A judge says David Einhorns hedge fund may succeed in its legal attack against apple. And youve been hacked. Major financial institutions, fast food joints, tech giants, and now car companies. Corporate america facing a flurry of attacks. Its wednesday, february 20, 2013. New fiveyear high yesterday. Squawk box begins right now. Good morning, everybody. And welcome to squawk box here on cnbc. Im becky quick along with joe kernen and andrew ross sorkin. Our guest host is Business Insider ceo henry blogett. From corporate hacking attacks to questions about dells corporate buyout, this is a great day to have him on set. Welcome. Coming up next hour, a squawk ceo summit. Were tackling a question on everyones mind how do we get the economy to grow from here . No one knows better than the leaders of corporate america. Joining on set this morning, 32 adviser ceo robert wolfe. Well have hanes celestial ceo irwin simon. And the kraft Group President , Jonathan Kraft. On the lighter side of things, spring is around the corner. That must meantime for baseball. White sox Vice President ken williams will join us to talk business on and off the diamond coming up at 8 40 eastern time. An interesting mix of topics in rotation today. First, lets get over to andrew with the top headlines. Thanks. Boeing reportedly found a way to fix battery problems with its grounded 787. Heres whats happening. Involves increasing the space between cells in the battery. A source tells reuters the gaps between the cells were why there was overheating. Well talk about that in a bit. In other news on boeing, the companys engineers are split on a contract. The largest professional Group Approved the planemakers latest contract offer. But members of a smaller Technical Union are rejecting it. Both groups authorized the union to call a strike. The groups negotiate together. But the contracts are separate. So talks are set now to resume. And no work stoppage is expected. At least in the near term. Also in the news, the fbi says its now looking into alleged Insider Trading in the options of heinz for its acquisition by Berkshire Hathaway and 3g capital. The sec filed suit against unknown traders who is said used an account in switzerland to trade on per ported purported inside knowledge of the transaction. And negotiators breaking down between res cap and allied financial. Creditors pushing for a larger settle chmt is why the company is resisting. This makes it likely that the company will face litigation. Also, Toyota Motors reportedly ramping up japanese output by 10 in april. The nikkei reporting that the automakers planning an increase due to higher than expected sales and a weaker yen. Joe . Would you if you knew about a deal, is there any way that you would do anything . No, no. With the email trail i dont understand. I dont understand why anybody would try anymore. They have i can follow you in ten seconds. What i find actually crazier about the situation is that the sec is looking into this, the fbi is looking into it. But Goldman Sachs which is where the trades went through hasnt released the names, and im not sure has to. And why that would be. Theres a whole secondary they dont have to . I dont believe we can talk about it. My sung they havent been subpoenaed so they dont have to do it voluntary. Maybe its a death wish or prison wish. Im not going to go into what that could involve. I mean, you have to want to go youre going, right . Its afternoon if you know about the deal and you buy something to benefit from when the deal is announced, youre doing to jail, right . What if you hear about it . The scuttle butt, trading is it you know, heres well talk to him in a second. In other news this morning, bank of america Ceo Brian Moynihan was awarded a 73 pay increase in 2012 to 12. 1 million. And if you do the math, i dont know how youd do. You have to do algebra. That would be 7 million last year. So add 71 on to that and get the 12. Bigger stock grant is how it happened. His base salary for 2013 is also due to rise by more than 55 which is a good number for any of us. Great. Isnt it . It is. If you could get 55 , youd set for that, wouldnt you . Absolutely. Okay. An 11 billionplus sale of Life Technologies is reporting reportedly looking less likely this morning. Potential buyer, thermal fisher scientific. Said to be skeptical about a deal due to a gap in the Price Expectations with the company. Meantime, buyout vaufrs come up short. And a u. S. Judge says that bp recovered 810,000 of barrels of oil from its 2010 gulf of mexico spill site. The judge ruled that this amount should be excluded from certain penalties that the company may face, cutting its maximum fine by as much as 3. 5 billion. A spillrelated civil trial as weve been reporting this week is due to start next week in new orleans. At the top of the show, you said something that made me think of ground hog day. You said markets at a new fiveyear high. I said new i dont like to say fresh. And you really dont need to say new fiveyear high fiveyear high but i see it every. Where i saw we say it every day, too. Seems like weve been in this position. Fiveyear high. Fiveyear high. Were not that far from a new high. A real new high. Hopefully. How many people remember yesterday, how many people said, no, this cant go much weve got to have a correction. And you know, a lot of times thats a lonesome cry after a while about the correction and they capitulate. Well see. So far, so good. It has been stubborn. 12year high for the nasdaq, too. Well take you through the stocks to watch, some big movers. First up, shares of netspend rising after hours. This is the Prepaid Debit Card provider. Its being acquired by payment processor total Systems Services for 16 a share or about 1. 4 billion. It was actually up after hours yesterday. A different foyer for millennia story for millennia media. The revenue missed the market and guns looked weak. All of these starts are wrong. Im not sure why we havent fixed them yet. This stock was down after hours, as well. And demand media shares getting a pop after better than expected earnings in revenues. The company says that its exploring splitting its media and domain businesses. Lazboy beating the street and shares rose after hours on the news. Right here you see 15. 