mr. schultz, welcome. when you go into starbucks, what do you order typically? >> a double short nonfat latte. >> let the record show. >> however, in the morning, a double espresso mack macchiato. >> beautiful. let's talk about the subject you're going to talk about in a moment, and that is corporate values. you say the value of your company depends on the values of your company. you're going to be talking inform201,to 1,500 financial services executives. the value has come down. >> in the past few years, starbucks had record revenue, record earnings at a time in america where you know consumer confidence is down. at the same time, we provided health insurance and equity stock options. the health insurance line cost $260 million this year despite the pressure to cut that benefit. what i'm here to say is you can't build a company solely based on the singular focus of creating shareholder value unless you create value for your people and the communities you serve. and my message is about achieving the balance between profitability and a social conscience. >> do yo

buy to take mr. schultz out of his position. >> options activity leading them to believe, anyway, that there could be something happening before that date in september. >> that's right. just the third weekend in september. >> okay. and nat gas is the best performing commodity today. futures spiking 5% on extended heat forecasts. grasso? >> a little perplexing with the weather forecast for the next couple of weeks showing the heat wave will continue. so it feels to me a little bit toppy. but remember that $5 mark in nat gas if we ever do get there, that's when the plants actually start switching back to coal. so, just be aware that you might see the coal names start to pop as we jump above $4, if that happens. once again i think nat gas a little toppy at these levels. >> our next trade politics. one of the biggest bears on the street, adam parker of morgan stanley laying out the bull case for stocks and it centers around the election results. parker writing, the biggest possibility here would be romne

mr. schultze out of the company not that long ago. had been on the board up until late may or june but source tell me had not been involved in the day-to-day decision-making certainly for over two years because people are wondering what will the plan be that mr. schultze would undertake to try to turn around a company that between rapist as good amount of cash but less and less of it with each passing month and quarter. by the way we're going to find out how the quarter just completed was on august 21st. now as for best buy it has responded to this letter that it received this morning with a statement and we have that four. i got it right in front of me. basically saying, confirming that it's got it and will review and consider the letter in due course consistent with its fiduciary duties, will evaluate the proposal carefully. this is a company and a board that's looking for a new ceo or at least says it's looking for a new ceo despite what significant payments to its interim ceo, bonuses, retention bonus and the like. couple of other

we hear firsthand now from mr. schultz himself in a first on cnbc interview. >> welcome back. before we get to that, we want to look at the moves that starbucks has made in the past month. green mountain will make, distribute, and sell the coffee packs for the keurig coffee cup machines. two days ago it opened its first evolution juice store. if that's not enough, they will start selling single cup home coffee machines. let me bring in howard schultz. good to see you, howard. >> good to see you, mere yeah. we just walked out of our annual meeting where we celebrated the success of the company and the stock was at an all-time high. really the celebration was about the balance between the social conscience. >> you're expanding into other businesses, including the juice and energy drink business. i realize it's all about growth as well as social consciousness but what about the critics that say you are drifting away from the core coffee business? >> well, nothing can be truth. the core coffee business is our retail stores. we'll remodel 1700 stores alone in the u.s. and open clos

make your mind up, mr. schultz. either be the good guy, pay uk taxes or stop selling the world this story. that you are, you know, such a wonderful man and go on making the biggest corporate profit you can. you can't do both. >> well, i'll tell you, nigel. in my opinion for what it's worth, i love starbucks coffee and i don't really care about all these other issues. i buy the coffee i like best. i don't open up any other frontiers to this, so it really isn't me, but it is a big story. and i guess the final question i'll ask you is, how intense is this? in other words, are we talking -- and they're not the only company, brought up google, mcdonald's, maybe to a lesser extent. how much money are you talking we could collect if these rules were changed in your opinion? >> well, if the rules were changed and the uk had a good, competitive tax structure that made it a very attractive destination, then we would be collecting many billion pounds more every year, which for a country the size of uk does matter. but for the

