Lower by 51 points. S p by 5, nasdaq giving up 14. Weighing on the dow, of course, is disney. Overnight in asia, the nikkei is managing to turn a little higher at the moment. The shanghai composite a little in the green. European equities, this one interesting to watch. A couple crosscurrents to watch. German dax down 1 . Frances cac, down almost 1 . And taking a look at crude, too. We got inventory numbers yesterday. After noon, well get more information this morning. Wti, that looks down its almost 1 . Hovering a little bit over the 44 a barrel mark. Brent for its part giving up about 0. 5 . Right around 45. A little higher as well, natural gas. Clerks our top stories, shares of dow component disney under pressure. Earnings falling short among the espn subscriptions fell and ad revenue dropped. Ceo bob iger discovering cordcutting answer the future of viewership on the conference call. Were also in discussions with a number of entities, some current distributors that are coming forward with new packages. And some completely new distributors all have expressed an avid interest in having espn and our other channels included in our initial offerings. And were very, very encouraged by the discussions negotiations that were having. Theme park revenue rising about 5 but that was weaker than expected. The company also announcing its exiting the consol video game business less than three years after it launched its infinity title. The bright spot, the movie business. Studio revenue rose to 2. 1 billion. Driven by star wars the force awakens and zootopia. And the board of bob iger, igers contract is up in 2017 but some have speculated he may stay longer. He addressed that issue on the call as well. I will say or remind people that i have just over two years left on my contract as ceo of the company. And the board is very actively engaged in a Succession Process it has has been actually for some time. And it believes that it has ample time to identify a successor, under timing circumstances, that will be just fine for the company. I have nothing really to add in terms of the extension of my contract except that i dont currently have any plans to extend beyond the june expiration date, that is june of 2018. Were going to talk to a disney analyst at 6 40 a. M. Eastern time. And jenkins weighing in here today, not all the time on the future of espn because she said box of something called a fork in the road called the ip multicast. Live is biggest challenge for internet. Yes, espn definitely has a future. Anybody that doesnt see espn in the future well, it has a future for sports programming but what about the othersy. We know now when you look at ad rates final four, olympics, super bowl, espn has been the crown jewel of all cable. You can see a slight downward movement now and again. But what a great asset. Im not worried about it. Im not watching it any less. Yeah, exactly. The whole family watches on game day on saturday. Its classic, right . They got a good franchise. You do have halftime reports. You are constantly talking about the effect of one dow stock on the average. Youre a nerd. I know youll know. Whats the divider . I mean, disney down five or six points thats 50 dow points . This is from robert so is it seven . Seven dow points. 35 of the 50 is all disney. Who knows what the rest of the market looks like. The stock in some ways was kind of ripe to come back. Remember, back in august the stock was around 120. Iger made the initial comments about espn. The space got obliterated. Then it was back to 106. Looked like it could have a little more momentum. But people cant get past the espn issue even as the studio from star wars, to zootopia to jungle book its been hit after hit. Comcast did a great day yesterday. I wonder a lot of times you see the other media stocks fall off. They did after hours. I know that time warner did to some extent. We should look and see to see if theres a crosssector. Helps to have nbc u and then comcast what disney doesnt have, and thats all of Everything Else that smooths it out. As you say, a superior business model, but thats just me. Anyway, this mornings other corporate story, these two guys get together, huhuh, no way, no way. Office supplies its frightening, you cant get this stuff on the internet, huh . Can you imagine what you have to pay for that hole punch . You cannot the this happen. Staples and office depot officially calling off their merger so they can sink in separately inground instead of holding on to each other. It comes after a judge ordered a deal halted not since sirius xm which we know as a monopoly. Theres pandora, and firefire, they got to figure out get howard stern, paying him 300 million a year just to it might be more whats he making now . Whats the deal like 500 million over whatever . Right. Five years, ten years. Anyway, a court and he signed a new one. He knows that 1930 formula that they use . Do you remember that . I just find it interesting in 97. Maybe in 1997, you could have a case for it, but today in the world of amazon but the formula they use purelily looks at what youre in. I made a list of the deals that have been blocked in the last handful of years. Pretty unbelievable. You look at this one, office depot and staples today. Bakers hugues and halliburton. Time warner, and honeywell slsh cisco foods. Those are all in the last four years. And interestingly enough, despite all of this, theres a sense that industry has become overly concentrated with the big company. Remember, there was obviously what happened in the wireless space. The tmode. At t that never happened. Is four better than three . We have adopted a little bit more of a euro viewpoint. Were not worried about necessarily the end customer as much as you are, you know, youre protecting industries at times. Youre protecting employees. I dont know. But thats whats so interesting, right . Saying, oh, were doing this for the consumer. When you look around, is that who benefits the most . Exactly. Thats a deal. I guess people would say 20 years before that there was no antitrust. Anyway, staples will pay a 25 2 million breakup fee to office depot. In political news, bernie sand issers claiming