and u. S. Business. Our overall growth even net cur currency was over 3 growth. You see Many Companies report negative growth and it is an impact. It will impact us about 30 cents a share over the course of the year. We were able to raise our guidance based on the strong overlying growth. Through acquisitions we have robotic surgery and that is a Breakout Game changing new platform. And then stroke is an area where the leader in stroke right now for hem raujic stroke and a new breakout market. Is it a stent you provide . A stent that removes the clot. Today drug therapy is, but five strategies that will open up this market and could become a multibillion dollar market. Where is it right now . Just in the early stages right now. Approval for the product in the United States and in europe. But right now neurologists have to recommend this as a standard of care. They have to change their treatment protocol. Its early and take a number of years for this to play out and really a break through in promising technology. Lets talk about a couple issues that analysts have noticed. Declining hip and knee sails in the United States. How big a problem is that and what do you do about it. Our sales are growing. Our hip business has grown faster than the market for the past three years. Our knee business has been growing in line with the market. We have price pressure that has been emrnlerging but on a net basis we are growing and the demographic are clearly in our favor. We love being in the hip and knee business. We think it is going to be a great business for the long term. For striker less than 30 of our sales. Very broad across three segments. Broad in orthpeteopedics and neurotechnology and spine. Is that just competition coming in . Yes, absolutely. Pressure not just in the United States. But this much pressure across the world. Health care struggling with access and affordability. That is something you would cite as one of the things you are watching. A lot of things going in your favor, but thats what you keep your eye on. Last years price was down 2 and First Quarter was better than that. 1. 6 . But we expect to have negative price pressure for the foreseeable future. The good news is volume is still growing very rapidly. And the hospitals will still pay for innovation. Were seeing that with robotic assistant surgery. Tremendous growth in that industry. In Health Care Robotics is late to arrive. You see robotics in all other aspects of the economy. We think that is going to be a game changer for us. Were the only company with robotic assistance surgery. This for us is a great engine of growth for many years to come. Kevin, thank you for joining us today. Thank you. Coming up this morning, big movers. Your list of stocks to watch ahead of the opening bell. Thats next. Also doing business in the Lone Star State. Texas Governor Greg Abbott will join us live. So, stay with us. 40 of the streetlights in detroit, at one point, did not work. You had some blocks and you had major thoroughfares and corridors that were just totally pitch black. Those things had to change. We wanted to restore our lighting system in the city. You can have the greatest dreams in the world, but unless you can finance those dreams, it doesnt happen. At the time that the bankruptcy filing was done, the Public Lighting Authority had a hard time of finding a bank. Citi did not run away from the table like some other bankers did. Citi had the strength to help us go to the credit markets and raise the money. Its a brighter day in detroit. People can see better when theyre out doing their tasks, young people are moving back in town the kids are feeling safer while they walk to school. And folks are making investments and the community is moving forward. 40 of the lights were out, but theyre not out for long. Theyre coming back. Welcome back everybody. Lets take a look at the stocks to watch this morning. Aol beating the street. The results were driven by strength in video, mobile and programmatic advertising. Yeah thats what we talked to a little bit ago with the ceo. Also monster beverage shares taking a hit. Sales and earnings missing the mark. That stock looks like it is down by 6. 5 . Shares of sprouts Farmers Market hit hard. Posting weaker than expected earnings and sales and offering disappointed fullyear guidance. That stock is down by about 9 . When we come back this morning, Texas Governor greg abbott is here to tell us why his company is best for business. Then its jobs friday. Our panel of experts ready to break down the jobs report. Theres some facts about seaworld wed like you to know. We dont collect killer whales from the wild. And havent for 35 years. With the hightest standard of animal care in the world, our whales are healthy. Theyre thriving. I wouldnt work here if they werent. And Government Research shows they live just as long as whales in the wild. Caring for these whales, we have a great responsibility to get that right. And we take it very seriously. Because we love them. And we know you love them too. Just because im away from my desk doesnt mean im not working. Comcast business understands that. Their wifi isnt just fast near the router. Its fast in the break room. Fast in the conference room. Fast in toms office. Fast in other toms office. Fast in the foyer [pronounced foyyer] or is it foyer [pronounced foyyay] . Fast in the hallway. I feel like ive been here before. Switch now and get the fastest wifi everywhere. Comcast business. Built for business. Texas voted the best state for business, again. According to a survey of ceos and chief executive magazine. Its a perennial top performer and cnbc best state rankings. Joining us now Governor Greg Abbott. 11 straight years and one thing that i think of note to point out this time is i hear that oh yeah, well, texas is all because of the Energy Industry oil and gas and, of course they do well. Being number one this year proves it is not just oil and gas in texas. Well youre exactly right. Were so very proud to be ranked number one. I think i can capture the answer to the question that youre raids raising because a couple weeks ago i was working with one of the top executives from amazon where we were working on a facility north of san antonio, texas. The size of football fields that involves all kinds of robotics. I asked that executive, why is it you all are coming to texas and opening up all these facilities . His answer i thought would be well, because we have low taxes and reasonable regulations. Thats not what he said. Very quickly he said the reason why we are expanding business in texas is because of the quality of the workforce. So we have not only low taxes and low regulations, we have top quality workforce that meets the needs of these growing business sectors and, so i think texas is poised to continue to be number one because we are less dependent on the oil and gas industry than we have been traditionally. Since the recession began in december 2007 texas has created 1. 