Its got to leave, though . I think so. Conceptually you would hope someone could reform. But when you look at what hes done, the signs arent good. He hasnt changed his pay. They give an indication of a ceo that doesnt care about shareholders. Thank you for coming in today. Make sure to join us tomorrow. Right now its time for squawk on the street. Good tuesday morning. Hope you had a great threeday weekend. Welcome to squawk on the street. Im carl quintanilla, with melissa lee, jim cramer and david faber here. Fiveyear highs last week, europe had strong Investor Confidence numbers in germany. But actually, was disappointed in the bank of japan. Which well wait until next year before it targets a new inflation rate of 2 . Our road map begins with what cramer calls the most important earnings week of the year for the quarter at least. A parade of dow components starting with verizon. A 12 cents miss dragged down by superstorm sandy. Dupont 2013, a cautious year with the slow growth world economy. How worrisome are those comments from the economic bellwether. J j exceeds estimates. The full year forecast a bit below the streets, as investors pay close attention to new ceo alex gorsky. The dow component reporting Fourth Quarter numbers of 38 cents. That was well below estimates. Verizon said the results were impacted by superstorm sandy. Were just getting details now, david, on activations on things like the iphone, 6. 2 million, not too shabby. The problem was not necessarily activations, carl. The key is simply that margins came in even worse than had been anticipated. This, after the Company Already guided them down a bit at the Consumer Electronics show a couple of weeks back. And there, of course, youre talking about operating koose i higher than anticipated. Investors may be a little concerned today when you take a look at that chart there. Now, listen, to carls point, theyre adding a lot of customers. Theyre activating a lot of devices. We talk often about the subsidy for the apple iphone, but dont forget there is also a subsidy for the samsung galaxy. When youve only got two devices to choose from, not enough competition for these carriers to say, no, were not going to pay that much. That certainly would seem to be something here that investors are going to continue to Pay Attention to. The margins are the key here. Well see. High multiple stock, 15 times, does have a nice dividend as you point out. Investors may be looking closely at the margin number for their guidance for the year, despite what are some positive comments. We love the stuff. How does it change. How does the metric change. If we look at the fios numbers, they start making money on the dvr, no, now its just wireless. You dont want to forget about the other important parts of the business. Theres a wire line business, and thats where they took the sandy charge in terms of the wire line. The positive effects from the union deal that will start to be felt this year. But wireless is the key for this company. Its what moves the stock. It is the most important component by far. This is a giant player that has had extraordinary success, nonetheless, concern about what are the costs going to look like as this year goes along if this number is not a one off, which it may not be. How significant is it in terms of new contracts, customers taking a lead from at t by about 20 million . Im sorry . Overtook at t by 20 million. Is that significant in this headtohead race . It can be. In some ways, i think, melissa, others would argue, at t and verizon versus apple and samsung, how much can we pull back some of the subsidy that goes into perhaps these margin numbers, what other things can we do to bring operating costs down as well. But there will be a read through to apple here. At least people will try to. Perhaps a positive one thats what my take looks like. Take caution there. Dont read too much into it. Nonetheless, that would be the take. Were going to get at t this week. And apple. And maybe two other s p companies. This is it. Go to davos to avoid these oh, no, im here. Ouch for those who go to davos. You were saying, jim, you were telling david before the show, you do not take this week off for a reason. You cannot take this week off. How do you do your job . This is it. Will ray lewis take off super bowl week . I doubt it. Look, ill take the heat. I like ray. Sorry. I like him. What a weekend of football. Would you buy apple ahead of the earnings this week . I think its fine. Tempered enthusiasm. Apples fine. The price target this morning is 650. Its fine. Its cheap. Its cheap. All right. Cheap stock. Of the utxs, the coaches, microsofts, pg es, do you have i think pg e is