Transcripts For CNBC Squawk Box 20150401 : vimarsana.com

Fido and friends. Were down to two dogs. Were thinking about it. Another German Shepherd . Possibly. When you get door stops or something you always get bookends. His and hers. So they can sit by the edge. Id like to get a brother. Of zara. Yeah what a dog. All right. Well talk a little bit about the Second Quarter. It begins today and the bulls are hoping it starts better than the First Quarter ended. It was a rough session yesterday down for the year by closing down about 200 points yesterday. This is the first down quarter in the last four for the dow. But they ended up. It was slightly higher. The nasdaq is on a nine quarter winning streak. Thats the longest winning streak ever going back to its inception in 1971. Check out the futures this morning and at this point they look like there are green arrows. S p futures up marginally and the nasdaq up by over 7 points. The stories, the big ones were watching today the deadline with the talks for iran have been extended by a day. Were still waiting to see if the u. S. Can strike a deal with that country. They agreed on monitoring and sanctions but the state Department Cautions that there are still some tough issues to workout. In Economic News jobs are in po cuss because its wednesday and friday is the first friday of april. So the employment report comes out friday. So the adp employment report is due at 8 15 eastern and forecasters are forecasting that the economy likely had a 225,000 private sector jobs last month. And on the corporate front go daddy pricing its ipo at 20 a share above its expected range. That values the company at about 4. 5 billion. That includes debt though. Shares are expected to start trading on the nyse under the symbol gddy. There you go. Among our stocks to watch today carpenter technology. Theyre cutting about 10 of the work force. Thats roughly 200 jobs. The Company Wants to reduce costs amid weak oil and gas prices and shares of i. T. Services provider synnex under pressure after the companies came in with results that missed the mark. The Second Quarter guidance looks a little weak as well and oil and gas producer says it might file for chapter 11 bankruptcy protection if it cant refinance debt obligations. Samsung was required in 2011 in a 7. 2 billion deal by a team of invery tors. Lets check on the markets this morning. A little snap back. I dont know what yesterday was as opposed to the day before. Its disconcerting that the quarter ends and people were loading on to things the day before and you dont have that same buying pressure. So now it will be in earnest plus it is april fools day obviously which is a weird day to price an ipo i would think for go daddy. Also weird day if we do reach some type of deal. They havent been so forth coming in the past. Its like really nobody maybe but what im getting to was this earnings season is probably more anticipated than most that weve seen because of the strong dollar and whats happened in the oil patch and elsewhere. Know that were right on the cusp. Right now all the guys and cfos turned on the burners and cooking all the books and getting everything right. Cooking the books. Is that a bad term . Yeah. Thats a really bad term. Maybe i misspoke. Theyre formulating their quarterly results. How is that . Is that more official . I think you meant tabulating. Im even getting an eye roll from mary which is rich. Thats unusual. I usually dont get that. They start about a week from today. When we start getting into it. Heres whats happening in europe. After what happened yesterday thats okay. At least have some green arrows. A quick look at asia which is mixed with shanghai doing the best out of those three that we follow. Energy 47. 33 now. Not a lot of action. Well see if we get a deal with iran. Its already that was the reason for breaking under 50 and then what got me was when i read u. S. Government bonds rose in the First Quarter to cap the fifth quarter in a row. Long erwining streak than the dow had. Longer as fed gets closer and closer to finally reversing its zero Interest Rate bonds continue to rise. Not Interest Rates. Bonds continue to rise and which is something mark grant said and theres more you know the fed can do things with shortterm rates but cant control where the bond market goes and we know that but a lot of people would not have thought let me buy bonds five quarters ago. Very weird. It is and not expected and surprising. Are you going to do that . No you do the dollar. If i must. 107. That is sort of stabilize. Got down to 104 briefly. Now we have people saying maybe europe is covering. Maybe we go slow with the rising rates and then gold now 1180. New this morning walmart is the latest company to speak out against the religious freedom measure and Mary Thompson joins us with that story. He has not signed it yet . No he hasnt signed it yet. We were covering that earlier. Now arkansas and georgia will be next. All three states are in the midst of passing religious freedom bills that have high profile corporations coming down on the states. The latest is arkansas. Passing hb1228 which governor hutchison is expected to sign even though he urged changes to the law before it was passed. Now the countrys largest private employment walmart in a statement, the ceo said every day in our stores we see firsthands the benefits of diversity and inclusion have on our associates customers and communities we serve. Today aesz passage threatening to undermine the spirit of inclusion throughout arkansas. Were asking governor hutch ininson to veto the law. It provides individuals and corporations valuable protections that might infringe on those freedoms. In minnesota a similar bill prompted store owners claiming they dont discriminate. The business communities in indiana and many in arkansas hearing this law will make it difficult to retain and recruit talent and draw new investments to their state. Now other corporations including American Airlines apple, wells fargo issuing a statement in support of the gay Advocacy Group the Human Rights Campaign saying these laws set a dangerous precedent and undermine equality in the work place. The changes theyre considering to the indiana law would guarantee these laws cant be used to discriminate against people no matter race religion creed and sexual orientation. Is that enough of a fix . We dont know what the wording is yet so we dont know if the wording would include all of that. Tsa what you would hope because governor mike pence says he wants the legislation to say we dont discriminate against anyone. Any business or the law would not give businesses the right to discriminate against anyone. So yes i think theyd like that. I think they want to probably go a step further with some kind of civil liberties. Does arkansas have an antidiscrimination law . It does not. Neither does indiana. Weird timing. But we didnt notice these things as 19 states passed them and bill clinton spear headed one in 1998. But theyre different than these. They have the civil they usually have something protecting is this a hobby lobby deal . Some of it is in response to what happened to hobby lobby. Timing looks like its in response to gay marriage being legalized. Many people say it happened in indiana. So its a little quid pro quo to those that were opponents of it. If it was inspired by that and not by the Affordable Care act then adding those things makes it undo the very thing it was set out to do. It sounds like it was set out. What does the First Amendment not cover. What does it not cover that needs to be legislated now . Do you know . Its weird isnt it . Its strange. Im not a legal expert so i hesitate to say anything. None of us are. Even those laws its a very complicated issue. And religious freedom is i was reading some statements that a number of lawyers issued a group of 30 lawyers had written in indiana and they say there has been over time this very delicate balance in allowing religious freedoms and state rights or states that would prevent anyone from being discriminated against but still allow people to practice their religion as such. Some people say we need clarification on it and others say that you go down a slippery slope when you have these kinds of laws obviously. Certainly havent heard the end of it. Thank you. We havent seen you in awhile. You missed me havent you . Is that why youre sick . Nauseous. Heart sick. Is this an april fools prank on me . I thaw the april fools joke was listeners having to listen to you sniffle all day long. Dont breathe this direction. Im glad youre here but dont breathe this direction. Really. I was thinking about calling in sick and then showing up but they would have someone. I dont know. They would try some drastic thing and have you sitting here. I dont even think that would happen. All right getting back to jobs the economy and the market with economists expecting lukewarm Economic Growth they could be looking at a grey area ahead. With us right here on set is bill smead. Bills firm just won a three year performance award last night and bill congratulations. Thank you. Gentlemen lets talk about this a little bit. We are looking at an economy that looks okay but a lot of the latest economic numbers are signaling a slow down. Economists are slashing their First Quarter gdp numbers. How do you think were doing . The dock strike on the west coast was evident. Our condo sits up on the hill and you could see the ships stuck out on the port because they couldnt move in. There were weird things going on. I think a better look at this is Southwest Airlines running an advertisement. It says wedding season is coming up. Get your low fares. I saw that during the basketball tournament this weekend. Theres more people going to get married this summer than probably any summer in 15 years and theres probably going to be more babies born in the next two or three years than any time in the last 15 years so while everyone is worried about greece and oil and this and that theres 86 million millennials in the United States that are reving up their life and i would not want to be the guys betting on the long bonds. You remember a couple or three weeks ago warren said if i would buy 200,000 Single Family residences i would do that and i sat this morning and tried to figure out, thats about 44 billion worth of Single Family residences, right . So the United States economy has operated for five or six years in recovery without housing and thats never happened before. What happens when they all decide to do the same thing at the same time. Do you think that housing is on its way back right now . Absolutely. The average household spends 15 of their gross income on a mortgage right now and the average renter in the United States spends 30 of their gross income. And the 30 is not deductible and the 15 is. So everybody likes to talk about mean reversions and theres your mean reversion. We have him coming in later and hes been a big proponent of thinking that rentals are going to continue to climb because of changing demographics people liking to live in the city and people getting married later in life. He would push back on that. Jeff gunlock would push back on that. A lot of people would push back on that. Heres the problem, we live in seattle. It has the highest percentage of 20 to 40yearold Single College educated people. So we get to see this dynamic, this group of people and as soon as you get a 2yearold child youre looking at a yard and a fence for your child to play. And trust me all of a sudden all the theories about living in a condo in new york go out the window when the 2yearold toddler needs a yard. Where do you think we stand with the economy right mow . I should point out we did talk to warren buffet yesterday. He said despite what all the economists are saying what he sees looking at his 80 business lines is that the economy is humming along. I feel like it is too but its obviously been an anemic recovery and well probably get a little glitch here in this quarter. I think bills point about housing is very interesting. Im seeing the same thing in that theres the market sending you a message if you can read the message and im seeing a lot of the Industry Groups that you would expect to do well on a housing recovery begin to stick up their heads. Some of the Home Improvement companies lt some of the companies that manufacture things that are used in housing. So you know, its indicating to me that we probably are going to see a descent recovery here in housing and i think his points are are very well taken about the rental market and what could happen as we come into a little bit stronger recovery and i do think the recovery will probably be stronger in the second half of the year. The markets obviously worried about what is going to happen in the quarter and theres a lot of nervousness. A day like monday would have been up 400 point ifs we had the kind of value you would like to see on that kind of a rally. Its been an unloved bull market all the way up. Any time you get near highs you have people start to come in worrying that theyll be the one without a chair when the music stops. Bill, you point out that you like housing stocks. I was surprised to see you list Berkshire Hathaway as a housing stock. Hes the second largest Residential Real Estate broker in the United States. He owns clayton homes, shaw carpet benjamin moore, berl burlington northern. Wells fargo is his largest common stock position. His fourth largest is bank of america. Theyll be two of the four primary mortgage lenders. Im hearing word that you can get a jumbo loan from wells fargo to buy a house with 10 down and theyre the most conservative out there. So ironically playing a recovery in housing the next five years is a very difficult thing to do in the stock market. Most people think well ill buy small caps to get at the recovery were talking about. The problem is theyre way more expensive than large caps and valuation matters dearly. We like large. We like domestic. So theres the front line plays. That would be the banks that make the loans, the nvrs that build the houses and theres the secondary plays. Hes also buying van tool. He wants to sell these millennials their first car that fits a car seat. The front line are the housing stocks you just mentioned. The financials making those loans. I know you like bank of america, wells fargo and jp morgan but Media Companies too. Thats the secondary. As soon as you get two kids youre stuck at home each night during the week. And youre going to watch shark tank reruns on cnbc and other things. So comcast and disney and ganet with their 46 Network Affiliate stations are very well positioned. You see everyone forgets that in the old days when i got married in 1981 average age to get married was 23 and now its 28. So the way that people became more conservative and more boring happened in your 20s. Now its going to happen in your 30s and everybody forgets that your life changes dramatically when you get married and have kids and that will happen regardless of whether you live in new york or st. Louis or you know peoria and as that happens the whole dynamic, imagine the spending change in the composition when theyre married and have two kids and are staying home more. You might pay more for cable and netflixs and everything you can do on a tv. What do you think about the market mentality . Just the idea