victory in west virginia. In an interesting twist, 39 said they would volt for trump over sanders in the fall. Lets bring in john harwood. Sanders voters said theyd vovol vote what was that again . People talked about a crossover appeal all primary long both dealing with a people disaffected by the system. West virginia is a very conservative state. Its just the kind of state that Bernie Sanders has done well in against Hillary Clinton because its an almost allwhite state. Very rural state. Hes done quite well with those in the past. This is a result thats not surprising because he led in the polls before the election but it was annoying to Hillary Clinton because it extends Bernie Sanders campaign. And it extends the argument that hes the candidates best position to beat donald trump. Heres Bernie Sanders last night. Our message to the democratic delegates who will be assembling in philadelphia, is while we may have many disagreements with secretary clivnnton, there is o area we agree, and that is we must defeat donald trump. Now, of course, the Donald Trump Campaign did very well last night, too. They won west virginia. And the erosion of the sanders supporters, that is to say, the number who said they would vote for trump is a sign that would be a securely republican state in the general election. Donald trump also won easily in nebraska which is not remarkable because he has no active opponents. Remember, ted cruz yesterday was in a radio interview with glenn beck, and he was asked, you can get back in the campaign, he said maybe if i won nebraska even though i was not campaigning that did not happen last night. So ted cruz is not back in the campaign. Everybody is going to watch the meeting between donald trump and the congressional leaders tomorrow to see whether trump can do better than he has before pulling the party together. With Bernie Sanders, he had no juice. And then governor ricketts, a chicago family, who spent millions of dollars he came around. Yeah he did come around. All right. These two newspapers, these two dueling tabloids we have. Weve got hillary, stop the coronation on the post. And then the ever classy and relevant daily news 54 choose head lice over donald trump. You know, they try to sell this newspaper. Not the paper for a dollar. The paper for a dollar. Theyre trying to sell the paper. Not the paper why didnt you buy it, joe . The paper is 1. 25. One copy is worth more than the actual entity itself. Why didnt you buy it . Think about the megaphone you have. With a vanity project and then i could i get to say i dont need that to publish anything, john. Thank you. We got an esteemed you can just tell, a very esteemed guest host. Look at this guy. I mean, if there was a richard, if there was a senior gq, you would be on every single time that they needed a cover, you would be on. Id rather get her opinion than your opinion. Mr. Fisher is barclays senior adviser. Also a cnbc contributor. And i miss you. We all miss you, i think, on the set. Now that we have you, now you can be more outspoken. Even more. Yeah. We talked a lot. I guess the one thing id ask you now, we ask you a lot of times, at this point, where are we at, we have one rate increase. Is it still helping, is it a net neutral whats happening . Or are you convinced at this point that it might actually be holding us back . I mean, we did 0. 5 in the last gdp number. All of this the best we can muster . Is it just not helping anymore . I think the fed has the market on tender hooks. We talked about this earlier, the justin moore market. Justin moore is a Country Music singer who has a great number of hits not current . Current. Current. Current . Yes. The song he has is you look like you look like youre going to try to love me down i think you know why you wont sit down youre dancing around, you cant sit down but youre scared to. Thats the federal reserve. Weve peaked on earnings. We have a bond market thats driven by Monetary Policy. We have a real estate Market Driven by Monetary Policy. I think is this a very precarious situation. Unemployment has come down to 5 . Inflation is running somewhere is in between, depending on what measure you use, 1 to 1. 5. Cti, to 3. Every time i await the announcement from my fellow clearance i feel like justin moore. Its an analogy its maintaining a mood in the market but you can keep someone on ritalin for a long time. But the same dose gets you less and less high. Finally, youre just doing it so youre not sick basically. You need more and more. When you try and get rid of it, then you really feel sick so that analogy holds, too. Yeah, i think we needed to do a little more to keep the patient alive after the crisis. I supported that. Its a question of sustaining something that is just differentiated between price and the underlying value. Price is very high. And the commercial real estate market. At some point, joe, were going to get a correction. And the question is how did the monetary authorities react. Well wait and see. Also whacamole. The dollar is at a point where they have a window now. Its not 111. 07 on the euro anymore. Ill tell what you i worry about insurance. Insurance companies are like oxen, theyve pulled that cart forward steadily forever and ever. Theyre literally 1 in the world in this country but theyre pulling a 6 liability cart. It doesnt square. Banks, interest markets being hammered. To be honest, sitting at the table we did not perceive. In germany, youre at worst shape because 85 of germans save through Life Insurance and pension fund in a negative Interest Rate world, right . How do you provide for insurance returns in that country . Thats where i would be looking for real concerns. But can we lead the world higher with Interest Rates, or could we follow thats the argument. Were arguably govern with sovereign credit we have a higher rate than they have. Im an american, i believe in leading not in following. I dont want to sound too trumpy in here. Not america first. But the point is do whats right for the longterm health of our economy and for those institutions that underpin our economy. Just quickly. Likely that they go in june, zero . Well, this is a guessing game. I have no idea. Theyve got the brexit and all of that stuff. I think theres buyers remorse. They should have moved forward. Its easy to say that in hindsight. Im not on the committee anymore, but i would like to see them move in july or june, and again in september. Just remember, she talked about janet yellen talked about the asymmetry of risk when she talked back in new york. Theres very little slippage. The bank of israel did it three timings under sam fisher, what she gave back theres nothing to give back. The punch line of that speech was the paragraph which said the only thing we can do is go further up the o curve and investment of 1. 