Transcripts For CNBC Squawk Box 20121213 : vimarsana.com

To Monetary Policy. Rates will be staying where they are right now, which is close to zero, of course. Until at the very least the jobless rate falls to 6. 5 . We can only cross our fingers wherefore when that might be. Ben bernanke says these changes will make the central bank more transparent adding they can only help the markets. The central bank ramped up its Asset Purchase Program adding 40 billion to its 40 billion a month purchases of mortgagebacked bonds. He spoke about the objectives during wednesdays news conference. The asset purchases and the rate increases have different objectives. The asset purchases are about creating near term momentum in the economy, trying to strengthen growth and job creation in the near term. And the increases in the federal funds rate are about objectives. On that note, lets get dinos take on the latest move. Grpg month. For you, this was expected. The 85 billion was expected. The move to the thresholds, that is, i think, we expected it was happened. It was signaled, but a lot of people thought it would happen later, maybe that it would happen sort of by march. So is it going to be different . I think the number was it was interesting. So lets take each one of them. The inflation rate 2. 5 . Lets remember, in january, they set up an inflation target of 2 for the headline pce, as its called. So now theyve already moved it, theyve moved the goal post a little bit. They were saying our target was 2 . Now theyre saying maybe they can live with 2. 5 . Theyre saying maybe these new thresholds will be reasonable ones. They can move them up or down as their own analysis dictates. On the unemployment side, Charlie Evans first pushed this and he pushed it at 7 and its now gone to 6. 5 . Even the big proponents of this have had these targets moved. Now, lets step back. What did this replace . This replaced a time horizon commitment. The fed had said were going to be accommodative until at least mid 2015. So then it moved and they said, well, were going to be accommodative until we get these inflation and unemployment numbers to these levels. Is this a really big change . Im not sure that it is. I mean your gamble is we could be at 6. 5 unemployment by mid 2016. I think, you know, the point is that the bigger issue is what are the asset pure chases . At what pace are these asset purchases and how long will they do them . As long as they are not committing themselves and not tying themselves to anything, all theyre saying is they have been tying themselves to a date, now theyre tying themselves to a number. Were going to be in here for a long time. Weve got qe now. We already knew we had qe. 85 billion, qe, the market was down 2 points yesterday on qe perpetual. Now we know were going to go to get the 6. 5 before we stop. If were in a new normal, like pimco says and like ryan hart, were never getting to 6. 5 . So this is qe perpetual for as long as it takes. The bang foreour buck were getting with all of these accommodative moves is getting slimmer and slimmer for market participants. Is this not worrisome to you that 85 billion a month doesnt move the markets and now we dont know when its going to end . I thought this was going to go on for a had very long time. Thats why when he said time horizon in 2015 but than he said why do you think its the same thing, then . But why didnt wall street main line this yesterday . Why wasnt this the fix they needed . Because they had specd it. The fed had already told you. Enough people said that they were going to were in permanent you and no now, this is a remarkable thing. A couple of years ago when they first did this, it was extraordinary. It was an emergency measure. Now, it is the standard. Weve got a weak, crippled economy and i cant believe we didnt get much fed support because we have no fiscal support. We have no fiscal support. Fiscal is going to be going the other way. And youre talking about 1 trillion of asset purchases now is the annual run rate spop that is now baked into the marketplace. Its billed its baked into asset prices and now its you know, what people are going to be betting on over time is it increased or decreased over time . All right. Have we not been lulled into you know, anything bernanke does now doesnt shock us or surprise us. Isnt this extraordinary . You know, a few years ago, there were all kinds of things that i would v never happened. Now if people ask me if such and such is possible, i say anything is possible. One of the things that i did think immediately yesterday was ben bernanke may not have this job in two years, right . People talk about that. He may decide he doesnt want to do it. He was asked about it. But he may ultimately be locked in. He may be locking in his successor and his successor after that into this type of thinking and this type of program. How hard is it to get out of this later . It is going to be extremely hard to get out of this, regardless of who the leader is, because, again, it is now you know, this is no longer an extraordinary measure. You did this during the emergency and then its time to get out. Now were you know, were in a bit of a quasi equilibrium here and this is how were running Monetary Policy now. So to now being doing a regime shift out of this, it is going to be very, very difficult and its going to be time consuming. It will be risky and the markets arent going to like it when when it comes. What does it say about the underlying fundamental strength of our economy and whether we have longterm structural problems being glossed over . We have a lot of longterm structural issues to confront. And the fed is, you know, the impact on the economy has not been strong. We have seen 2 growth since the recovery started. Markets have reacted more than the economy. And now the effect on markets is leading to to think of a you know, we always have to come up with met fors like this is. Slogan . No. Im worried about rise above because when we get to the debt ceiling, you cant use rise above. You have to stay below. Stay below. So were going to have to change it. No, but i think it might be a big boat thats got a bunch of holes and the water is coming in and you have the fed putting water out as fast as it can. Instead of fixing the holes but the problem is, if they cant fix the holes, right . So because of our inability to because congress fit the structure stuff. And there are demographic issues that are, you know, not under anybodys control. But, you know, we do have this problem with the Labor Force Participation going down, we have people exiting the labor force because theyre discouraged and in some places its the if i were running this country, i would be taking bernanke to dinner every night and getting him whatever he wants. Because its really masking the inability for us to govern. And the economy wouldnt even be doing 2 if it wasnt for the fed at this point. I think thats and that is politically if youre bernanke, the bronc thing to do or maybe the right thing to do for the country is to stop and say you guys over there figure it out. Multiply by times 12 by three . The value is going to be 4 trillion in another year. Thats about 25 of gdp. Sounds like a lot. Boj has more, ecb mass more. Swiss national bank, way more. So i mean, there are no limits that were approaching. So i wouldnt be shocked if a year from now were here and were talking about 4 trillion unemployment to a number thats even bigger. Lets check on, you know, the markets which are like that boat. Even after all this, weve got nothing. Were just trying to tread water and were indicated down about 9 points on the dow. After it was all said and done yesterday, were supposed to open higher. Yes. I dont know what you said later on in your conference. Did you do it . Ray dalio made comments latter in the day. De . About corporate bonts bonds and he thinks this whole thing at some point is going to implode. Steve galio was there. Yeah. It was a pretty interesting day. But i think his comments moved some people, too. Did we broadcast ray dalion . I dont know if we broadcast him live. We should grab some clips and play them on squawk. Dino, did you have something . I think youre on track in terms of the economy. The economy is weak. Should i be wishing things just bottomed on their own so that we could start policing i mean, you know, what will be great would be a surge in productivity. You know, a surge of demands externally. I cant get here any earlier. Were here at 3 30 in the morning. You know, can this economy be more productive . Go to bed at 8 00. Can that happen . Can we get a surge of external demand . And those things are unlikely or cant be predicted. Andrew got in earlier today than ever. I did. I was coming from the concert last night. No, i wasnt. Lets check out the situation in crude today. 86. Were used to that now, too. Its like, okay, 86 is fine. The tenyear, and this, when we used to go and see greenspan down in washington, he said Everything Else you have on your ticker, i need to see the 10 year. I need to see that every morning. Nothing has happened in the ten year for the last i dont know. Its just not as interesting as it used to be to watch. When its manipulated, its not that interesting. One of the things about qe is that its volatility. And you have seen implied vols down in all Asset Classes, including bonds. Because things normally are volatile, that just shows us once again this is not letting things letting the chips fall where they may. Yeah. I think its baked into the cake. But i think hes on to something. The fact that the fed is there, the fact that the fed is trying to get ahead of the fiscal cliff and weve got these big bond buying programs. And the last time, remember, in august of 2011 when we had the last showdown, what happened . Bonds rallied. And you said you want this to be fixed. You almost need the markets to be more volatile than they are. Thats one of the theories that people have thrown out there is that the politicians wont do something until the markets forced them to do it. Lets get to kelly evans, talk to the Global Markets. Kelly, i want to tie this to you, tie this to your purview over there. Every year, i get a tie from van ek and i got the first one was bernanke, a picture of him in a helicopter. And then i got one with draghi and a can and euro signs. Yesterday, its back to bernanke with the helicopter, but its alternating with draghi with euros because now he is out helicopter draghi. So were all in concert in a world that cant seem to exist without liquidity. We wasnt do anything based on our feds. Its not a great world to be in. Well, ben bernanke has given a great analogy. Its funny you bring that up today because its partly what were seeing as we look over to the italian and spanish debt auctions that havent wrapped up their fund rt for the end of the year. Its still a weak session for european equities. Just in fact last couple of minutes, weve had news from the euro group where after last night, it agreed on a common supervisor, the ecb under margo draghi. This morning, they agreed finally on the disbursement of aid to greece. Some says it removed uncertainty. Other investors, not so sure. I wanted to show you the italian curve, italy and spanl wrapping up their fundraising for the year. Their auctions werent all of that huge, but we are seeing yields fall, prices rise across the board as investors did show up. If we flip over to spain in particular, we can take a look at the threeyear over here. A bid to cover ratio of 4. 8 . One indication certainly of the kind of indications there are where the ecb is expected to be the most active if and when these countries have to access their bailout programs. Now were seeing prices in spain sell off a little bit. The tenyear, just under 5. 4 is the level there. For the longer dated papers, investors are a little bit more wary. Now, that news coming out of the euro group meeting, i wanted to show you the euro dollar as we wrap up todays Global Market support. Its still down. 1 , 1. 3056. That would tell you that the resolution is largely priced in. Now as focus moves into the start of next year, a couple of the key questions will be how much mario draghi follows ben bernan bernankes caps, maybe even cutting into positive territory. Expect to hear plenty more about that in the weeks to come. But for now, some resolution means this is front and center for these fiscal cliffs. Back over to you guys. Kelly, have your bookers called yet . Do you know . Have you tried to it may be better for you to call him directly instead of a booker. Can you get him on . Dont you want to interview him . Hes very charming, too. Look, maybe, joe, if you help us out. If we all ask nicely enough we can have him come on and explain why he is or isnt trying to dodge higher french tax rates. He, though, has been one of the more outspoke nn france about high tax rates overtime and even warning sarkozy about raising taxes. Im sure if anyone, hes happy to make this an issue. Did you see his net worth, supposedly . 120 million and i dont know whether thats euros or dollars. Hes made a lot of movies. Hes very charming in the airplane, if you remember. Joe, are you skulking at 120 million of in the net worth . Am i what . Can you scoffing, saying that 120 million is extraordinarily low . No. Shes hearing the audio from the audio room. No, that wasnt me. That was a sound track of a french guy that we ran long ago on the show. No, i god bless him. For an actor to accrue that much i think is great. And i like him. I like his movies. I think he ought to get going and order salad a few more times, but didnt he have a problem in an airplane . I think that was him, yeah. The aisles were clogged. Thanks, kelly. Yeah, youre right. I hate the when that happens. Its been more than a month sips the election. Next well have the post election nnz wall street journal results. Find out how the American People about washington, the cliff cliff and as we head to action, well check out the price of gold. This is america. We dont let frequent heartburn come between us and what we love. So if youre one of them people who gets heartburn and then treats day after day. Block the acid with prilosec otc and dont get heartburn in the first place [ male announcer ] one pill each morning. 24 hours. Zero heartburn. Lets get the National Forecast now from the channels wolf reynolds. Are you mad . Im not mad. I answer to wolf reynolds, reynolds wolf, i answer to everything. And then at home i hear all different kinds of names together. Theyre both actor names that people make up to be cool. Either way, its good. Its republicynolds wolf. Lets show you whats happening out west. We have spotty showers along the coast and snow showers along the coast. Still scattered snow showers in parts of the lets see, parts of the mountains in california. Not only portions of the san gabrielle mountains, but also the mountains in sierra, nevada. Its going to cause some backups in places. San diego, you might have a few delays there. In vegas, miami and new york, minor to no delays whatsoever. Thats the good news. Very quickly, lets talk about the east coast. So far, so good. Scattered showers on parts of the coast, but new york city expecting a high of 45 today. Mostly sunny in the ohio valley, into parts of the northeast. Still scattered showers in parts of south florida getting very close to the record, the yearly record of rainfall in miami. As we wrap it up, from fargo and on the other side of the river, expect snow showers. Still balmy, beautiful showers in dallas. Mostly sunny and 65. Back to you. Reynolds, thanks so much. Thanks for flag along. You bet, guys. Americans want action when it comes to the fiscal cliff. John, youll give us some of the highlights, but with what weve told them about what will happen if we go over, i guess we shouldnt be too shocked that they dont want to go over. Weve basically said there could be a recession, there could be millions of job losses and Everything Else. So i guess we probably shouldnt be surprised by that. No, we shouldnt. Theyve gotten the message. Theyve absorbed it. Weve asked in the survey how serious a problem is the fiscal cliff . And you get 68 of the people saying its a very serious problem, which tells you something when youre talking about something abstract like tax and budget politics which people dont ordinarily Pay Attention to. Theyve gotten it. But what were seeing in this poll, joe, is the after glow of the election. Typically when president s get reelected, the partisan fighting stops. Their numbers rise. The president s Approval Rating 53 . When you ask, who do you trust to handle the fiscal cliff, it shows how the president has the upper hand. 38 say they trust president obama. Thats twice as many as trust speaker boehner, although the 38 , of course, is under 50 . 