of is good news good news . If we get a strong jobs report on friday does the market look at that and say great the economy is coming along or are we still in the position where were hoping for the fed to hold our hand even longer . Thats a coin flip. I wouldnt make an investment based on what i think the reaction is going to be good news or bad news but were probably kind of at the point now where good news may be a little bit of bad news because were obviously going to get the rate increases. Theyre coming. You know if youre an investor thats noise. Thats peripheral noise. You need to Pay Attention to where we are in the market. Three or four years to run in my opinion. Good news ought to be good news. It will be because the economy is improving. Were going to see a stronger dollar along with that. You need to be attentive to where you are in the market and you dont need to trade these corrections. The average investor has no business doing it. Im always reminded of what he said about football as why he always ran and didnt pass very much. He said when you pass three things can happen. Two of them are bad and thats the same way i look at overtrading accounts. Theyre better off staying where they are. This has been a wonderful time to invest in large cap. Good dividend paying stocks. As we go forward i believe that theyll give you the best return probability and in the latter stages the bull market small caps but looking at Interest Rate where is they are right now, the compelling argument is to buy large cap dividend paying stocks in my opinion. Well john i want to thank you for joining us today. Its been great talking to you and bill thank you for braving coming in here and not getting rattled by joe blowing his nose the whole time you were talking. I only did it once. You threw tissues at mary across the room. I did. Coming up banking on the financials. What a top industry analyst says we need to know before earnings season kicks off. Then later legendary investor sam zell. Never a man to mince words and on the off chance he isnt a frank enough talker for you today, the always outspoken mark cuban is going to stop by for an extended interview. Well talk basketball fighting with the fcc, tech bubbles and much more. No topic is off the table. First as we head to break heres a look back at this date in history. Welcome back. Big news out of china overnight. Beijing taking a page out of the play book. Eunice what prompted this . Well there are a lot of different reasons. The German Shepherd<\/a> . Possibly. When you get door stops or something you always get bookends. His and hers. So they can sit by the edge. Id like to get a brother. Of zara. Yeah what a dog. All right. Well talk a little bit about the Second Quarter<\/a>. It begins today and the bulls are hoping it starts better than the First Quarter<\/a> ended. It was a rough session yesterday down for the year by closing down about 200 points yesterday. This is the first down quarter in the last four for the dow. But they ended up. It was slightly higher. The nasdaq is on a nine quarter winning streak. Thats the longest winning streak ever going back to its inception in 1971. Check out the futures this morning and at this point they look like there are green arrows. S p futures up marginally and the nasdaq up by over 7 points. The stories, the big ones were watching today the deadline with the talks for iran have been extended by a day. Were still waiting to see if the u. S. Can strike a deal with that country. They agreed on monitoring and sanctions but the state Department Cautions<\/a> that there are still some tough issues to workout. In Economic News<\/a> jobs are in po cuss because its wednesday and friday is the first friday of april. So the employment report comes out friday. So the adp employment report is due at 8 15 eastern and forecasters are forecasting that the economy likely had a 225,000 private sector jobs last month. And on the corporate front go daddy pricing its ipo at 20 a share above its expected range. That values the company at about 4. 5 billion. That includes debt though. Shares are expected to start trading on the nyse under the symbol gddy. There you go. Among our stocks to watch today carpenter technology. Theyre cutting about 10 of the work force. Thats roughly 200 jobs. The Company Wants<\/a> to reduce costs amid weak oil and gas prices and shares of i. T. Services provider synnex under pressure after the companies came in with results that missed the mark. The Second Quarter<\/a> guidance looks a little weak as well and oil and gas producer says it might file for chapter 11 bankruptcy protection if it cant refinance debt obligations. Samsung was required in 2011 in a 7. 2 billion deal by a team of invery tors. Lets check on the markets this morning. A little snap back. I dont know what yesterday was as opposed to the day before. Its disconcerting that the quarter ends and people were loading on to things the day before and you dont have that same buying pressure. So now it will be in earnest plus it is april fools day obviously which is a weird day to price an ipo i would think for go daddy. Also weird day if we do reach some type of deal. They havent been so forth coming in the past. Its like really nobody maybe but what im getting to was this earnings season is probably more anticipated than most that weve seen because of the strong dollar and whats happened in the oil patch and elsewhere. Know that were right on the cusp. Right now all the guys and cfos turned on the burners and cooking all the books and getting everything right. Cooking the books. Is that a bad term . Yeah. Thats a really bad term. Maybe i misspoke. Theyre formulating their quarterly results. How is that . Is that more official . I think you meant tabulating. Im even getting an eye roll from mary which is rich. Thats unusual. I usually dont get that. They start about a week from today. When we start getting into it. Heres whats happening in europe. After what happened yesterday thats okay. At least have some green arrows. A quick look at asia which is mixed with shanghai doing the best out of those three that we follow. Energy 47. 33 now. Not a lot of action. Well see if we get a deal with iran. Its already that was the reason for breaking under 50 and then what got me was when i read u. S. Government bonds rose in the First Quarter<\/a> to cap the fifth quarter in a row. Long erwining streak than the dow had. Longer as fed gets closer and closer to finally reversing its zero Interest Rate<\/a> bonds continue to rise. Not Interest Rate<\/a>s. Bonds continue to rise and which is something mark grant said and theres more you know the fed can do things with shortterm rates but cant control where the bond market goes and we know that but a lot of people would not have thought let me buy bonds five quarters ago. Very weird. It is and not expected and surprising. Are you going to do that . No you do the dollar. If i must. 107. That is sort of stabilize. Got down to 104 briefly. Now we have people saying maybe europe is covering. Maybe we go slow with the rising rates and then gold now 1180. New this morning walmart is the latest company to speak out against the religious freedom measure and Mary Thompson<\/a> joins us with that story. He has not signed it yet . No he hasnt signed it yet. We were covering that earlier. Now arkansas and georgia will be next. All three states are in the midst of passing religious freedom bills that have high profile corporations coming down on the states. The latest is arkansas. Passing hb1228 which governor hutchison is expected to sign even though he urged changes to the law before it was passed. Now the countrys largest private employment walmart in a statement, the ceo said every day in our stores we see firsthands the benefits of diversity and inclusion have on our associates customers and communities we serve. Today aesz passage threatening to undermine the spirit of inclusion throughout arkansas. Were asking governor hutch ininson to veto the law. It provides individuals and corporations valuable protections that might infringe on those freedoms. In minnesota a similar bill prompted store owners claiming they dont discriminate. The business communities in indiana and many in arkansas hearing this law will make it difficult to retain and recruit talent and draw new investments to their state. Now other corporations including American Airlines<\/a> apple, wells fargo issuing a statement in support of the gay Advocacy Group<\/a> the Human Rights Campaign<\/a> saying these laws set a dangerous precedent and undermine equality in the work place. The changes theyre considering to the indiana law would guarantee these laws cant be used to discriminate against people no matter race religion creed and sexual orientation. Is that enough of a fix . We dont know what the wording is yet so we dont know if the wording would include all of that. Tsa what you would hope because governor mike pence says he wants the legislation to say we dont discriminate against anyone. Any business or the law would not give businesses the right to discriminate against anyone. So yes i think theyd like that. I think they want to probably go a step further with some kind of civil liberties. Does arkansas have an antidiscrimination law . It does not. Neither does indiana. Weird timing. But we didnt notice these things as 19 states passed them and bill clinton spear headed one in 1998. But theyre different than these. They have the civil they usually have something protecting is this a hobby lobby deal . Some of it is in response to what happened to hobby lobby. Timing looks like its in response to gay marriage being legalized. Many people say it happened in indiana. So its a little quid pro quo to those that were opponents of it. If it was inspired by that and not by the Affordable Care<\/a> act then adding those things makes it undo the very thing it was set out to do. It sounds like it was set out. What does the First Amendment<\/a> not cover. What does it not cover that needs to be legislated now . Do you know . Its weird isnt it . Its strange. Im not a legal expert so i hesitate to say anything. None of us are. Even those laws its a very complicated issue. And religious freedom is i was reading some statements that a number of lawyers issued a group of 30 lawyers had written in indiana and they say there has been over time this very delicate balance in allowing religious freedoms and state rights or states that would prevent anyone from being discriminated against but still allow people to practice their religion as such. Some people say we need clarification on it and others say that you go down a slippery slope when you have these kinds of laws obviously. Certainly havent heard the end of it. Thank you. We havent seen you in awhile. You missed me havent you . Is that why youre sick . Nauseous. Heart sick. Is this an april fools prank on me . I thaw the april fools joke was listeners having to listen to you sniffle all day long. Dont breathe this direction. Im glad youre here but dont breathe this direction. Really. I was thinking about calling in sick and then showing up but they would have someone. I dont know. They would try some drastic thing and have you sitting here. I dont even think that would happen. All right getting back to jobs the economy and the market with economists expecting lukewarm Economic Growth<\/a> they could be looking at a grey area ahead. With us right here on set is bill smead. Bills firm just won a three year performance award last night and bill congratulations. Thank you. Gentlemen lets talk about this a little bit. We are looking at an economy that looks okay but a lot of the latest economic numbers are signaling a slow down. Economists are slashing their First Quarter<\/a> gdp numbers. How do you think were doing . The dock strike on the west coast was evident. Our condo sits up on the hill and you could see the ships stuck out on the port because they couldnt move in. There were weird things going on. I think a better look at this is Southwest Airlines<\/a> running an advertisement. It says wedding season is coming up. Get your low fares. I saw that during the basketball tournament this weekend. Theres more people going to get married this summer than probably any summer in 15 years and theres probably going to be more babies born in the next two or three years than any time in the last 15 years so while everyone is worried about greece and oil and this and that theres 86 million millennials in the United States<\/a> that are reving up their life and i would not want to be the guys betting on the long bonds. You remember a couple or three weeks ago warren said if i would buy 200,000 Single Family<\/a> residences i would do that and i sat this morning and tried to figure out, thats about 44 billion worth of Single Family<\/a> residences, right . So the United States<\/a> economy has operated for five or six years in recovery without housing and thats never happened before. What happens when they all decide to do the same thing at the same time. Do you think that housing is on its way back right now . Absolutely. The average household spends 15 of their gross income on a mortgage right now and the average renter in the United States<\/a> spends 30 of their gross income. And the 30 is not deductible and the 15 is. So everybody likes to talk about mean reversions and theres your mean reversion. We have him coming in later and hes been a big proponent of thinking that rentals are going to continue to climb because of changing demographics people liking to live in the city and people getting married later in life. He would push back on that. Jeff gunlock would push back on that. A lot of people would push back on that. Heres the problem, we live in seattle. It has the highest percentage of 20 to 40yearold Single College<\/a> educated people. So we get to see this dynamic, this group of people and as soon as you get a 2yearold child youre looking at a yard and a fence for your child to play. And trust me all of a sudden all the theories about living in a condo in new york go out the window when the 2yearold toddler needs a yard. Where do you think we stand with the economy right mow . I should point out we did talk to warren buffet yesterday. He said despite what all the economists are saying what he sees looking at his 80 business lines is that the economy is humming along. I feel like it is too but its obviously been an anemic recovery and well probably get a little glitch here in this quarter. I think bills point about housing is very interesting. Im seeing the same thing in that theres the market sending you a message if you can read the message and im seeing a lot of the Industry Groups<\/a> that you would expect to do well on a housing recovery begin to stick up their heads. Some of the Home Improvement<\/a> companies lt some of the companies that manufacture things that are used in housing. So you know, its indicating to me that we probably are going to see a descent recovery here in housing and i think his points are are very well taken about the rental market and what could happen as we come into a little bit stronger recovery and i do think the recovery will probably be stronger in the second half of the year. The markets obviously worried about what is going to happen in the quarter and theres a lot of nervousness. A day like monday would have been up 400 point ifs