schultz mentioned private equities but didn't name any private equity firms. >> that's correct. he hasn't named names but claimed to have lined up firms and management to come in and help him taking the company private. >> do you think it's a good idea? >> well, i think it's a good idea for investors in the near term. to stay in the chairs to see how it plays out, but yeah, i mean, i think they can execute some things and change over the business and help turn around the business better as a private business without the scrutiny of wall street on them. >> without the pressure. ty, what do you think after this? i mean, it does buy him sometime to turn around the business model but partnering with private equity and can't do that, he can't pay the debt either. >> absolutely not. it's a question of whether the companies that might be involved in this can make the numbers work. what's also i guess a question, would be a question in my mind would be whether the guy who was until a couple of months ago the chairman of this company, was the founder of the company, was the guy that buil

mr. schultz now stepping down from his position. he was the founder of the company. elected director tyabji will succeed him. yahoo! shares a bright spot on this down day. the struggling web giant trying to put the ceo debacle behind it. the temporary ceo trying to rally the troops in his first memo after scott thompson resigned. the memo says "today's announcements lay to rest the unfortunate and serious distraction following our senior leadership and the composition of our board going forward. in spite of the bumpy road, we are traving meaningful places every day and heading in the right direction." scott thompson revealing he has thyroid cancer and resigning following questions of his academic accomplishments. >>> chesapeake's higher. investor carl icahn buying back into the imbattled nat gas giant. news could turn up the pressure on chesapeake, which is facing a cash crunch and a corporate governance problem. the stock is down to its lowest level since 2009. and let's turn back to matt cheslock to ask him what he would do with chesapeake, yahoo! and best buy. jum

mr. schultz is excited about the potential of doing this, but i don't know if he can convince the rest of the folks to get the money up there to get through the bidding process with the lbo. i think this's a possibility, however, because of that, i hope some upside calls. continue to see upside call activity based upon the people that buy into the rumors that come up. but i don't think it's really going to happen. i still got to have my foot in the water. >> anthony? >> it comes down to financing. if you look at the numbers and you look at where deals are getting financed, it's not going to happen based on that. i would bet against it. i think it's a fiction. >> all right. >> bottom line, right. exactly. let's move onto another beleaguered retailer. what is jcpenney's strategy. loyal customers and wall street alike wondering. ron johnson's initial approach was to lift sales to every day low prices and not through special promotions. but in december alone, the company has rolled out two sp

. >> mr. schultz, i'm just wondering, you're describing -- if we get back to the product model, you're describing the starbucks chain almost as a platform to launch products. you have reminded us in the interview that 17% of people do not own this sort of coffee machine. but i'm wondering down the line what else you may attempt to sell them at 17% don't own at the moment. >> i think we are a coffee company first and foremost, but when you talk about the competitive landscape in terms of our business, starbucks has a huge competitive advantage because of the ability to demonstrate and interact with our customers in our stores. unlike all the other companies who are relying on second and third parties, we have the ability to create trial, demonstration, awareness and loyalty in our stores and then fellow that up with multiple channels of distribution. that's why this will be so successful. >> what sort of products? obviously you sell the coffee cups, where would you next look perhaps to expand t

schultz himself as he moves his equity over. raising $1.5 billion from private equity, let's call it, is still a very, very big problem, or at least let's call it a tough thing to do. a tough thing to do, given what's going on with that retailer. >> get that radio shack merging with best buy, jcpenney, together with groupon -- >> if you tie a bunch of rocks together, they'll float. >> dumb as a bag of hammer as i look at that possible leverage buyout. >> mary thompson is in for bob this morning with more on what is moving. >> we have a mixed picture in the markets right now. dow coming off the lows of the day, down 26. nasdaq is higher, up 1 1/2 points, rebounding from a lower open help by strength in semiconductors. you can credit that with invideo raised dividends. traders concerned about two things. what's happening in the eurozone and what will happen with the fiscal cliff. let's start with the eurozone first. take a look at the chart of the euro. 7:30, another leg down, added pressure on the futures. recent concerns about f