2 million net jobs. The rest of the country, 49 states combined 700,000. So, any of the positive jobs numbers that we see. A majority more than a majority comes from texas. So to recapitulate your fact, was it not for texas, the United States of america would be a net job loser ever since 2007. Right. And, again, the reason is because we have such a great business environment, we have so Many Companies that are choosing to relocate to texas from other states and, joe, we have been really focused on bringing in investment from outside of the United States increasing Foreign Direct Investment into our state. Governor we constantly have these arguments that are never settled with people on squawk box about whether these old ideas of low regulation low taxes. Whether progrowth policies actually work. They have an answer and that is we tried that in the past and that is what resulted in the financial crisis of 2008. We keep hearing that from progressives and i always try to think of if we could find something you could extrapulate to the entire nation. Look at the individual states and thats where you have an actually test tube to see whats happening. But usually they just write it off to oil and gas, as i said. One thing ill tell you, Richard Fisher, the great Richard Fisher hes a democrat. Whenever he talks about texas he says the same things and he says its low regulation, low taxes and not just oil and gas and tort reform and its all the things that you just mentioned. But i dont know why, argue about what the real reason is. Its the combination of all those and lets contrast it because as you all talked about every single day, we seem to have this job growth malaze. We have not had the economic upturn that the United States of america should have and three reasons for it. One is because the heavy hand of obama care. Two is because of dodd frank and three is because of the epa. I know for a fact in the state of texas even. Those three regulatory regimes are putting a lid on economic expansion. What texas works on is trying to reduce regulations. Speed up the permitting process. Provide an environment for businesses because we know one thing and that is when businesses succeed in texas, texas will succeed. We work to empower businesses. Allow them to make a profit. Allow them to hire people and it is a win win proposition. Thats the one thing. Love or hate the private sector versus government to pay for government. You need the tax receipts coming from the employees that are employed by companies in the private sector. And that seems to be lost on half the population at this point. Thats part of our math. Joe, this is something very important to point out. We see tax receipts continue to sky rocket. Those are our sales tax receipts. Its important that you know that while we are ranked number one during this legislative session were in right now. Were going to be cutting taxes by about 4 billion. Allowing businesses and individuals to keep more money in their pocket. So were going to make texas even more attractive. The pack wrap on texas is that theyre last in education or something. I know andrew wants a question. Okay. Hes got another ill come with your question in a second. I see you over there waving. Go for it. Finish up on the education issue first. Oh, so it was. That is where i wasnt. Watch my knee jerk. Its amazing. I can do it, too. Go ahead. Go ahead. No ill give you the question. Go ahead. And the question that you support, which is you always say that politicians should get out of the bedroom on the issue of gay marriage. I do. And in Corporate America today close to 400 companies have signed petitions saying the Supreme Court should allow samesex marriages. You disagree. Do you have companies coming to you, governor saying that you should change your view on this . Well let me answer that question. But very quickly, let me answer the question that joe raised and come back. Texas is not last in education. Texas ranks number two in the nation for high school graduation. And we are expanding our tremendous universities even more and plugging those universities into the workforce. Governor we only have 30 seconds. If you want to answer andrews question, you better do it quickly. Listen companies that are looking for diverse workforces like apple, for example. Apple is coming to the state of texas and expanding operations tremendously because they like the type of quality Work Environment that we have. They are satisfied with the cultural environment in the state of texas and like it a whole lot. If you spent any time in austin texas, you know Companies Like apple like austin texas. Governor, we appreciate it. Thanks for your time. And congratulations. And well keep having these conversations. Great conversations. He was great. Thank you for coming on governor. Still to come, we are just over 30 minutes away from the big reveal of the april jobs report. We got those numbers and analysis when we come back in just a moment. Just because im away from my desk doesnt mean im not working. Comcast business understands that. Their wifi isnt just fast near the router. Its fast in the break room. Fast in the conference room. Fast in toms office. Fast in other toms office. Fast in the foyer [pronounced foyyer] or is it foyer [pronounced foyyay] . Fast in the hallway. I feel like ive been here before. Switch now and get the fastest wifi everywhere. Comcast business. Built for business. The countdown is on. The april report just 30 minutes away. The nestvers in the fed will watch these numbers closely. A decision on Interest Rates hanging in the balance. Our expert panel is ready to give you the information you need to make the best possible investment decisions. And to tell you what the numbers are saying about the economy. Happening now, mcdonalds serving up sales data. Can kale the hamburgler and artisan chicken turn things around for the slumping fast food chain. Well go inside the numbers with an analyst. We had the polar vortex. Thundersnow. Oh, again thats a twofer. Get ready for the pollen tsunami as the final hour of squawk box begins right now. Live from the most powerful city in the world, new york. This is squawk box. Welcome back to squawk box here on cnbc first in business worldwide. Im joe kernen along with becky quick and andrew ross s o, rkin. Ready for the jobs report. Breaking news about mcdonalds. We should have outtakes. You can see what im saying. Becky has some of those numbers. Actually the numbers are better than expected. Theyre still talking about down negative numbers for the month. Global sales down 0. 