quarterback quarterback begins right now. good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin who will be here shortly. we'll have an nfl draft breakdown a little later this hour. first let's get to today's headlines. apple is said to be in talks to buy headphonemaker beats electronics. apple could pay as much as $3.2 billion for the company founded by dr. dre and music producer jimmy ivine. back in january, rubenstein was on set with us. he put on a pair and explained how he was learning the hip hop

business. with a deal like this, looks like he was a good learner of all this. we'll talk much more about this potential deal in just a few minutes. >> immediately people are saying apple never paid for a brand, it was always its own brand. beats, at first i didn't understand it. it was totally overpriced. my kids both have a couple of pairs. they're plastic. i don't know whether the sound is better. i know kids want them. i remember a couple of kids were looking at them. i wonder, are those knockoffs, are there real? >> there's a cache around it. >> there's the music business. >> that's fledgling. that's what apple really wants. for a couple of years, downloading itunes was growing and growing. now it's down 6% or something, year-over-year for those tunes. i was amazed that sales of beats is like $1.2 billion in revenue. >> i was thinking about that. everybody who wants a pair has them. >> but they break.

at least the ones my kids have had, that we've had to replace. if you drop them. 3 billion, 1.2 billion in sales. at least i can do the math and understand there's a real product here. i guess -- is it iovine? >> i guessed on that one. >> we need andrew. >> the nfl draft, in new york city, i don't know if he was there, if andrew was sleeping -- you had to sleep over there to get tickets to go into rockefeller center. i don't know how late he was there watching the draft. >> i think there's traffic on the bridge. >> he was not at the draft? >> no. >> i think it's traffic on the bridge this morning. >> iovine was close to steve jobs and also brought us the black and red ipod u2 thing.

>> right, right, right. >> he has a relationship with that irish superman with bono. >> bono. >> are you sure? >> i'm sure. >> it was sonny bono. >> and this guy is bono. >> no. it was sonny bono. >> the other guy is called the edge. >> if you're a rock star you get to do whatever you want. >> what is his name? paul hagas or something? >> isn't -- paul who? hagas. one deal may be in the works another is falling apart. the proposed $35 billion merger between omnicom and publicis has been called off, as the challenges informing the world's largest advertising agency proved too big for the partners, too many delays. too many uncertainties.

>> concerns about some of the brands. they were going to lose some big accounts. >> they needed to stay together to take on new media, new advertising, google, facebook. >> you know who was saying he was in favor of this whole deal was sir martin sorrell. i think it was creating internal strife. a lot of their clients were upset. if you own the coke account you don't want to be merged with the people that own the pepsi account. >> sir martin was hoping for an even fatter paycheck than 50 million that he made. >> i think so. he's gotten some serious grief from the uk over that. >> i like him, though. he's all about income inequality. he likes that 50 million. a lot of guys like that. anyway, as presented in july as a marger, the deal began to seriously unwind after omnicom chief executive john renn expressed during an earnings call some concern late april

citing some tax complications. renn and maurice levy, the other ceo said in a joint statement on thursday, we have thus jointly decided to proceed along our independent paths. we remain competitors but maintain a great respect for one another. shares of omnicom, they are indicated a little bit lower. i think people wanted this to happen, omnicom shareholders. >> they've gone a long way towards making that happen and in the process probably created problems and were dealing with the down side without getting the up side on it. >> who are these two governors, speaking out against the pfizer/astrazeneca combination. martin o'malley. you need to play that song. >> "alley cat." from "aristocrats." >> marco sent a letter to pfizer, to ian reed, the ceo of

pfizer, expressing deep concerns about the bid. they question the impact on the deal would cause jobs in both states as well as pfizer's open interest in relocating its corporate base to britain. astrazeneca employs around 3,100 people in maryland, 2,600 people in delaware. "wall street journal" is laying out the tax implications of a pfizer/astrazeneca deal and not just what it would do for pfizer but it would affect pfizer shareholders in some weird, not well understood or well-known law, i don't know, i have to read it. it's in the ten-point of "the wall street journal" today. pfizer shareholders face a tax hit if a deal for astrazeneca goes through. why dontd we learn about it together. >> what page? >> b1. >> it would cut its yearly tax bill but it would trigger something for shareholders.

shareholders with stock in taxable accounts would own capital gains taxes in the appreciation in their chairs when they're converted into the stock in the merged company. you'd have to pay the taxes on the appreciation. >> oh, that would -- that's a big hit. >> that would -- as bart simpson says a lot, that would be bad. i won't say the "s" word. the hit would stem from a little known provision of u.s. tax rules that is triggered when a company buys a firm overseas and relocates there. >> you have the same capital gains -- >> shareholders would get -- >> how much of this deal is in stock? if i own pfizer stock, i would be very unhappy. although if you sell it because you're ticked off you'd still have to pay the capital gains. that's not a very shareholder friendly policy. >> the futures this morning after yesterday, you did see the markets closing slightly higher yesterday.