the question continues to be whether mr. schultz will be able to bring in partners for this potential bid for the company and of course if in fact he's successful in doing that, what price will he pay. the stock was down sharply on friday. i think largely because of the del numbers and the sears numbers. there were other rumors around. they are still working on it. we'll see if they get something together in any way that would be a real bid that could bring to the board and what that board will do with it. people i speak to say you can make a case this makes sense. don't forget it generates free tax flow. you can get it under control. have a smaller base and have something real there. you get up into the 20s, they were 25, much harder to make any sort of a case. this is not saying they'll be successful in raising a billion and a half dollars for private equity to make a run at the company. >> i'm getting these costco and walmart in a fight to the death to sell you a 16-inch screen which is normally where i would go for best

with us on set, jan niffen as well as mr. herb greenberg, as well. jan, if you're richard schultz, would you buy or try to buy best buy? >> i think it's a good idea. i think he'll do well. if you have a billion dollars to put in of your own, you can get private equity guys to play with you. i think it's financeable up to $29 or $30 a share. not where it is now. >> why do you think it's trading off the offer price? >> i think it's trading below the offer price because people are saying right now this can't be done and financed. they'll never come up with $3 billion of additional equity they need. i think it can be done and big-time private equity guys that understand retail to play in this gamble. >> on that note, i spoke with a source earlier today as an investment banker, won't go on the record. he said he thought it could get financed and raise the debt side and wouldn't be easy. you agree with that? >> i agree it wouldn't be easy. >> it can be done to your point. >> the biggest deal done in a long, long time. it would be a lot of money to raise. h

with mr. jolet coming in from france to run the company, that's not a good prescription for best buy. could be a huge competitive advantage for walmart. >> you also have an economy that's sort of in a tough spot right now. are you also worried about just consumer spending in general going into the holidays? >> maria, testidefinitely worri about consumer spending. the strongest increases in 2010, 2011 -- big declines after crop year 2012. there are a lot of walmarts in that area. worry for walmart. worry for a number of the other retailers in the economy overall. >> i'm not sure why we're talking about the holiday season anyway. we've got a week and a half left in the summer. why does walmart's move make you optimistic about the holiday retail season? >> i think what they're doing is trying to capture a little bit more wallet share early. the way any retail promotion works, if it works one year, which it did last year in 2011 bringing out layaway, which they brought back after a hiatus after a

howard schultz. >> what do they do? do they go to dunken donuts? >> i don't know. mr. coffee? >> it's funny, there's a great deal of competition. within one block of me, i've got a new place, the coffee bean or something which is a chain in california. another up and west sider tells me. >> you stick it to the man. i get that. >> coming up, market reaction much more ahead on "squawk on the street. 16789d take a listen to what cramer says. don't worry, it will only take one minute. six dots in 60 seconds. "squawk in the street" will be right back. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important. well, both are important. let's be clear. they are but this is important too. [ man ] the receivables. [ male announcer ] michelin knows it's better for xerox to help manage their finance processing. so they can focus on keeping the world moving. with xerox, you're ready for real business. ♪ now i'm free ♪ free falling ♪ and i'm free ♪ free falling >> rick santella here. we hav

. >> thank you, mr. santelli. imagine that, testing a 1.50 yield is a possibility. what's coming up on "mad money" tonight? >> six flags had a good june. trying to battle the notion that howard schultz is saying that june was bad all over. people are going to theme parks. they're loving it. >> excellent. >> i also want to point out that i'm going to be on the hunt for company that is didn't see july be bad because of what rick santelli just said. if consumer confidence is going up, perhaps the whole foods is doing -- that's more of a beacon than a starbucks. starbucks was a quizzical conference call. >> got it. >> and obviously facebook and then versus amazon, amazon is saying, this is just fabulous. too much demand is a nice problem. >> it's a big problem. high-class problem. >> yes, it is. >> jim, have a great weekend. see you tonight on "mad money." >> thank you very much. your mets are coming back. >> oh -- got a lot more "squawk on the street" ahead. we're keeping an eye on facebook. #a#a#a#a#a#a'9#a+=#a#a#a#a#a +g#a >>> good morning. welcome to the second hour