6 for the month of april versus estimates, though, of down 1. 9 . Looks like the numbers are better than expected in every one of the major regions. In the United States samestore sales were down by 2. 3 but thats compared of estimates down to 2. 7 . Some commentary on this the new chief and ceo said that they are still dealing with ongoing competitive activity and negative customer traffic in the United States. But, again, down 2. 3 is better than the down 2. 7 expected. And europe actually the numbers were up and this is first time weve seen this in a while. Up 1 versus the down 0. 1 expected. Down 3. 8 versus estimates of down 5. 8 . So across the board, these numbers are better than expected. Youre still talking about a little bit of difficult time for the company. Apnea is snoring. Apmea is you are right. Maybe that was the kitchen sink quarter. Yeah but they dont have control over it. It is what happens with the customer. Europe is rebounding a little bit economically. They said in europe there were some specifics, too. Solid results in the uk and germany. Offset by a negative performance and when it comes to the middle east and africa still the challenges that theyre having in japan where there have been serious social concerns about what to do with mcdonalds there. That was offset by strong results in australia. By the way, you want europes numbers to be right. I mean that was the uk. If those numbers are falling to pieces, you have a bunch of problems. Lets get you through some of the other stoeries that investors will talk about this morning. Syngenta rejecting a takeover offer from monsanto. They undervalue the company and does not fully take into account Regulatory Risks. Also reuters now reporting that microsoft has no plans to pursue sales force. That contradicts a report earlier this week that microsoft was evaluating a bid. Taxi service uber has submitted a 3 million bid for nokias map business. The New York Times says uber is competeing against german automakers which may team up with on an offer. Less than 30 minutes away from the april jobs report. Futures ahead of the number are still, i think, in kind of a little bit better place because of the bond market calming down. The tenyear calming down. But were waiting to see what it will bring and i think we talked about it earlier. I dont know what we want we want something in the middle. North of 200. 2225. 250. If its too high. We will have people thinking we misstated it. We misstated the slow down and things are getter better faster than we thought. If europe is Getting Better and were also Getting Better that would be okay i think. If were in an opzitaupopposite direction. Here to get us ready director of Economic Policy studies. Nera is president of the center for American Progress and austin goal golsby school of business and Strategic Partners and at 32 advisors which was wolfys runningback number at penn i think, right . Yeah t was. I dont know how good he was. But that was his number. He is probably not the most famous runningback with the number 32. I dont think. I think thats probably true even at penn. Robert wolf. As long as were talking. We have the camera on you, where are you . Are you above 200 . No im below 200. The basic, the basic logic of the jobs numbers is theyre tied to how fast the economy is growing and the economy hasnt been growing that fast. You keep saying europe is looking better but even better theyre in the ones and china slowed down. Japan slowed down. I just its not a great environment. So, i dont see a big number. What about you, kevin, but are you above 200 . Im above 200. Doesnt it snap back usually . No . First quarter is negative and now cast for Second Quarter gdp just a smidgen above zero. Very close to the edge of recession and twoquarter roll. I was way below consensus last month and i was high and this month im at 165. Again, it looks like were slowing down in the u. S. And i still believe in the strong second half but im really nervous about this number. I have us at 2. 20. I think the question is i think expectations is the economy will get stronger in the Second Quarter. We hope to see that beginning with this jobs number and, so i am definitely north of 200. Usually in the past, neera, it just seems like its an average, right . A lot of times we get into this mindset of thinking that these, that one month makes a trend and it doesnt. But that would definitely be a snap back. That would mean it is an outliar last month right . Yes. I mean i think there are a lot of folks who are predicting stronger jobs gains and its definitely true that the rest of the Global Economy does seem to be slowing down. The real question is, how much the u. S. Market is doing and were still pretty consumption based in the United States. So im hoping that that will reflect in the employment numbers. Austan i have channeled you a few times recently which i do because, you know you make good arguments a lot of times. You actually were listening, joe. Ive seen that and it made me feel good. And what im talking about is one of the ways that people say that its that none of our problems are selfinflicted here. In other words, since the crisis. Is because well look at the rest of the world. The rest of the world has also been slow. So if it was, but then i thought of a way to counterthat is that europe always was europe. Weve only been europe for six years now. So, we used to be able to beat we used to be able to do we used to be able to do better gdp all along. I thought you were just going to tell me about what happened on your home planet and how great it used to be over there. But, look the world is still a dangerous place, joe. And even europe you see people saying oh, europe is turning around. I mean were days weeks, something away from another crisis in greece. Were just going to keep having that over and over. If not greece then somebody else. They got major structural problems. And, you know the Election Results in the uk are somewhat definitive and theyre going to perhaps set up another battle over britain and do they want to exit the euro . I dont think theyre out of the woods either. You know what you can weigh in, too. But im going to Say Something we were talking about off the air for a second. Austan, i dont know whether the uk results. At this point im still talking to austan kevin. The uk results i dont know if you extrappialate whether it be more central in this election here. Hillary clinton moving left being forced left by phantom primary