we had the kind of value you would like to see on that kind of a rally. Its been an unloved bull market all the way up. Any time you get near highs you have people start to come in worrying that theyll be the one without a chair when the music stops. Bill, you point out that you like housing stocks. I was surprised to see you list Berkshire Hathaway<\/a> as a housing stock. Hes the second largest Residential Real Estate<\/a> broker in the United States<\/a>. He owns clayton homes, shaw carpet benjamin moore, berl burlington northern. Wells fargo is his largest common stock position. His fourth largest is bank of america. Theyll be two of the four primary mortgage lenders. Im hearing word that you can get a jumbo loan from wells fargo to buy a house with 10 down and theyre the most conservative out there. So ironically playing a recovery in housing the next five years is a very difficult thing to do in the stock market. Most people think well ill buy small caps to get at the recovery were talking about. The problem is theyre way more expensive than large caps and valuation matters dearly. We like large. We like domestic. So theres the front line plays. That would be the banks that make the loans, the nvrs that build the houses and theres the secondary plays. Hes also buying van tool. He wants to sell these millennials their first car that fits a car seat. The front line are the housing stocks you just mentioned. The financials making those loans. I know you like bank of america, wells fargo and jp morgan but Media Companies<\/a> too. Thats the secondary. As soon as you get two kids youre stuck at home each night during the week. And youre going to watch shark tank reruns on cnbc and other things. So comcast and disney and ganet with their 46 Network Affiliate<\/a> stations are very well positioned. You see everyone forgets that in the old days when i got married in 1981 average age to get married was 23 and now its 28. So the way that people became more conservative and more boring happened in your 20s. Now its going to happen in your 30s and everybody forgets that your life changes dramatically when you get married and have kids and that will happen regardless of whether you live in new york or st. Louis or you know peoria and as that happens the whole dynamic, imagine the spending change in the composition when theyre married and have two kids and are staying home more. You might pay more for cable and netflixs and everything you can do on a tv. What do you think about the market mentality . Just the idea of is good news good news . If we get a strong jobs report on friday does the market look at that and say great the economy is coming along or are we still in the position where were hoping for the fed to hold our hand even longer . Thats a coin flip. I wouldnt make an investment based on what i think the reaction is going to be good news or bad news but were probably kind of at the point now where good news may be a little bit of bad news because were obviously going to get the rate increases. Theyre coming. You know if youre an investor thats noise. Thats peripheral noise. You need to Pay Attention<\/a> to where we are in the market. Three or four years to run in my opinion. Good news ought to be good news. It will be because the economy is improving. Were going to see a stronger dollar along with that. You need to be attentive to where you are in the market and you dont need to trade these corrections. The average investor has no business doing it. Im always reminded of what he said about football as why he always ran and didnt pass very much. He said when you pass three things can happen. Two of them are bad and thats the same way i look at overtrading accounts. Theyre better off staying where they are. This has been a wonderful time to invest in large cap. Good dividend paying stocks. As we go forward i believe that theyll give you the best return probability and in the latter stages the bull market small caps but looking at Interest Rate<\/a> where is they are right now, the compelling argument is to buy large cap dividend paying stocks in my opinion. Well john i want to thank you for joining us today. Its been great talking to you and bill thank you for braving coming in here and not getting rattled by joe blowing his nose the whole time you were talking. I only did it once. You threw tissues at mary across the room. I did. Coming up banking on the financials. What a top industry analyst says we need to know before earnings season kicks off. Then later legendary investor sam zell. Never a man to mince words and on the off chance he isnt a frank enough talker for you today, the always outspoken mark cuban is going to stop by for an extended interview. Well talk basketball fighting with the fcc, tech bubbles and much more. No topic is off the table. First as we head to break heres a look back at this date in history. Welcome back. Big news out of china overnight. Beijing taking a page out of the play book. Eunice what prompted this . Well there are a lot of different reasons. The Chinese Government<\/a> as you said is creating its own version of the fdic and the government has been talking about this for many years but we finally have a launch date. May 1st. Thats sending a signal to the markets that the government is willing to make good on some pledges to reform the financial sector. Under the new scheme chinese deposits will be guaranteed up to 500,000, thats about 81,000 u. S. Dollars. To what extent the Chinese Government<\/a> is willing to protect chinese savers. People also see this as a way for the government to allow itself to close troubled Financial Institutions<\/a> without creating public panic as the economy continues to slow down and put pressure on the banks and the program is seen as an important step to deepen financial reforms paving a way to a long awaited end to Interest Rate<\/a>s controlled not by the state but by the markets hopefully at some point soon guys. Yes well talk about banks right now. The picture being painted for this earnings season is just days away from starting but s p capital iq says financials could be the topper forming sector this quarter. Expecting growth of more than 10 year over year. With us now on set to weigh in he is a banking analyst at rbc capital markets. Just first off, five out of the ten sectors are, i love this five out of the ten sectors in the s p are supposed to show positive growth. Is that the opposite of negative growth sf. Sounds that way to me. Thats when earnings go down and not the rate of change goes down . You do not expect that ill ask you, what about banks. Whats really driving the story is loan growth. Were starting to see good loan growth in the United States<\/a>. The Federal Reserve<\/a>s weekly data that comes out on friday afternoons is showing total loan growth 8 year over year which is very positive. Commercial and industrial auto credit all the things that you would expect in an improving economy you would expect that. Thats correct as you pointed out commercial in particular is the driver and not housing so if housing comes back and the consumer comes back that would be very positive. Nice to get commercial loan growth. It is in most parts in the United States<\/a> and even commercial real estate is coming back for the first time. Construction lend chging which you might recall is a big collapse to the session. Thats also come back. Normalizing in terms of credit losses and provisions. That should be slowly getting where the bad things happening over the past five years should have gone away by now. Youre right. We only have a couple of what we referred to as selfhelp stories. These the companies that still have credit improvement. Thats citi group and bank of america but the industry is back to normal on credit. Its very strong right now. No nobody the yield curve hasnt improved much but thats something to look forward to is it not . You put your thumb right on the issue for the banks. When we talked to clients last week talking to Institutional Investors<\/a> that was one of the main questions was the yield curve and when will Interest Rate<\/a>s rise . Thats the last piece to the recovery story for the banks which we think will happen this year. Even if the fed starts to raise Interest Rate<\/a>s thats not a guarantee that all Interest Rate<\/a>s are going to go higher. You have so much free money in japan and europe at this point how does that effect what our banks can actually end up charging. Thats a very good point. What were thinking is that money if it flows in will keep the long end of the curve down so the yield curve wouldnt be as steep as normal and it may not be as positive for the banks. The real positive outlook would be a parallel shift in the yield curve but because of this cash floating around the world there seems to be pressure on the long end of the curve. But if the fed would raise longterm Interest Rate<\/a>s they would do well in that environment. But the bank stocks did not do well in the First Quarter<\/a>. No, they didnt. This is one of the few quarters in the last five years they have underperformed the general indices by anywhere from 2 to 300 basis points. We talked about a 10 gain. Youre not looking for anything close to that. Im thinking the s p may include all financials. Thats why its higher but the banks will be in the low mid to single digits. You dont have necessarily Big Money Center<\/a> banks as your favorites although you do like citi and jp morgan. Thats right. Its one of the stories that even if Interest Rate<\/a>s dont go higher their earning growth will be quite impressive because last year they sustained the number of charges due to litigation settlements and repositioning. That company is simplifying itself. So theres a good story there even without Interest Rate<\/a>s going higher. Theres something for everyone. And a couple of analysts recently recommended bank of america but youre not bank of america, were with that group as well. They still have a number of costs theyre lugging from the crisis and theyre continuing to fall. Theyre doing a good job of bringing them down. But the ones you like are the well managed one. Pp bbt, these are well run operations. Youre right. Those companies long corrected their problems in the past and theyre now becoming some of our best best. What about bku. Theyre headquatered out of florida. You guys remember him. Yes, of course. And then you also like regions financials. Thats correct. Stt. Thats correct. Sti is suntrust. I knew that. Another very well managed bank. Excellent. Everything i want to know about banks. When we come back this morning tiger woods plays 18 holes as augusta. Is an announcement on the masters next . First as we head to a break take a look at yesterdays s p 500 winners and losers. Hello. I am here to offer sophisticated investing strategies. My technology can help you choose the right portfolio. Monitor it. And automatically rebalance it. All without charging advisory fees, account service fees or commissions. That may be hard to compute. But im a computer. So trust me. It computes. Say hello at intelligent. Schwab. Com in new york state, were reinventing how we do business so businesses can reinvent the world. From pharmaceuticals to 3d prototyping, biotech to clean energy. Whether your business is moving, expanding or just getting started. Only new york offers you zero taxes for 10 years with startup ny business incubators that Partner Companies<\/a> with universities, and Venture Capital<\/a> funding for high growth industries. See how new york can grow your business and create jobs. Visit ny. Gov business okay here we are. Normally you would sit here. Yeah. Youre sick. I feel like were doing some type of i dont know im going to think im trying to transmit esp thoughts to you. This is weird to me. It just looks weird that youre way over there. Just not very personal. Im going on vacation. If im going to be sick i dont want it to be while im on vacation. Some things you cant help. My son got it first. I do feel. Im glad youre over there though. I dont think its flying off of me. Did you hear the rumor yesterday . More than just a rumor . Tigers gulf stream 5 was spotted at augusta. I heard it but only when we teased it a moment ago. Its confirmed he played a practice round. Do you think hes coming . I dont know. My prediction was that he would not play. But other people are saying if you don play you cant win. Thats true. He has goals he wants to reach still. He does and i was transferring my own fears to him because i dont think we have it but uncharacteristically he hit some shots late last year that you would never see tiger hit in terms of his chipping and it almost looked like he was decelerating and i cant imagine for me going and playing at augusta with the way they have those greens. So strong psychologically. If i had any issues i wouldnt go and play at the masters. But as you said if you dont play you cant win. But you never know what hes going to do and when he first started everybody bet against him. Tournament after tournament. It was a pluk or whateverfluke or whatever and he always did these amazing things. You think this is the situation, it used to be you could take tiger or the field. Now its mcllroy or the field. Maybe not necessarily at the masters because he had that one until he got the number ten and then he came back and won the u. S. Open and the story were going to talk about when he was 9 years old he sent tiger woods a letter that im coming after you. It wasnt a nice i really admire you. No, this is when he was 8 years old when he was on a talk show. I assume either in ireland or maybe somewhere in the u. K. I dont know but he was on a talk show and he actually takes a couple look at how cute he was. And hes going to hit these balls. On his fourth try he put all the other ones hit right on the edge of of the open of the dryer. Two or three do that and he finally gets it in and the guy tries to do it and just dribbles it along the ground. Tiger was with bob hope. Tiger was i think three or four i think when he was on tv and he had an amazing swing. He tries to put a club in kyles hand. Kyle is already older. Hes three. Thats the same age when tiger hit a full on swing. This is a week from thursday it starts. And youre ready because your bracket stunk so badly you needed Something Else<\/a> to focus on. My bracket. You dont recognize. Oh the basketball thing. Yeah that whole thing. Yours would have stunk. Coming up you press the button. And as a result im doing well. Well talk to the ceo of Pretzel Company<\/a> j and j snack foods and later dont miss sam zell and his warning investors and breaking Economic News<\/a> mark zandi will bring us the adp employment report. Plus mark cuban is going to stop for an extended conversation at 8 30. Squawk box will be right back. E financial noise financial noise financial noise financial noise you can call me shallow. But, i have a wandering eye. I mean, come on. National gives me the control to choose any car in the aisle i want. I could choose you. Or i could choose her if i like her more. And i do. Oh, the silent treatment. Real mature. So you wanna get out of here . Go national. Go like a pro. J and j snack foods is a 2 Million Company<\/a> that specializes in everything from slushie to icees. The stock is down this year but doubled over the last three years. Im looking at a longer chart going back