38 . Oh, man. But when you look at the potential solutions, does obama have a mandate . We asked that question. You see very big numbers, 68 says he has a mandate to cut taxes for people who earn less than 250k. 65 say he has a mandate to raise taxes on the wealthy while cutting spending. Both elements are important. And when you ask about eliminating the bush tax cuts for people who make more than 250,000, 59 say he has a mandate to do that. So the president clearly has the whip hand in the negotiations, but, of course, members of congress dont respond to national polls. Theyre fought elected nationally like the president. Theyre responding to their districtes and thats why we have a Different Number to solve. I saw a number on nightly last night that was sadly low. We try to make something out of it. Who would you blame if we go over . And it was 19 to 24. That was weird, wasnt it . Thats where well, i think in some respects 19 we plame i think the president and 24 would blame thats not very thats like 24 . Thats all you can get for that . You cant even make a story out of that, can you . Well, i think there is a certain on both your houses if that happens. But look, it is clear, president obama has the high side of Public Opinion in a macro level. But, john, to campaign individual districts . For me, that bothers me. I understand ginning up public support, but beaches and campaigns, its govern, govern, govern, stay in washington, be with these people. Govern. Getting people to im getting email every day. I got one from i dont know, from his people, joe, call your congressman, call your congressman. And i finally wrote back on one of them. Youre still campaigning . Would you please start governing . And they sent Something Back to me, if you have comment on policy, snd it to this meal. But i finally sent it back and said would you please just youre in. Youre in for four more years. You dont need the crosssection of the United States behind you. As you say, ive got to pen. You won reelection. Now govern, now lead. But, joe, from the White House Point of view, which they feel was indicated by what happened in the election, the purpose of the campaigning is to make republicans govern with them. Thats by their rules. You know, the republicans got reelected, too, and theres more of them. Right. Well, theres more or them in the house. There is not more of them in the senate. And you need both houses. Then youve got the debt ceiling. The debt ceiling could be ugly, john. Yes, but thats an example in 2011 where the republicans did not govern. We knew the debt ceiling had to go up. They werent willing to do it. We had a long fight. Republicans lost the fight and the president then decided that he couldnt that working in a room with those people was only part of the solution. He needed to take his case to the country. John, thank you for that. I wish we could talked more about this and we will, but well do that with you probably tomorrow. In the meantime, coming up, weve got more of todays top stories and a hockey superstar went from top of the world to rock bottom, now hes making sure other athletes dont blow their cash. I always wait until the last minute. Can i still ship a gift in time for christmas . Yeah, sure you can. Great. Wheres your gift . Uh. Whew. [ male announcer ] break from the holiday stress. Ship Fedex Express by december 22nd for christmas delivery. By december 22nd wooohooo. Hahaahahaha oh. There you go. Wooohooo. Hahaahahaha im gonna stand up to her no youre not. I know. You know ronny folks who save hundreds of dollars switching to geico sure are happy. How happy are they jimmy . Happier than a witch in a broom factory. Get happy. Get geico. Fifteen minutes could save you fifteen percent or more. Good morning and welcome back to squawk box here on cnbc. Im joe kernen along with andrew ross sorkin. Becky quick is off today. In the headlines this morning, Sprint Nextel is offering 2790 a share for the 49 of clear wire that it doesnt already own. That news is out in an s. E. C. Filing earlier this hour. Our david faber reported earlier this week that a deal we know the two was getting closer and then it was on deal book after david reported it. And sprint thats not true. You know what . David has done remarkable. Everything around sprint examine clearwire, he has been on the ball ahead of not a competit competitor. Hes a colleague. Sprint is now authorized management to proceed with that bid. And were going to get a fresh read on Holiday Shopping when the government releases november sales figures at 8 30 eastern. At the same time, the government is going to release the latest on Producer Prices. Is today thursday . And you didnt say it. We want to welcome you for a thursday. I count on you for that. Youll do that later. I will do it later. And initial jobless claims comes out. Also, google maps. The apple iphone. Im so psyched. I cant get over this. This is it. The major headlines for the day. Apple had replaced google maps as the default mapping application with its own app, but that app was the target, as you know, of widespread criticism. The one thing people will take away from the new iphone is that it didnt have google on it. The google map is now available as a download from appel itunes. You can get it for free. And the big question was, a, was google going to make it and, b, was apple going to accept it . We were at the conference yesterday. There was a lot of discussion about that issue. It might be easier to list who wasnt at your conference. You know, you were invited to the conference. I was. I had Something Else to do. What did you have to do yesterday . Wash my hair. No, i had a no, i would have come. I did. I had a lunch. It was in the city. No. You were so close, you came across the bridge . I also had to meet with my style team. Okay. My style is lacking, apparently. Another historic night at Madison Square garden and the 121212 concert brought relief for hurricane sandy. The soldout show lasted nearly six hours and was said to have reached an audience of two billion, with a b, people around the world. It was broadcast over tv, radio, internet, quite a night if you were lucky enough to have a ticket. I was actually at another Charity Dinner where they auctioned off tickets to this event with a car waiting outside and some very generous person spend 19,000 and bought the tickets. Not that much. 19 you think is not . I thought there were tickets earlier that were going for more than that, also. It was an extraordinary concert for an extraordinary situation. And it will be interesting to see how much money well probably find out soon enough how much money was raised. 121212. And were all still here. Someone told me at 12 1212 and at 12 12, i called penelope. I wanted to be on the phone for that moment. I thought it was very row mant ek. You didnt do that. I didnt. Its really not 100 years. Its 88 years. Was she laughing about that . She was. Shes a big viewer. So she knew 100 years, you could do 121212 again. Some twitter people wrote in, you get 13 in your mind. But theres no 13 month. Exactly. Weekly data jobless claims coming out at 8 30 eastern time forecast to drop by the 3,000 to a total of 367,000. Plus, were going to hear retail sales on the Producer Price index for november. Lets find out what we should be watching when the opening bell hits today. Scott, to me, one of the questions is was going on with why is the volatility so low right now . It is staggeringly low. Its only about 5 and it hasnt been that low but about once over the last couple of years. I think that the markets arent going to go anywhere until we get a deal, but i think the markets are saying that ultimately we will get a deal this year. Fiscal cliff or its bernanke . Physical cliff. I think were going to get a deal. I think that the market, though, yesterday, at least in fact last half of the day was very d disappoi disappointing, given everything mr. Bernanke had done. We had a nice gain in the s p. We gave it all back. And i think that the market is not quite certain what mr. Bernanke is doing. And he now sounds like my Junior High School guidance counselor. Then why is it talking about talking about human potential. Youre not living up to your human potential. Why are you saying its not bernanke, then . Better nabky seeps to be helping as we gloss over this problem. Well, the s p is barely above its 50day moving average. Its had a nice run, but it had a big problem after they got started buying mortgages back. I dont think that you can say that what weve seen over the last ten days, anyway, in the s p is fantastic. If mr. Bernanke wants to take credit for the s p not going anywhere over the last few days, thats fine. What do you think of all the dooms dayers out there . I remember even a month ago, people say, if we are in the middle of december without a dealing, the markets are going to start freaking out. We are in the middle of december without a deal and the markets are not freaking out. That is absolutely right. I think the tone, though, has changed a little bit. We no longer have duelling press conferences where politicians have each stripe step up to a bunch of microphones and start to blast the other one. Joe is right, they need to start governing rather than campaigning. I think theyre governing, but theyre doing it behind closed doors because they understand that nobody is served. Real quick, if theres a freak out, if there is volatility, it comes when, literally after january 1st at this point . No. I think its right around christmas. I dont think anybody wants to be in washington, d. C. For christmas dealing with this and i think that if we get to christmas and theres not a deal and theyre not saying a deal will be done over the next couple of days, then i think youll see people start to go buy options. I think the thing to watch to see if that happens is the vision. If the vix gets above 20, then we can see whats going on. You can always catch scott on options actions on friday afternoon. If you want comments on questions about anything you see here on squawk box, email us at squawk at cnbc. Com or do the twitter thing. Now youre like the recommended users. You should just tweet you direct. Right. But you have had, what, 700 tweets, right . Cramer, 26,000. Carl like 8,000. Carl is just hes a tweeting machine. Puts pictures in and not like nice pictures, usually scenic pictures. Still ahead, a former hockey great who went from superstar to down and out and now hes preaching fiscal responsibility. Hes going to talk to us about his journey, about managing money and why he would put the nhl in the penalty box. Squawk box is coming right back. Ct wool exports from new zealand, textile production in spain, and the use of medical technology in the u. S. . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 75 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. Hes going to apply testosterone to his underarm. Axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men. Axiron is not for use in women or anyone younger than 18. Axiron can transfer to others through direct contact. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these signs and symptoms to your doctor if they occur. Tell your doctor about all medical conditions and medications. Do not use if you have prostate or breast cancer. Serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. See your doctor, and for a 30day free trial, go to axiron. Com. Welcome back. U. S. Equity futures at this hour should be up like 800 points, but theyre not. Down two yesterday, down 18 today. We have 85 billion a month forever from in the new normal and we never get any jobs and we basically are going to have 85 billion a month until, you know, weve got to get through that mind thing. It may only last another wa is it . Whats today, the 13th . The 13th. So it may only be another eight days. I bet just the fact that we got through yesterday. 12121212121212. Anyway, former nhl star anderson went from being the highest paid athlete in the world to being on the streets. Derek sanderson is a managing director at sports Wealth Management and the author of a new book, crossing the line. The outrageous story of a hockey original. And he joins us now. Congratulations on a book. Congratulations, derek, on turning your life around. I can remember when you were like a like a babe magnet in the nhl. You had the long hair and everything. And, you know, i think about it doesnt have to be athletes, but i think about a lot of people that make money and then make bad investments and then their personal life kind of disintegrates, as well. As far as advice goes, is it Financial Advice or are a lot of these i think you need counseling or therapy, as well, right . Just for all the money and success that you have. Well, its a coping mechanism. Its a difficult thing to take that keep of money, when you havent been bred to money and you dont understand mope all that wealth comes to you. It tends to get into the way of your social life. It takes the spirit away from the game that you love and play. Its a difficult thing to handle and theres a lot of counseling involved. Theres a lot of put it away, dont spend it and its very difficult to get someone 21, 22 or 23 years old to save money when theyre making 78 million a year. That seems foolish. But ill tell you, if you dont b, we try to teach the compounding of money, where it will take you. We have smart people worthing with us, wornging with athletes. Sometimes i wonder wa comes first. These guys, they seem to be preyed upon by people with investments that dont work out or get rich schemes or, you know, all of this stuff. I dont know what comes first. The you know, the money that then, you know, clouds your judgment in making investments or it almost seems like you would have to, you know, fix the person psychologically and then look for Good Investments. You cant just give a person who is enamored of the wealth, you cant just give them Good Investments, then they would have more money to do drugs and can alcohol with, right . If you give them Good Investments and you still own that stuff, then theyll be dead. Yeah. Thats a good point. And you are to remember, all the players and all the leagues play in that get rich quick scheme is there before you get there. Before the young player gets there. Hes already with the veterans. So you have to keep them what to be aware of. And how to behind. And this modern world technology, no matter what they do, somebody is taking a picture of it or tweeting or talking. Theres very little privacy. And thats another issue. You have to be careful of how you behalf. Is the problem more that theyre being swindled on bad investments or more that theyre just mixed spending money . Well, a lot of it, ill tell you, the swindle appears to have made off top of thing, that happened, yes. They dont Pay Attention, too, and thats what we try