opponents. She really doesnt have any. And we were just saying if i were her, i would bring it back. I would bring it back and say, look, i would not have this confrontational, you know sort of relationship with the private sector and business. Im not going to constantly pitting one group against the other. Im not going to try to topple the 1 . Im going to try to bring everybody up. She has a perfect opportunity to move back to the center and try to bring us all back together again. And, instead of just getting a coalition of progressive groups to get to 50 , she can get all the independents along with the democrats that will vote for her anyway. Would you advise her she doesnt need to go far left . Youre asking me . Yes. You talk to her dont you . I think shes going to get all the independents. Have you seen then you dont think, you missed my point about what happened in england and you missed my point is that i think the country at this point is not comfortable with how far left the center of the Democratic Party has moved. Hey, austan i dont think the polling reflects that. Neera . I guess i would reject. I guess i would reject the premise that hillary has moved far left. I do think that people and you see this in everyones anxieties about the economy. People are still anxious about wages and about raising costs in the United States. You know, the u. S. Is very different from the uk. You could also take from the uk results that people were pretty happy with the government in power and they didnt vote out the incumbent. They kept him in. The Democratic Party is the incumbent party in the United States. So i dont think we can take too much from the uk elections one way or the other. I think the challenge for both parties. Not the Democratic Party alone. The challenge for both parties is that people are continually anxious about wages. Wages have been stagnant for a long time. Hopefully well see in these jobs numbers that theyre moving up. And that every politician, not from a left perspective or right perspective, but really have to address those issues and i expect hillary to do that and i hope republicans join her. The two sides want to address the problems in different ways i think. Kevin, you have a chance to respond. Although whenever i want you to hit it out of the park you are always so. This one, i mean if you look at the flipflop on free trade i think what mrs. Clinton learned the last time she tried to follow the advice and she got outflanked to the left by president obama. I think what shes doing right now is taking out an insurance policy so it doesnt happen again. That will discourage Elizabeth Warren from entering the race and then probably during the primaries, she will have lots of moderate positions. Arthur brooks your buddy Arthur Brooks has a lot of data on the country that its still a center right country. Are you saying its not . Now it is a center left and its not even center left at this point. Its center right. Then theyre looking at the last six years going, what happened . But she still got to win the democratic nomination. Right now shes discouraging other people. Its the parties that are not center. Looking at austans expression. Hes just poker player. Cant read him at all. Stick out your tongue adam. Im just so glad both are wearing purple ties. Coming up next its purple. Red and blue. The country is coming together in the center. Mcds Sales Numbers and what it will take to get the stock moving, again. Last three years while the dow has soared you can see whats going on. They are, well well see where that goes. Squawk box returns in just a moment. Thank you mom, for protecting my future. Thank you for being my hero and my dad. Military families are thankful for many things. The legacy of usaa Auto Insurance could be one of them. Our worldclass service earned usaa the top spot in a study of the most recommended Large Companies in america. If youre current or former military or their family, see if youre eligible to get an Auto Insurance quote. [ girl ] my mom, she makes underwater fans that are powered by the moon. [ birds squawking ] my mom makes airplane engines that can talk. [ birds squawking ] my mom makes hospitals you can hold in your hand. My mom can print Amazing Things right from her computer. [ whirring ] [ train whistle blows ] my mom makes trains that are friends with trees. [ train whistle blows ] my mom works at ge. My name is jamir dixon and im a locate and Mark Fieldman for pg e. Most people in the community recognize the blue trucks as pg e. My truck is something new. Its an 811 truck. When you call 811, i come out to your house and i mark out our gas lines and our electric lines to make sure that you dont hit them when youre digging. 811 is a free service. Im passionate about it because every time i go on the street i think about my own kids. Theyre the reason that i want to protect our community and our environment, and if me driving a that truck means that somebody gets to go home safer, then ill drive it every day of the week. Together, were building a better california. Welcome back to squawk box. Mcdonalds monthly samestore sales better than expected. Matthew defrisco senior and director restaurant analyst. Good morning to you. Good morning. Ic alling low icic icic icic looking through the numbers, they are better but still lousy. They admit theyre losing to strong comfetative activity out there. They are the restaurant with the largest exposure to europe and positive in europe despite some of the economic struggles there and contraction of the categories. I think that is definitely something to call out and see at least is that an easterbrook creation . They were already doing that before the European Market was improving quicker than the u. S. I think what hes done in europe, he can bring to the u. S. , as well. Which will be to improve the traffic trends and hopefully get to positive by the second half of this year. Were you impressed with his strategy that he laid out earlier . I was. I think hes focused on operations and also immediately hes attacking the Capital Allocation and refranchising to get to 90 of a franchise mix will improve their capital, which is key to the stock. A lot of the franchise the owners complaining and worried about whats about to happen and the costs that its going to put on them. Well he does talk about simplifying the menu. I think thats speaking directly to the franchisees. Simplifying labor, execution, less cumbersome and less equipment in the store to make things move faster. You dont think huge capital costs in terms of what hes going to be pushing on them at least initially . Well mcdonalds gets away with it because they share the capital, they