to 07 and it was below 30. Now its 106. Squoin joining us is the ceo and i dont think people even though about the pretzel fad. They have been exposed to it a little bit. I had an idea because i love soft pretzels with mustard but its more of a trend its a trend. Is that correct . Yes it is. We have been in the soft pretzel industry selling millions of pretzels for over 50,000 Food Service Customers<\/a> throughout the country. Most notably under our super pretzel and our other brands like texas twist and more recently this fad which you so well described has become a trend and now were selling them in shapes of rolls and buns to also tens of thousands of fast food restaurants and casual dining restaurants like applebees and Buffalo Wild Wings<\/a> and several others. We know about how much Innovation Matters<\/a> to these chains and a lot of them i see theyre making sandwiches on pretzel rolls too. What makes a pretzel roll a pretzel roll versus a normal hamburger run. The dough make up is different and the process is different. We also shape the product in there so it looks more like a traditional soft pretzel than it does a roll and theres a special solution. Something which is exclusive with us. We trademarked the nail many years ago which gives it a special taste it gives us a sharpness and a flavor. Its pretty amazing. The other thing, in my house were allowed to have pretzels because theyre fat free. They may be carbs. One of the best kept secrets of soft pretzels are theyre good for you. Theyre low calorie. Theyre baked. Not fried. No sugar. No fat. And less than 200 calories depending on the size of the pretzel. Depending on the size. What about a super pretzel . Well if you make things bigger theyre going to contain more calories and youll have to workout a few more minutes a day but its worth it. Its not like a cinnabun or something. Is that like the round ones were looking at. Well a 3 ounce pretzel would be about 270 calories. Only because im eyeing these things and id really like to eat one. So as you eye them buy them. You wont be sorry. Jerry, thank you. I appreciate it. I cant eat all of those. I probably could but thanks for talking with us today. Appreciate it. I appreciate being here. Thank you for having me. Opportunities in cuba. One fund manager was ahead of the game. Hes going to tell us about infrastructure. Thats next right here on squawk. 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If you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com welcome back everybody. A cuba opportunities summit being held at the nasdaq today and cnbc is the official broadcaster. Our chief International Correspondent<\/a> is here on the set along with the fund manager who has been looking forward to the chance to invest in cuba. Michelle. Good to be here becky. Congress exists because of recent condition to normalize relations with cuba. Joins us is tom herzfeld. A business that existed for 22 years. We have interviewed you for decades on cnbc about when the time might come to be able to invest in cuba. It looks like it may finally be here. What are your thoughts as the president has made the announcement . I think its very close. Weve been prepared for over 20 years to do that just now. Dealing with every industry in cuba. Every sector every potential business opportunity. And were absolutely ready to go. By the way i just want to mention one thing if i may im not talking about hersfeld fund im talking about clients and a private equity fund weve formed. I imagine the sectors have to be compelling. Travel . There are currently Six Industries<\/a> for investment. Those are the first steps that we take. Eventually every industry hotels. What are the Six Industries<\/a> that are well the Telecommunications Postal<\/a> services medicine, agriculture. So youve also held for a long time bonds, cuban bonds, that when you bought them they were legal to trade. And then as sanctions have gotten tougher over the years. Tell us the story of that what happened during hurricane sandy. Well there was a very small issue of sovereign debt of cuba outstanding. Most of what they call agency debt. Sovereign debt is the debt that is traded cents on the dollar. Before it was halted the trading, it was on the New York Stock Exchange<\/a>, we actually bought the bonds on the stock exchange. And weve been holding the value of them. But, you know the coupon bonds, during hurricane sandy, they went and in wall street a basement flooded. We had to find the bonds and coupons. Try them out . Yeah. What about the issue of claims gentlemencompanies like general electric, 6. 5 billion of american corporations that have claims sitting with the u. S. Government that have to be resolved before the embargo can ever go away. Is there any way to get over that hurdle . This has brought a lot of attention to if you go to a surgeon with a stomach ache he wants to operate but if you go there you want to create a fund. Weve created a fund. With the s. E. C. And weve given the u. S. Government a deal on how to solve the entire 6. 5 billion problem. Basically 750 million worth of Developer Properties<\/a> in our fund. It would put 750 million in cash in the 1. 5 billion fund which would exchange the entire 6 billion, shares in our funds, to recipients who are holder of the claims. And we would have it as it on the cuba stock exchange. That would be quite a thing, if it ever happens. Well see. Well its been great to have you on. Thanks for joining us. Thank you. Well be at the conference all day, at the nasdaq. We have the ceo of the Norwegian Cruise Line<\/a> coming up in the power lunch. And the undersecretary of commerce. He used to be an investment banker and now work on trade for the United States<\/a>. Michelle thank you. Coming up billionaire investor sam zell is going to tell us why they thinks a correction is coming. And when hes not yelling at refs signing social media or appears on commercials or shark tank, mark kookcuban has time to join squawk box. At 8 30 had eastern time. [ male announcer ] your love for trading never stops. So if you get a trade idea about, say organic food stocks schwab can help. With a trading specialist just a tap away. Whats on your mind lisa . Id like to talk about a trade idea. Lets hear it. [ male announcer ] see how schwab can help light a way forward. So you can make your move wherever you are. And start working on your next big idea. Overpriced thats according to our guest host sam zell. The real estate titan tells us where these finding value and why hes investing in energy now. Its just like the fast furious here we go except all the cars are parked and everyones happy. Well take you inside the new York Auto Show<\/a> with executives from gm and bmw. And the founder of toms shoes is setting his sites on coffee and clean water. The socalled chief shoe giver is here to explain as the second hour of squawk box begins right now. Announcer live from the beating heart of business, new york city this is squawk box. Welcome back to squawk box, everybody. This is cnbc. First in business worldwide. Im becky quick along with joe kernin. Andrew is off this week. Weve been watching the u. S. Equity futures on the first trading day of the Second Quarter<\/a> you can see right now things look mixed. Nasdaq down by one point. The nasdaq up though above by two points and value. And is that the idea of the song . I guess thats pretty clever. Who was that anyway. I have no idea. Stories that were watching, nuclear talk between iran and six world pour resuming today. And theyre abandoning that saying that enough has been made. And a veto of a controversial religious freedom bill in indiana wanted by a senator that opponents say it could be used to allow discrimination based on sexual orientation. Walmart ceo Doug Mcmillan<\/a> said the bill undermines the spirit of inclusion in that theyd. Go daddy has posted its share at 17 to 19. Values the company around 4. 5 billion. Go daddy is expected to begin trading today after the opening bell. And some people on twitter said i dont know what youre talking about. What commercials are you talking about that wed probably like to see. There arent many. Thats bar, isnt she . I dont know. Thats just from leo. The woman that youre looking at is on dancing with the stars right now. And that was danica. Danica. And danica has been on. That was bar . Anyway, its going to list on the New York Stock Exchange<\/a> with the ticker ggdy. Go daddy. On the show sam zell to make money in a time when Everything Else<\/a> is falling. By the way, he knows how to time a deal better than anybody else. Hes sounding the alarm. Sam, what makes you think that stocks are overpriced here . Well im not a stock person. And i dont claim to have clairvoyance, but theres a significant and growing glare between the stock market and the economy. Almost every company is truly in numbers less than expected. Revenue, particularly for multinationals, is being hurt by currency valuations around the world. Im looking for demand. And i find very little of it. And i think were going to have very significant competition because, you know, the euro is 40 lower. The yen is 40 lower. These are our competitors. And theyre playing with you know funny money. And i just think that its very hard to imagine that the current scenario can continue. I wonder where they got the idea playing with funny money like that . I have no idea. Call it voodoo economics. Well weve watched whats happened with the euro. Its been pretty spectacular. There are some people who say, look, weve seen the move at this point. Its something that if it stabilizes, well get on top of it. Do you agree with that . Well i was at a Board Meeting<\/a> two weeks ago. One of the people sitting on the board is an executive of one of the big multinational companies. And what theyre saying to us is you know their margins are getting crushinged. Theyre forcing to be it more competitive for it to be. You know i dont know how your competitor is profit with 40 less than yours, how does that get better. So hes had this notion with at least a year with the market ahead of the underlying fundamentals. Some of the fundamentals at least with the numbers that we report look like they started to try to catch up with where the stock market was. A lot of people would say, that job is moving through or a lot of part time but there has been some improvement. I dont think theres any question. Okay. But the markets continue to go up too. So i dont know whether the gap im wondering, if you im making some assumptions here, im sure that you think that the easy money of the Central Banks<\/a> has something to do with it. And i just wonder if weve said, maybe all Asset Classes<\/a> maybe benefited from all the money. Not just the stock market. I dont think theres any question. Yeah, not just the stock market. Certainly, real estate art. Art . Any higher asset. When you cut the cost of carrying it pushes up the price. Its not real complicated. The question is is not what happened last week. The question is what will happen next week. And as everybody is competing with everybody else i mean weve had a worldwide bigger than devaluation game going on. The euro is down 40 . The russian ruble is down 60 . I mean these are ultimately competitors. And ultimately, were going to have to respond to that. And i dont think theres ever been an example of us doing great when the dollar is very strong. And everybody elses currencies are very weak. Youre talking about the concerns even before we see the fed raise Interest Rate<\/a>s . Thats right. Do you think they do raise Interest Rate<\/a>s theres this dern of the currency wars does that keep them from raisinge inging rates this year . I think they moderate whatever it take. But ultimately raising rates should be a symptom of a significantly improving scenario. Remember, right after world war ii, what was the first thing that the world did . They set up world goods. Why, they recognized that growth was related to world trade. You had to have stable currencies in order to have world trade happen. And now we have unstable currencies. One of the impacts is going to be a reduction in world trade. I remember that really cool sculpture that you made about fiat currency. The dollar is now strong. One of the worries, i think you had, the Federal Reserve<\/a> that actually divided the dollar against i guess its not necessarily against other currency, theyre all fiat currencies. Were trading two overvalued cats for one undervalued dog. You bet. So the whole world is maybe at a point where, you know we feel flush, we feel like things are going pretty well. Theres lots of dollars in the pocket they just worth less. Worth more in relation to the euro . Or worth less. Yeah. I dont know which parts of real estate because the other thing that we hear all the time is that housing is finally starting to recover. We dont think its overvalued. Do you think theres parts of real estate that are overvalued . Well everything is relative. If you look at the cost of capital, then the cap rates on real estate are pretty realistic. The question is you can assume that this cost of capital will continue to move forward. Obviously, it cant continue to go forward. And as Interest Rate<\/a>s go up it will have an impact on the value of real estate. But certainly, commercial real estate has done very well. Im not sure that i completely agree that the Single Family<\/a> house market has returned. I think were in a major de desuburbanation trend in the country. The result is were not going to have the highvalue Home Building<\/a> as weve had in the past. As more people move in the city and affordability becomes an issue. We had a guest earlier who is betting on the Home Building<\/a> industry. Heres what hes talking about. The cities have been rejuvenate rejuvenated. He said youre going have more people getting married than we have in years. Were also going to have more babies being born. And also were doing this later in life. The millennials are having babies later in life. Yeah, lets talk about the Economic Impact<\/a> of number deferring buying a home from age 25 to age 40. What does that do to the economy . What does that do to the furniture manufacturers . What does it do to all the other elements . I mean what im not suggesting that, you know, the end of the world is coming. But its very obvious that delay of marriage deferral of children is having major impact on the classic suburban you know, household, American Dream<\/a>. As i said often, the American Dream<\/a> is not owning a house. The American Dream<\/a> is freedom to own a house. Right. Its a huge difference. Lets bring in michelle ka carusocabrera is back. Were talking about this because of the conference all day long at the nasdaq about investing in cuba. The president s decision to normalize relationships with cuba. For the first time cuban americans are supportive the president s initiative to normalize relations with cuba. It comes in at 50 . Specializing for decades in surveying cuban americans about the situation with cuba. Specifically the embargo. 51 agree this an agreement from back in december. Back then 40 on the lefthand side there agreed with the president s decision. The 51 disagrees has fallen from 48 excuse me. Now, implications for the election marco rubios candidacy, et cetera and the embargo in general, and why we see so many florida legislators still supportive of the embargo and against the president s decision. The new survey of cuban americans lives in florida, versus cuban americans living in the rest of the United States<\/a> the rest of the United States<\/a> overwhelmingly agree with the president s decision. 