3. 2 . Our road map begins with a 7,000 fine, every single day, thats what gm is paying because the Company Still has not provided enough answers about its ignition switch recall. Its not the only bad headline for gm this morning. More on that. Earnings season is officially under way after alcoa reported its results after the bell. What can the aluminum maker tell us about the rest of the quarter . We will have some answers. Instead of running from facebook, companies are willing to pay a lot more to advertise on the social network. But is that good news for the companys stock . First up, though, some tough news for the auto sector. Toyota recalling more than 6 million vehicles after uncovering five different faulting involving parts ranging from steering to seats and nhtsa fining gm 7,000 a day for missing last weeks deadline to provide information about its recall for defective ignition switches. Morgan stanley cutting gm to underweight today, 33 target, guys, and what is a tough note, talking about the capacity the industry has added, currencies, auto financing, deflationary forces, saying theres a lot of work to do for these guys. You either believe in the cycle or you dont when youre on the call for alcoa its clear that cycle is alive and well, that march was better than february, that february was not that bad. I think this is such a downbeat called. I have to disagree with it. Its too downbeat. You could say jim, Charitable Trust owns gm. I think its an inexpensive stock. David kostin was on yesterday. I think hes remarkably good, i have to tell you some of the work he does is that hedge funds own gm. They own aig, theres a kiss of death thing here. You have to get the hedge funds out before gm goes higher. We talked a lot in the last couple weeks, Hedge Fund Ownership the pain theyve been suffering and look at names where they are heavy in the ownership because they have been taking gross exposure down as a result of losses in different parts of the portfolio and that means, obviously, taking leverage down but also just taking the draw down so to speak, selling the stock. And you want to look at those names. Others look at those names to short them. People shooting against the hedge funds. I talked last night on mad money about time warner and cbs. One point i hadnt read coatues holdings, 7 billion to 5 billion. Theyre very well known. Hes been on with us, somebody i know very well represented, tiger cub. Tiger cub. Has done an extraordinarily good job. But yesterday, coatues letter, these letters by the way go around these days, do you remember in our day, a letter was something private between the Hedge Fund Manager you got my worst letter ever and you called me. Did i really . Yes, you did and you said oh, my god, its faber on the line. Like mike wallace calling. Faber on line one. I had a couple of those calls, i remember. Nobody on the other end ever forgets them. Its true that letter that you got, how did you get it . Well, you know, tnsa didnt get it and you got it. Everybody gets the letter. I knew tyicoatue was a tiger all im saying is yesterday at one point i turned to dave and said, do you think that cbs is down because of letterman . In the meantime no its down because of a letter. A letter from a hedge fund and people im like, desperate, like last time im like maybe there are too many commercials. No. Its a hedge fund. Do you believe in this Morgan Stanley fundamental analysis, though, that u. S. Replacement cycles coming to an end, right, tesla is getting all the engineers, theyre going to have to invest in a lot more cap ex to keep up. I dont believe it in at all. When you saw the inventory numbers, were back to 65 days. Thats we had 70s. I think were seeing theres going to be 16, 17, the build will be fine. You know what, let me say that theres if youve been recommending gm, the pain is so great, its almost like you just take that anvile and throw it away today. We used to call it at my Old Hedge Fund that you managed to come up with a bad letter, this is the maiden in the volcano. Like karen cramer used to say i dont care were throwing one of these stocks in the volcano. I cant take the pain. This is i cant take the pain call and you know what, sometimes those you have to go to the other side. Other people that have come on the air and said they cant take the pain, its lower. You have to take the other side of the people who cant take the pain. Gm, i think that gm is a buy not a sell. I like it. Now, of course, youre been a holder here through this. Ive been wrong. Hey, how about that. On twitter people are going to say, cramer, is an idiot. Even he admits hes wrong. Sometimes twitter is not the most accurate all three of us more or less the constant chorus, at least you get some people saying youre really brilliant. Periodically. You got one of those. Congratulations. I never have gotten one of those. He gets a couple of them. They feel down, bad for me after like five bad pieces including an attack on my restaurant, i get one guy that says i like cramer, i dont think cramer is the devil, sign of 666, but i think that gm, i was wrong, because i didnt really anticipate what i think turned out to be the greatest debacle in auto history since the pinto, but at this point, let the hedge funds liquidate, throw the maiden in the volcano and move forward. Talk about something youve been dead right on alcoa. Reporting First Quarter operating profits of 9 cents a share ahead of wall street estimates. Revenue did come in shy of consensus. Raising its Aerospace Growth outlook for the full year citing stronger demand for aircraft. Heres what klaus cline felds told jim cramer last night on mad money. I think hair row space is aerospace is ed dual and were standing on multiple jewels, i could also talk about the coming back of the building and Construction Market that was in a big slump but coming back now. Jewels. Sitting on some jewels. He didnt even talk about, you know yes, i like klaus cline felds, you make fun of me, used to be able to get your Wedding Dress cant return those. But yes, the larger people say yes to the smelter. You cant return those after theyve been worn. A heads up at home. The boeing call was very importantp in in other words thats my take away on the unbelievable seven to eight, goes to 8 to 9 . If anyone listened to the last Conference Call you heard a gasp on the previous one because he put a bullet through the head of boeing in the last call. Talking about an inventory correction. Now boeing, this is going to be it was the beginning of the boeing decline, im predicting the beginning of the boeing advance, 2. 