The nasdaq lower by 15 and the s p 500 lower by 7. Andrew . Thank you, michelle. Hope you had a good weekend. Well tell you about the Corporate News as pimco is working to assure clients it has a solid team in place. Thats what they are telling everybody to manage their funds following the very public departure that surprised so many of us of founder bill gross that happened right here on the air on squawk friday. The bond giant has seen 10 billion in outflow since that news first broke. And the wall street journal now saying some are projecting withdrawals could hit 100 billion or more. The ripple effects from gross departure being felt far beyond pimcos doors. In Newport Beach they dropped upon the gross news. Also, meantime pimcos new ceo doug hodge says they are moving away from the founding. In an interview the total return fund run by gross does, in his words, decline pimco. Well tell you other Financial News this morning, Goldman Sachs tightening its interest rules on investments that bankers can make in individual stocks and bonds effective immediately. Bankers are not going to be able to allow in activists with driven hedge funds. This comes as Elizabeth Warren calls for hearings into issues raised by secretly taped conversations between fed supervisors. Did you hear these tapes . I didnt hear the tapes. The tapes were part of the American Life project. I listened to it over the weekend, its pretty crazy, the tapes. The tapes were secretly recorded by a woman inside the new york fed that is suing she got fired. And i believe this is part of the case that was thrown out. Nevertheless, the tapes unto themselves do raise questions about the fed, everything. I was startled at the rippled effects of bill gross. You know, italian and spanish tenyear yields rose on fears of whoever takes over the fund isnt going to like spanish. Can you imagine you leave a firm and two massive economies see their sovereign debt yields rise . Unbelievable. No firm is more associated with the founder. I was still trying to think phl took it, his name, but that was weird. And some say it never regained stature to that level. Im surprised that a trillion dollars bill gross single handedly built that firm to where it was. And does anyone advertisers, i love them, pimco, youre great, youre wonderful, but does anyone else there know how to manage bonds as well as bill gross . Do we know . I dont think we know, though i do imagine that hodge is right in that theres a lot more people behind this than bill gross. They are going to attract the best and brightest, right . Very few firms are so associated with it. But then you look at some of the recent the erratic behavior that maybe thats coming from the other side that is leaking some of the stuff about writing about his cat. And also getting more and more thin skinned and maybe abusive to employees. Heres the thing that could have been true for years, but as long as youre making money, you can do whatever you want, right . But the last three years he hasnt done so well. There is a person that if he wasnt so guarded and protected and just always saying, you know, seen to be phrasing things like, he looks about the corner, he could tell us everything. And he tells us nothing about this. I think theres a contract in place that prevents him from doing that. All i can get out of him, you know what i can say is, hey, how are the jets looking . Heres my question, he could tell us, meaning does he have something to prove . By the way, do people at pimco now have something to prove and therefore how do you hit a home run in a bond fund with zero Interest Rates . When you know its just headed up . I mean, how do you manage that really well . I mean, you still do the global you try to outperform the other repeaters. But you also mentioned the volatility back, its at 14 and change. But that reminds me of going from the tenyear, you go from 1. 8 to 2. 5, its a 50 move but still 2. 5. The vix is still 14. I wonder if bill gross going to just manage money rather than managing the firm allows him to focus on that which hes very good at. I think this could help or hurt. This is as much of a psychological game how about the people who are on the board of pimco, this guy definitely has to go, but what does it mean . And now it happens and they are just watching billions leave. You knew the market cap of allianz is dropping billions. Thats unbelievable. It was going to hurt the firm alone. It was a decision they felt they had to make. During the commercial breaks on friday, i was calling you said it happened on the show and i was thinking, we didnt have anything to do with it, did we . No, it happened during the program. The timing of those people it had nothing to do with what you said about gross or what i said about gross. It was simultaneous. It didnt happen on this show, andrew. It was announced during the show. Its an illusion. You think about that a lot. Its the grandeur i have. You are not really a part of any of these stories. You have to get over that. You are just reporting on them. I am an observer. We are just reflecting on whats happening right there in the world in the public. I want to reflect you because what have you got . No, i just fair warning to the viewer, i am sick. I have im sorry. Hold on. I dont know what is going on around this table, but whatever they had, becky and joe had, now i have it. And this week is not the best time. Hes stepping back, too. We have a guest waiting. Hes like very patient. He looks like hes in a tennis match. He doesnt want to take my hand and he shouldnt. Japan eas softbank is offer 32 a share to buy out dreamworks. Thats the studio behind shrek and madagascar. Theres dreamworks and Dreamworks Animation, right . Dreamworks is not live action, they have cartoons. And this is dwa. I never understand, do you only use deodorant on have mercy on me this morning. I know you sweat when youre sick, dont you. Its gross. Horrible, clammy, is