do or die. He either blows away the number i think he blows it away, he does a good job. Do you think this is do or die . Now . Mcinerney is in charge, hes got his hands full. J j, i thought the quarter was fine. Youve got a new ceo. Verizon, selling that. What else do you have to do here . Travelers is good. Dupont. Ill make a strong case that dupont margins have bottomed. These are fine earnings. But i care about google tremendously. Remember the last time google reported . Yeah. Interesting afternoon. Yeah. What are you looking for up there . Im looking for my google notes, trying to figure out where they were. I write them on different pieces of paper and i lost them. But i found them. What are you thinking . Its easier for people to track on desktops than mobile. So we go into this quarter really wondering what things are going to look like for google, and or facebook. Lets not forget that. I know thats not part of the sweep necessarily, but its it Still Matters though. Will you still see lower cpcs, cost per click. And of course, google has never been that shareholder friendly. Does that matter. They dont do buybacks, they dont pay a dividend. They spend 12 million on motorola they open up north korea. They are like their own country. United states and google. And theyre back in the map museum. The map museum. Oh, yeah. You see larry on the subway with the glasses. Have you seen this picture . Riding the sweet train with the google glasses. I missed them. Im on that train most of the time. When im not here, im on that train. How did you take away from your shopping time to go to that map museum . Lets talk about dupont, posting operating earnings of 11 cents a share beating wall street forecasts. Issuing a full year outlook above analysts forecasts. The ceo did express some concerns about 2013. 2013 i think is setting up to be a cautious year. The question is, how will the u. S. Economy respond . Are we taking good steps around the debt . But the deficit has to be dealt with. And it needs to be dealt with in a matter of months. I guess the question, jim, here, is are they sort of sandbagging or preparing us for the worst . They did have to slash 2012 in october, so maybe theyre preempting you come on tv, youve got to be statesmanlike. You cant come in here and say, look, i think its going to be good. Shes just saying shes writing off europe. I think europe is stabilizing. They get a turn in asia. Tio2 was a disappointment. I think its troughing. Latin america really strong. Ag really strong. I think its actually gotten its groove back. In terms of the chemicals, Performance Chemicals were down by 15 , sales, electronics, communications also down. Ag you mentioned, bright spot, up 18 . Theyve been talking for a long time about Strong Demand in latin america for seeds, which have been an add to the other agricultural names, like monsanto. Finally you can see it. One of the things of the great ceo of ppg, hes been saying, some of the companies some of the Chemical Companies have stuck by commodity. I thought dupont had progressed to proprietary. This may be the quarter we start to think its finally progressing. Chuck is such a high end guy, he would never knock dow or dupont. But i took away the idea that the companies that were proprietary were much more chemical. Remember, dupont you read the transcripts of these calls. Theyre going on right now. I believe 9 00 a. M. Verizon also is in progress. Do you read all the transcripts . No. I dont have any life outside of cnbc. You dont suspend shopping, do you . 6 00 a. M. Saturday. Where does the time come from then, in your i was up at quarter to 4 00 this morning you slept in, oh, good. Over the weekend, they dont do mlk over in europe. They should, but they dont. Wide open. I tweeted immediately. You can get up and follow my tweets. I get up about three hours later. 6 45 . I havent gotten up at that time since 7th grade. I was up earlier. You think. Meantime, j j, better than expected Fourth Quarter numbers. The medical products revenues and current year outlook short forecast. Street wanted 549. If that stock comes in, youve got to buy it. End of story. Throughout this period, there have been disappointment, disappointment, disappointment. The stock keeps going up. I think hes going to rationalize this company this year. I think gorsky is going to get rid of the divisions that have hurt the company. I want to own j j. Whats optimistic about the action is its off just by less than a percent. On friday it closed at a record high. This is a stock thats just been going higher and higher after a long time of just sitting there. Stocks performing really well. If it doesnt sell off on the back of this, its doing fine. You have companies that disappoint and they bounce back so quickly. People want to be in. A stock comes off look at caterpillar. You know the caterpillar story. I thought it read poorly. You maybe thought the gigantic frog was not so bad. That could be down to 35. 