to get them to understand is, you know, the difference, where is your money . And you have to look at it and bhain behave, take care of it. But the bad investment is always at the golf course or the restaurant or things that are very different and someone else has to manage while youre playing. And thats something you dont want to do. Give someone else your money to play with while youre not watching it. Its a stuff environment right now. What do you tell them, go into a. 6 cd . Its very difficult. What are you telling people to invest in right now, derek . I myself dont. I dont tell them what to ive been listening to you guys and youre the experts. Uhoh, then youre in trouble. Yeah. And everybody watches you guys and everybody speculates and is guessing. Its a different thing. Prudent, wise management is the sound way to go. But, derek, i would think the hardest part would be watching the prudent guy who thinks, im going to save my money, im not going to buy 20 cares and then and that, but then their teammate res. Everybody else is doing it. Isnt that so much the part of whats going on here, sort of the culture of it . There is a culture of it. And thats vary difficult thing to watch out for. Its very difficult for a player to control when theyre young and they see the older guys doing foolish things. And then you can start a trend, keep the dressing room down. Its a different thing, no matter what you do or how you talk to them. What are we going to do with the lockout here, derek . I am i dont know. When they started this, i thought the last cba was very good for everybody. They got their cap. They got everything they wanted. I thought the owners would be thrilled back up mr. Bentman decides to turn them around and lock them out again. I want the people to understand this is not the players striking. This is a lockout. So its difficult. The players are getting beat up, i think. And i just want to see them playing again. Yeah. I mean, its hockey was coming back, i think. It was with high definition. Big screen tvs. High def television. It will be back. Hopefully this will pass. Its a pleasure having you on today. And youre right, i think you can learn from here. Watch cramer at night, watch throughout yao the date. Youll at least have all the information you need to make more intelligent decisions. Thats right. Be informed. Thank you very much. Coming up, weve got mysteries surrounding john mcafee. Hes landed in america. Weve got that story now. We also have duelling guest hosts ready to take the stage coming up at 7 00 eastern time. Mat miller and joe watkins, theyre going to go at it. Theyre going to be rising above, thinking below. More on squawk as we continue. [ male announcer ] you are a business pro. Governor of getting it done. You know how to dance. With a deadline. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. This is awesome. [ male announcer ] yes, it is, business pro. Yes, it is. Go national. Go like a pro. Yes, it is. Try running four. Ning a restaurant is hard, fortunately weve got ink. It gives us 5x the rewards on our internet, phone charges and cable, plus at Office Supply stores. Rewards we put right back into our business. This is the only thing weve ever wanted to do and ink helps us do it. Make your mark with ink from chase. I have obligations. Cute tobligations, but obligations. G. I need to rethink the core of my portfolio. What i really need is sleep. Introducing the ishares core, Building Blocks for the heart of your portfolio. Find out why 9 out of 10 large professional investors choose ishares for their etfs. Ishares by blackrock. Call 1800ishares for a prospectus which includes investment objectives, risks, charges and expenses. Read and consider it carefully before investing. Risk includes possible loss of principal. Cmon, michael get in the game [ male announcer ] dont have the hops for hoops with your buddies . Lost your appetite for romance . And your mood is on its way down. You might not just be getting older. You might have a treatable condition called low testosterone or low t. Millions of men, fortyfive or older, may have low t. So talk to your doctor about low t. Hey, michael [ male announcer ] and step out of the shadows. Hi how are you . [ male announcer ] learn more at isitlowt. Com. [ laughs ] hey live from capitol hill today, encouraging lawmakers to try and rise above gridlock. Fiscal cliff, of course, is a complete madeup deadline. Discretionary spending is 1 trillion, 280 billion. Were 18 billion short of having nothing for the entire government. What do you think the best possible outcome could be . Something like simpsonbowles, and work off that. When a deal is announced, if the left and the right arent angry, theres not a real deal. Were back on squawk. And weve got an update on a very interesting crazy story. John mcafee, holed up in a miami hotel after his deportation from guatemala. Weve been bringing you different aspects of this throughout the past couple of weeks. The Antivirus Software founder has been evading authorities in belize who want to question him in connection with the death of a neighbor who was shot, if you remember. Mcafee said he did not kill the neighbor. Fear for his life if he turned himself in to authorities in belize, he was tweeting and blogging about all this as it was going on. Mcafee announced on his website last evening that he arrived in miamis south beach neighborhood. American airlines said mcafee sat in a coach class seat on the flight from guatemala. Were going to get robert frank on the case later to talk more about it. This is a wacky, wacky story. Is he wanted here . Apparently he hasnt been arrested here. Is he wanted here . I dont know. Maybe robert frank can tell us. Okay. I cant figure out if this is just all trumped up in his own mind. Im not i dont really does he get to come back and just go to south beach and just resume where he left off . Is he living large . Hes got lots of money. South beach is a place where you actually, i dont understand why he left. Were going to talk to robert frank about all this. He knows the details. Ive got a lot of questions. But lets get a quick last word from our guest host this morning, dino coast. Leave us with something. Give us hope. Is there hope . You dont have to. You can depress us if youd like. Its hard to have hope. But Steve Liesman was walking by a little while ago. He had a trip of bernanke talking about what the assets is for and what the fed funds rate is before and for the life of me its really hard to reconcile what he said. He said these are two different objectives. One is for shortterm stimulus, one is for longerterm Economic Management of some kind. And i, you know, thats the first time that he has talked in those terms about how they are really different objectives, like tools. I think for most people this is about you either ease financial conditions or you tighten them. So, if its getting a little i think even the fed communicating at this point. Ive been ive thought that for awhile, actually. Because i think maybe just the message is getting confused in the marketplace, and maybe whats happening in front of us now was always happening behind the scenes. You know better than i do, but we just didnt appreciate it. You know, the feds have this ongoing process of communication for 20 years. In the last few especially the last year, 18 months, you know they made very aggressive effort. And do people have more clarity . Yes or no . Im not sure that they do given what we heard one of us is right, andrew. Either financial crisis, and the debt that we had built up was so big and so reinhart wrote off big that the fed knows were still really weak and were not growing like we should. Or, all this policies, all the regulation, all the worries, all the uncertainty, one or the other is causing us to be far below what the country is capable of, and we need the fed for training wheels and the training wheels look like theyre never coming off. Which is not good. I want to fly. I dont want to be at stall speed forever. I want to fly. And i want to dance anyway, we would like to, you know, as we said, thank you. Want to dance. Remember that commercial . I do. Maybe we should dance. Wait till we go to break. Okay. Go. Fox trot . Tango. Nice. Coming up, the fed links the Unemployment Rate and more of todays top stories. Weve got that and a lot more. Plus were going to go tango. Rising above. Squawk has dueling guest hosts to work out all the fiscal cliff issues that lawmakers cant. But what should the small investor do ahead of the new year . More squawk box next. This is america. We dont let frequent heartburn come between us and what we love. So if youre one of them people who gets heartburn and then treats day after day. Block the acid with prilosec otc and dont get heartburn in the first place [ male announcer ] one pill each morning. 24 hours. Zero heartburn. Look this isnt my first christmas. These deals all seem great at the time. But later. [ shirt ] merry christmas, everybody not so much. Ho ho ho this isnt that kind of deal. [ male announcer ] break from the holiday stress. Save on ground shipping at fedex office. The fed makes history. Chairman bernanke links Interest Rates to the Unemployment Rate, but does this mean investors should get in to stocks right now. Time for dueling guest hosts. With offers going back and forth between capitol hill and the white house, were going to try to solve the problems on our own set with matt miller of the Washington Post, and republican strategist joe watkins. Plus taking the pulse of small investors. Why volatility will be the name of the game in 2013. I had a bad experience on this ride once before. What happened . I threw up. The second hour of squawk box begins right now. Good morning, welcome to squawk box here on cnbc. The partys just getting started. Becky is out today. Take a look at futures as we set up the day after what was a down day yesterday. Dow looks like it will open up down ten points lower. S p 500 off about 2. 5 points and the nasdaq off a little over four points as well. Some of the morning headlines, Sprint Nextel offering 2. 90 share for 49 of clearwire it doesnt already own. Our own david faber reported earlier this week that the two sides were getting close to a deal. Clearwire has acknowledged that the offer says the discussions between the two are continuing. The future of American Airlines will be in focus today. The ceo scheduled to address the pilots union with the view of the airlines future following its bankruptcy restructuring. The unions favor a merger with us airways that would turn management over to that airlines executives. We talked a lot about that. The u. S. Home reowe potions rose to a ninemonth high in november. Thats according to a new figure from realty track even as the number of homes entering foreclosure process are at a sixyear low. It did not escape all of our viewers that we were going to dance on break and then we came back with a bunch of deliverance music. That was for the dueling guest hosts. We already headed for dueling guest hosts. It was preproduced. And then we happened to serendipitously say we were going to do the tango on break. I was pushing for the fox trot. Why cant apart . Anyway the wall street journal says that barclays plans to eliminate as many as 2,000 jobs in its Investment Bank as part of the restructuring plan. The cuts are exexpected to be announced last year. Barclays would be the latest to make such a deal. And were going to go to what we asked for. We talked about now we have the chance to talk to many big deems at the conference yesterday, ray dalio says low Interest Rates are squeezing risk premiums, and as a result most Financial Assets are fully priced. He thinks the biggest opportunity may be shorting the bond market. Dalio wasnt very positive on any asset class and when asked about the impact of the fed and the economy, this is what he had to say. Were now in the situation where the impact of another quantitative easing will do very little. And so we have that as the setting, i think, for the next year. At the same time as theres fiscal weakness. We have not in our lifetimes ever experienced a case in which there was a downturn in the economy in which there was not an ability of the central bank to ease Monetary Policy. This explains a lot. He was a gold guy. He was a gold guy. He was saying short bonds. Short bonds . The question is when do you short bonds. Thats the issue also by the way, treasury i think he was talking more about treasuries. I will say by the way, blankfein yesterday made the comment we could be in a bit of a buck around corporate treasurietreas well. Knowing that the fed can sort of decide where bond prices are, and knowing what we heard yesterday, that its going to be till they gave us a number, theres an unemployment number, seems like he may have to put off being right on the bond market for a couple of years. No . Probably shorting got to be right on the timing. It can cost you. Because youre on markets and Steve Liesman is here. Let me talk about this 121212. You know at the 12th hour of the 12th minute and the 12 second there were like eight 12s. Another historic night at Madison Square garden. This was the 121212 concert for sandy and it brought together some of the biggest names in rock n roll on one stage. The starstudded lineup included the rolling stones. I would like to move like jagger. But i cant. Paul mccartney. Eric clapton. The who. Bruce springsteen. Did you go straight from the concert came right in here. You see people call him them the strolling bones . I have heard that. Theyre said to have reached an audience of 2 billion people around the world. It was broadcast over tv, radio, and internet. Quite a night if you were lucky enough to have a ticket. I can tell you, you know that, and i wouldnt venture into that i mean, there were ventured into town yesterday. But i dont like a lot of people around. You know . You would have only had a private concert in your living room . Right. Anyway for the first time the fed is linking Monetary Policy moves with economic bench marks. Cnbcs Steve Liesman joins us now with more. You could have been, steve, oh, youre going to do it actually. On any of the previous discussions that weve had. You could have been here and i would have valued your input. But what we finally decided was, either ten years. Took ten years to do that. Yeah, yeah, yeah. What we finally decided was that, whether andrews right with this reinhart rogue off, the financial crisis was so deep, or whether im right that a lot of Government Policies with regulation, and uncertainty, whether one of us is right about the economy, just not somewhere in the middle. Both right in the middle. But we still need training wheels and bernanke is all too willing to have those training wheels on indefinitely. Well, first of all from bernankes point of view he has this zero Interest Rate policy. He cannot set policy below zero. He has this problem. What is the appropriate policy for the economy and the way it is given given his duel mandates. Weve got to change the dual mandates. Hes totally justified in what hes doing and he has total cover. What we dont know what the longterm effects are going to be. I thought it was like moving around skwarks. The universe might end at any moment. Have you thought about what policy would be with a single man date right now . Where would he be wed be in a similar place. He may not be doing 85 billion. Really . 85 is a lot. I want to show you a couple of cool go to what bernanke said yesterday. Thats the first element i have in there. He sort of explained this policy. By the way, he called it qep. I like that. Could also call it qe four or even qe six. Whatever you call it the fed is set to increase the balance by a trillion dollars. 6. 5 and a 2. 