46. And acena earnings beating the street. That stock was up in the after hours. Not down 4. 5 as this chart says. And rambis announcing its signed a patent license agreement with lsi corporation. Rambis offering upbeat revenue guidance. And well get the charts fixed. Weve let the tech people know, and it hasnt been fixed yet. Back to you. The price on the left and the price on the right on the chart were both wrong. They were much higher or lower we told the i. T. People about this last week. Didnt get fixed. Takes time. Well get. It. Lets check on the markets. As we said, another good day yesterday. This morning well see whether we can consolidate gains or head higher. We dont know yet. Those are all treading water moves today between now and 9 30. Well see whether we get more definitive look at where were headed. Oil, to me, it just you add everything up, you have oil this high and other economic numbers which gold . In gold and down another 10 this morning. It doesnt i dont know. It makes already at a low. Were not that far from 8 unemployment. Youve got the payroll tax and sequester coming. And i know rich people only put the money in the bank and dont spend it, but there are significant tax increases, not just the payroll tax, but people at 400 and above, theyre part of the economy. Theyre getting whacked with the obama care and the deal that was arrived at. All of these things austerity is ugly. Getting there. So is oil oils not supposed to go up when the economys slowing. You have the Central Banks that are printing money. You do. Its got to go up. Think about what would happen if they werent. And in all bets off on what happens with the ten year now, too. If were in a slowing environment. Gold suddenliy were immediately going back to 2. 75 or 3 . And the dollars been something to behold in terms of the yen. You dont see that often. And especially when its telegraphed by not the guy with the hair, the guy named after lincoln, right . Abe. Abe . Is it abe . Or abe. I know it. Lincoln is hot. Abe to me. Lincoln is hot. You think its going to win . Theres a movie every day. Theres that and the oreillys killing lincoln and lincoln the vampire hunter. I read the book. But . I did. You had that much time . I office a plane. I tried on a plane. Thats okay. Did they have bathrooms on the plane or bottles . [ flushing ] funny. He knows what youre talking about. I know he. Does memorialized for all time. I dont think the i blame him. We dont need to tell the audience at this point. Look up Business Insider. You were talking about your brothers. Only the boys. It was only the boys of course. Little boys. Trying to drive 12 hours across little boys with little weewees. It would be easy in the bottle. Lets look this squawkward moment has been brought to you by joe kerner. Ha, ha, youre it. The gold board it was her yesterday that blurted that out. Where is gold . Down again. Its down another 10 under 1,600 now. Hit a boump that yesterday was already at its weakest level. The charts, lower lows, lower highs. A bumpy ride on the way to the guaranteed 2,000 which every single gold bug talked about. A death cross. It is new technical chart where people are freaking about. You got me. Where could it go . It could go anywhere. Yellow metal. It was 200. Buffett points out you could fit all the gold in the world on a football field. 40 by 40 square. Then what do you do . Nothing. Give me cattle. Give me pigs. Give me broilers. Give me anything. Give me guns, the to steal the gold. Whatever. Pretty much. All right. Okay. Its also time for the Global Markets report. Well fly over to kelly evans. She may be able to save us a little bit. Standing by in london. Miss evans, good morning to you. Andrew, good morning. Its the bank of england thats moving markets today. The Federal Reserve minutes later today are sure to be the focus of the u. S. Session. Over here, the actions started. The sterling dollar behind me, down. 8 . We did fall below the 154 level. Guys, weve been flirting with 153, below 153 in the last couple of minutes, as well. The first time weve been at these levels since last july. More significantly it comes as the bank of england saw governor king whos leaving outvoted with others on wanting to increase the size of the quantitative easing program. Dont expect that theyre sort of shedding any tears over the strong Market Reaction today when those minutes pass. The bank of england saying the weaker sterling is good for growth. A lot of britains tonight agree as they look at a continuing rob of their discretionary purchasing power. That story is something not just britain is dealing with for the time being. What it is doing, if we can flip over to the Market Reaction for stocks, is helping bolster the ftse. So after hitting the fiveyear highs, now punching above the 6,400 level for the First Time Since 2008. So adding about. 4 today. Fiveyear high is similar story to what were seeing with the s p 500. Its mixed trade for the rest of the markets. But as we head back over to you guys, its going to be an something question now for the Federal Reserve in the u. S. As the bank of england now comes out, weakens the sterling by by almost 1 today, weve got new zealand talking currency down, weve got korea talking its currency down. You mentioned whats been happening in japan. Suddenly the u. S. Dollar starts to look like one of the stronger men by comparison. On that note of currency wars around, what, 25 at this point, back to you. Thank you. In other news, a judge says David Einhorns hedge fund has shown a likelihood of success if his legal attack against apple goes forward. The judge made no immediate ruling to block a shareholder vote on a proxy i need to apologize to becky quick. We were talking about this last night on the show yesterday and by email. I