share the investment with their franchisees. So, i think its a partnership where he does have to prove a sales lift from it but i do also think he is gentle with how much he is pushing down the pipe with capital. Big disconnect. Everybody says they need to be simpler on one hand and then the world has move under to wanting everything to be customized. How do you do both . I think simpler means less busy on the menu. Less options to order from. Chiptole is a perfect example. Very few ingredients so it is leveraging and better usage of your ingredients in the back of the kitchen for preparation. Matthew, really appreciate your time this morning. Thank you. Thank you. Take care. When we come back this morning, our expert panel makes final predictions before the government releases the april jobs report. Right now, though as we head to a break, investors sleighing monster beverage this morning. That stock is down 5 after reporting weaker than expected reports. More stockess a esss ahead of the open. Squawk box will be right back. Boys . Stop less. Go more. The passat tdi clean diesel with up to 814 hwy miles per tank. Just one reason volkswagen is the 1 selling diesel car brand in america. Seven out of ten Power Outages in the us are caused by weather. But utilities can now predict where the power will go out, within a few city blocks. Working with ibm theyre combining micro weather forecasts with detailed data from local sensors. To predict where outages are likely to occur. And send crews exactly where theyre needed, when theyre needed. Ibm analytics from the internet of things is making energy smarter every day. [ male announcer ] your love for trading never stops. So if you get a trade idea about, say organic food stocks schwab can help. With a trading specialist just a tap away. Whats on your mind lisa . Id like to talk about a trade idea. Lets hear it. [ male announcer ] see how schwab can help light a way forward. So you can make your move wherever you are. And start working on your next big idea. Theres some facts about seaworld wed like you to know. We dont collect killer whales from the wild. And havent for 35 years. With the hightest standard of animal care in the world, our whales are healthy. Theyre thriving. I wouldnt work here if they werent. And Government Research shows they live just as long as whales in the wild. Caring for these whales, we have a great responsibility to get that right. And we take it very seriously. Because we love them. And we know you love them too. Welcome back everybody. Time for our panel to give their official predictions before we get the jobs report for april. Our panelists today kevin haslet Austan Goolsbee and, kevin, why dont we get to your prediction first. I think the bad trade data will make the hirer go down a little bit as people worry it is going to get worse. Im looking at 165. Neera, how about you . Im more optimistic about the economy economy. Im at 220. So on the high end so far. Austinost austan, what is your guess this time around . I want neera to be right, but i think it is going to be around 160. So, youre at the low end right now. Rick, you want to weigh in with your thoughts . I think gdp is soft too. Thats why were hiring more people. Ill move up a bit to 180. 180 for rick santelli. Steve, how about you. Do i use this thing here now. You did it. I had some help in the back. 178. I got weak manufacturing ism. I have a weak adp. Decent claims and good services. I get 178k. I wont do this because i think its stupid. You wouldnt do anything stupid on television. I have to come up with something every time. You go ahead. So my model, this is 183. Did you cop me . Im 182. Clusters. But under price is right rules, you lose. Lose if you go over. So he wouldnt do that because you can win. He cant win. Im changing it. You cant. I want to go to, youre 178. You cant change it. Im under you guys. Id be grateful. Who is in favor i did it first. No you did it. Joe, im with you on this but because you have already taken the good stuff. What have you got . Oh yeah. You drew that up very quickly. And youre going to dance, too . You should see what hes doing under the desk. Not wearing any pants either. Look at the workmanship. Who did that . Did you draw that . I did draw that. When . Yesterday. I did do it yesterday. Impressive. What i will say most of us consolidated around the middle. Thats what rick called the number on this. The symbol for the artist formally known as prince. What symbol is it . Man, woman together and something else. Remember when he had a guitar. Guys, let me ask you really quickly what you think the stock market will do if we get around 180,000. Rick, we have been talking about that through the morning. What do you think the number is if you guessed it around 180 . I think we have are you talking to me . Rick go ahead. Okay. Are you talking to me. Listen, i think that we entered a new paradigm. I thought prior to this the equities pretty much made the call for the fixed income. Spongy equities brought rates down. Now, i think rates will move equities and 180 will give a pass to the market. Double top for the ten year and moderate waiting for another volatility. Anything over 275, i think you have a good chance to see rates take out the 224 level and i dont think stocks will like rising rates. Okay. Kevin, what were you going to say . I was just saying that i think if we come in about what im thinking like way below 180, 165, you can actually see the tenyear start to head south towards 2, again. And big news for markets. Basically this is the price of everything. Exchange markets and equity markets. Gentlemen, thank you. We have some ladies too. I dont want to say just gentlemen. Well see around the corner because zee the april jobs report and the reaction from our pannal and the markets as we head to a break. Take a look at u. S. Equity futures. The bet right there. The dow looks like its up 67 points. Well see what happens in just a couple minutes. R of the world has gotten you far but what if you could see more of what you wanted to know . With fidelitys new active trader pro investing platform, the information thats important to you is all in one place, so finding more insight is easier. Its your idea powered by active trader pro. Another way fidelity gives you a more powerful investing experience. Call our specialists today to get up and running. We are just a few second away from the april unemployment report. The future ahead of this and things have been positive for most of the morning. You can see at this moment it looks like the futures are indicated up by close to 72 points for the dow. And s p futures up by 6. 