5 inflation right. Bernanke was not shy about explaining his reasons. The conditions prevailing in the job market represent an enormous waste of human and economic potential. Return to broadbased prosperity will require state improvement in the job market, which in return requires Stronger Economic growth. Now just want to make sure you understand whats going on here. There were really two policies out here, and two rules. You talk about that a little bit with dino in the last hour. Okay, so qe, the purchase of assets, will continue if, quote, the outlook for the labor market does not improve substantially. Keeping the fed funds rate at zero will be appropriate at least as long as the Unemployment Rate remains above 6. 15 at inflation. Notice it is not the same numbers, the same policy rules for qe. We dont know what those numbers are leading neil to talk yesterday in his criticism, hes from Credit Suisse, he says quote at least upon the introduction after todays fomc meeting the new guidance language seemed anything but clear. He called it the fog of transparency. You guys also were speaking about the connection between the fed and Unemployment Rate. Diminishing returns. Take a look at the chart here. On the righthand scale there, all right, that is that is the Unemployment Rate and that is the green line. The blue line. They messed that up. The other point is supposed to go down, the blue line, in a very shallow way. The green line which is the Balance Sheet, shoots up. So there you see that the feds own forecast is you go down from 7. 75 down to 7. 5. 20 basis points, in the next year for a trillion dollars. Which is not really a whole lot of return. Then the other thing, if you look at the forecast they really lowered their forecast. They do see a 3 growth quarter but they brought it down, they did a trillion dollars of qe, or forecast that, and they brought their forecast down by a tenth. So theyre seeing diminishing returns. Steeper. Youre doing more qe. Im not sure we all made enough of this. Way did a trillion dollar Balance Sheet in 09 to 12. Thats four years. Were going to do a trillion alone next year. So this is a big and rapid expansion. Can i ask you a question . In the last hour we talked about chun indication. Do you think that now theres an overcommunication thats going on . Meaning did all this stuff really happen in the background and we just never knew it . Theres a change in communication. I dont think the fed first of all, nobody heard dino say it. I said it yesterday. Nobody was ready we all said we want more transparency. Right, right. Now its a little bit. The grass is always clearer on the other side of the hill. Calendar dates we understood. Now ive got to think about how Unemployment Rate i do want to know. But the thing that im worried about is that, if were in a new era of normal, a pimco era where were at the lowest Unemployment Rate we get is still at 6. 5 or above. Thats huge. What youre suggesting is huge. What youre saying is that 6. 5 , the new normal, in other words, what they call the naru, nonaccelerating rate of unemployment. That changes everything. That means the fed is way too easy. If 6. 5 is the new 4. 5, then that 85 billion has to go away. What you would then get would be huge inflation if thats true. Right. You would get wage acceleration. You would get pricing increases. Thats what would happen. Thats not the feeling of the fed. Its not 9 general consensus. I hope not. You know, morning in america. Were getting back to 4. You also have that slack. Remember why we talked about the u6, we talked about that, because thats total slack in the labor market. Thats, i think, what bernanke wants to see come down. I think hes out of different ideas. Hes got this main thing he can do. Not out of bullets. Its going to press on those. All right. Thanks. Kind of glad. We are just were just seven were just weeks away from the fiscal cliff deadline. Still no deal. Joining us for the next two hours is our guest host matt miller, cowl up nist at the Washington Post. Former white house aide under president clinton and joe watkins, former george h. W. Bush white house aide and republican strategist. Im sure these guys will probably be metaphors for whats happening in europe. We want to rise above it. Which would mean could mean matt is going to slow walk us over the cliff so that in our opinion did you see how long it took him to get from the green room here . Let me ask you. Are you guys, republicans still saying that jobs matter if we raise taxes . You finally said oh,ist not that big a deal anyway. Where are you . Have you thrown in the tall . Not at least to the public. Weve got to make the point over and over and over again that, you know, we can get to this number, we can do this, the republicans have offered a deal that makes sense, thats reasonable. That says guess what you can do. You can get this done without raising marginal rates. You dont have to beat down folks who are small businesses, who are successful, to get where you want to go. You can do it by beat them down by taking them back to the clinton era rates of 22 million jobs . This is but you dont want to go back to the clinton era rates. You only want to go back on the top 2 . The reason we were able to balance the budget so its better. But the reason we were able to balance the budget and have a surplus was because we were raising a lot of money because everybody was paying in yes. Go back to that top 2 you hardly raise any money. Its thats not the clinton tax rate. Larry summers im not done. All right. Then. Why if the boomers retire, of course taxes are going to rise as a share of gdp. Were doubling the number of seniors on Social Security and medicare. This is what the democrats now want to do, as a first step. They feel it was the inequality of the justice argument, blah, blah, blah, and if thats a piece of the beginning of the adjustment to the boomers retirement, fine. Dont you really wish we were talking more about entitlement reform and spending than just taxes . I think we need to talk about that, joe. They want to talk about youre the only one on your side who wants to do both, then. Im a unique individual. The right answer would be to link i think whats so interesting about what bernanke did yesterday, people like me have been writing for the last few years, what we need is a fiscal deal that says stimulus, infrastructure, all this stuff in the nearterm, when weve got 23 Million People who are looking for fulltime work and cant find it. And then when unemployment is below some trigger rate, which is what bernanke has for the first time done,ook the unelected chairman of the fed, very weird thing in a democracy, that hes the one talking about the enormous waste of human capital. He sounds like a bleeding heart liberal, right . And hes right. Why is he the one in our system who talks about the need to take extraordinary measures to try and get people into the job market, and then adjust once weve gotten back to Something Like whatever the new rate of unemployment. What youre saying, though, to the corporate im confounding you ideologically, i know. No what are you saying about the bush era tax cuts . What are you saying about that . The greatest thing ever done. Now with the economy being as fragile as anemic as it is would you want to raise taxes on folks making over 250 . I mean somebody in the northeast who is making over 250, just over 250, by the way, with a family, with kids in college, with a mortgage to pay, with a couple cars, they dont have any money. And below 250 you cant raise it, but above 250, absolutely matters. Were going to continue this conversation after the break. But i would also say, were not only talking about higher rates, youre also talking about deductions for those people, as well. So were not really talking about clinton era tax rates. Were talking about Something Else. Youre not talking about clinton era spending, size of government. Anyway. Bingo. This will continue in the meantime, check futures real quick. Its not setting up nicely after mr. Bernankes announcement yesterday. Looks like wed open up with another down day. Not horrible but not great, either. Coming up next the markets, yep, appearing to shrug off the feds move to get aggressive on the economy. Were going to take a look at where you should be putting your money to work. Write now, squawk box on cnbc profit from it. Hahaahahaha oh. There you go. Wooohooo. Hahaahahaha im gonna stand up to her no youre not. I know. You know ronny folks who save hundreds of dollars switching to geico sure are happy. How happy are they jimmy . Happier than a witch in a broom factory. Get happy. Get geico. Fifteen minutes could save you fifteen percent or more. Theyre not admitting. Good morning and welcome back. We have a buyout deal for Electronics Retailer best buy that might be getting closer. You sounded as if we had a deal. Thats the way you do it then you pull it back. People get all interested. They turn off the mute button. They call their friends, watch cnbc, theres a buyout. Then they say, it could be getting closer. Weve been telling this but its still interesting. Very interesting. Dow jones reports that founder rush ard schultz will submit a formal offer this week. Apparently hes going to run starbucks and best buy. The neighborhood is said to be in the 5 billion to 6 billion. Be that good. Are they brothers . Big box retailer. Okay. Lets get some investment ideas and find out the significance of fed chief Ben Bernankes comments. Yesterday, joining us now, jason trendert of Strategic Research what did i say . Anyway, jason its good to see you. Chief Investment Officer and managing partner. You saw what ben had to say yesterday and you did what . I thought it was a little more aggressive than i was expecting. But i mean, trackly, i dont know why i would be surprised by that. Because ben bernanke has been clear, very open about the fact that he wants to be more aggressive. I have to say, though, that i never really thought that this would be very efficacious. You have 30year fixed Rate Mortgage of 3. 5. Feds done a lot. And it seems to me it has to be much more on the fiscal side than the regulatory side to get things moving what the heck are you doing then as an investor . What are you supposed to do after all this . What i will say, andrew, that one thing that concerned me a little bit is the market actually closed down slightly. That there was initial reaction to it, and you never want to see markets sell off on what should be doesnt look like its going to open much higher today. Right. You dont want to see markets sell off which should be good news. Other investors are coming to the conclusion that you have diminishing marginal returns. Listen the fed can literally drop money out of helicopters. Theyve been doing that. The problem is its going directly into bank vaults. The velocity of money continues to go down and its very, very hard so give me the investment idea. The investment idea to me is that its not going to help. And that i think the other we actually think and therefore you do what . The last time just give me a second here, andrew. Im trying to get to it, okay . We, i think, are going to theres going to be a slowdown in the economy. Want to be very careful in terms of retail stocks. We still want to be in very defensive sectors. And that really has nothing to do with the fed. Which was the original question that you were asking. I think it has to come much more from the fiscal and the regulatory side and it doesnt look like youre going to get much of a deal there. Hmm. So you you think so now were back to the fiscal cliff. You think there is no deal coming . Or you think were getting a baby deal . I think youre getting a baby deal. And i think without structural. True structural reform i dont think youre going to have the types of risk taking on the part of businesses that would generate real growth. And i think there is a yawning gap between Business Confidence and Consumer Confidence right now. Capital spending is already weakened. But Consumer Confidence still remains relatively high. When does it hit the consumer . I think really in the first quarter. Because especially if the payroll tax cut is not extended, which it seems very possible, that is a very big deal. I also think you really have to watch to see whether the debt ceiling is actually extended. And if the debt ceiling is not extended as part of this deal, thats also a very, very negative development, because it means were going to have another couple of months of wrangling. Jason. Thank you for your thank you. Sorry to push you on this. Not a problem. I appreciate you pushing back. Not a problem. Coming up, House Speaker john boehner telling his colleagues to cancel christmas plans. Thats the word. We speak to our guest hosts about what it will take to get a deal done in d. C. Over christmas break. I cant believe it. Plus the former ceo of e trade now running Jefferson National is going to tell us what this all means for the average investor. Americans are always ready to work hard for a better future. Since Ameriprise Financial was founded back in 1894, theyve been committed to putting clients first. Helping generations through tough times. Good times. Never taking a bailout. There when you need them. Helping millions of americans over the centuries. The strength of a Global Financial leader. The heart of a onetoone relationship. Together for your future. I heard you guys can ship ground for less than the ups store. Thats right. Ive learned the only way to get a holiday deal is to camp out. You know weve been open all night. Is this a trick to get my spot . [ male announcer ] break from the holiday stress. Save on groushipping at fedex office. Youve got comments, questions about anything you see on squawk, shoot us an email. You can also follow us on twitter squawkcnbc is our handle. Joe, whats your handle . Its either joesquawk or squawkjoe. Its one of those. Next the trading block, the day after the fed meeting and the chairmans news conference, what is the trade to make right now . And then later, mitchell cap lon, ceo of Jefferson National and former ceo of etrade financial is going to give us the pulse of the market. Tomorrow on squawk box well go inside the feds latest move. A special extended interview with dallas fed president Richard Fisher. Quantitative easing, the economy and the fiscal cliff. Dont miss squawk box starting tomorrow at 6 00 a. M. [ engine revs ] [ male announcer ] the mercedesbenz winter event is back, with the perfect vehicle thats just right for you, no matter which list youre on. [ santa ] ho, ho, ho, ho [ male announcer ] lease a 2013 c250 for 349 a month at your local mercedesbenz dealer. You wont just find us online, youll also find us in person, with dedicated support teams at over 500 branches nationwide. So when you call or visit, you can ask for a name you know. Because personal Service Starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. Our support teams are nearby, ready to help. Its no wonder so many investors are saying. [ all ] im with scottrade. Welcome back to squawk box. This morning in the headlines, were about an hour away from a flood of economic data. November retail sales, Producer Price index and weekly jobless claims set to hit the tape at 8 30 eastern. Also juicy news out of europe. European leaders have agreed to hand over the next batch of loans to greece. The country will get about 48 billion euros between now and march and the European Union finance ministers have reached a landmark deal on banking supervision that makes European Central banks the regions top banking supervisor. It will be approved by eu leaders later today. And solar city going public today. It was supposed to happen yesterday. Solar equipmentmaker sold 11. 