should have read. I didnt no, you were right. In the complaint, the suggestion is not that apple can never issue a preferred share. Its just that it would require a shareholder vote. What does that mean . That strikes me as odd. You would think more shareholder say would be a better thing. Then theres some other some think its a bad thing because it means the board cant unilateral dee it and therefore cant make the decision. And other chershareholders w never vote for a better deal . We can talk to our guest host about it. Weve introduced youve been talking. I dont know if you need an introduction. Henry blodgett, Business Insider ceo and editorinchief. Do you have i think his idea is financial engineering. We had had a back and forth. Hes much more sophisticated about this than most people. He persuasively argues that one plus one might equal a little more than two if you get a big block of referred in there. In terms of complexity, everything else. The thing with the case, though . In terms of what hes asking for . Yeah. I think basically whats going on here is he wants a pulpit. He want to bag his finger at Apple Management and say, look, youve got 140 billion on the Balance Sheet. Start giving it to me. I own you. Do something with it. Do you think hes going to could . I think hes going succeed in forcing apple to do something with the cash. I think issuing a preferred i dont think it makes sense. I think there are plenty of other ways to get the cash back to shareholders. You could use debt if you wanted to, you could increase the dividend. He could exploit the difference where a prefer sudden trading and common is trading. The idea you that could create security and stick it in there without disadvantaging the common stock shareholders doesnt make sense. Right. Youre putting yourself ahead of everybody if the shareholders will vote, theyre never going to vote somebody else having a better position than they have themselves. Thats thats right. A lot of shareholders, they say increase the dividend. Right. Give back although i did read something that the judge in this case had already said. He thinks einhorn might be in a position to win. I dont understand the legal i think thats the technicality of this particular lawsuit which is all around can apple outlaw the issuance of a preferred. It doesnt force them to do that im making it more its not just about whether they can outlaw it. Its whether they can put it as part of the proxy . The proxy. Theyve combined it into a vote that includes other issues. So what hes fighting for is for it to be separated out. So that shareholders would vote for it separately. Were its down weve got to put it in another bill. Right. Lets joe was joking, and you i dont know if you were joking or not, Insider Trading. I understand what hes saying. On this issue of heinz, we have what appears to be some form of trading ahead of the situation with these options. Which by the way there almost always. Is somebody knows why does it happen in this day and age . Were inundated every day with reports of somebody going to jail, getting arrested, doing something for the exact same thing. Is there no deterrent effect . First of all, its good that the sec is acting this quickly. And it just happened in the merger last week that was announced. Why dont they know who they are, by the way . They will. Why shouldnt why shouldnt you know who they are is what youre asking . Yes. It will come out, no question. Look, so its very good. That will deter it. If it happens the next morning, as its happening. Pictures its become obvious to people. Something happens on the trader floor, whats going on, rumor. Wow. Theres this big deal going down. Ill take a play on that. Its different when you hear someone has to light the match to begin no, you can play it. If the rumors going around and you think you got tellery no, the question is how did the rumor emerge . Any trader on the Trading Floor hears scuttlebutt. People hear things all the time. There are lots of companies out there that are prime acquisition targets. Everybodys got on the screen, somebody must know something. A rumor starts. I hear stuff usually from some form of insider. Maybe somebody heard something with regard to a banker, some banker was going that city. Putting two and two together. Making a good bet. Not based on actual knowledge but a bet that a lot of people follow that. They cash in, suddenly theres the huge action in the options. Secs right to look at it. They can put people other oath. People want to testify heres what i saw, what i did. The evidence that people are trading ahead of the deal is not evidence that they knew it was going happen. They figured it out. Let me throw one other piece of news the at the monsanto i used to track plans. You cant do it anymore. Very hard to track plans. Get out on a moped and follow sir larns wiwrence wildman i believe thats legal as long as youre not tapping lines. It eerie. Dell, they had earnings. I dont think new england care good the earnings, they in cared about the earnings, they cared about the buyout. I think its sad and public shareholders take a longer term view is the only reason this company is going private is because michael dell and silverlake think that they can create a huge amount of value by doing that. Theres going to be a big dividend where they pay themselves a huge mont off the top. Whats sad is why cant they do it now with public share orlando. Are public shareholders willing to suffer through whatever the transition period is, does it allow activists and others to try to kick people out from the board . I mean, there is a legitimate argument to be made, doing it in private. Some people would say a legitimate argument, doing private makes it easier. Youre not having to deal with the stock falling when something bad happens. Activists trying to come in to ruin your plan. It makes it easier. Theres no question. But michael dell needs cohones to say this is the right plan for the company. I am going to execute it, its going to take three ye