5. We have also been keeping a close eye on the tenyear because as rick was just saying as rates go perhaps so goes equities at this point. Take a look right now, you see the tenyear yielding 22. 189 . 223,000. Payrolls increased by 223,000 jobs. The Unemployment Rate is 5. 4 . Average Hourly Earnings up 0. 1 . 2. 2 for the last 12 months. That Unemployment Rate, the lowest since may of 2008. Pretty much in line with consensus overall. Private sector job growth increase and the allimportant revisions. March was revised downward. Originally 126,000 jobs. Its now been revised downward to 85,000. A slight upward revision for february. Up by 2,000. So, from 264 to 266. So, a net downward revision of 39,000 jobs for the last two months. Job gains, we had some big categories here. Professional and Business Services plus 62,000 jobs. Health care plus 45,000. Construction plus 45,000. Perhaps the biggest indicator is whether re weather related. On the oil side, the Mining Sector losing 15,000 jobs and a subset of that, oil and gas extraction losing 3,000 jobs. The Labor Force Participation rate 62. 8 . 62. 7. The socalled real Unemployment Rate is now at 10. 8 . That is the lowest it has been since august of 2008. Thats pretty much the numbers there. Pretty much in line with consensus on the headline number. Back to you. Hampton, thank you very much. Folks, take a look at the numbers. The market reacting very nicely to this. Right now the dow futures are up by 130 points. Thats nearly double the gains that we had seen this morning just before that number came out. S p futures now up by 13. 5 points. If you want to look at the tenyear. Lets check out the yield there, as well. Thats what markets have been paying so much attention to. Right now 2. 128 . Earlier i thought maybe there was no number that would be the gold ae goldylic aelock goldyilocks. The market came in at a gain of 228 and you said 220. This is as you expected. I would like to note that austan who is an economist, i did better than austan. Shes a pro. And im going to get her a job over here at the business school. Austan you even tweeted that ne neera was over 200. I was giving you credit for nothing, joe. You didnt come up with a number. I asked someone earlier, what did you expect 220 . He claimed the winner every time. Its just an average. Every time we have a down one, the next one averages it out. That is why it was called an average. It was going tabeo be 220 or prince. Neera, finish your thought. No, i hope this is part of a trend and that we see Second Quarter that is much stronger than the first and hopefully the employment number is a start of things to come. Steve, what about i think thats absolutely right. Go ahead, austan. The fed now youll hear a lot of discussion again, about the fed. Maybe just an aberration and the fed will act. And, joe, your love fest over the Job Performance in texas. You better get ready because last month they had a bad number and you see in that mining and oil numbers, theyre going to continue to have a tough match in texas. Theres two things in this number that make me optimistic about the growth story. The first thing is the construction number this massive bounce back. 45,000 in construction. And also leisure and hospital hospitality. You can imagine some of that will be weather related, as well. That bounced back from minus six to 17,000. If youre the Federal Reserve and you wonder if the First Quarter was an aberration or somehow weather related and temporary. You would look to those numbers and say there was a pretty good effect in the jobs market for the First Quarter or at least in february and march and now it looks like its coming back. You might expect gdp to follow that or on some of the other growth numbers. You mean revisions for the First Quarter or the Second Quarter . More likely the Second Quarter. The work that we talked about a couple weeks ago showing this weak First Quarter has a somewhat stronger Second Quarter in there. You get the bounce back. The immediate question is going to be i think this is where you have to focus on the market. Lets imagine this number next month ahead of a late june meeting by the Federal Reserve. Does another 232. 50 put a june rate hike back on the table . Kevin, what do you think . I think we were way below conens on the panel. If you subtract from this number, then you are about what our average was. Our average was below consensus. The last refuge. The last refuge. Its not that good and that was where our number came from and im just saying that were not that far from still believing the Second Quarter is going to be very very weak. I would guess that the Current Quarter forecast going into the june meeting is still going to be onish, even if were optimistic about data coming in. A negative quarter and a 1 quarter in june. Theres no way theyre going to move, steve. The last people who hired people they dont need is the Construction Business right . If theyre doing 45,000 on construction, they brought people back theyre building homes and youre going to get some form of a pop in there. Homes and other structures obviously. And, so my guess is that if you do get that Second Quarter strength or rebound, then i dont know. Maybe it should be back on the table. Neera . I think like the big challenge is there is still a lot of slack in the economy, even monthtomonth. So, youre going to have some good numbers. But if you look at the overall economy, still a lot of slack. So especially on the wage front. So i would be surprised if they did. A rate hike or really thought significantly about that. Rick why dont we get your thoughts on this too. The idea if this were the number and this were heading into the june meeting, how do you think the fed would react . I dont think the fed is going to raise in june no matter what the next number is. I think we have been bait and switched. We shouldnt pay so much attention to the job ss any more. It doesnt matter. If were, if our input is on jobs and our input on productivity is low and the output keeps going down doesnt really matter. We need to focus on what grows the pie. Obviously, creating the jobs isnt growing the pie. If the jobs are created in an environment where were not productive. So we have bad policy and we have decent job growth. Thats why the gdp is going to drag and drag and drag. We need to shift our focus. Just like Bernie Sanders. He is a socialist but calls himself an independent. He used to be about jobs jobs jobs. But now needs to be about growth. Rick just adores Bernie Sanders is that what just happened there . Im totally confused. Who is going to get the independence, i was wondering, Bernie Sanders is an independent. Thats right. What does that mean now . I dont