69 , whereas those in florida, less than half 41 . The other significant thing age. When you look at young cubanamericans way there on the left 89 to 29 69 support normalization of relations with cuba. Over the age of 65 only 38 . You can imagine those are people who came right after castro took over and lost all of their property. And theyre still quite angry about the situation. To actually get the full embargo lifted youd have to have an act of congress. We know legislators out of florida dont want to do this yet. Is that enough to block them . Right now it is. Right now it. And if the tide keeps shifting and it really does feel, from my experience with the cubanamericans that i know, that it is shifting. So there could be changes, lets see. But certainly, already massive changes in our relationship just because of whats already been announced by executive order by the president. You know we have mark cuban on today, too . But hes not cuban. Hes not cuban i thought you were going to a marco rubio, i was going to say, really . Just playing along with you. Somebody should mark cuban today. That would be good. Hes on. I bet he has an opinion on cuba. I bet he does. I dont think so. His name is i get it. I totally get it. Its funny. Michelle thank you. Well be watching today too. Thanks. When we come back well have much more from sam zell. But first, we will take you behind the wheel at the new York Auto Show<\/a> mark reuss will join us neshg. And then bmws ian robertson. And then the found of toms shoes wants you to get kicks off of dark coffee. Well talk about that in a minute. Welcome back to squawk box, everybody. This is the first trading day of the Second Quarter<\/a>, so far, yeah things have actually turned around. At the start of the morning it looks like green arrows across the board. Now there are red arrows. Dow futures down by 14 points. S p futures down by 4 points. Nasdaq down by 3. Sears and mall operator General Growth Properties<\/a> have announced a joint venture. Sears will contribute 12 its Properties Located<\/a> at general growth malls. And then general growth leasing back to the retailer. The two say its designed to unlock the value in the real estate. And give sears more financial flexibility. Sam what do you think about that . Well you know the magic of the sears thing has all supposedly been about the real estate. Number one, nobody in my opinion looked at the real estate carefully. And said how many square feet multiplied by therefore. The reality is they only did 12. And they had more than 12 to do. So, i think that they took on a major, major job. And i have my own experience with retail that i recovered from and i have no desire to go back into it. Was it we got and sold to fed rated. You know the Retail Industry<\/a> is not one of these industries where everybody falls up. I think its less sophisticated, certainly, when you get involved with fashion. And obviously, with general growth is going to do is hopefully take those spaces and break them up into small shops and go from there. The question is who is the draw that youve now taken anchor tenant. Based on sears recent performance, i dont think anybody would miss them. Its really good. Neat to be with drexler or terry. Or walmart. You have to be really bad. And were youre not so good its one of the classic, you know all or whatever rising tide lifts all boats. When it goes the other way, oh, my goodness. With warehouses and stores full of like yellow culottes that youre selling for ten cents. I would never know what to pick. Never. Especially with generation x. Jung young store. General motors getting an early start at the new York Auto Show<\/a> unveiling the all new top of the line cadillac ct6 at an event in new york last night. Joining us with our first look and a preview of what we can expect, we want to see the ct6, too, but maybe you can give us more on the autos. Mark reuss, cadillac has been one of the bright lights in u. S. And domestic makers. This is how different than the other cadillac . Its very different. And good morning from the show floor here. We had a great night last night with cadillac. And showed the world for the first time our ct6, which i think from the engine to the body structure to the mass of the car, and the luxury appointments is going to be industryleading here in those segments where it competes. Is this you know everything from welding aluminum which General Motors<\/a> holds as a proprietary technology. No fasteners, no extra things to some of the Aluminum Castings<\/a> that have been combined to eliminate parts to an all new 300 horsepower motor. All of those things combined for the first time in one of the most hightech power trains ever produced. Were doing that to make a real statement around innovation. American luxury and doing it in a way that is different from anything in the marketplace so were very excited about it. A lot of what cadillac and gm is focusing on now is innovation, i guess, and almost a digital move into the new gm i guess. So this is both theres a lot of technology a lot of technology that gives you power but saves gas in a nutshell. It does. Itss, you know really a lighter car than other cars in the cadillac lineup. Weve done that through incredible manufacturing techniques. But were also delivering features like a full panoramic mirror that basically eliminates all the blind spots that you have on a directional rear view smir. Theres a lot of safety in the car as well. Weve been focusing on that over the last year or two. Delivering things from a safety standpoint that no one else has. This car will be our flagship and test that safety innovation. Its a great car to drive, by the way. I drove it in its final calibration a couple weeks ago. The car drives like it looks and it has presence but its not overweight. Its not fat. Its not inefficient. Its very fun to drive. With the seats that weve got in the car, weve done it in a tasteful elegant way. I think thats the way for cadillac. A new face of cadillac. A lot of sales. Do they look like a 2 gdp economy or 3 gdp economy . Thats a great question. I think if were really going to be successful as the economy and industry goes forward, were going to have to deliver even more than what the industry is delivering from the value of a standpoint of these vehicles. I think thats what were focused on from a fuel economy, price point standpoint. Thats great. We want General Motors<\/a> and cadillac to lead the way with cars like the ct6. So you cant tell me anything about auto sales . Well its coming in mere right now. You have the yeartoyear comparisons, let me be honest are tough for the automaker in the industry because weve got less selling days on the month on a yeartoyear basis. I think theyre strong still. We are going to see that in the numbers but i havent seen that yet. Mark quickly, the oil prices no one know what is theyre going to do. If youve got less of an emphasis on developing hybrid technology right now . Do you introduce this with the hybrid yeah not at all. Its a great question. Anybody who plans in a longlead capital extensive business for episodic oil price and gas price fluctuation i think is at risk. So, what we like to do is look at you know permanent changes in societal changes fuel economy capped electrification. I think in an hour here were going to introduce something thats Ground Breaking<\/a> with the new malibu which gets 47 miles per gallon in hybrid form. It beats all the competitors. And four inches longer. Youre going to see Ground Breaking<\/a> that were focused on because we know our customers are. And we want to feel good about what were doing with the environment, fuel no matter what the price is and the conservation of the whole environment. Mark you said there are less selling day information the month. Around there 30 days in march . Im talking actual selling days. Im sorry for the ignorance, what does that mean oh, sundays when the dealerships are actually open. Yeah. Okay. No thats my density. Thank you. Not at all. Theres not always 28 days in february. No but march. Sundays, you cant do it. Okay. January, february march, april, may, june associationso, yeah. Mark reuss, thank you. Thank you very much. When we come back this morning, squawk booze news. A new king. Announcer time now for todays aflac trivia question. Which Company Opened<\/a> the first drivein gas station in the u. S. . The answer when cnbcs squawk box continues. Ahhh ahhhhhh. Liberate your spine. Ahhhahhhhhh. Aflac and reach, toes blossoming. Not that great at yoga. Yeah, but when i slipped a disk he paid my claim in just one day. Ahh so he had your back . Yep. In just one day, we approve and pay. One day pay, only from aflac. [duck snoring] announcer now the answer to todays aflac trivia question. Which Company Opened<\/a> the first drivein gas station in the u. S. . The answer gulf oil. In squawk booze news. Craft beer has a new king pennsylvanias yuengling brewery. Of what can be considered a craft brewery. Brewers who use corn or rice are now allowed. Yuengling wasnt considered before because it uses corn. The craft brewer sold 19. 6 billion in craft beer last year. Thats up 14 in 2013. You got this down with the month now . Yeah. If there is wait a minute how many months have 28 days quick. One. All of them. Coming up see, i knew you didnt have it right quick, how many have 30 . 11. 11. Good. I had to think. We were doing that like two minutes ago thinking since then. Thank you. Guest is sam zell. Well have much more. Well tell you why an nfl player is suing bank of america. Well be right back. [ male announcer ] your love for trading never stops. So open an account with schwab. And when a market move affects, say a Cloud Computing<\/a> stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. Welcome back to squawk box, making headlines. Harpercollins reportedly could pull its books from amazon. Business insiders reports that the publishers contract with the immerse giant is about to expire. S selsewhere, walmart, putting pressure to cut prices. Part of the retails push to regain its position as leader. And etsy says its ipo expected to be priced at 14 to 16 a share. Do you know etsy . I know of it but ive never used it. I do too. Nfl star Dwight Freeney<\/a> is suing bank of america for 20 million. Freeney claims bank of america aided and abetted a fraud scream in 2010. Freeney asked the bank to manage his finances. Two years later, mr. Freeney said he lost more than 20 million for what hes called the fraud scheme. Freeney is currently an unrestricted free agent. The bank denies playing any role in the alleged scheme. Getting back to our guest host sam zell weve mixed in a couple things with the talk about the economy and valuations, zam. Sam. That is the notion of trying to make it easier for everyone to succeed and flourish and thrive. We were just talking about immigration. Its something that it has been neglected to this long where its polarized voters to the point of i made the point, i dont know how a republican that doesnt deal with immigration doesnt now how republicans could win the presidency again. I wouldnt agree with you more. I think people forget that this is a country of immigrants. And that the strength of america has resulted from the kinds of people. You have a story, dont you . Who came over someone had a dollar or something. I was born 90 days after my parents came to this country. Right. And they came took them 18 months to get here from the germanpolish border. But their attitude was indicative of what im talking about. My father thought the streets of america were paved with gold which meant opportunity. Discrimination and all the things that existed in europe didnt exist here anymore. And we had a dhauntcountry that was focused on growth not on redistribution. When you focus on growth you arrest opportunities. When you focus on redistribution, you cant bound opportunities. And aggressiveness. And aggressiveness is what has made america different from the rest of the world. Theres a way of approaching immigration. Immigration say huge story. Absolutely. It doesnt have to be a negative. I thought it was just the way that were educating a disproportionate share of the smart people in the world. Weve never had as many foreign students as weve had in the United States<\/a> today. This is a resource for our country. The idea that we that we teach them but we wont let them live here. And if we give them the benefit of the best University Systems<\/a> in the world, then we send them away to use that knowledge against us it just doesnt make any sense. And i think that hopefully, whichever cant date gets elected, the focus will be on resolving these immigration issues. And creating an attractive environment, an attractive you know, ecology of immigration. Let me just be even more blunt because youre always blunts. Lets say there are two ways of looking at things. Redistribution and growth. Weve had Chris Van Hollen<\/a> talking about the budget. Talking about growth and along with things that you want. Eitc. The tax credit. Do something, throw a bone to the growth side of things. No trickledown. It didnt work. It doesnt work now. Thats not going to happen. Now Elizabeth Warren<\/a> and her concontingency democrats are going to pull their candidate to the left. Lets say hshgillary clinton is elected. Do you think we get a progrowth candidate . I dont know. I think Hillary Clinton<\/a> compared to the current president would be wildly progrowth, compared to a republican less probably. The whole issue for America Today<\/a> is where is the demand where is the growth . Because the growth is the future. And i think the malaise and the fact that weve recovered much slower than this recession than any previous recession is the fact that we havent unleashed the growth. I mean we spend 1 trillion in the stimulus bill that accomplished nothing. Zero. Other than added 1 is trillion to our debt. Everybody is talking about infrastructure. You can imagine if that trillion dollars had gone into infrastructure, instead of extending unemployment. And subsidizing, you know various municipalities around the country. I mean you couldnt spend a trillion dollars and the Economic Impact<\/a> would really have been felt. We had Kevin Schwartz<\/a> on he said the narrative putting forth by the Federal Reserve<\/a> itself. The stagnation weve done all we can by these extraordinary measures. Weve been dealing with what would have happened anyway. He said maybe not being as active as the fed and allows this to settle maybe theyve been part of the reason weve been unable to grow. Well people have varying views on that subjects. My own subject, qe 2 and 3, and fed pose haslicy has not been as corrective as it ought to be. And flooding it with uros or the japanese, i think thats a base thats ultimately going to come back and bite us. What do you think the ability to come back to 2 or 3 growth in the next ten years do you think we can do it . You tell me. I think the effect if the republicans get elected, the chances of that happening, i think, are pretty high. I think if a democrat or if the current expectation of who might be a Democratic Party<\/a> in there, and where theyre going to focus, i think the probabilities are very low. Even though bill clinton looks, in hindsight, looks like a progrowth democrat. He understood the private sector. He absolutely understood the private sector. I think whats unfortunate about bill clinton is the misdirection during his presidency took away from the fact that i think bill was a terrific president. And i think he was a good leader. You were a democrat back then werent you . No, sir. And do you think hillary would employ those same progrowth strategies . Im sorry, you dont think hillary would employ those same progrowth strategies . I think if left alone, that Hillary Clinton<\/a> running against obama in 08 for sure would have those policies. I think Hillary Clinton<\/a> running in 2016 has a party that has shifted dramatically to the left in the interim period. Shes got people like Elizabeth Warren<\/a> who are you know screaming and pushing the Democratic Party<\/a> away from reality. You know the similarity reminds me immensely of 1972. When the Democratic Party<\/a> committed suicide by nominating george mcgovern. Right. And weve got that same kind of flow happening right now. The president gets hammered for being not progressive enough. Yes yes. A large part of the i dont know were right in the middle of it here in new york city but its incredible to me. Anyway. Coming up were going to head back to the new York Auto Show<\/a> for a sneak peek at the fastest car in the bmw showroom. Well head to the boardroom and take a look at the u. S. Equity futures. Bmb taking speed to a whole new level at the north american debut of the v6 grand coupe. This is the fastest car on the bmw floor. It can be yours for just over 100,000. Joining us with a sneak preview from the new York Auto Show<\/a> is bmw board member ian robertson. Ian, lets see this. Youve got the unveil. Good morning to you. Were very excited about this car. The statistic, as you said its the fastest one. Has a limited top speed of 200 mile. Up to 60 miles in 3. 