5 million shares at 8 per share. But that is below earlier estimates of 13 to 15 per share. And ivan musk still going to make a lot of money doing that. One other story to note,s new york citys taxi and Limousine Commission voting today on a proposal that would permit taxi drivers to use taxi hailing apps. Weve talked about this before like uber. The use of taxi handling apps, smart phone apps like uber, haywell and others rising sharply around the country. I use it sometimes. There is some pushback, though, on these apps. A group of livery and black car owners have asked the commission to reject the proposal. Also big issues about the value of a medallion in new york city. Its a huge market for that. And how annoying is this . You ever stand on the street in new york city and you see the cab go by you with nobody in it . That might start happening a lot if people are using these apps because the taxi driver would get an order on the app, and say oh, im going to go three blocks but theres two people on the block before he gets there, and so theres Big Questions of how this is going to work. This vote would allow them to temporarily at least try this. Uber tried to get into this market about a month or two ago, and then was ultimately blocked by the commission. So, those in new york playing with the app, today may be your day to at least experiment. And we have a we have 75 participation in rise above here. Weve got ive got the hatfields, and the mccoys here. Ive got hannity and holmes. And you are the 25 that is not for you, listen, rise above no, for joe, rise above is the Obama Administration needs to rise above. For you, its the house and boehner need to rise above. For me, its Everybody Needs to rise. Its not a partisan thing. Its a lets do this. What about Marc Andreessen . Lets not rise above anything. Hes like one of the only people. Weve got all this okay. We gave you one. Theres a sink below caucus. Here it is. You want me to tie my tie like you . Put it on your tie. Its like a rorschach. It can mean anything to you. We just want to get this done. My styist would not be happy with this look. Your stylist has got a lot of work to do. Thats not your problem right there. Oil prices are hanging around 86 a barrel while gold prices are tumbling following the fed delayed decision to push ahead with another round of stimulus measures. Guy wolf, lets look at the trading block here. Different markets and see. Guy wolf is macro strategist at marex speculation and jim moor yo is on constantly on cnbc. Unless theres more than one of him. Joining from the cme. As i said, a cnbc contributocon. Guy, ill start with you. I just referenced and we had Jason Trennert say the same thing, traders used to just mainline like fed 85 billion a month. That used to give us a great how do you know about that . Mainline . Because theyre because theyre addicts, traders. And they dont care about structural. They dont care about anything but gimme, gimme from the fed. They werent even impressed by 85 billion until 2016. Are the benefits of this policy to just not be apparent, and the negative effects, you know, coming more into the fore . Yeah, i mean. A couple of factors. First is the fed are not the only ones out there quantitative easing. When they started they were the only central bank out there, so it had an unusual effect on their currency. Whereas now its much more keeping up with everyone else. As things roll off they have to do more just to keep things neutral. When they announce a new amount of buying, then you have to also factor in the amount of previous buying from the previous rolling off. Its much harder to really accelerate aggressively. And finally, in what actual real stimulus is there . You know, you look at 30year mortgage rates. How much lower can they go . Is that really going to put a lot of money in peoples pockets . Is that really going to stimulate growth . I dont think so. So incrementally, fewer and fewer impacts on growth. But with him, necessarily, the market didnt go down 300 either. So we havent decided that the negative effects, the negative effects longterm of this are going to be really nasty. And some people, there are some people who feel that way. That once we do this were never going to be able to get out of it. The fed will never get out. What will happen to markets when the fed announce theyre going to start selling their portfolio . You know, i thought it was insane, really, to even pick a number for unemployment and inflation at which they would start raising rates. Because every time the Unemployment Rate goes down markets are going to panic that the fed is going to start hiking. Thats another thing. Why is 6. 6 crisis time but 6. 4 . As soon as you give the market a number. 2 doesnt hurt anyone im going back to my communication problem. Would you like to know that this is what theyre thinking behind the scenes or would you like to know this is what theyre thinking in front of the curtain . I think you need to keep people guessing. As soon as you hang a number out there, who knows if its the right number. No one has any idea. Ray dalio would be right. He would be right. If they start selling if the fed starts selling youre going to be selling into that. How quickly could rates go up. What do you think, jim . You listening to this . Yeah, of course im listening to it. I thought you were wandering off, looking around. A couple times. But im back in. I got most of it. Okay, one the market thinks we wont get as much bang for the buck Going Forward. Two when the unusual market got out the market had a difficult time deciding what was stronger language. The previous rates stay low for 2015 or the new language stay low until under 6 . The move from 9 to 8 was relatively quickly. I think what the fed is saying the move from 8 to 6. 5 any real strength in the labor market is going to be accompanied with strength in the Participation Rate and thats going to be much tougher sledding. Realistically this language is stronger language than the 2015 language. But yes, you said the bad longterm effects from keeping rates low. I think theres bad immediateterm effects. Theres tons of Pension Fund Managers out there budgeting 6. 5 to 8 and the only way theyre going to meet that is if states start to increase taxes. Theres also a ton of baby boomers, retirees, or people who saved money along the way who used to count on some sort of income stream, and now are getting used to this new paradigm where theres no yield on the money, no risk for yield on the money so theyre dialing back their habit. Think of it as a medium, somewhat deflationary effect. Why do you think the Participation Rate is going to go up . Since the end of the recession as weve dropped from 10 to 7. 7 the Participation Rate has gone from 67 to or 65 to 63 so why would it go up now . I didnt say it was going to go up. I said i think the fed thinks its going to go up if theres real live strength in the labor market. I will say i do probably agree with them. If theres real live jobs created not just mcdonalds and yum brands, i think we could expect the Participation Rate to go up a bit. I think theyre giving themselves proper cover saying the 6. 5 rate. I thought it was amazing. I used to say the fed just say were going to keep rates low for a bunch of reallies, really, really, and they did that policy. I dont know whats worse that policies, or giving a number theres big problems with transparency. Because the market tends to think that the fed really knows what theyre talking about. If you look at their history about being accurate in their predictions, im not saying theyre awful, but theyre no better than most other groups of economists. The fed can say were going to keep rates low through 2015. That doesnt mean anything but the market sometimes thinks it does and immediately adjust those rates. How do you pronounce the fed chairmans name . I wont do this. Im not falling for your tricks, joe. Do it . Bernanke. Wow, you got a hernia, getting it. What is it with you people in chicago to get that out. We just had scott nations on, he said bernanke six times. Hes college educated. I know he had phonics. Hes an intelligent guy. I dont know why. I know he sees theres two ns, he doesnt care. I call him the chairman just to avoid it. I think you like him so they call him timmy geithner. Thats probably the case. A measure of disrespect. Bernanke, like all right. Thank you guys, thank you. Youre not from these parts, are you . Im from enland. Thanks. How quickly did i figure that out. Anyway. Thank you. Thank you, guy. Thanks, jim. Putting money to work or sticking to the sidelines. On his way to the set, make your way out, mitchell kaplan, ceo of Jefferson National and former ceo of etrade financial. Were going to find out how investors can rise above the fiscal cliff uncertainty. Check out best buy this morning. Take a look at this. We are up a little over 12 . Buyout deal for Electronics Retail may be getting closer. Dow jones reporting that the founder of that company will submit a former a formal offer this week. That story and a lot more in stocks to watch in just a bit. [ male announcer ] at scottrade, we believe the more you know, the better you trade. So we have ongoing webinars and interactive learning, plus, inbranch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. Our teams have the information you want when you need it. Its another reason more investors are saying. [ ] im with scottrade. Its another reason more investors are saying. Try running four. Ning a restaurant is hard, fortunately weve got ink. It gives us 5x the rewards on our internet, phone charges and cable, plus at Office Supply stores. Rewards we put right back into our business. This is the only thing weve ever wanted to do and ink helps us do it. Make your mark with ink from chase. Volatility is the name of the game when it comes to making money. Is that true . Im not sure. And our next guest says you can expect more of it in 2013. We havent had a lot of it yet. Mitchell kaplan is the ceo of Jefferson National and former ceo of etrade financial. Thats how i know him. Looks like a Virtual Party here on the set. Guests are allowed to come in. Usually we dont talk about it. Were you handing out pins . No, ive got pastries. I was making sure its under 50. Where has the volatility been . I think with the fiscal cliff, so many people were expecting were in the middle of december. The world was supposed to be falling apart by now. That was the threat to the politicians in washington. I agree. Its fascinating. After leaving etrade i got involved in a company which its Business Model is really about solely serving the feebased market advisory market so registered Investment Advisers and feebased advisers. So we see perspective of individual consumers through their lens, their clients. What theyre basically saying, we do surveys, we happen to be in the process not unlike the days of etrade of doing focus groups, and what were hearing is 85 , 90 of their clients are absolutely fearful of what the fiscal cliff means. And they are afraid that the volatility is yet to come. Its interesting. Its a little like so theyre out of the market . Theyre on the sidelines . I think there are two different behaviors. You have the selfdirected which think about the etrade model. And so on selfdirected i think youve heard consistently a lot of people have withdrawn. Trading volumes are dawn. Theyre uncertain of what to do. You probably are seeing less volatility. As a result of that, and then when you look at the money thats being managed by advisers i think people are thinking about, from an advisory perspective, what can we do to dampen that volatility . People are fearful, everyones supposed to go in the markets. Is this a good time . I dont know. I think it used to be that when people were fearful they got in the market. I think people have gotten so badly burned over the last ten years its not just the fiscal cliff. Its the journal piece from earlier this week that you saw. The journal piece had 2001 and the tech bubble burst. That was followed a couple years later by the financial crisis where everybody lost and watched the market go to 6,000. Now, you know, they got the fiscal cliff and they just got burned. So everybody i dont think the fiscal cliff in and of itself is what it is. But it adds and then youve got all the stuff you were bringing up, hsbc, youve got the High Frequency trading. You got the flash crash. You got the idea that its not an even Playing Field. And then when Interest Rates are 1 or 2 people feel like no one knows what they should do. To what end . I think a big part of it is you have to step back and say whats the Bigger Picture . Whats the concern . A lot of people feel like the system is rigged. So that, you know, one of the things that was interesting to me at etrade was watching the evolution of selfdirected to a need for guidance. Sort of some level of guided advice. Do you believe the do you believe that the Retail Investor has a fair shot . Against the Institutional Investor . No. No. I do not. I do not. I think that at the end of the day to level the Playing Field, there are certain products and services that you can buy selfdirected. Shouldnt we be trying to level the Playing Field . Of course. Of course. But the answer is its never going to be fair the same information as an institution no, you dont. But we used to explain it, when i was in business, that the big institutions were like the elephants running around, they were in but little mice, if youre very quick, you can learn from the elephant. And you can actually do pretty well piggybacking certain things. I dont know if i just go and say that its absolutely not, that the individual investor, between 1982 and 2000, the individual investor was able to make. Sooner or later were going to get back. Weve had twelve years absolutely. You operate in spectrums. They always move too far in one direction or the other. I think if you are an investor and you think about things over the longterm, the Playing Field what are you a i want to know whether the Playing Field so you were at etrade you were perfectly willing to put all these poor people into the lions den. Now youre not at etrade and it hasnt been fair . All along you shouldnt have been running etrade then. You should have said, go away, dont open an account no because the view at etrade and its the same view for us today at Jefferson National is the way to level the Playing Field is to encourage people hire Jefferson National . No. Encourage people to save low cost because you actually use technology and you disintermediate the Distribution Channel in a way that its a much better value Safety Products and services and try to educate and inform. And you are leveling the Playing Field because youre telling whoever your client is, whether for us its today an adviser or a direct consumer, heres the information. And you can do it lowcost. And i firmly believe that if you consistently provide that value equation, and you have a client who is thinking about building for their future, or their retirement, and theyre patient, then you can do much better when youre small you can actually big investors lose their ass, too. Thats true. Theres times where youre small where you can be more nimble, and i dont know if i buy look at the financial crisis. The people who are the biggest losers who are the biggest institutions. The taxpayers had to pay their fair share. But everybody has had more than like someone coming on cnbc saying the individual investor doesnt have a fair shot. You know what i mean . Especially some guy who used to run etrade. Its that they dont have a fair shot and they dont have the same access realtime to the broader set of information. But that was the goal of etrade, was to try to disseminate information. Sometimes thats way too shortterm for you anyway. And they dont have investment committees, as well. Agreed. But i think the most important thing is, if you change the mantra so people think about investing for the long term, it does level the Playing Field. Right. Okay. Thats really the most important take away for me. Is this country has historically been overlevered. Individuals have been overlevered. We havent saved enough. If you step back and say the goal is to save for retirement. How do you do that with high value and information . Then you begin to level the Playing Field. When i say its not level i worry about more people who are trying to be more active intraday traders on information. Well im glad. Did you do a twelvestep thing . No. Step one. All those years. All those years sworn off build value products. Okay. Mitchell thank you for being here. My pleasure. Coming up, check out the futures right now. See whether, you know, someone has fixed these and made them totally unfair. There they are. Anyway, now were up were up he talks, we go up. In spite of that. Anyway, up 11. 