Into the close here. The action really occurred overnight. 9 00 we got word about Nuclear Tests by the North Koreans, and we also got word that china said its currency fix lower. I think that was a major factor. Modest expansion and new lows. Almost 200 at the nyse. Havent seen that in a while. The autonation ceo talking about the dealership. Thats a new low for autonation. The carmakers are being affected by that announcement as well. Whats holding up . This is looking a like 2015. Those old consumer names that did so well, the rentals and the conagras and the tysons and dr. Pepper, theyre the ones, again, fractionally on the positive side. Gold subpoena, and i do want to point out that while the Spider Gold Trust is on a fiveyear decline, the volume is fairly heavy today. Much heavier than normal. Twice the normal volume. Even though it may not be moving that much, guys, the volume interest is very high. All right, bob. Thank you very much. Bob pasani on the floor. More on north korea this morning. Lets go to chief pentagon correspondent jim mick mick. Theres still an awful lot of skepticism here at the pentagon and throughout the u. S. Government that this was an actual Hydrogen Bomb test. In oning part because it was 5. 1 on the Richter Scale which matched the atomic bomb tests of the previous tests since 1996. Price sily in terms of the size of the weapon. And its exponentially more difficult to create a Hydrogen Bomb. Not that it couldnt be done and not that north korea is pursuing a Hydrogen Bomb and if it were the case, this would be a huge game changer. A Hydrogen Bomb is about 1,000 times more powerful than the equivalent of an atomic bomb. It takes a small atomic bomb, very small, and plant it in the Hydrogen Bomb to actually ignite that thermoNuclear Device. Now, the u. S. Military had sniper planes, rc135s, in the air gathering air samples about the time the test occurred, and were even told they had people on the roof of the embassy in seoul collecting air samples just in case the wind should take any kind of chemical that is may have been thrown in the air. Thats probably the only way they would actually be able to confirm that the North Koreans conducted a Hydrogen Bomb test. It could be more compact and create more damage than an atomic bomb of its size, which means that it would more easily fit on to a Ballistic Missile warhead which would mean long range capabilities if, in fact, they did have a Hydrogen Bomb test. Again, a lot of skepticism and we wont know probably for weeks if, in fact, they did this. Carl. Ill take it from there. Here is ban ki moons reaction just a few moments ago. Destabilizing for Regional Security and seriously undermines the International Nonproliferation efforts. I condemn it unequivocally. Joining us now on the Cnbc Newsline is the former bureau chief of the Associated Press in pyongyang, jean lee, now Teaching University in seoul, south korea. We appreciate you coming to the phone this morning. We just heard the secretary general of the u. N. Denounce this as profoundly destabilizing, but north korea has run Nuclear Tests three times since the beginning of this century. Whats different about now versus then . I think the big difference is theyre claiming to have tested a Hydrogen Bomb, as we heard earlier. This is a huge step up. Theyve had success over the past several years, and because their program is so under cover we have really no idea whats happening. Its really only when they test a Nuclear Device that we have a sense for how far along they are. From my impression from having followed this issue for the past three tests, its a huge jump, a huge leap. I think in terms of the destabilization in the region, youre talking about a country that clearly does not care what china has to say about this or anyone else for that matter and doesnt appear to be under international obligations. The u. N. Resolution banned it from dissolving its Nuclear Program. Who can the world turn to . Go ahead, swreen. Its just going to point out that one of the things in terms of, you know, extremely powerful deveess and north korea has not allowed in the International Inspectors nuclear inspectors for years theyre doing this without any security, and thats terrifying for the region as well, and you have ban ki moon holding out the proliferation the threat of proliferation, the possibility that north korea may be selling technology to other rogue nations. You mentioned this collection and this research. We know we just heard from jim mikliaciewski, that there are seismologists on the ground trying to measure this. Do you think it is possible to confirm one way or another what exactly this test was . Its very tricky. Theres a very small window and obviously it is fairly iffy right now in korea. You dont know if theyre going to be able to capture that enough to confirm it. They have not been able to confirm whether it was highly enriched uranium or not. Theres a very small window and that can take a long time, and as i mentioned, people cannot get on the ground experienced inspectors cannot get on the ground. Theyre doing this at quite a distance. It is possible we may not know conclusively if it was a Hydrogen Bomb. What we do know is theyre headed in that direction. Whether or not it was a successful Hydrogen Bomb test, we may not know, but we know that thats what theyre working on now. Jean, a lot of the color that has been reported here stateside from inside the country or nearby is that this is, as you might expect, a show of strength, a lot of support from the rankandfile of north korea. Is that what you have heard . Well, you know, thats the thing thats the perspective that, where yes, on the ground, theres a huge domestic reason for why they are doing this. Something like this certainly brings the people together. Its a sense of pride. Theyre extremely proud, and they dont have a lot to be proud of, and this Nuclear Program is a huge source of pride. People this is something that is a regime. There are other tough times which they can point to as a positive thing. Something that makes them strong and makes the world stand at attention, frankly, which is whats happening right now. It is unsettling to say the least, and we appreciate you coming this morning. Jean lee, the former ap bureau chief in pyongyang. When we come back, well keep an eye on that and the selloff today. Also, a rare and exclusive interview. The ceo of sony will join our john fort at ces. Am is cutting production of the iphone. The stocks now at about 1 had been a share, and you are looking at occulus. Com. The rift finally on sale today. The price tag . 