it up here or everywhere. Just up here. Headache, too . My throat is on fire. My eyes are hurting. To other news, microsofts ceo is in a meeting with regulators in beijing. Chinas government said he promised to cooperate fully with authorities in their antitrust investigation. They have seized evidence from multiple microsoft offices in china calling in highlevel executives for questioning as well. And theres the European Commission because it reportedly is set down to accuse apple of benefiting from elicit state aid in ireland. The fda is saying this is based on preliminary funds to tax deals. They suggest the probe could mean apple is facing billions of euros in bonds. What is it called, the irish sandwich or whatever it is . Hot coffee in the sun, i dont know. Some very twisted way of reducing your tax benefit in a very legal way. In a very legal way. In a shareholder way. I dont know if it is legal but well find out. The dow is taking investors for a wild ride heading into the trading week. It was my read. It was my read. Sorry. Read it. No, no, you finish what you started. Its you. Generosity. What were you talking about . One thing to tell you about ireland, they know how to play golf. They do. Thats where you are headed, right . Just like scotland. Rory and graham. Painful. Painful for the united states. Its like we just learned how to it was born in scotland. It was. And the euros had it first and it looks like they have a lot more experience with the entire playing of the game than the u. S. Did you see neither one of you saw it . I watched every minute of it, and the entire time youre hoping against hope, but youre watching whats happening and knowing that youre just not an icecubes chance in hell for a win. But it was pretty, right . It was, but it was like the varsity team playing the j. V. Team. It was incredible. And its been like that eight out of ten times or nine out of eleven or something. It had nothing to do with tiger but those guys. We congratulate them. Ian poulter is a friend of the show. The dow is taking investors for a wild ride. We are at 17,000, so 100 point moves arent what they used to be. There will be a day when we do 500, 600, 700 points up and down. That will happen. After the fed gets out and all this volatility that had been masked by all this money sloshing around, there will come a time. For the First Time Since june of last year, stocks are poezing five Straight Days of tripledigit gains, up or down. What can investors expect as we close the quarter to get ready for the big jobs report coming on friday . It is. Get ready for that. Ill be watching. We want you to do a good job of it. Maryann bartel is here with portfolio solutions, the chief Investment Officer. Thats a big title, isnt it . Sounds good. People have problems. And you are the solution. Yes, i am. Yet it is not pretentious or anything, is it . Do you feel you and merrill are in a position to help people . We do not guarantee results but we try to get our clients to their goals. Thats a good i assume that. Dont all broker firms . We have the chief Investment Officer that actually created how we get to our clients investment results. Im liking it. He wrote the paper beyond are you just an economist . Just a boring economist. Thats all i got. Thats it . Do you have any solutions . Do you expect to talk . We have you here and you here. I did bring my crystal ball, so hopefully i can tell you more. The vix is 14, will it get back to 30 . I cant want say it will never happen. This year i dont think so. Is the fed and what were seeing, its such a big part of the dollar. Its a big part of the equities market. A big part of the bond market. When they finally exit, and we normalize Interest Rates and everything else, will volatility return . We think volatility will definitely return. But if you study history, this is certainly not normal for the kind of environment that were in, it takes six months before the market responds to a fed tightening. In fact, normally the economy is booming and that is why the fed is tightening. And the market gets very giddy and it takes a while for the market to realize that the punch bowl was taken away. So believe it or not, six months after a fed tightening on average markets go up double digits. So when is the first tightening move . And is it possible that were wrong and that it gets pushed back because things weaken a little bit . When do you think it at bank of merrill lynch, our forecast moved up in june. So we are closer to consensus. So that gives us all of 2015 before the market reacts to it is what youre saying. Thats what history has shown, but i think things are different this time. Not only are they raising rates at the fed funds, youre the economist, the expert. He has no solutions, though. They are also going to Interest Rates on excess reserves and using reverse repos. And i attended an economic summit where 30 of the audience had no idea what a reverse repo was. Supposedly the repos wont work because its not going to cause any drain. Well, the tightening cycle is very different. I think you can get a lot of market behavior not knowing how to react, just like when ben bernanke used the word tapering we treated it as tightening. I think the market can get confused over the coming months by the fed language. And we can continue to see volatility. Kevin, is june 1st the i think thats right. You do . You think its june. Given the economic backdrop it seems like a reasonable forecast. Thats our forecast at ubs as well. If you were to say which way the balance tilts, its probably an earlier exit. Q1 is not out of the question, but right now it seems like the fed is, with the kind of Economic Data were getting, it can be patient and wait for inflation closer to the 2 threshhold. Do you think the economy has moved in to a higher level of activity at this point . I do. If you look at the last couple of quarters, three out of the last four quarters, you have grown above 3 . The Third Quarter this year gdp seems to be tracking at 3. 