5. Still to come this morning, pimcos neil kath cari tells us whats working. Mark reuss. Tomato, tomato. Good guy. If we dont know you probably dont know. Doesnt matter. Well unveil the latest and greatest pickup trucks. At 8 30 eastern jobless claims, ppi and retail sales. Does your portfolio have what it takes to win the race . Tired of watching your assets slide . Feel like you are knee deep in [ bleep ] . Near not. Stocks to watch is next. Well help you make it to the opening bell. When squawk box returns. And we can save you 10 on ground shipping over the ups store. Look this isnt my first christmas. These deals all seem great at the time. But later. [ shirt ] merry christmas, everybody not so much. Ho ho ho this isnt that kind of deal. [ male announcer ] break from the holiday stress. Save on ground shipping at fedex office. And his new boss told him two things cook what you love, and save your money. Joe doesnt know it yet, but hell work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. Hell start investing early, hell find some good people to help guide him, and hell set money aside from his first day of work to his last, which isnt rocket science. Its just common sense. From td ameritrade. She thinks my tractors sexy shes always staring at me lets take a look at some stocks to watch this morning. We talked about clearwire. Faber knew about it. Cnbcs david faber reported earlier this week this was going to happen. Sprint nextel is going to offer 2. 90 for the 49 of the company it doesnt already own. Surprised he hasnt called in yet to walk us through this. And you can also, as we always say, its probably now on andrews m a website. After david faber breaks these things it usually ends up on dealbook. Thank you. Best buy founder Richard Schulze makes a formal takeover offer this week according to the minneapolis star tribune. Yum brands is upgraded by Goldman Sachs to buy from neutral. Citing increased potential for yums operations in china. Although, thats what we talk about all the time. Kfc in china. Thats the growth in their, i think isnt yum bigger than mcdonalds in terms of total number . Yeah. I think subway is, too. Research they dont even call it kentucky tried anymore. Kfc. And its really chicken. Thats uncalled for. What do you think it is, cat . That is uncalled for. This is all ill say. Tastes like chicken. Yes, its chicken if david novak taco bell. Yeah, taco bell. Is that really meat . Is that your next no. All right. The Restaurant Research in motion, rim shares coming off a sevenmonth high on news that the u. S. Immigrations and Customs Enforcement agent are going to use the blackberry 10 on a trial basis. That is on news, did you see this, that the agency is going to ditch the iphone in favor okay, so why . I dont know. I just want to say, so blackberry was one of the sponsors of the thing yesterday, at the dealbook conference and they showed off the blackberry 10. Kel me about it. They have one with a keyboard and one without. I actually, forgetting about being a journalist or related to a sponsor, i actually thought it was neat. I, as a consumer was thinking, i may have to get this thing. Because i have not made the move. I know. You may have to wait. You may not wait for this thing. Weve got to go. Coming up pimco manages more than 1. 5 trillion with a t. Find out how the company is planning for the fiscal cliff. Sfx sounds of african drum and flute look whos back. Again . Its embarrassing its embarrassing we can see you carl. We can totally see you. Come on youre better than this. All that prowling around. Yeah, youre the king of the jungle. Have you thought about going vegan carl . Hahaha you know folks who save hundreds of dollars by switching to geico sure are happy. How happy are they jimmy . Happier than antelope with nightvision goggles. Nice get happy. Get geico. Fifteen minutes could save you fifteen percent or more. The fed ties Interest Rates to unemployment. Our situation has not improved. Pimcos kNeel Kashkari on the feds latest move. The looming fiscal cliff and Investment Opportunities for 2015. Gm set to unveil two new trucks. Were going to talk to president of gms north America First on cnbc. Plus a flood of economic data. I dont even know you. Are you okay . Yeah. Weekly jobless claims, Producer Prices, and retail sales hit the tape at 8 30 a. M. Eastern. The third hour of squawk box starts right now. Welcome back to squawk box here on cnbc. First in business worldwide, im joe kernen along with andrew ross sorkin. Becky is off today. Our guest host this morning, republican strategist on my left, but on my camera right, joe watkins. Hes rising above today. And then on my right but actual la camera left and to the left oh, im sorry, joe is former g. H. W. , 41, you were in that administration. Matt miller was in the clinton administration, and now you toil at the Washington Post. Are you allowed to do that to go from clinton to just being some objective columnist at the Washington Post . Who says im on jettive. I was leading you into that. We have more from them in just a minute. First andrew has this mornings headlines. The wall street journal saying that barclays plans to eliminate as many as 2,000 jobs. The cuts expected to be announced next year. Barclays would be the latest to make such a move with ubs, Deutsche Bank, Credit Suisse and citi all announcing job cuts in recent weeks. Google maps returning to apples iphone and ipad. Ive been waiting for this for awhile. Apple had replaced google maps as the default mapping application with its own app. But that was the target of widespread criticism. People couldnt figure out where they were supposed to go. The new google app is now available as a download from apples itunes store. Includes voice activated turn by turn directions which was previously only available on the Android Version of the app. For those of you including myself who have not upgraded to ios6 because of this mapping feature, now things may change. Also long hours ahead, jeffrey, to wrap . For the Third Straight year toys r us is going to keep its stores open 24 7 from the morning of december 21st to 10 00 p. M. On christmas eve. Well, well see. December 21st there may not be youre talking about the mayans . Yeah, well see. Theyre planning. Theyre planning to do this. Wont have to worry about the fiscal cliff, either no, no, no. Thats what they said. The market sold off on prospects for the fiscal cliff. But then the mayans yeah, exactly. Weve got to get through that. Maybe something for the mayans. Weve got to get a separate pin for the mayans. Weve got to get a lot of pins. Were going to flair, like remember tgif. The suspenders with lots of pins. The retailers Flagship Store in times square open around the clock since december 2nd. Toys r us joins macys on the late shift which will be open all night from december 21st to the 23rd. Both chains will have special sales for those burning the midnight oil which is typically what happens to me. Lets get a check on the markets this morning. U. S. Equity futures at this hour. Dow jones looks like it will open off 7. 5 points. S p 500 also down, all off marginally after Ben Bernankes press conference yesterday overseas in asia you can see what happened there. The hang seng off slightly. Shanghai composite off slightly and the nikkei up, actually, not badly, too. Finally in europe, the ftse, the cac and the dax also off again marginally. Thats the way to headline. Markets sold off in the morning when it was proven the mayans were going to be right but rallied in the afternoon when there was progress on the fiscal cliff. If you didnt get through the mayan and toys r us would then stay open all night. No one really thinks somethings going to happen, do they, on the 21st . I dont know. Sfl i dont know. There might be viewers out there. I think were going to make it i want to hear it from you. So we can fall off the cliff. Exactly. The feds linking Interest Rates to Unemployment Rates are going to stay where they are right now which is close to zero until at the very least the jobless rate falls to 6. 5 . And as expected the central bank ramps up its asset purchases. Sooner or later this is going to be real money. Adding 45 billion to the 40 billion its already spending per month purchasing securities. It is said to increase the Balance Sheet by a trillion dollars over the next year. And you can,know, if it goes all the way to when they think it will go to get to 6. 5. Just add a trillion dollars a year. Joining us now Neel Kashkari head of global inquiries at pimco. The first thing weve been eluding to all morning i know that our friend Mohammed Al Ariane has probably been more of a proponent of the new normal. I dont know whether thats a pimco idea, the firm that pimco came up with following the fiscal crisis not the fiscal financial crisis. If you still believe that, what if we never get to 6. 5 . Well, hi, joe. Its great to see you. Youre exactly right. Just a month ago chairman bernanke for the first time acknowledged that the u. S. Has structurally lower economic growth. But weve been calling the new normal for the last few years. And youre exactly right. That means the fed, if you combine that with yesterdays announcement, that means the fed is going to be exceptionally easy for a long time, and that it could be a couple years or could be three, four years, maybe even longer, because unemployment is now structurally higher. We hope its 6. 5 is not the new naru, the new minimum unemployment. Certainly it is increasing. The longer people stay unemployed the more structural it becomes. The fed is really in a box here. Theyre trying to engineer Financial Market outcomes. Trying to raise the prices of risk assets across the economy. The problem is, we dont think they can engineer real economic outcomes. They can make the Financial Markets look better, but even at that, theyre becoming marginally less effective. Theyre needing to use more and more stimulus to engineer the Financial Market outcomes. So were happy that theyre trying to do what they can do. We dont think its going to lead to real economic growth. You could have been here this is what weve been talking about all morning long. Getting less and less for every time you announce something. Down three yesterday, even though it was all the way up to 85 billion a month. So when mohammed, and bill and you guys came up with the new normal, you did not actually say what its called naru, i understand that now. Ive heard it a couple times today. You did not come up with an actual number where the new lowest rate would be for unemployment . I think there are a wide range of opinions within pimco. We know its higher than 4. 5 . Thats what it used to be, 4. 5. 4, 4. 5 historically what people thought about. The truth is we dont know exactly what the right number is. And unfortunately the longer this takes, the higher it probably becomes because as people become detached from the labor force, unfortunately they become unemployable and it becomes a large swath of the economy that exits the labor force. Whether it takes 2. 5 years or 3. 5 years or 5 years to fall down to 6. 5 , part of that determines is the Participation Rate in unemployment. How many people leave the labor force. And so this is a very, very tough problem for the u. S. Economy, and chairman bernanke has very limited tools in what he can do about it. You know whats interesting, though, its really greenspan back in the 90s, wasnt it, neel, he kind of pushed the envelope to discover the lower naru that we thought was in the 5 , 4. 5 range, so the idea that he was criticized but it was pretty gutsy move for him to stay on the pedal to see how low it could go. Maybe it was never really 4. Maybe it is. Maybe theres other stuff going on in the economy. Theres technology changing. The advent of the robot. Theres a bunch of stuff going on besides working off the asset bubble that we have that we probably even, you know, the brains at this table cant sort of see how big is the Balance Sheet now . Its almost 3 trillion today. If people were worried about 3 trillion already. They were saying thats going to be hard to extricate yourself from. We go up a trillion a year now and talking 2016 so were going to, is that three years, 6 trillion . Is that okay . You know, it could be that large. Im not sure if its okay. Bernanke should be credited for being very bold and experimenting. But the problem is, we dont know how any of this ends. We do know that this is likely going to lead to inflation. Right . The fed has said 2. 5 is the new cap. But if you drill down on the 2. 