5 seconds. And a very powerful vehicle, but at the same time a very luxurious vehicle as well. Is that a 6 series . Wow, that looks great. Thats the new 6 series ian . 6 series grand coupe base. A twoseater. Executive saloon but highperformance vehicle. Are you going to make a motor psych to match it it . Say again. Are you going to make a motor psych to match it. I drive a bmwr800. Youll see the motorcycle as well. You should take a ride on that one. Holding son difficult. Ian, we just smoke with mark reuss earlier from General Motors<\/a>. We know were getting Sales Numbers<\/a> that are coming out later today. He gave us a little preview and said all in all, it was a tough comparison year after year because there were fewer selling days that the dealerships were open during the month of march. How you can comment on that . We havent seen the numbers yet. Theyll be in the next 24 hours. But as you say there were a few less selling days than this time last year. All in all, were very pleased. The market continues to move forward. I think thats a positive sign. Ian, would a loaded 7 series cost more than the 6 . The 7 series is clearly a different type of vehicle. This is more of a sports coupe, but with four doors, the 7 series of course is the luxury vehicle at the top end of the market. Right, is that over 122,000 for the 7 series or this the most expensive bmw . You can add to that with the spoke features. If you went up to the v12 version, clearly, its even a little more expensive than that. At this point, is it what weve seen the tiffanies, the bmws and mercedes of the world are going better than luxury goods seems to be flourishing. Is that still a true statement . Yeah its fair to say that the world is somewhat dynamic and volatile. And the unless the unexpected circumstances may be some areas like russia definitely, china is a little less buoyant than it has been. To bring that in to perspective, it is the largest car market in the world. And it has to be brought into perspective. You dont even need an mseries in the v6. There is an m6 version as well. Thats a slightly different looking vehicle. This is more straight lined. The m6 is really a performance all, all terrains in terms of corners and all the rest of it. Ian, thank you. Great to talk to you. When we come back this morning, the founder and chief shoe giver of toms shoes is branching out from footwear to coffee. Hell talk about his roasting venture and the cause behind it. I want to put on my boogey shoes theres nothing more romantic than a spontaneous moment. So why pause to take a pill . And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime<\/a> the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com welcome back everybody, toms has given away more than 35 million pairs of shoes around the developing world. Pressed by the consumer sales, keeping that one for one model, toms is branching out into bags and coffee. The founder and chief shoe giver at toms shoes. Thanks for being here. Thanks for having me on. Coffee is such a crowded arena. Why coffee . I think when you look at a model, its based on aid, giving aid to giving shoes. As we wanted to create more Economic Development<\/a> in countries, like guatemala, honduras ethiopia we realized one of the biggest industry is coffee. By trading with coffee founders we can make a huge impact in lives. At the same time were rolling out Retail Stores<\/a> rather than focusing on the same product, creating the cafes so more people are coming in has proven to be a great strategy. It seems like theres a starbucks on every corner. How do you find a place to locate the cafes . The other thing, the big coffee shops have been from a mass commodity. I think more and more customers are looking for a place to go and hang out in terms of feeling like someones home or living room and kind of that third place to save time. Its a little bit off the beaten path. So youre not talking about necessarily in big city. Smaller fields i know you have one here. Yeah one in new york. Chicago, porlt portland. Austin. So you wouldnt be here on a busy street . Right. Its about picking the right neighborhoods and right locations. The great thing is we have National Distribution<\/a> in whole foods. One of the coffee brands in all of america to be in whole foods. Were seeing even though we moved from shoes to eye wear the customers are making a difference with the morning cup of joe. I love when i buy a pair of your shoes that it is making a social difference. The onliry i buy it the shoes are comfortable and they look good. You got to have a good product. Exactly. Thats one of the things exciting about getting into the coffee space, trading directly with the coffee farmers were getting the choicest quality of bean. We can offer an artisanal part of coffee. Youre not just doing this with water. Org. How much of the world has no clean water its like a ridiculous number. Anywhere living under the poverty is struggling. Its not expensive. Theres ways of doing it with loans. Like the way water. Org does. This makes sense for you, too. Absolutely. Eventually we will work with water. Org. We have a great project now, water for people that does the private and public partnerships. Very similar to water. Org. The key is to create a partnership that will be sustainable in a Community Owned<\/a> by the community. To go in and help create clean water if the community didnt own it. For every bag of beans you sell for ever cup of coffee a day of clean water. Yeah. Thats amazing that a cup coffee can turn around theres another profit in that that you can actually turn around and do that . Well the thing is most of the Water Systems<\/a> very scalable. The up front cost getting into the community and building up the system but then the systems can last 20 or 40 years as long as theyre maintained and owned by the community. Thats one of the most important things anyone working in the water space recognize you have to get that community buyin. Id rather buy a cup of coffee and in your face the thing youre righting about all i got was criticism from the last thing i thought of. And now this thanks for coming in we appreciate it. Whats your handicap . My handicap is 11. Is really ought to be a 4. You almost win every year. No i didnt make the cut this year. Youre a great player. You got the hips the beard and 60 million i dont even want to talk about it. Coming up mark cubans here, 600 million. Tech valuations, startups and his views on the market. Shank tank, hell join us on the set in the next hour. I was determined to create new york citys first selfserve frozen yogurt franchise. And now you have 42 locations. The more i put into my business the more i get out of it. Like 5x your rewards when you make select business purchases with your ink plus card from chase. And with ink, i choose how to redeem my points for things like cash or travel. Hows the froyo . Just peachy. Literally. Ink from chase. So you can. A new quota ready to kick off. David blitzer says that the market isnt moving anytime soon. And breaking news. Private payroll data just minutes away. The numbers and a look ahead with mark zandi. And a maverick stops by the squawk set. And mark cuban joins to us talk Tech Innovation<\/a> where hes investing and business on the hard court. Its april fools day 2015. [ laughter ] and the final hour of squawk box begins right now. We dont get fooled again announcer live from the most powerful city in the world, new york, this is squawk box. Welcome back. Welcome back there it to worldwide exchange, business worldwide on cnbc. Im joe kernin along with becky quick. Our guest host is sam zell. Chairman of equity investments. Great to have him had here. The futures started to turn around and looked like they were going to extend yesterdays loss us. That is indeed still the case. Down 30 points on the dow jones, nasdaq down about 10. European stocks did not immediately sell off the day after what happened yesterday. Mostly the averages over there are higher. Marginally a present in france some of that less on the ftse and germany. And in greece. We know things have settled down in greece that doesnt rank as a European Market<\/a> to watch. Normally. We do now. But we know that the crisis has passed when when we take it off the boards . Yeah. Either that or its out of the euro. Or its gone. Heres whats happening right now. We are waiting on the adp employment report due in less than 15 minutes. Forecasters say that the economy likely added 250,000 private sector jobs. Mortgage applications surging by more than 5 . This is happening the spring selling season gets started. Deadline for iran taxing gets extended one day. Russias foreign minister is quoted as saying with a degree of monitoring and sanctions but the state Department Questions<\/a> a couple issues to work out. Sears and General Growth Properties<\/a> announcing a joint venture. The two say its designed to unlock the value in real estate and give sears more financial flexibility. Thats like a tenyear story, isnt it . Yeah. Its like a tenyear delta, air, united continental, american, downgraded. The sales are somewhat based on having will be long for a while. And valuation probably doing pretty well with whats happening with the oil. Apple, apple added to citys u. S. Focus list. Someone at citi discovered that. With models with more memory. Meanwhile, someone wrote a piece on one of the aggregate sites what exactly does the watch what does it do . We thought that about the iphone. I know both might have kids want it. They want it bad. Because you cant really if youre somewhere like at school or something, you cant use your phone you can kind of go like that. Theres a dick tracy interest to it. You can check out texts and things. I didnt think about that. I bet schools wont let you wear them. Maybe not. Markets are getting ready to kick off Second Quarter<\/a> trading in a little while. First quarter downgraded. And nasdaq up. To face the music why he moved apple to the dow. Here is the chairman now of industries. You probably cant hear me rallying about how stupid a move that was, david. Did anyone tell you heres my point. Im being facetious to some point. Apple deserves to be in the barrel. Its the Biggest Company<\/a> by Market Capital<\/a> in the universe. Its a tech bellwether. It affects the economy. So it should be. My only point is you guys never really look at sentiment or technical things to decide how its going to work out in the long run. My point is apple has 809 billion. Its gone to 750 billion. Its doubled and split. Its doubled, doubled, doubled. Now at 750 billion. Its going to be hard to go to 1. 5 is that trillion next . Yes. Its going to be hard to go to 1. 5 trillion right you dont think about that . We specifically dont see this as an investment recommendation plus or minus, positive or negative. You just say it needs to be there. But in the case of apple and the dow, it was very much driven by two splits. Apple split, 700 bucks a share it would have messed up the index because of the way the index is calculated which is unusual and maybe strange. But been doing it since 1986. And when the visa thing came along, we clearly had to do something even though we would have lost the tech rating in the dow. 7. 5 percentage points. Do we look at tech analysis . No. The structure, because of the structure, you cant put google in. And google probably should have been there a long time ago, but you still cant put it in there. You look at the dow to begin with. Its been around for 100plus years. 30 stocks. There are roughly 4,000 traded equities in the u. S. Market. 