know. Theres a great op ed about how the country, if you take the name plate of socialism away and you construe that making somebody like a ge systemically important is like owning or running a company, were just arguing some antics about the direction of the country and thats the type of policy that has given us weak growth. We dont distinguish what we really are in this country and what people really do and dont want. I am going to call that an endorsement of Bernie Sanders. You guys heard it right . That was pretty close. At least hes honest. He should say hes a socialist. And were on a socialist ticket. Then he could actually work at your school. Just remember for the fed in june, i think we all agree that theyre unlikely to move in june and lets just remember that greece is going to run out of money, probably before june or somewhere around then. Theyre going to have to resolve. They did a little redistributing in their history, didnt they austan . Did what . They did a little Income Redistribution didnt they over the years . But in that environment, i think its going to make it even harder for the feds. They have the outcome that they have. I think theres also an issue in greece of people not paying enough taxes at the high end and just leaving. So, i mean i dont think greece is a good example one way or another for the u. S. Yeah. I think its quite an excellent example. Driving them into the ground. But my point is hard to see the fed moving to lucent in the u. S. On the context that were teetering on the edge of some financial based crisis. Tighten in the u. S. . Yes, tighten. What is the standard on these numbers . On the monthly numbers . Plus or minus 95,000. So if you hit, instead of all this announcement, why not do a regression of around 200 instead of thinking about all this stuff. I wrap in the threemonth average and the number. Its not quite that whats the word . Whatever you call it. Within 50. Thats my standard. You have a stander error smaller than the average. But thats okay for a model. Its not terrific its not bad. I just want to point out, though, at 5. 4 . If you do another tenth next month, youre at 5. 3 . We knew that. What is the feds long run Unemployment Rate . It came down to 5. 1 . Lets invoke the spirit at the table. One of the brighter guys we know here who was a huge fed critic and say, okay how were you sitting 0. 2 above your longterm Unemployment Rate at zero and not raising rates. If thats the story. 5. 1 is going to come down. It has been coming down. Thats joes point. You just keep moving. That feeds directly into ricks criticism of the Federal Reserve, which is you give us a number and you come next to that number and then change that number. Now, in their defense, where will say that what has happened you had a lack of inflation and a lack of wage growth so that tells you implicitly that the long run Unemployment Rate is lower and i think thats what austan is eluding to. Still 0. 2 above its mightily close to being that place with rates at zero. Steve liesman is part of our panel here this morning as is kevin hasset Austan Goolsbee and, of course rick. When we come back well get more Market Reaction to the jobs report. We should also tell you just for those of you who werent here at 8 30, that number came in 220,000 jobs. The market definitely likes what it has seen here. Nobody knows what that is. The stock future market is more than doubling and bonds get in shape and well talk about all of this with jim paulson and ethan harrison. Coming up on squawk on the street interactive chairman barry diller sits down with david faber for an exclusive interview. Stick around, squawk box will be right back. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Welcome back to squawk box. The economy adding 220,000 jobs last month. The Unemployment Rate dropping to a sevenyear low. Some people saying that joining us now is jim paulson, chief investment strategist at Wells Capital management and with us on set ethan harris and as joe just said. The futures are up in a very big way. Up 200. But then the question becomes, i thought there is a good news bad news suanario because were all sitting here trying to figure out what the fed will do as a result of this. This is a goldy locklocks number. Right next to consensus. The economy is healthy, but its not booming. We dont have to worry about the fed in june. So youre happy or excited or are we you know we always get, effectively, when anything comes in as contentious we become disappointed by the end of the day. Heres the disappointing thing. That is this is the best we have in the economy right now. The labor market is great. Its recovering and doing exactly what the fed wants to see. If it was just the labor market the fed should have hiked already. The problem is the rest of the economy. Crummy exports and mediocre consumer spending. That lousy First Quarter is not the jobs market. It was everything else. Thats what we need to see in the Second Quarter. We need to see the other data catch up to the jobs numbers. Mr. Paulson, is the market fairly valued given whats going on here . Overvalued, undervalued . Well i think that the market leading up to this andrew was worried about overheat so to speak. I mean we had, we had the embedded Inflation Expectations and rising rather aggressively and bond yields themselves breaking up towards 225. We had material stocks leading and Energy Stocks and kind of inflationary undertone to this. And i think that this is a typical bad news is good news. If you put in the revisions, its a fairly backtoback weak number, again, on average below the 200,000 level with the negative revisions. And the wage number only went up 0. 1 after going up at a 4 annualized pace in the First Quarter. I think people were bracing for a powerful number that might move up the feds exit strategy and this sort of cooled that off. I think thats why were getting a rally. Valuation im confused. This is a disappointment then . Were getting a rally on disappointment. I think so. I think what the market says something about market mind set. I think the market mind set has been good news is bad news and this morning bad news is good news. And i think thats what it says. So if we we get hot reports down the road i still think that is going to be bad for the stock market. The fact that this report was weak is what is putting a bid into the stock market this morning. You agree with that . I think it was an okay number. If 200,000 is our standard thats pretty High Standard to meet on a regular basis. I mean, the growth of the underlying labor force in the economy is only about 100,000. So were growing twice as fast as that underlying trend. I think, actually