5 . Its their own forecast of inflation. Its not an independent measurement. So theyve bought themselves an awful lot of flexibility to be aggressive, and to keep their liquidity flowing. But at the end of the day, this is not going to lead to real economic growth. Unfortunately, it likely leads to an inflationary outcome. The only good news is its likely a new years away. Its not inflation around the corner. But it might give us time to deal with this, i mean, if we could be optimistic and rise above, we deal with the fiscal cliff, then the fiscal abyss. The fed keeps us sort of above stall speed and then we do some structural things, would that work . Thats joe, thats exactly what were all hoping for. We hope that republicans and democrats, the congress, the administration, can enact bold Structural Reforms to make the economy more growth oriented. And you know, live within our means. Manage our budgets. If we can do that, then the fed is building a bridge to the congress. You talking about the congress . Pardon me . Live within our means and manage our budgets . Are you talking about the congress . Well, you know, weve done it in the past. We can all be very bearish on our political system. But our political system over the longterm works. Republicans and democrats have come together before, have made tough choices. If we can do it again, then bernankes actions are not going to be for naught. Theyre going to be buying time for leaders in washington to take over. But if leaders in washington dont take over, then ultimately this is just going to lead to an inflationary outcome and it will all be for naught. What im worried about on the political side is we could be on the verge of an endless cliff and we may be falling into this, this kind of perfectly dysfunctional political equilibrium that will be selfperpetuating. Because if you have a cliff know, i mean, i think the if most were going to have a Little Bridge deal or some patch of a deal that says, okay, well come back and have time to work out tax, entitlement reform with another cliff. But whats going to change between now and then politically that will make it work . And maybe we get another down payment and another cliff. Gridlock, people used to like it on the right because it meant that the government couldnt do anything. But weve got all these things where if you dont do anything, somethings happening because you didnt do anything. Thats what makes it different this time. And gridlock, so neel, have you bought any stocks . We heard dalio say bonds, i think pimcos been of that mind for awhile that bonds probably arent the place to go right now. We think returns across Asset Classes are going to be lower Going Forward than weve been used to in the past. But equities should do better than bands over the intermediate term. Were being very selective. Were not buying the market as a whole. Were buying companies that we think are market leaders. Very strong balance smeets and a very attractive valuations, that were going to hold for months or probably years. So longterm buys, of individual names rather than the market as a whole. Two things. One on dalio and we forgot to mention this earlier. He is bullish on one thing. Hes bullish on agricultural property in australia. So, if you have agricultural property in australia, you should go buy it immediately. Honestly thats what he said yesterday, i forgot about that. Because theres im not even sure i und stood. But when is the freakout moment . We talked about this this morning, so many people thought there was going to be a freakout moment come middecember. Does it now come postjanuary 1st if we dont get a deal . Is there a freakout moment or is this actually what you just said, this sort of perpetual cliff and people sort of get over it . I think that people are recognizing its not truly a fiscal cliff. You know, chairman bernanke was asked this question yesterday. Its more of a fiscal hill. The world does not end on january 1st if theres no deal. Though we would expect to see volatility increase, probably the equity markets pull back. That may put more pressure on congress and the president to come together. Ultimately if there is no resolution, which we think there will be, we will be in recession next year and that will absolutely hurt the economy, obviously hurt the markets. But its not as though everything ends on january 1st. So hopefully they kind of got there at the last possible second and do the bare minimum at least. Maybe theyll do more than that. But im not holding my breath for more bold action in the next couple weeks. Maybe fiscal end. We do got to go i guess. When you guys still, and mohammed, you all get together and hash things out, i guess . You talk more about bernanke or more about washington . Well it depends on the day. I mean, the fiscal cliff were watching very, very closely. Obviously yesterday, you said it joe, yesterdays moves were exceptionally bold. The markets kind of look through them. I think the markets are trying to digest what exactly it means. And how the fed is really going to behave Going Forward and what the 6. 5 means. Were very, very focused on these issues, too. Youre back here in new york. So we didnt get you up at 5 00 in the morning. All right. Neel, thank you. Thanks very much. Well see you. Coming up, gm set to unveil two new pickup trucks. Cnbcs phil lebeau going to join us next with president of gm north america. And at the bottom of the hour, the governments latest read on employment, inflation, and the consumer. Were going to get jobless claims, ppi and retail sales numbers. Well, having a ton of locations doesnt hurt. And a santa to boot [ chuckles ] right, baby. Oh, sir. That is a customer. Oh. Sorry about that. [ male announcer ] break from the holiday stress. Fedex office. [ male announcer ] i have obligations. Cutestress. Tobligations, but obligations. G. I need to rethink the core of my portfolio. What i really need is sleep. Introducing the ishares core, Building Blocks for the heart of your portfolio. Find out why 9 out of 10 large professional investors choose ishares for their etfs. Ishares by blackrock. Call 1800ishares for a prospectus which includes investment objectives, risks, charges and expenses. Read and consider it carefully before investing. Risk includes possible loss of principal. Welcome back to squawk box this morning. Its a big day for General Motors as it takes the wraps off two brandnew pickup trucks critical to its success next year. This is at a time when gm wrestles with a glut of old pickup trucks. Cnbcs phil lebeau joins us with not just a first on cnbc interview but another first on cnbc interview. Hi, andrew. Phil . Thanks, andrew. We are joined by mark reuss the president of gm north america joining us from detroit, where in a little bit theyre going to be showing the new chevy civil aud dough and gmc sierra. I know were going to get a bit of a sneak peek first. Thanks for joining us this morning. Thank you very much, phil. Its great to be here. Two new trucks. Just very exciting. Weve got a lot to cover. I know you want to give us at least a sneak peek. Is this the silverado were going to show you the front end of . I dont want to ruin the surprise for anybody else in pontiac. There are a lot of people here, some show biz here today, too. I am going to give you a little bit of a sneak peek. So here we go. And tell us what stands out here . The beginning of the reveal. What stands out to you with the redesign . I think the redesign, phil, is really, its a gorgeous truck. This is going to be use ten tashs. Its going to be highly engineered. Highly thought out and positioned well from a market standpoint. So this is not going to be the biggest, craziest truck front end. Its going to be a lot of beauty in it. Highly engineered from the ground up. New gen 5 with direct injection variable belt timing and our cylinder deactivation. So great fuel economy. But no compromise on the duty cycle to make a living with the truck. And it does it with a lot of beauty. So positioned quite differently in the competition. Youre obviously optimistic about the chances that its going to do well in the market, mark. I am. But lets be honest here. This comes at a time when you guys are really struggling to manage the transition from the current generation of silverado and sierra to this next generation in the middle of next year. First of all, can you guarantee that these new plodles will be in dealerships by april of next year or by may of next year . Because there are a number of dealers i talked with who said were hearing they might slide back a bit. Were not sliding back anything. Were right on track. Were bringing our stamping plants online here. Were bringing our new generation of small block online. So theres no delays at all. Rather were right on track. So im not going to guarantee timing here for our competition. Its a very competitive market. So im not going to get into guarantees on timing, were right on track. I dont know what dealers youre talking to, but they obviously havent really seen our timing schedules, and were right on track. So no problem with that at all. And then the other question becomes, with the current backlog you have 139 day supply of the current models. Much more than you want. You doubled the incentives that are being offered out there up to 2,000 more to move those out of dealerships. Its only been a short time. What kind of response have you seen in terms of starting to clear up that backlog . Were off to a great start this month. November was a very tough month for us. Weve done very well with the oldest pickup truck in the market for the last year or so. Were now going to have the newest here very shortly. As we sell down, you know, we flatout were not incenting as hard as the rest of the competition and marketplace. We missed november and calleding the incentive load that weve had. Were now very competitive in the marketplace again and have a great truck out there, still. Youre seeing sales pick up in the way that we had hoped. So were in good shape. Our inventory levels by year end we think will be in good shape as we prepare to build a little bit of buffer. Were right on track with that. We think were in a good place. Mark, one last question. Timing of the new models. When will they be going into show rooms . Spring of next year . Early spring . Late spring . Weve got two models here. Weve got the gmc and the chevrolet, quite different. Were going to stagger the launches of those across a couple of plants. Several plants, actually. And then the stamping plants to go with it. So youll see theres not one date where we throw the switch and say theyre in dealerships and we go. Theres rather a staggered overlap of the selldown of the old trucks and the beginning of the new trucks. Youll see this feather in beginning in the spring through summer and then fall. Weve got a lot of different models of trucks. Weve got the crew cabs, extended cabs. All those trucks that we have to feather in and begin to sell. Theres not one date that were going to throw the switch and weve got the new trucks. Youll see that happening at all the dealerships. Mark reuss, president of gm america giving us a bit of a sneak peek of the new civil audo and sierra. Theyre going to be unveiling those a little later on this morning. More throughout the day on a very big day for General Motors. They need to make this launch a success, andrew, and joe. They need to have this be a very successful launch, because this is a critical vehicle for General Motors. Thank you for bringing us that, phil. I thought right at the end there it was almost showing us a little more leg. Hiking the skirt a little bit extra there. Coming up, breaking economic data. 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The 12 12 12 concert for Superstorm Sandy relief brought together some of the biggest names in rock n roll on one stage. Fans got a special treat when Bruce Springsteen invited jon bon jovi joined him to perform born to run. Springsteen joined bon jovi later for his song who says you cant go home. The show lasted six hours and said to have reached an audience of 2 billion people around the world. Coming up weve got a flood of economic data. Were going to get the closely watched weekly jobless claims plus retail sales and Producer Price numbers for november as we head to break. Take a look at u. S. Equity futures. Welcome back. Were just seconds away from jobless claims, retail sales and Producer Price index. Steves got breaking news before this. From the fed . Or yeah. But at 8 30. Oh, at 8 30. 8 29. 37. So rick doesnt we need to do two things at once at 8 30. Who wants to go first . I was going to go very short and come back later. This is linear television. Go before you were going to delay the numbers . I was going to delay the numbers. This is that important. I cant say that. Im just saying this is something. Theres like fedstyle transparency. The Federal Reserve, global Central Banks acting together to extend the dollar swap lines with the Federal Reserve. More on the meaning of that when we come back. First Rick Santelli has the numbers in chicago. All right. Here we go. November retail sales headline, up 0. 3 . Thats a little light. Most of us were looking up half of one percent. Internals, take out autos. Unchanged. Take out autos and gasoline. Were up 0. 7. That is better than expected. So if we kind of look at this generically, its not a bad number. Its a little light on headline but close to expectations. Subtle revisions last month, nothing new. Producer prices. Down 0. 8. Down 0. 8 on headline. Thats a bigger minus that were looking for in condemn with some of those import prices weve seen. Maybe its because fiscal cliff has reduced demand. If if we look at exfood and energy, its up 0. 1 exactly as expected. Year over year numbers, up 1. 5 . Year over year exfood and energy up 2. 2 . The former up 1. 5 is definitely a bit light 2. 3 our last look. One could argue matches expectations. A little heavier than our last year over year look which was 2. 1. You know if we look at the claims number its 343,000. That is definitely a very big drop from an upperly advised 372,000. So you know, were down 29,000 on initial claims. And were getting back into a zone that we were kind of carving out before Superstorm Sandy. Whether this number is back on track, and around all its distortions of holidays and storms and weather and whatnot, i cant say. But most people around me were shaking their head when they saw it. Theres your litany of date to. Theres still more to come. You got 170 handle on 10s. A 290 handle on 30s. And it seems like theres some major divergence going on between tenyear and boone which we havent seen in awhile spread widening. Back to you. So okay. Were going to i mean, youre youre pessimistic, too, about anything good happening. But we can still hope to rise above. But i mean, its not looking too good. Is it . Well, no. I guess it isnt. I think were still i always i always hope to rise above, though. Trying to rise above. Ive been wearing the button. I really like the concept. I guess the problem is, is that i dont know, it seems like the holidays have messed up the politicians minds, and this may be news to some that, you know, i guess holiday spirits in washington are will 12 months a year. So, steve, maybe maybe i made a mistake. I thought that the market would want to know very briefly about Global Central Bank action before it wanted to know retail sales numbers. News judgment, was that the right call . Yeah. The consumer everybody but it was swap lines. Existing eyes grazed over. This is the ability of Central Banks to use dollars to fund or to pump liquidity into their markets overseas with dollarbased assets. So Deutsche Bank can go to the bundesbank and fund paper there using dollars or dollar paper has at the bundesbank because they have a swap line with the Federal Reserve. They put euros on deposit. The fed puts dollars on deposit there. Theres a big issue. Is there risk to the central bank . I had an argument with einhorn. I think the Federal Reserve is protected on this. So thats what happened. Canada, england, switzerland, what am i missing . Ecb . So they didnt they didnt do another 85 billion . No. They going to do something every day now . If you take off from the story earlier this week about what goes on in basel, this is the new thing thats going on. If you remember the last qe, developing nations were acting against what the fed was doing. There is now a Global Central Bank easing going on. And this is one component of that. I think thats the way to think about it. And i just wanted to say a word about the retail sales numbers, which are pretty good if you take out the number that goes into gdp. If you look at that number. It was up 0. 5 . With some mixed holiday information. Merchandise stores down 0. 9. Department stores down 0. 8. But Miscellaneous Stores where we do internets and cat doings up 1. 4 . Big drop in gasoline station sales, thats good. Do people take the savings and buy sweaters with them . We dont know that. Clothing up 0. 9 . And vehicles up. Consumers dont care about this cliff at all. We have seen and bernanke mentioned it yesterday, a pretty sharp drop in consumer sentiment. Sentiment whether or not that results in less spending is another issue. How often is there that big a disconnect, though . One of the first front page stories i ever wrote for the wall street journal back probably 15 years ago was about the disconnect between sentiment and sales. Oh. All of a sudden when sentiment drops in the wake of 9 11, people found themselves at auto show rooms. So i was really depressed about what was going on with america. I went out and bought a car. I mean, that was one of the greatest disconnects in the history. Right. You know. Actually that was ten years ago. But ive written about that. Just one of these vehicles thats out there. And then the claims numbers, i said last week i was reserving judgment at 375. Now were down 343, maybe theres a reason for optimism here. Want to be careful that its not bigtime snap back and maybe some expiring ability to get claims. But 343 is below that threshold number weve been in this 350 to 375 range where we said that doesnt matter. Thats in the range. 