599. A lot of people are having trouble accessing the site and placing orders. Well see what progress theyre making when squawk alley conditions in a couple of minutes. Sure, tv has evolved over the years. Its gotten squarer. Brighter. Bigger. Its gotten thinner. Even curvier. But whats next . For all binge watchers. Movie geeks. Sports freaks. X1 from xfinity will change the way you experience tv. Welcome back to squawk alley. Im john fort here with sony ceo mr. Hirai. You had a keynote last night. Lots of news out of that. Yep. Want to start out, though, its a big newsy morning, talking about geopolitics, a lot of the concerns are out of asia, whether its north korea, whether its chinas economic slowdown. How does that affect how do you expect to sell these products through 2016 . I think the most important thing for us at sony is really to focus on, you know, the things that we role. That is making sure that we just have great products. Whether its in Electronics Segment and video games. Were essential great content in terms of entertainment properties. And to make sure theyre products that appeal to the customer. You know, from a standpoint, theres some volatility that were talking about. I just think we just need to take a step by step. Its been three days i think now in the markets. We still have a long ways to go here. Quite a three days. Lets get to the tvs to started. Always big, literally, here at ces. You came in as sonys ceo, turning around the tv business was moneylosing tv business was a big part of your mandate. How is that going . I mean, youve got it separated off a bit. People are buying more ktvs, and you announced innovations here. Has that business really found its legs . I think that the business is certainly heading in the right direction. We were profitable last fiscal year, and we aim to keep it in profitability situation for this fiscal year as well. Its fueled by great products in 4k. Larger screen, premium segment tvs, by android, and a lot of customers are now coming into retailers around the world asking for 4k and in many instances asking for sony 4k tvs, and i think its turned a corner, and now were in a phase where were going to be talking more about the great products that we can bring to market as opposed to whether business can be profitable or not because it is profitable. You havent managed to make a lot of headway approximate in smart phones themselves, but apple, samsung, others absolutely use sonys imageing chips, image sensors for the cameras in their smartphones. You guys have pretty much cornered the market as far as that goes . How do you manage to do that, and do you feel like your position is secure . We look at the technology we have in image sensor that is we deploy today as well as the road map that we see for the next three to five years, and i think that the leadership position that we have both in terms of technology as well as the relationship that is we have with all of our customers is something that is something that is going to be a driver for growth for sony for a very good period of time, and i think that, you know, we do have the Cutting Edge Technology in terms of being a manufacturer that does image sensors and also does camcorders, visual products, and of course, smartphones as well. We really understand what the consumer requirements are as well as the manufacturer requirements are, and we just have been hfd the curve. I think one of the most important drivers especially for sony, and it is called playstation vr is the gaming content. There we have over 200 developers that have signed up for the program. I think about 100 titles are in development actively as we speak. Theres a lot of support for vr based content from the content community. We want to really extent what weve got over the course of the past 20 years with the playstation format now into a vr format where, you know, its more immersive gaming. I think theres a demand we can create with playstation vr this year. Go pro has stumbled, right . Nobody, including sony, have managed make much inroads in action cameras against them. Do you think you have an opportunity here to take some share in action cameras . I think that, first of all, we have the leading technology in terms of the pure imageing side of our action cameras. Just as importantly, i think theres a creativity we need to come up with in terms of different accessories to meet different customer demands in markets around the world, and i think its that creativity that is going to either make or, you know, cause some challenges for that business. Sony ceo, thanks so much for joining us here from ces. Lots of ground ahead to potentially take kayla and, of course, im continuing my trek here at ces interviewing the ceos. Qualcomms ceo coming up next, guys. Back to you. Well see you, john, in just a few moments with that interview. John fort and the ceo of sony from ces. Coming up, more on apple stock woes and the status of Facebook Occulus preorders. Markets closing in europe in less than 15 minutes. Well have the Market Action on a big day for the markets. A volatile day with a lot of geopolitical issues. You wont want to miss the european close. Squawk