what i liked in the report which nobody has talked about is the fact that the Participation Rate has been stabilizing. So people have quit running away from the labor market and sticking around and working. Thats a good sign. We need those workers. This is a more real number. Its a more real number. This is an economy where you can see in the labor market were getting an increase in wages and were getting very close to full employment and were still getting decent jobs numbers. But still decent jobs numbers. Where do you think the s p will be at the end of the year . I think well be up 5 or so. A small, mediocre year. Jim, we have to run. What is your s p estimate for the end of the year . I think well be flat with the start of the year andrew. I think we might go higher here towards, up a little bit. But i think we might have a correction before the years out because i think were eventually going to overheat before the years over and at least in the stock market to worry aboutthat. When we Research Well get jim cramers take on the jobs report it took Tim Morehouse years to master the perfect lunge. But only one attempt to master depositing checks at chase atms. Technology designed for you. So you can easily master the way you bank. The network that monitors her health. The secure Cloud Services that store her genetic data the servers and software on a mission to find the perfect match. And the mom who gets to hear her daughters heart beat once again. Were helping organizations transform the way they work so they can transform the lives of the people they serve. Uhoh. Is that video shopped . I dont remember doing that. Well be using this a lot now. A lot. Lets get down to the Hedge Fund Manager formerly known as cramer. No no joe. Yes . You have it all wrong. I stuffed the inserts that you delivered to the door. They had to be folded didnt they . I stuffed them between 12 00 and 2 00 a. M. That was the job to get when you were 13 14. It was not highly skilled. Speak for yourself. I remember with becky one of the other guys on one of the other crews dumped the entire stash down the sewer and didnt think he was going to get caught when they didnt show up. He did get caught. It was hard work jim. You had to go to every house and do that. It was the job, your buddy said ive got a job. You want the income. And its the worst job in the world, but it was a job. You know what . You had to be there a certain time. You didnt want to be there and you had to stay against your will. When youre 12 this is not something youre used to doing. Remember working papers . You had to get working paper for that job. I had other ones i mentioned to becky. I dont know. One was called hand crafts made by the handicap. To this day they were 5. To this day, i dont know for sure whether they were being totally honest. I dont know it was a scam. That was our sales pitch, and im not convinced it was actually i cant look at you. They still have it up there. I know. Mcdonalds, the jobs number. Europe is turning and people are just having another hamburger. One of the things weve seen over and over again is that look, when people have a little more flush they buy a second drink. They buy fries they might not. This is happening and it matters. It does matter. They are getting lucky in europe. You guys cover jobs better than anybody. Im looking at this month of march saying people are smoothing it out. Not a lot of wage growth. Well take the Interest Rates up. The speed with which this stuff is happening is breathtaking. Rates go up and down. Its got to calm down. It becomes too difficult to figure out whether they fade the opening and by 10 30, were down. We are headed for the summer doldrum. Sooner or later well get more of an indication where we are headed the rest of the year. We cant keep up down up down up to 2016. It will be something in the dollar did peak. No one thought. Right. You would have so Many International companies you have to plow into. You see this major reversal from the First Quarter. Im betting that will happen. Right. 1. 05 . I was counting on parity. Absolutely. Up next we are calling it pollen tsunami. We will tell why you allergies are particularly bad this year. And when flags attack. Some amazing video. Boys . Stop less. Go more. The passat tdi clean diesel with up to 814 hwy miles per tank. Just one reason volkswagen is the 1 selling diesel car brand in america. [ male announcer ] your love for trading never stops. So open an account with schwab. And when a market move affects, say a Cloud Computing stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. In the us, three in ten College Students drop out. But how can you spot whos at risk . The one who lives far from campus . The one who works the night shift . The one with new responsibilities . One thing cant tell you, but the right combination can. Universities are using ibm analytics to understand pressures in and out of the classroom some expect to cut dropout rates by twentyfive percent. Ibm analytics is working to make education smarter every day. Futures pointing to a sharply higher open this morning. Now up 186. After a couple of after a week or two where there was some questions about a lot of things. We were up 70 before the numbers. 223,000 jobs. When bonds rally bonds rally on a better number. I dont think that was bad news. The question is whether this will hold up. I dont know. Well see. If you notice youve been suffering from allergies, its because the ferocious winter and delayed spring created a pollen tsunami in the northeast. Big pollen producers are coming out at the same time as the seasonal ones. Usually those are staggered, but this year they are hitting at the same time as grass pollens. The northeast isnt even getting the worst of it. The worst city in the country right now for pollen is jackson, missouri. Check this out. Video caught on a cell phone camera during a flag ceremony in mexico last week. These are soldiers unfurling a flag during a military parade. Its the eighth largest flag in the world. Measuring 210 feet by 105 feet. One unlucky soldiers rifle became entangled. He was lifted almost 100 feet in the air. He spun wildly before slamming back to the ground. Luckily the soldier suffered only a concussion and minor ankle fracture. Thats good. Join us on monday. Squawk on the street coming up now. The economy added 223,000 jobs last month. We are on track for a strong open on wall street. Good morning and welcome to squawk on the street, im scott walker with jim cramer live from the new york stock exchange. David faber is at iac headquarters in new york. And has some very big interviews this morning. Be yes, indeed. Thats right, scott. We are