70 it didnt read well. It didnt read well. Friday night ahead of the holiday the game plan. Theres a note on a stock getting play as well. We are short of things to worry about, and long of liquidity, which tends to weaken the resolve of any bear. Do you think there are a few things to worry about right now . China coming back . Look, we have a couple of bad quarters come in. Remember, we started strong with earnings, i think. But we found that the next, like ten days, we start recalibrating and saying, maybe things werent that good. The bank stocks, they were good. And then we got some nottoogood Bank Earnings last week. Retail banks i thought were good. Im waiting for the semiconductors. Intels quarter was disappointing. Its a mixed picture. But i think intel didnt go down that much. Boeing, when they reported, i bet you boeing up side, surprise. I found ge was good. I thought schlumberger was great. Some companies not so great. Its a mixed picture. You mentioned boeing. Interesting development in the investigation, the japanese reportedly focusing on the battery itself. And that supplier. U. S. Regulators say the fire in boston, the battery didnt exceed its output standards, so maybe its a wiring issue, maybe it is a Circuit Board issue. A wrinkle there. The investigations in japan and here taking different routes. All of which may add up to the dreamliner not coming back quite as soon as theyd hoped. Someone screwed up. Product liability. Its not so clear that the Japanese Company its not that big. We look at the size of it. But people have insurance. And i think that boeing could be doing some collecting. Yeah. Finally, on the market, interesting article today in the journal again saying perhaps were underestimating how much stock is being bought back. Yes. That is still an underlying theme as we head further into this year, which is incredibly low cost of debt. Again today, you see Companies Taking debt out that they took on not that long ago, with lower cost debt, or even use some money to buy back stock. Certainly a theme that continues. Herbalife is being sherwin williams, the tape is being printed against it every day. I wouldnt be surprised if the Company Comes in with guns blazing. Guns blazing. Michael johnson. He doesnt tolerate this. Hes actually a tough guy. I would assume he is. And dan loeb, you said brings three guns to a knife fight. Yeah. Thats what i said this weekend, the ravens brought three guns to the knife fight. Jim sounded off on the fed. He has no idea what its like out there. None. And bill pool has no idea what its like out there. My people have been in this game for 25 years. Jim was absolutely right. If you saw these transcripts last week. Stick around for that. Also ahead, sheila bair one day after the president s inaugural address. What she has to say about the debt ceiling standoff. What a week it is going to be. Squawk on the street is back in a minute. Twins. I didnt see them coming. I have obligations. Cute obligations, but obligations. I need to rethink the core of my portfolio. What i really need is sleep. Introducing the ishares core, Building Blocks for the heart of your portfolio. Find out why 9 out of 10 large professional investors choose ishares for their etfs. Ishares by blackrock. Call 1800ishares for a prospectus which includes investment objectives, risks, charges and expenses. Read and consider it carefully before investing. Risk includes possible loss of principal. Shares of research in motion are up sharply this morning, after the ceo said the ongoing review could potentially leetd to the sale of its handset business. Plaque berry upgrades alone could in fact drive themes. The question in terms of if they do license their software platform, jim, who would they license to, since knockia is with microsoft, and samsung, motorola with android, so who is left to license with this platform . They talk about making white phones all over the world. Its conceivable they could do it with that. If you go to, i dont know, apple san torii, i dont know theyre huge. Major growth market. Emerging market. Looking at the margins for verizon, they certainly hope this company gets it together. If you had a viable third competitor, it might put them in a better position to say, were not giving you everything you want, apple or samsung. R. I. M. Has been a oneway stop. Verizon was up. Verizons fine. Theres too much