alley will be right back. Zimplt welcome back. Contributor john steinberg, formerly ceo of the daily mail north america. Happy new year. Happy new year. You have some big ideas when it comes to apple. We should mention is holding up today. Absolutely. If you look at the other line of revenue, youre looking at 3 billion. Up 60 for 2015. Their year ended earlier because of the holiday. Thats a massive amount of revenue. Its a massive amount of growth. The stock trades incredibly cheap. Right now people are saying theyre over. Theyre out of ideas. What company is 3 billion in revenue 50 thats out of wrdz . You know, i said on the show someone will call for it to be broken up, and i think its a stretch. Theyre not being properly valued right now. Weve got a lot of Single Companies that are multibillion dollars. Thats their whole company. They get traded at better pe multiples than these guys do. Jim cramer has said if you are trading apple right now you do not believe that theyll be able to have a solid revenue stream Going Forward. Iphone cycles being what they will. Do you agree . Lets have a list of possible things they could go into. Some far fetched. Some maybe not so far fetched. Cars, vr. Theyre always late to things like phones and theyre always better at it than everybody else. How about appliances and media. They could launch netflix. How about banking . Health and medical. These guys are going to figure something out, and the stock trades cheap enough right now that you are not in over your head in terms of valuation like you are with a netflix or stock like that. I think you have to be out of your mind to bet against apple. For those that say they should have bought x and y, that would have been out of character tore them anyway . Its a Different Administration now, and they have shown themselves to act very differently than they did under steve jobs. The verge called this past year a beta year for apple where they released products like the ipad pro, that they wouldnt have done before. I think its not out of the question that tim cook could do both acquisition and also he has more to the stockholders like the stock buyback. Its not out of the question either, i think. I situation where you have the report on the back of multiple analysts reports talking about potentially 30 correction in the supply chain. Is now a time to sell even temporarily in your opinion if you think its an opportunity to buy . I dont know how you sell a stock that trades at a forward pe ratio of 9. 5, right, according to my y charts data thats going to grow revenue 10 billion for the next year. Next two years without any of these big ideas that we laid out there. You know, i understand weve never seen a company this big before, and that does bring in a lot of growth questions, but this company has reinvented itself. I watched the cnn documentary about steve jobs this past week, right . A company from the verge of bankruptcy to the most valuable company on earth seems a bit dicey to bet against them. As we were talking, john is trying too preorder Facebooks OcculusVirtual Reality glasses. Its been hard to get through. Where do you stand at this moment . Where i stand right now is originally when you went through you clicked the preorder button and you got a white page. Then i was able to get the 599 order price. Its amaze, by the way. This is tape of the actual event. I clicked the preorder button, and i get a white page. Now i was able to try to put my credit card in, and i was able to use pay pal as well. If anyone thinks i have bad credit and thats why i wasnt able to get through, it wasnt just my credit card. Then it fails out. Ive got numerous 1 notifications on my credit card right now. Keith terri was up there. He had the same experience. Now youre stalled out with credit cards and a lot of people on twitter right now saying that they cant get through that credit card step. Two possibilities. Either its so overwhelmed there are all these people trying to occulus rift. I dont believe that. I think facebook hasnt sold a product before. Im not saying orders are light, but theyre probably not that high, and these guys werent prepared. It kind of blows my mind that these people can be unprepared for this. When i talk to our producers about doing this segment, i said, you know, maybe i wont get through, and then the story will just be that i couldnt get through. Like it was a why dont they just have amazon do this for them . I mean, facebook doesnt have that hostile of a relationship with amazon. Mark zuckerberg has just posted on facebook saying after years of development its now available. When you put it on, he says, youll feel like you instantly teleported into adventures like deep sea diving, piloting a star fighter or playing in a band on stage. Fair assessment . So i have not used this particular one. I have only used the samsung one before, but everyone i have spoken to before says its earth shattering. Youll need an expensive xoort. Very few people have pcs. The 599 price is amazing. I said to cnbc i would buy it. If its 2,000, i dont want to buy it. They said facebook would lose about 100 per headset they sell. They are pricing it up slooults at least to where the street was expecting, but now people are saying that theyre trying to order it, and its saying end of april potentially to ship it. Yes. And they cant get the handset controllers these touch controllers that were supposed to be available right now. Theyve said they are delayed. This goes back to the apple argument as well. Apple may be late to vr, but theyre not going to have all of these types of problems that newer people to the hardware game have. Keep trying. Ill try. As im walking off, ill be trying. Good seeing you guys. John. The ceo of occulus is coming up in just about an hour. Up next, more on those developments in north korea with the former ambassador to south Korea Joining us on th