1 increase, 5. 7 increase in air bus and by the way, the truck call was the best call and he didnt even talk about it on the Conference Call. Gigantic. Heavy trucks expected to gain 5. 9 . Very important. This is a i thought that they really delivered. By the way, the revenues were not weaker. Take out 8 to 10 of the capacity same time you have a decline in the price of aluminum and you absolutely have to have a incline in revenue. Any signs they missed on revenue that are out there you think are misleading . Yes, absolutely. You have to do the numbers. You have to go back over the amount of closures and the price of aluminum. Im getting heat, stock is down 15 since he came in and youre an idiot. Im tired of idiot call. Its not a bad revenue quarter at all. Thats good. And earnings per share did 9 cents instead of 5 cents and thats the downstream. A part which is taking share from steel and i like it very much. What happened . All right. We got a deal this morning. Really . Nothing mine 2. 9 billion it appears Procter Gamble is selling its iams. Pet food . In the major markets for 2. 9 billion in cash. Who did they go to. Mars pet care. Mars. Mars, the Largest Private Companies in the world. Hershey downgraded at goldman today. Pinnacle foods run been an exmars guy. To ber shah. Yeah. Its interesting, Procter Gamble is trying to focus more on its core business so it is getting rid of its pet care business. Mars pet care, most of us think of mars as a Candy Company, but their pet care company is good, employs more than 35,000 people across 50 countries and among their big brands are pedigree. They say adding iams and eukanuba will be a good fit for them and its their vegs of making a better vision of making a better world for pets. Huge growth business. It is. 50 billion industry. Look, every time i want to get negative on the pet business because zoatis, its more broad, you come back and say yes, as bertha said, huge amount of money spent on this. Procter gamble, ive been waiting for the big restructuring since laughly came back. Really rationalize the company, raise the dividend 7 . This is all good news for proctor because i think proctor needs to be a little more focused. By the way you get very Good Discount on proctor products. Other large potential businesses out there from Larger Companies, navartis Animal Health for sale potentially. Yes. And then, obviously, mercks consumer business. Thats for sale. A lot of offers from im hearing. An active potential auction. Could go for 11 to 12 billion. Are you serious . Bank kaiser the one im hearing on that. Thats why the stock is, thats a great call by you. Again just to this idea of the Larger Companies starting to part with some of the assets they dont see as strategic. Shoals too for merck have the Consumer Products business. B and g, small company, bgs, Conference Call recently, 4 yield, they have been moving very aggressively. Theres a lot of companies that want this space. They want this space. Meantime lets move to facebook. According to ad week this morning, brands are willing to pay more to advertise on the social network after their pages started reaching fewer fans with unpaid posts. Facebook coo Sheryl Samberg on the today show asked about her future. You have, i guess, unloaded about half of yer Facebook Stock and some read the tea leaves and say is she planning to leave facebook soon. Im glad you raised this. Theres been confusion. A good chunk of what was sold was for taxes. Theres confusion. I have plans to stay at facebook. I love my job. I love what we do every day to connect the world and being able to work on my personal time. You might be running for Political Office . Would you rule it out . Would you run for Political Office . Im not running for office. I really love my job an no plans to make any changes. Would you rule it out . I have ruled it out. I dont think thats for me but i really believe in what im cog. Moving the ball forward with Savannah Guthrie there. The ad week story pricing according to some ad buyers and partners up 10 . Quarter on quarter from q4. Yeah. My goto guy there is robert from sun trust, put out a terrific piece talking about return on investment, ad revenue 2. 