15 20 million market cap or more. To say ive got 30 stocks that will tell you about 4,000 is a bit of a stretch. Weve got another index called the s p 500, which, by the way, analytically is new. Apple, i cant give you a date but apples been in the 500 for quite some time. I can go back to the 1990 whs we put aol in the 500. It was only aol six generations ago. An upandcoming star. Sometimes coincidences are you know the dow goes from 6,000 in 200 whatever it was, 2008. Back to almost 20,000. And then you put apple in. It just looks like youre even topping out the dow. Maybe its the citigroup that is waiting. Ciscos never seen 600 billion again after you put it in the dow, right . I think so you didnt but aig in the dow, did you . You can hang that on somebody else . No. You didnt but somebody else did. The aig story really is the dark days of 2008 we did not chuck it out of the 500, even though by the rules he should have vanished with Lehman Brothers<\/a> wafting away in smoke, how it made the world out of the 500, it would have been the wrong kind of headlines and would you have called up and said no matter what you do, im going to complain, you knee. I know. I told you, i should send you a bill for the service. The weird thing is how closely the s p and the dow have tracked over time. Thats showing that obviously theres got to be a correlation between the stock price and market value of the company. No big surprise. Splits ruin that but otherwise. But 30 stocks in the dow that has a market value, its a pretty good chunk of the u. S. Economy in the world. That explains why they track so well. Overall, your agnostic about valuations in general. I guess it wouldnt be good for David Blitzer<\/a> to say, wow, were a little rich here right . Well i think we are a little rich. You know one thing i say that ive learned from being on the index and running it roughly 20 years, when you look at it i love index investing. Its not easy to pick the right stocks. Well just made a comment about the overall index, though. So its not cheap. P. E. Ratio is 18 and change which strikes me as a little bit rich. With one quarter into the year i think were up almost 1 including the dividend. We aint going know place this year. We do know qe still works. Call up anybody, the stocks are doing well. We always come back to the notion about qe works for a while. Right, right. And it makes things appear better, but the question is, does it finally engender animal spirits to where people feel good about their wealth and they do things about the underlying economy that actually justify it. Well if we step back from the stock market for a second look at the rest of the u. S. Economy, the u. S. Economy is probably better off than it was a year or two ago. The Unemployment Rate<\/a> is way down. Its been growing. Other than new home construction, it looks very nice. So yes, i think qe had some positives on that. And i think it was the right thing to do at the time. It doesnt mean its the right thing to do now for the United States<\/a>. Right now, its the puzzle and to figure out when to raise Interest Rate<\/a>s. You dont think greece is going to exit in the near term . I dont think greece is going to exit. I think at the end of the day, its politics. Its not economics. And ever european politician not just every greek politician has a huge stake in this. Greece goes its especially the death knell for the euro. Its the whole thing that failed and a political house of cards. Is the euro bottoming at 105 . That i dont know. I could never figure why it was up at 1. 35 or 1. 40 at that point. Its a little bit like the pound you go to london and look around if pounds were dollars, the currency rate would look reasonable. But theyre pounds. Why should everything cost you 2 more in london than new york. You have 47 or so today do i want when oil and crude did hit 120 did you think about putting it in the dow at that point . Is that an idea that maybe you we cant put crude oil in the dow. 120, must have wanted to right . To catch it on the way down . 120, im sorry, they wouldnt let me do that. All the way back to 30. Thank you. Up next Just Moments Away<\/a> from the march adp employment report. Porsche at the new York Auto Show<\/a>. Well talk to porsche about the ultimate luxury. Whats on your mind lisa . Id like to talk about a trade idea. Lets hear it. [ male announcer ] see how schwab can help light a way forward. So you can make your move wherever you are. And start working on your next big idea. Adp is out. Steve liesman is here. Thanks soap. Ss so much. Adp reporting 189,000 jobs created. The street looking for 185. You have to go back to june 2013 for a miss this size. How did we miss . You can see it there, goods, up 5,000. And the payroll estimate 248. Just so you know plus or minus, adps been running 45,000 away from that. I want to go to that to show you the biz size. Up 19,000. Good job guys in the back there. Smart measures doing okay. But we probably have the effect of the dollar but weird effect of Lower Oil Prices<\/a> that we cant quite figure out. Dont ask me lets bring in mark zandy, hes the guy that puts it together. Mark, i got to tell people the back story here. I wrote you on monday and i said mark wont the jobs numbers be weak because all the other data has been terrible. You kind of said you know looks like its been pretty good. Are you changing your mind on that. No no. I dont think that the question you asked me why are or economists thinks the job numbers are so strong not what i think. Youre speaking third person once removed. Thats correct. Ive very careful in answering the questions you ask. Is the job market weakening to reflect what weve seen which is a lousy First Quarter<\/a> . Yeah i think you nailed it. You can see the illeffects of the oil price declines. Resource and mining employment declined sharply, and i think well see that over the next few months. I do think the dollar is having an impact. Its having an impact on manufacturing which is weakening and there have been a nice source of growth. Large multinational corporations theyre the ones going to see it the most. Theyre not hiring as aggressively. And whats weighing on the job market. Oil first, the dollar second. Mark i dont know if youre questioning economic assumptions here. Going into this everybody said up and down Lower Oil Prices<\/a> are good for the economy. Everybody said that the stronger dollar was not going to be that big of an effect. I talked to Dennis Lockhart<\/a> the fed president for atlanta last week he told me hes questioning the effects of the economy. Where are you . Well not yet. Look, when theres big changes in the economy, the losers of those changes react much more quickly than the winners of those changes particularly when the winners are much more diffuse. The Energy Economies<\/a> are getting creamed. So theyre getting aggressive up front were seeing the illeffects of that. The benefits of the oil prices goring to take more time. And filter through in a year or two. If you look at the models the models say the consequences of oil prices will be weak job numbers. Lets talk about the friday numbers. What is your numbers going into this, are you prepared to change your number what youre expecting on friday. The number the consensus on the street is 248. Yeah i would have picked 248, 250. If you look at insurance claims there. Theyre consistent with 250. If you look at the recent job Growth Numbers<\/a> which are predictors of whats going on now. Thats over the past six months. The conference reports came out late yesterday. That looked pretty good. I would have said is 250. I do think the adp number is the best way of getting at it. Id say probably a print of somewhere around 200 k. Adp is private sector to show in 10,000, 12,000 for government. Mark, i think the big choice out there is this a repeat of last year deja vu all over again, weak First Quarter<\/a>. And the better bet sonis on a turn around for the quarter. About 1 for the First Quarter<\/a> now . Yeah i think the economy is going to reaccelerate. I think the weather played a big role. I think the underlying growth in the economy is still 3 . That will become evident as the year progress. In terms of job growth job growth has been extraordinarily strong. Out of any balance. Just to put context in this suppose its 189, thats still well above 100, 125 that you need to make for unemployment. Thats still pretty good. Mark thanks very much. I think well see you friday. Joe, youre going to be here. Im happy to be here. Im happy to try a 7 00 a. M. Start. Instead of 6 00. Instead of 6 00. See if we can do without you. I dont know. Do you like the numbers at all . Switching to 7 00 . Is this good news for bad news. Next there is no substitute for porsche. The luxury carmaker showing off the most powerful and best the best ever made. Porsche ahead of american operations joins us next. And mark cuban at 8 30 a. M. Join us on squawk box. E financial noise financial noise financial noise financial noise ameriprise asked people a simple question in retirement, will you have enough money to live life on your terms . I sure hope so. With healthcare costs, who knows. Umm. Everyone has retirement questions. So ameriprise created the exclusive confident retirement approach. Now you and your ameripise advisor. Can get the real answers you need. Start building your confident retirement today. Porsche unveiling the most powerful and fastest ever made at the new York Auto Show<\/a>. And the porsche north america ceo joining us with the strength of the luxury consumer. Is this a throwback a little bit to the spyder and roadsters in the past. Twoseater, midengine, and 335 horses right . Good morning, joe. This is the most extreme boxer created for the porsche. It combining lightweight body structure. Very good design and of course more power than ever. With the engine developing 375 horsepower. It is also the ragtop needs to be put down manually . Or does it not always right . Its very important for to us bring only a very powerful car, but also to gain some weight. We gain roughly, 60 to 70 pounds compared to a regular boxster. This is one of the reasons we came with a manual rooftop. And we also chose the most engaged driving experience to come with a sixspeed manual transmission. So this is a similar price to a 911 now, is it not . But you could get one pretty well equipped for the base price of a 911 . Its were coming with a surprise of 82,900. I think its a very attractive proposition to have a very pure car. And it comes indeed very close to the 911. Again, we have learned that this is say completely different customer groups. And the 911 has its own permit as opposed to the boxster. We dont see any major shift between both of them. We had ed mclaren on that said theyve got you in their cross hairs. I think i started at 180,000. You dont look scared. Are you worried about mclaren and the competitive aspects . I think its a compliment from them if theyre saying that. Anyway, we like competition, and we are building some of the best sports cars in the world, we think. The 911 turbo has been very very successful. In 30 of our 911 series here in the United States<\/a>. So a very successful car, i think every car manufacturer coming with the new sports car is taking the 911 as the reference. You got the cayenne. The panamerica. Is there a mix sam would like a motorcycle. I dont know. Or ducati. I used to ride ducati and now im riding bmw. You need to come up with a superbike to do that. Thats maybe a good idea. But after we are very we are very busy with all of the cars. And i promise to you, we have other surprises in our pockets but i wont tell you this today. Weve got to run. I always throw in a shoutout to jack daniels yesterday. Great facility. Great mechanic. Thank you. Come to visit us in atlanta, thank you. I will. Youre going to very late headquarters in atlanta. Ill do that at some point. All right. Still to come this morning taking it to the tweet. Dallas mavericks owner mark cuban is here going to give us advice over the lynn tilton and the s. E. C. Investigation. Squawk box will be right back. You can call me shallow. But, i have a wandering eye. I mean, come on. National gives me the control to choose any car in the aisle i want. I could choose you. Or i could choose her if i like her more. And i do. Oh, the silent treatment. Real mature. So you wanna get out of here . Go national. Go like a pro. Welcome back to squawk box, everybody. Heres whats making headlines this morning. Well await march figures on u. S. Auto sales. Prices out. Sales up 2 . Slightly less than expected. Analysts do see ford sales at 5. 4 . And gm a 1. 2 drop. And we talked to some that said there are fewer selling days. Two more economic reports ahead. Well be getting the manufacturing rates at 10 00 eastern time. And go daddy makes its wall street debut. Priced at 20 a share. Above its expected range of 17 to 19. We have a special guest joining us right now mark cuban is owner of Dallas Mavericks<\/a> and shark tank investor. Mark youve created this huge twitter storm over the s. E. C. Investigation of lynn tilton this week. I did . Yeah. I have experience there. You hold your tongue you jump in you rush to the fray. What happened here because this is different than what the s. E. C. Went after you for inside trading . Maybe not. Maybe not. Look. I dont know all the details. But just from what i read apparently she had three funds which she brought into debt and Distressed Companies<\/a> from 2003 2004 and 2004 these arent transactions that took place in 2013, 2014 and 2015. Its not like it took 12 years. It took five years to where they were going to press charges. To me its a red flag. The s. E. C. Is looking into the saying saying that some of the investments that she was holding, valuations changed, she didnt tell her investors. As a result she was still able to take fees in from those investors. She was fighting this vigorously. Not knowing the details but its not the type of investment that changes day to day. Because it was from more than ten years ago, you know did she all of a sudden change how she valued things. It has to be marked on a daytoday it doesnt have to be market to market at all. She probably went to her accountants and lawyers. Shes been doing it five years. The fact that they took five years to make a decision b, something that is not changed on a daytoday basis make please raise a red flag. In my case, they waited there was a change in the people taking over the case and they wanted a skin on the wall. When it came down to it we went to trial, it took less than five minutes, an hour was for lunch, for the jury to decide they were full of crap. Even if they found it reliable, its like an expensive speeding ticket. People dont look at the s. E. C. And say well you had a problem with the s. E. C. So theres something wrong with you. The s. E. C. Isnt what it used to be. So you are arguing on the one hand that the s. E. C. Is taking frivolous cases on the other hand you would like to see a s. E. C. With more teeth . I would like to see the s. E. C. Take an insider trader group and extract it. You have no idea whether youve inside traded or not. I called up the s. E. C. One time and you know what i have this situation, i want to know if im allowed to do a, b, c orr d before i do it. They said for knee send eight copies of a letter. They have a copy of a fax from 1980 saying what to do. If you cant call the s. E. C. And ask for guidance yet, they might sue you for something, thats ridiculous. Its the same thing as calling the irs and asking them for questions. If you dont know what to do anybody can sue you for anything. Sam do you have any problems with s. E. C. Issues . If youre in business and with companies, at various times youre dealing with interpretive issues. Government is not the most efficient at policy. You were a victim of it pipe was a victim of it years ago. Thats why, you know Less Government<\/a> is all very, very beneficial. Which is why all just say Net Neutrality<\/a>. Youre talking about s. E. C. Im thinking, an agency that maybe has some problems. Then the ftc, if you ever said what you felt about the ftc and the way this happened what would mange fcc i said what i really thought about it. So we know now that socialism is bad. Probably. But is crony capitalism just as bad as socialism . Every Single Person<\/a> in the world is going to have a government person to talk to about Net Neutrality<\/a> to get either a waiver or or to get what they want. Its going to be so big, you need so many people to present your case. And having walked through the hallways trying to meet with different commissioners on issues its crazy. Then why is it so different about the altruistic sharing of because you got to hire 150 people. Im not as cynical about government as you guys are. Thats not what caused Net Neutrality<\/a> . No, this is Big Companies<\/a> versus Big Companies<\/a>. I think was a bolt of lightning when whats his name john oliver on hbo put together a piece not led to by the way, he was informed by a lawyer. A bolt