1 trillion. Flatten the curve even farther. That would be the only tool left in the feds toolbox. Thats worrisome. Not yet, obviously, but when we saw that 0. 5. Everybody is writing off that 0. 5. I couldnt help but think what if that became the real world, 0. 5 became the new job number 150. Or even worse. Or the stock market keeps going up when you see a need somewhere else. Hasnt seemed to respond as well. And were stuck at zero and things slow down. Weve got nothing. We expect the consumer to kick in a little bit. When you think about the consumer, the consumer has to save more because they dont earn anything on their savings. Bar and restaurant sales, which i love bar and restaurant, were thought seeing it much elsewhere. A little better retail sales except for apparel. And in the cycle, joe, were seven years in. And the Business Cycle is yet to be conquered. Looking at the way you dress when you come in here, barneys and deneiman marcus, they must doing good. We have played it before for andrew. We were kidding him taabout it. Its about a country boy and this is a city girl. You look like i need a drink. You look like i need a drink. All right. Just a 90s girl in an 80s mercedes. Hes going to be with us. Im trying youre trying to coexist. Theyre both believers. Theyre both believers. Big time believers. Coming up, how safe are your socalled safe haven investments. Jpmorgan invest Steven Parker is raising a cautious flag. He joins us next. Keep watching squawk box. The ceos of target and jpmorgan and home depot cofound er ken langown. Well be right back. Youre not gonna watch it no, youre not gonna watch it we cant let you download on the goooooo youll just have to miss it yeah, youll just have to miss it we cant let you download. Uh, no thanks. I have x1 from xfinity so. Dont fall for directv. Xfinity lets you download your shows from anywhere. I used to like that song. Their best day in two months. Jumping more than 1 each. The next guest says there may be signs of froth in perceived safe access. Joining us is Steven Parker. Guest host, of course, is Richard Fisher. He is with us as well. Richard fisher raised his just so you know. What kind of a froth are we talking about . Where are we looking . I think if you look broadly across all asset classes, where is the money going . Its going into gold. Its going into government bonds. Its going into the yen. Specifically with equities which is where im focused while there are outflows broadly, the places inflows are places like consumer staples. And people are thinking because says that very uncertain world, they want some uncertainty. The problem is, safe assets are a function of not just the fundamentals, but also the price. If you look, staples trading at 22 times. Utilities normally trading at 22 of the discount. Today, theyre trading at a premium. Markets basically saying growth is never going to recover. Interest rates goring to stay low forever. Inflation is not coming back soon. If you see any of those things starting to reverse, i think the safe assets are potentially at risk. Its how to make a rotation out of those assets . Or just take more money out of the stock market altogether . No, i think you have to be careful about trying to tie markets. All markets are broadly expensive right now. Although theres certainly opportunities. Were seeing opportunities in certain parts of the value parts of the market. You have to have a longterm time horizon recognizing theres some volatility. A lot of the markets outside. U. S. Have experienced these big corrections, japan, markets are better. We had a correction, did we not . Well, we did, back in february, down 10 or 15 . That was because of fears around recession which obviously didnt play out. If you didnt believe in a global recession now is the time to be buying some. Other markets which have been beaten up where youre seeing more value and potentially more Earnings Growth relative to the u. S. Since we have Richard Fisher here what role is the fed going to play . I dont know why youre asking me that question when youve got the expert here. He said its going to play 100 of the role. If the fed does hike in the summer what role is it going to play in deflating costs . Two things, one of the rally particularly driven by multiple expansion. And i think that has a lot to do with what the fed has done. I do think that the markets have gotten a little sanguine in terms of their view of a fed hike. The fact that the markets are pricing in zero in june and less than 50 of a hike this year. I think that thats a little too optimistic, depending on how you want to look at it. I think were going to see one to two hikes this year. And that may cause volume difficult in the near term. People are going to get nervous about that. But i think longer term you need to see normalization and policy for markets to continue to move higher. Steven, good to have you this morning. Do you think the market is too complacent about the fed at this point . Well, i think theyre dependent on the fed and therefore complacent. I mean, its nice those are two Different Things. No, its not. Theyre very excepti iaccepting fact that rates are going to stay low. There is the goal ive seen that the cost is zilch. Propels the markets in a different way. Steve, again, thanks. Were going to talk about ride sharing, via. But also just to really make sure you come back, im going to have a small dissertation on the hirschman index. You have heard about this 1935. 1935. Its named for the square root. Well look at