400 we thought was sandy. And now going down below 350 i think some economists, you know what, maybe the job market is a little bit better than we expected. The real disconnect thats out there, andrew, is weve reduced Capital Spending but not hiring. Right. Usually those things Work Together when they cut capex they also cut workers to go along with that. They seem to have cut capex on maybe a temporary, im worried about the fiscal cliff basis, but kept their employees on board. That seems to be the case right now. And presents the possibility of making some progress. They come back with some more capex then weve got a shot did we get rick to talk about the fed yesterday . Time for a some wisdom from rick . Im here. Rick, so what did you make of that . Do you understand what policy is now . Before you tell me how much you disagree with it, i just want to know if you understand it. Do you understand it . No, i dont. I dont. I wanted to see if we were simpatico on that story. You know what steve . I do understand it. Ben bernanke is the norm crosby of central bankers. Anybody who is younger than about 40, go google norm crosby and youll see what i mean. Im older than 40, and i dont get it. Help me understand. We have to leave a little to the imagination. Im not showing any more leg on that comment. I want to play an experiment, steve. Roughly, whats gdp . Roughly, 2 economy. All right. Whats the deficit for the current year that were measuring gdp . Roughly . Budget deficit . The deficit is going to be a trillion and a little bit of change, right . Okay. Whats the size of our gdp type economy . . Real or nominal . Either one. Its about a 12 trillion dollar real economy. Okay. What percentage is that deficit 1 trillion to the 12 trillion economy . About 8 . 7 , 8 , deficit to gdp. So is it fair to say if we have a 2 gdp and a deficit thats 8 that the real economy ask minus 5 to 6 growth. Is that accurate . No 73 okay. Well i want to cant do that. I want to know why. I know we cant. But i have people that email me this all the time. And its very fascinating, i think theyre very smart. Theres a little apples to oranges there. But i still think its interesting. It is interesting. Were running very large deficits and not getting the growth to go along with it. The transfer payments and all that really artificially boosts gdp. But the deficits are shrinking. Not fast enough. We were talking about a 9 , 10 deficit. Were at 7 . We need essentially five or six points, rick. Weve got to get to two or three too get what they call the sustainable level of the deficit. I think what youre pointing out is that deficit does need to get to a point where it runs in line with the growth of the economy. My point is the guys behind you who you quote a lot and seek to support what theyre saying in their words do not seem to support it in their trades. If theyre so worried about thats because they want to make money. Its like what bob pisani said. This is just what the traders wanted. Okay im done, you go. Let me quiz for you for a second. If they were so concerned about this imbalance, which ostensibly is about the inability of the u. S. Government to pay its bills, why arent they selling the very paper they appear to be buying with abandon . Because they would like to continue to contribute tax revenues to the evergrowing deficit and money. Need for employee but agreement to making money are two different things. Talk to the guys behind you and find out if they so think the u. S. Is exchange guys. These are Foreign Exchange guys. Get into the other pit there. Go take a walk and come back. I dont get it. If they so think were out of whack why arent they selling . Come over here anthony. All right. Hold on. Ill translate. Give me the question. Heres the question. Steve liesman has a question. If the u. S. Fiscal situation is so out of balance, if the country is so bankrupt, why isnt he selling paper . Why is everybody out there buying by . Steve liesman wants to know if the country is so horrible, deficits are so bad, why dont you sell more bands . Why dont i sell more bands . Traders . Whos going to buy them . Theres the first answer. I guess what hes getting at is you dont really believe the countrys in bad shape otherwise youd be selling bonds. Theres a guy right now who is actually selling bonds. So maybe we started a trend. Lets keep talking. Its i wont disagree with your math. And i know your guys behind you agree with your math but your actions speak otherwise. Debt is not a problem in the short term. The problem is joblessness. Steve, i like sweet desserts but i cant eat them because all the suits i have wont fit. I think its kind of the same thing. I just buy new suits, man. I dont nope whats wrong with you. All right. All right. John mcafee back in the u. S. Could be he extradited to belize for questioning in connection with the murder of his neighbor . Tomorrow morning at 7 00 a. Mchlt the story behind the feds latest move, dallas fed president Richard Fisher is going to be our special guest. Weve got lots of questions for him. Try running four. Ning a restaurant is hard, fortunately weve got ink. It gives us 5x the rewards on our internet, phone charges and cable, plus at Office Supply stores. Rewards we put right back into our business. This is the only thing weve ever wanted to do and ink helps us do it. Make your mark with ink from chase. [ male announcer ] you are a business pro. Monarch of marketing analysis. With the ability to improve roi through seo all by cob. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. Im going big. [ male announcer ] good choice business pro. Good choice. Go national. Go like a pro. Can i still ship a gift in time for christmas . Yeah, sure you can. Great. Wheres your gift . Uh. Whew. [ male announcer ] break from the holiday stress. Ship Fedex Express by december 22nd for christmas delivery. Were back on squawk. John mcafee is holed up in a miami hotel after his deportation from guatemala. Joining us now with more on this crazy story about the Antivirus Software founder, cnbcs robert frank. Robert, tell us. Hey, andrew. What the heck is going on here . Youre right. It just gets crazier by the day. He arrived in miami last night. He says he has no money, no phone, no contacts, doesnt know what hes going to do with his life. He arrived in miami, staying at some swanky south beach hotel. He was met by federal agents on the plane. He thought they were there to arrest him when those marshals were there to escort him safely to his taxi. So, right now, there is no arrest warrant for him in belize. Remember hes just wanted for questioning. He is a person of interest. There is no actual charge or arrest against him in belize. Right now theres no reason he would be extradited. The question is can the u. S. Officials force him to answer questions to the Belize Police . Unlikely given that hes just wanted for some questioning. We dont know where hes going to go. My guess is hell probably wind up in california, new mexico. We dont know how much money he has. He says he has 20 million but its all in belize. Those accounts, he says, are frozen. Will be interesting to see. He said some mysterious canadian dropped a wad of 5 bills to him yesterday and thats the money hes living on right now. Robert, is there a possibility this whole thing has been sort of trumped up in his own mind and that hes almost created his own story by going on twitter and blogging and that this whole thing is like some kind of weird movie . There is no question that one of the narratives here is that this is a giant publicity stunt. You know, to what end, that is the question . We have to remember, a man is dead, in belize. Its his neighbors, the guy, mcafee was disputting with, for several months. We have to remember that. But no question this has been a giant media circus. He did just sell the rights to his life story for a movie and a book. How much did he get four that . We dont know. But he says the media saved his life here because if we hadnt, he says, the Belize Police would have taken him in and he says killed him in retribution for not playing political bribes. Theres no question this has become more of a media manhunt than a legal manhunt. Who do you think should play him in the movie . Thats a good question. I was thinking Robert Downey jr. If youd age him a little bit. He would be really good for this. Yeah, yeah. Weve got to get someone older and more craggly. There are character actors that look just like this guy. This could be a new role for nick nolte. Mug shot nick nolte. Perhaps. You remember that one . You know what . Who was the fellow who plays pacino. Pacino does look like yeah, yeah, yeah. Who is the actor in the fighter . Who are they talking about . Mark wahlberg. Christian bale. He does kind of have that look. Pacino. Does this guy have a history of instability before . Robert . Yeah . Give us the history of us instability. Well, you know, mcafee, of course, you know, started mcafee the antivery russ company was worth at one point 100348. Went to belize under sort of mysterious circumstances. In 2009 he said he went there because he just wanted to start new companies and belize is a very free government. Very few regulations. There were reports that he was making bath salts, methamphetamines, some kind of drug in belize. That was never proven by authorities. He said bath salts were like mind expanding or something. Well, there was somebody posting and you know. Remember, this is a guy who loved giant, practical jokes, right . He said that this whole heart attack that he had in guatemala last week was a fake. And seems like it was. And he did post on some drug boards that he had started this new hed founded this new kind of drug that gave you some kind of erotic high, and that, you know, he had created it. And he now says that he was just posing, that was not accurate. Many people in belize thought that he was using drugs. You know, they say he looked like he was. He says hes been clean for over 30 years. So thats something that we dont really know. Okay. Robert frank, with the news. And were going to have a little bit more later. So well find out the legal situation here in the u. S. Once we get to talk to the state department and justice. Now that hes in the u. S. We should bring him to the set of squawk. Were trying. Were trying to do that. Definitely not beneath us to do that. I was serious. I know you were. And we mr. Mcafee if youre watching right now, you have an open invitation to the set tomorrow morning. Nots aa guest. Guest host. Well give you two hours. Coming up jim cramer on the feds qe cards and stocks to watch ahead of the opening bell. Well head down to the new york stock exchange. By not breaking down. Consider the silverado 1500 still the most dependable, longestlasting fullsize pickups on the road. And now weve also been recognized for lowest total cost of ownership based on important things, like depreciation, fuel, and maintenance costs. And now trade up to get a 2012 Chevy Silverado allstar edition with a total value of 9,000. From outstanding value to standing the test of time, chevy runs deep. So as you can see, geicos Customer Satisfaction is at 97 . Mmmm tasty. And cut very good. People are always asking me how we make these geico adverts. So were taking you behind the scenes. This coffee cup, for example, is computer animated. Its not real. Geicos Customer Satisfaction is quite real though. This computeranimated coffee tastes dreadful. Geico. 15 minutes could save you 15 or more on car insurance. Someone get me a latte will ya, please . Welcome back. Lets get down to the new york stock exchange. Jim cramer joins us now. Earlier, i said, it was funny, jimmy, we had that guy from etrade, who says the individual investor never had a chance, said we had etrade a long time, finally decided, watch cnbc and brought you up, said if you watch mad money, you can even the Playing Field, even with the big guys. I thought that was, you know, if you watch enough and watch your show, i think you can even do better that the big guys, cause youre a lot more nimble, arent you . Well, thank you. What are the themes of the show . Own apple, okay . Apple, how many times i did say it . Almost worried people would say i cant take the guy saying own apple anymore. Own the big stocks that pay dividends. I mean this has been sensational. I think kids have control their tax situation, individuals can be able to if they could control their 401 k , they will do better. Joe, you are dead right. The people who continue to come on air and say you cant beat it, are they looking at the s p, which has done nothing versus individual stocks that we talk about some of which have been fab pure louse . Like how many times have you said, it bull market somewhere, make money in a bear market, too. Look at this morning, cvs reports a great number. We have been saying buy cvs, buy cvs, buy cvs, the drugstores are taking the lions share of the growth of the consumer. I sit here and say i didnt say buy walmart at 74. The idea that the game against the individual investor is not true. The idea that the individual investor should feel more emboldened to be in stocks, i dont blame them after a facebook. I dont blame them after highfrequency trading. The idea you cant do better than the s p is ludicrous. Thats what i hear over and over again, people i think have a vested interest in keeping nut s p chains. Do you think 6 1 2 is the new they call it a ner echln ghandi, 85 billion a month forever . I think we cut spending, we will be able to stop. People will say, you know what on their baby to a balance the budget, i want to put my money in the United States, i want to bring jobs to the United States, cause they are fiscally responsible and you can stop. Without spending cuts, you know something, joe, it doesnt matter. He is just trying to do some stopgap thing. But spending cuts get a deal done. When the president offers spending cuts, we are going to get a deal done. All right, jim, thank you. Thank you. We will see ya. Okay, coming up, our guest hosts this morn having been joe watkins and matt miller. We will give them the last word when squawk returns. Tomorrow on squawk box, we will go inside the feds latest move, an extended interview dallas fed president , Richard Fisher. Quantitative easing, the economy and the fiscal cliff. Dont miss squawk box, starting tomorrow at 6 a. M. 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Read and consider it carefully before investing. Risk includes possible loss of principal. Minneapolis star tribune reports that founder Richard Schultz is going to present a 5 to 6 billion buyout offer to the Electronics Chain this week. Okay, back to our guest hosts, joe watkins and matt miller for the last word. Um what is the last word gonna be . You know, if you think about what bernanke did yesterday earthquake on everybodys mind, theres Something Weird in a democracy where we are relying on essentially this one unelected guy with a little unelected institution to try to goose the economy with a tool thats not the right tool to do it. Maybe by flooding bank reserves, you know the printing money, get into the economy through some other bunch of things that may not happen. Maybe we can do Something Like raise the minimum wage. Want to put money in peoples pockets, a boost in demand, how is that . The burdenen in congress, got to get this done, sometime running out. Anybody worked on capitol hill or the white house, you know how slowly things move. And this deal is going to be structured in two stages, the first dealing with tax rates, the second dealing with the parameters for budget reform and tax reform in 2013 and the tax staff verse to write this legislation and then had the cbo has to have three days to look at t we are running out of time here. Write the legislation first . First en