of lightning, he got it right, right in terms of marketing . Do you see the New York Times<\/a> versus the wall street journal, do you see the way Net Neutrality<\/a> is portrayed . I look at it and take a look at it myself you can see where this is coming from obviously. As a geek someone who has grown up with the internet what i have seen is that for the first up until three years ago, you didnt see google or apple with a presence in d. C. We just went and we just competed. Now, as theyve gotten presence they want to use that and they want to have influence to try to do whats best for them. I dont think its a political agenda as much as Big Companies<\/a> who never really had had muscle in d. C. Trying to show muscle. They went from spend nothing money to billion of dollars. Youre into government that likes to control industries . You dont think this is just a takeover of no i think its more a vote pandering issue. I think marks right. How are you going to get young kids to vote right . Those kids if im 21 years ago old thinking about voting who is the party thats going to take away my internet versus the party that now, it might be getting taken away. I know but the department of internet is not going to do but, you know our well intentions lead to i agree with you. Thats not an expression. Low intentions lead to i agree with you, in terms of net effect. I agree with you. This was a huge mistake and its only going to get worse. But really what are the intentions. Thats the underlying issue here. I really dont think theyre that smart, sam. Verizon sues with their own interests and it goes in the wrong direction. Now, all of a sudden its a jump ball and everybody is trying to get things going in their direction. I think it just turned out the ways that people didnt imagine. The law of unintended circumstances is what took over here. We should point out that youre on an Advisory Panel<\/a> to at t. Right. At t is not going to benefit from how Net Neutrality<\/a> i think they might. How so . They might not like it but everything becomes a legal battle. In order to get approval to take something down you may have to go to the ftc. They talk about forbearance they didnt put in the law, as belt as i can read it they didnt put in the law to say we expressly do not do these things. They say we retain the right to do the things that were not forbearing on. And that san awful lot of an uncertainty, on the part of investors, trying to figure out whos going to win on these things. No question. That puts a chill on things though. Theres no question theres uncertainties. Who benefits are the most uncertain. Theres the quick and the dead right . I think the quick companies were going to take a break, and actually a programming note today on power lunch at 1 00 p. M. , lynn tilton is going to be live today. Now, the other thing is you know, i want to ask you, just to go to break, think of this question would you rather have 10 channels of content for 40. Or 1500 for 90 . You see where im going that. Youre asking two guys who money is no object. No no. Look i mean is it the end of it because of the hbo stuff . Its the beginning. Okay. Im going to think about what you said. Maybe ill talk to you on break so i know what youre going to say so i look smarter. And a quick break. When we come back more in mark cuban and sam zell. Weve been watching the futures. Theyve taken a decided turn for worse out there the morning. The dow is down by 42 points adding to the rosters from yesterday. The s p 500 is down by just over 6 points. Nasdaq down by 8. Stick around, squawk box will be right back. Financial noise financial noise financial noise i dont understand. Were back with mark cuban other than of the Dallas Mavericks<\/a> and shark tank investor. Were trying to figure out the future world that was a tv show. It is a tv show. I have read people that mark grant at southwest security said i just see the apple, 20 different content, hbo, if i had debt or equity of a Cable Company<\/a> i would sell it immediately because theyre going to end up being known as internet providers and not a Cable Company<\/a>. I mean is that necessarily a bad thing . I dont think thats the way its going to turn out. How is it going to turn out . Fundable pricing on content. At t directv. Time warner whatever. When they deliver content when they deliver the show its digital. Now, on one hand they make a choice to say were going to deliver cnbc in a way that never buffer, and fast lanes that are prioritized so theres absolutely no chance youre going to have no problem receiving the contents. That the value. They are going to plug it into the wall plug it into the tv no chance of it buffering. That market is not going away. On the flip side theres the value from mobility. So if i want to watch cnbc where i want how i want yeah i want to do this. But for a big part of the population, they dont want to have to go through apple tv. They dont want to have to go through a third party device. There will be separate markets. Look, with all the changes weve gone through in technology weve only seen a couple million households drop off in terms of cord skirtcutters. It hasnt been huge. But they needs the broadband, too. You have broadband, you know. Plus the other impact of doing it online where theres opportunity, it screws up the rest of your house for getting internet access. So theres a negative impact that i dont think people fully understand. And the third part is they can always cut the cost if you want a 29. 99 bundle the band that is fungible to them. I didnt think about that. Out of the 1500 maybe there are, you know, 1,000 that i dont want. And theyre providing them for you. Right. But do they also rans fall by the wayside and do the people who provide that content also no money is always made in content by aggregating and disaggregating. Someone is going to walk in and say im going to aggregate hbo, sling, whoever else is streaming. Theyre coming to cnbc and say, look, ive got this pack amount that we pick who we stream. Now, all of a sudden at t or whoever comes back and says wow, theyre selling it for 99, well give you all the more channel for 89. It sounds like investment banking. Very much so, yeah. Thats different than the forecast of a lot of people in terms of well theyre allowed to be wrong. Its a daunting future but, you know everything gets more expensive. I think about what it cost ten years ago. I cant believe ten years from now its not even going to be worth even more. Destination anything is becoming more valuable. Anything that can draw an audience becomes far more valuable. Youre seeing more live events on are television. The whiz coming to television because we want to be able to talk and have something to talk about. So what were learning about television, stuff like this where anything can happen that drives a better audience than just repeats. Have you penetrated the full market of the mavs . What did you pay for it . 2 million in january of 2000. Whats it worth now . 2 billion. I might sell it for 6. No my attitude has been that we lowered ticket prices. We went to the fines we lowered ticket prices. I want people to come to games. I dont want any mavericks fan to wake up in dallas and say i cant afford to go to game. You didnt buy it to lose money . Well i didnt buy it to lose money. But id rather win a championship. When a company has when apple gets a 1 trillion market cap, when they have the biggest quarter ever no one is throwing a parade in cupertino or anywhere. The mavs within a championship can you imagine if the cubs win a championship . Why dont you just buy it. Do it with me. I wanted him to write a check. This is honestly the first time that youve ever yeah yeah. Supposedly he and i were doing a big deal together on the cubs, but weve never met. You guys should talk. You could talk about the government. He might be able i am happy with your valuation. Do you think College Hoops<\/a> should i like the shot clock the way it is. College so boring for the first ten seconds. What about at the end of the game. You finally slow up an offensive rebound and oh my god, were not going to catch it. The first 30 seconds run and gun . There is no run and gun in college anyway. Nba is run and gun. Obviously, im prejudiced about that. When you watch a college game until theres ten seconds left on the shot clock, nothing happenings. Thats the problem. The play is getting set up. Do you like getting thoses drafting those kentucky freshmen or should there be a way of paying them . How do you do it . Thats a good question. Ill leave that to adam silver right now because thats a collective bargaining thing. The big problem is aou. The expectation of kids coming out of high school into college, thats where things are schooled or trained to be pros in ways that are not preparing them the way they should be. All right. Do you do you like shark tank being on cnbc as much as being on that other network . What other network . Dont you get a better audience . We sell more product on that other network. This is a sim buy theic relationship. It really is. Ill tell you what doesnt work right out of 35 40 deals careful. Ive got one thats gone on to business and two that are out of business just dont know it. So when those shows reair, its oh. You can talk to us. Well pull those. Do addendums. Thats what were trying to do with beyond the tank, youll see more updates. Thank you for coming on. This is the only show you did in new york. Only good one. Thank you. Only Good Business<\/a> one. Great to see you, mark. Always, guys. Thanks, sam. Nice to finally meet you. More from sam zell. Stick around for squawk on the street. The ceo of godaddy joining the crew live from the floor of the stock exchange. Squawk box will be right back. Id like to put in my 15year notice. Youre quitting . Technically retiring, sir. With a little help from my state farm agent, i plan to retire in 15 years. Wow. Youre totally blindsiding me here. Whose going to manage your accounts . This is a devastating blow i was not prepared for. Take charge of your retirement. Talk to a state farm agent today. [ male announcer ] your love for trading never stops. So open an account with schwab. And when a market move affects, say a Cloud Computing<\/a> stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. Host sam zell. Equity Group Investments<\/a> chairman. One of the things we have not talked about is oil. Petroleum, stocks up 43 to date led the purchase incredible to hear about a stock up in the oil patch given whats happened with oil prices. First of all, power primarily asset is a refinery and when the price of oil goes down the refinery spreads do better particularly in the case of hawaiian refinery because of the long period of time between the purchase of oil and its reaching ohio hawaii. Im a real estate guy, our idea about assets are similar. We made a fortune buying real estate below costs. We look at refinery here i dont know what the replacement cost is but its gigantic multiple of what we purchased. And we like the fact that its kind of a unique market and we think theres a lot of opportunity to take Power Petroleum<\/a> and weve got 1. 4 billion to play with and weve got a lot of opportunity to generate income. Its been a real challenge but a lot of fun. Were almost at a 1 billion company today. Amazing. You to go there to manage things . No, no no. But i go there just to check it out. Islands and all . Oahu. We provide gasoline for the islands and we provide jet fuel for both pearl harbor and honolulu. As far as the price of oil is concerned, i know theres a lot of verbatim recently about theres another leg down. I dont know the answer to that. What i do know is that we the world is has a demand of 93 Million Barrels<\/a> and were producing 95 94 Something Like<\/a> that. I consider that to be a very small surplus, even though in the u. S. Storage is a problem because were producing so much more. But overall, i think we probably have seen the bottom give or take on oil. And if i were rolling the dice or making bets, which i do every day, i think that well see oil end the year maybe 20 higher than where it is today. Yeah. Things happening that make you bullish and not so obviously, a lot of people in china driving cars but we get better and better at mileage and Everything Else<\/a> and conserving and renewables and alternatives. A lot of the oil comes from a place called the middle east. If you things are quieting down there. Sure. If you believe that weve got that under control. You believe that ive got a bridge to sell you. I actually have a bridge to sell you. Most people dont. Im building one on a mexican u. S. Border solely because for years i said i have a bridge to sell you and i never had one. Now im going to have one. Youve got Everything Else<\/a>. An interest the whole Energy Market<\/a> is interesting. My own personal view is that i think people are overestimating how terrific things are going to be in future and i think that its a much lower evolutionary process rather than radical change process. In terms of alternatives for oil . In terms of alternatives. We were talking about the chevy volt. Right. When oil was 12120 a barrel i imagine the numbers for volt were more attract than 40. No one buys tesla because its electric and saving gasp they buy it because they love the car, its fast its cool. Nobody remembers that tesla done make any money making cars. Makes money collecting subsidies from other carmakers. I dont know that thats an economic model that would justify the kind of multiples that you see on the stock exchange. I suspect people are buying tesla stock because theyre buying the tesla car because they leak it. Right. Oil could go to 10 and people would buy teslas. Theoretically, tesla stock should have dramatically dropped with the price of oil going down but it didnt. Right. Anything else thats on your mind . Only a minute left. No. I think obviously the world is in disarray. I continue to be just shocked at the greed of which the markets do not reflect the risks that we see out there. I think i just came contact from the middle east i was in middle east and japan last week. I think things in middle east are rapidly, you know getting out of hand. Have our interests and israels diverse. I dont thing our interests in israel have diversed. But i do believe that we have a situation that has become personal peak as opposed to best interest of the u. S. Government. Best interest of the United States<\/a> is continued very strong relationship with israel. I think anything done to impair that or harm that will ultimately translate negatively for us. I think its much more likely to see the gcc in israel make a deal in the near future sometime because they both together have identical interests. Right. Thank you. My pleasure. Wonderful having you on today. It says josephine, thats funny. Thats okay. I dont care. Im comfortable. April fool. Happy april fools day. Join us tomorrow. Squawk on the street coming up right now. Fanfare begun for godaddy going public at big board. What are the prospects for the ipo as we kick off the Second Quarter<\/a> of 2015 . Good wednesday morning. Welcome to squawk on the street. Im Carl Quintanilla<\/a> with Jim Cramer David Faber<\/a> at New York Stock Exchange<\/a>. Month of april started with a volatile overnight session. 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