nitpicking going on. R. I. M. , when they reported, they took the stock down themselves, and ever since then its been a staircase up. What does selling the hardware unit instill confidence in the 10 whatsoever . Qualcomm did it. No, i dont know. Its a nice story. Remember when qualcomm got out of hardware. I think that r. I. M. Is you know, look, this generation, weve been waiting for this iteration. R. I. M. s not dead. I think thats the issue. R. I. M. Is not dead. Its a walking dead. Even with very conservative estimates, theyre estimating 29 million unit shipments for fiscal 2014. Just from upgrades alone, people who have blackberries are going to upgrade. That accounts for the bulk of what theirs modeling in for the fiscal year 2014. Conservative, they make the case on r. I. M. Shares are going to double over the past three months. Few stocks you can say that about. Indonesia should be remember, i started selling bric with two is. And blackberry, is synonymous with phones over there. When you have that kind of number, that means you can go to countries are people are presuming that you have a blackberry. When you go to europe, people assume you have a samsung. Yes, they do. Thank you. Good answer. A new week means new opportunities. Cramer is here to help you find the best of the bunch as mad dash is ahead. The ceo of the sands on the state of the gaming industry and the bets his company is making to grow the casino operator. A lot more squawk on the street back in a second. [ male announcer ] when you wear dentures you may not know that your mouth is under attack, from food particles and bacteria. Try fixodent. It helps create a food seal defense for a clean mouth and kills bacteria for fresh breath. Fixodent, and forget it. Nothing. Are you stealing our Daughters School supplies and taking them to work . No, i was just looking for my stapler and my. This thing. I save money by using fedex ground and buy my own supplies. Thats a great idea. Im going to go. We got clients in today. [ male announcer ] save on ground shipping at fedex office. About six minutes until they all get back to work after a long weekend. Lets get jims mad dash. Speaking of the inauguration, some policy ideas in there. Jefferies, remember, the president took aim at utilities, coalfired utilities, and i found it chilling. I found it chilling, because these companies have spent fortunes trying to meet the demands of the epa. And it isnt enough, the president just saying, no. Not enough yet. He wants to stop coal in this country. He just wants to wipe it out. Because he thinks its a terrible thing. A lot of people said it was packed with partisanship. Bp. Bp, talking about valuation. Now, wait a second. Wait a second. You have a trial that starts in a month. And how much money has this company had to this company has paid out billions. But its not over. Its not over. Theyre going to get hammered again. Maybe after they get hammered again you can buy it. But this thing is still in the crosshairs of government trying to make the budgets. Justice department zapped them. Doesnt matter. They will not let this one go. A good cautionary note as well. Yes. When we come back, well find out how much longer Boeings Dreamliners are likely to remain grounded. And did you hear about this . Phil mickelson, why is he paying 62 , 63 tax . I like the nike add. All that, plus the opening bell in just a moment. [ construction sounds ] [ watch ticking ] [ engine revs ] come in. Got the coffee. That was fast. Were outta here. [ engine revs ] [ indistinct shouting ] [ indistinct shouting ] [ male announcer ] time and sales data. Splitsecond stats. [ indistinct shouting ] its so close to the options floor. [ indistinct shouting, bell dinging ]. Youll bust your brain box. All on thinkorswim from td ameritrade. Youre watching cnbc squawk on the street live from the Financial Capital of the world. The opening bell is going to ring in a little less than 90 seconds. A busy week. Everything from apple to microsoft to bristolmyers reporting earnings. We talked about some of the highlights. Also, davos happening. You never know what could come from the other side of the planet. A lot of hitters there. Periodically getting a new story. We have maria over there, and steve liesman, i mean, its really were bringing out the big guns. Weve got the bazookas there. Yes, we do. Yes, we do. Its big. It is big. A couple of years ago is when the arab springs started, we were in davos. Thats right. All right. Microsofts there. Bombers under fire again. Hes under fire constantly. Its been a long time. Lets get a look at the opening bell here in a few seconds. The s p, as you know, an interesting day, a bit of a ru