2 . In the Fourth Quarter, 3. 4 seems reasonable. We have had a break out here in capex. Well update this later in the week as it seems to be moving in the right direction. Job growth seems to be averaging about 200,000 a month. The Unemployment Rate has fallen to 6 by friday. So i think the economic backdrop does suggest that the economy is moving. If it dropped. 20 it would be in the fives, wouldnt it . It would. We just had someone say last week this is a completely sort of distorted 5 to 6 Unemployment Rate. And that things are still so weak that we never in the next five years, we never see rates go back because we cant afford to let them go back because it will cost too much on the debt we already own here. Well, the lower Interest Rates, the feds portfolio has been redeeming a lot of cash that they have been sending to the treasury. So, you know, as the normalization of policy takes place, there wont be handing of the money over because they could potentially lose its 150 billion per point they said. Really. If it was a four, youre at an obamacare type numbers for a year. If you go back to the 1950s, we are very similar type of Interest Rates. We had zero Interest Rates in the early 20s, 30s and 40s. We had the tenyear equivalent that took 16 years to normalize back up to 5 . So im with you, i think rates will get higher much lower than people anticipate. The market, will it continue to go up . I mean, its at 17,000 now. Is it well, the seasonality is going to get will it be 50,000 . We dont have the forecast out that far. We have a solution to where to be invested over time within the marketplace. But i think people should understand that the seasonality going into the Fourth Quarter is very strong. And very strong even with the Midterm Election year. And so forecasting next year out, we have we dont have an official forecast, but knowing where to invest within the markets. We have talked team usa all year. We have talked about technology, energy, autos and manufacturing. The capex i like that, team usa. We had the olympics and shes clearly patriotic. This a good day for me with andrew. I should bring up youre just you cant argue. Im so under the weather, just get me this tissue is my white flag. Just go for it. Shall we talk corporate taxes . How about fairness. Did you see the piece in the New York Times . All this data, the data decided not today. This is my thing. A person from my church said the only fair in life is the state fair. Thats not bad. Just a catholic guy . No. Did you marry someone and change religion . Yes, i did. Wow. What do you think of that . The only fair is the state fair. I think i did, although i play video games on most sundays. Its horrible to admit that, but nonviolent. The educational ones. Thank you for solutions, by the way, all of those. And him for the economic prognostications. Coming up, positive news in the battle against Breast Cancer. The details on the latest advancement from swiss drugmaker roche is coming up next. And forbes is out with the list of the 400 richest americans. We know the usual suspects but this time there are 27 new faces on the list. Well tell you who they are when squawk box returns. E financial noise financial noise financial noise financial noise in global news thousands of protesters flooding the streets of hong kongs Central Business district today. This is the worst unrest since china regained control of the former british colony back in 1997. Susan lee is joining us from the ground with the very latest. Susan, what is the latest . Hi, michelle. Yes, we are seeing more people than the 80,000 estimated on the streets of hong kong over the weekend. And what makes these protests really perk up the International Community is the escalation and confrontation from the hong kong government. Yesterday firing tear gas into the crowd, pepper spray, at one Point Holding up signs saying disperse or we will fire. The speculation is they had rubber bullets being fired into the crowd. We dont have confirmation of that, but today it looks to be gav galvanized. This draws comparison to 1989 with a peaceful protest. A Student Movement here on the streets of hong kong happening all over again. We have seen capital flights today with repeats in selloff close to a threemonth high. No one knows whats going to happen going into the long weekend of october 1st and october 2nd. We have been hearing from the government its looking like the stock will stand today because of the number of people on the streets. And the people are questioning whether or not hong kong is still independent from beijing. So we have the chief secretary second in command here in hong kong coming out with a statement saying they advise to take a second look at the fight for universal suffrage, which is the right to select the leader of hong kong. She says the government will take some time to take a second look and theres no guarantee that they will do this any time soon. You mentioned the comparison to 1989, do they anticipate something as horrific at Tiananman Square and is there chance that the Chinese Government may do Something Like that ever again . Well, in taking a look at the crowd today, even with it galvanizing with more students moving into the streets of hong kong, it doesnt seem like fear has struck just yet. In fact, i feel like the movement has gained momentum with whats happening on social media. You cant get a hong kong feel without talking about the Yellow Ribbon movement. This is called the umbrella revolution because thats what they are using to separate themselves from the pepper spray. And they are sleeping in the hot sun because it is very hot. It is bolstering in the city of hong kong. I didnt get a sense of fear from those attending the rallies still in the streets of hong kong heading into the evening here. All right, thank you, susan li in the middle of the p