17 billion, price increases of 80 . Everyone should read his stuff. Hes been so dead right. Jordan rolharohan, first guy ou the bunker went over the top recommended facebook. Pretty good call. I told you watch jordan hes been bloodied, they can come back and do the right thing. Today the twoyear anniversary of the purchase of instagram they bought for 1 billion at the time had 30 million users today 200 million users. And i got to tell you that people are going to not stop going to stop laughing soon. Thats why they have the confidence to spend 19 billion what it could come to if all that deal comes through in terms of the restricted stock for whats app or 2 billion for a Virtual Reality gogel maker. Place a lot of bets. Microsoft placed no bets. Right. I know. Weve talked about it many times and ill tell you keeping a lot of technology bankers very happy. Well, how come their stocks arent doing better . Whose . The bankers . Stocks are terrible. Have they . Youve taken a look at some of the prices. In the last day or two . Morgan stanley, Goldman Sachs, those names . Morgan stanley lost 10 . I regard that as consequence a. M. You have noticed the market has been tough lately, some tougher than others. When we come back, senator marco rubio will join us live. Hear what he has to say about the economy and more. Also ahead, la quinta going public today. A big week for ipos. Well talk to the ceo of the hotel chain. Ticker lq by the way. Take one more look at the premarket, this winss morning started on squawk on the street in just a minute. Public today. Oday. Weve been very clear in our conversations with our european friends that, you know, we think that particularly in surplus countries there is a need to boost demand. There is a demand problem in the world and theres a demand problem in europe. That was treasury secretary jack lew talking about earlier on squawk. Also out of europe jpmorgans Ceo Jamie Dimon tells the french newspaper european banks lag behind their u. S. Counter parts and say profits may still vary for different kinds of reasons but if you look at the equity outstanding loans, debt capacity you would see the u. S. Banking system is sound, it can do its growth, financing growth and employment, europe is not at that same stage. Lew had tough words for china, exchange rates, good interview. It was real good. A lot of things wrong right now. You can understand why Interest Rates are where they are, understand that the world is not that robust. Klaus cline feld mentioned almost everything positive. Whats the negative, nonresidential construction in europe. Barry talked about moving aggressively into spain, italy, uk, his boots on the ground, i actually trust a little more than what policymakers say. Interesting story in the times detailing what is a high rate of unemployment in the likes of a greece or spain or italy at 13 and the creation of the longterm unemployed, something weve been dealing with here and what that is structurally. We mentioned at the top of the show the greek ten years below six, when drogy said whatever it takes, it was 27. 6. It was. Now 5 and change. Thats insane. A malcolm x moment. It was. Thats who first originated that phrase, malcolm x. I think drogy has done a remarkable job, i think that these bank are replenishing. We used to joke about you know what bank, im not going to say it, its like a jeopardy question and your were king at jeopardy other than watson, there is a tremendous burgeoning move in the Spanish Banks and used to think they were the ones that were going to go under. The italian banks do not have necessarily the best balance sheets. We have to stop complaining. Now a threeyear Budget Approved by the cabinet. Government functioning things going on. Thats new. If you had you had gone back 2. 5 years ago this would be fiction. If you bought up a portfolio of sovereign european debt Allah Jon Corzine you might have been able to do well and hold it. Thats the key hold it. Not to buy it. You have to be able to hold it. Jon, just to be clear, did not hold it at all. No. Jon selling is always the problem. My boss at the old squid, giant squid, Goldman Sachs, corzine did a little work for him, hes very nice by the way. David tepper was the nicest guy ive worked with before. He lectured me how not to hurt clients. I wish he were on squawk more or on our show. He was another guy you learned a lot besides corzine. Absolutely. When he does speak its generally news. Hes so exciting. Well get cramers mad dash after the break, one more look at futures, dont go away. All right. Seven minutes, you know what day it is, i know you do. There you go with that hump day every week. Never get tired of hump day. You dont. Lets start off with isrg. Severe disappointment last night. Will the analysts back away . No. Almost as if they preannounce to the upside. Im going with herb greenbergs reality check, hes going to be on cnbc im sure, saying there is a problem in demand here. Its not just a gap in the new product coming because we didnt know a couple weeks ago there was a new product coming. I think hospitals have spent enough on this stuff. And the razor blade Model Looks Like the razor blades have decreased. I say stay away from isrg. It was up on the hype on the new product. Maybe, maybe demand has peaked. Interesting. Just like for razors, a lot of guys wearing beards. I still gillette, i still do the gillette. I know. I got them at harman, good price. One more were looking at. Once again, this is that budweiser am bev justice department. They buy corona extra and madela which happens to be the hottest selling beer. Actually on the breweries too. And they announce again and its even better. They raise this stock is still cheap. Why . Because theyre talking about numbers that are so, so big, double digit growth, raising numbers, raising their range, david, this is a story that you always have to watch. This was the big winner from Anheuser Bush ma della, this was the winner. These guys are nice guys. Its terrific for them. Upstate new york. Remember when they were just like a sleepy wine company and they didnt have money. Wine in a box. Those were the first few cnbc Christmas Parties back in the day as i remember, wine in a box in the hallway. Goldman during the bad year we had our Christmas Party at the corner of 42nd it was all fun. Young. La quinta to the ipo waters. Well talk to the ceo of that chain after it opens for trading. The opening bell just a few minutes away. Stay right here. Squawk on the street is coming right back. Right back. [ girl ] my mom, she makes underwater fans that are powered by the moon. She can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. My mom works at ge. [ bell ringing, appla