>> it was a mixed day yesterday. markets cl s closed near the lo the session. you see red arrows. the dow indicated down by 8 points, s&p down by 1.5 points and the nasdaq down by 5.5 points. take a look at the ten-year note. at this point it's yielding 2.6%. sitting right where it's been sitting all week, above or below that 2.6% yield. we'll see what happens today as we get closer to the opening bell. also take a look at oil prices this morning. oil prices right now are up by about 82 cents. 1010.08 is where wti is standing. the dollar yesterday, we were watching closely at the euro after that ecb decision and also talk from the head of the ecb about what had been going on. you saw the euro give back. the dollar is higher once against. it's trading 1.3814. the dollar/yen, the dollar is up against the yen at 101.74. and gold prices this morning

look like they are -- >> trading -- >> up slightly. 1,287. $1,287.40 an ounce. what is apple thinking with a possible beats buy? does it make sense. >> i struggle to figure out a way that this makes good sense. hooerz the best i could do. beats known for making pretty expensive head phones. they have a streaming music service that they've been running since the beginning of the year and also a service called topspin that connects artists to their audience. look, the best pro case i can think of is defense, maybe google or amazon was sniffing around beats. beats has a decent business in music. they've been able to make high margin hardware. apple knows how to do all that stuff already but it sure wouldn't be good for its competitors to get into that business. maybe apple is looking to dramatically overhaul itunes,

the way it handles music services. itunes radio is to have to a decent start. some rankings have them number three or four in the streaming business. they're not exactly blowing the doors off. jimmy iovine is a genius in the music business, been in it since the early '70s. beats didn't have the much in terms of intellectual property that would justify a price like this. there would probably be a culture clash between a somewhat buttoned down, quieter apple character and dr. dre. plus it's backward looking. music, apple already won that. why spend a bunch of money to try to win it again. what is beats? they sell from mid-200s to mid-400s.

i had a pair, they tended to fall apart. they managed to turn that accessory into a fashion statement in a way that hadn't been done before. the company is about six years old. of course they have the streaming music service. downloads have pretty much flattened out. they've gone down a bit, streaming services like spotify and even pandora are on the rise. not a lot of profit in those but they're gaining in popularity. apple might be looking for a way to answer. $3.2 billion, boy, that's an expensive way to answer. >> it's not like a 16 or $19 billion whatsapp. >> i see so many reasons to question it. my knee jerk reaction is, what are you doing? it implies you can't come up with anything itself. you're buying this company, it

has a name and a brand. is that the point you've reached now that you've run out of ideas? i see all these things. i'll take the opposite side. that's the consensus. no one understands this deal. they must know something to be doing it. >> apple doesn't buy brands. >> they are now. >> i don't know. they sniff around a lot of stuff. a lot of times they don't actually pull the trigger. >> how long did it take beats to do the music streaming? apple could have done that themselves, couldn't they? but they don't have jimmy iovine. >> beats got this from mog, apple has had plenty of opportunity to buy this, lots of people willing to sell it to them. >> they didn't want -- you say potentially from a defensive perspective, they didn't want google or someone else to get the streaming music. >> that's one way it could make sense. apple will dip its toe in a lot of these deals. it loses out particularly when

it has to do with data. apple's culture, it's a craftsman's culture. they like building things, determining through force of will what the answer will be. in the data business you let the algorithm determine the answer. apple, its culture doesn't go with that. >> it's a little depressing. i would have liked to have seen the head phones that steve jobs would have designed in terms of how they look, they work, the style. you know how elegant everything he did was. it was almost like architectural where form follows function. >> johnny wouldn't design beats headphones. it's hard for me to imagine apple buying this and doing anything but killing it. >> i used to think kids look

funny walking around with headphones. they're everywhere. >> kids are supposed to look funny. >> sometimes it's the nerdy kids that have the headphones. >> my mom got mad at me when i started shaving my head in high school. >> were you losing your hair in high school? >> i wasn't. >> michael jordan was shaving his head. >> it was a choice. >> i was shaving it close and i took the guard off by accident. >> do you know now if you were to grow it back what would happen? >> oh, yeah, the lines are pretty clear. >> you have lost hair since? >> yes. >> you wouldn't grow it back and go, oh, no, i'm bald. >> i know. the jury is in on that one. >> you do know. >> i could draw you a line. >> that was a good seinfeld. the guy was bald for three or four years.

then when he saw he actually was bald, he was upset. >> you're very handsome. that works for you. >> thank you, joe. >> it wouldn't work for me. i have ears, bumps. >> you don't know until you shave it. >> right. >> i have things that -- >> it looks good on him. >> i know he does. i see the mail that comes in. joining us right now on the "squawk" news line, for more on apple's rumored bid for beats is david garrity, principal at gva research. what's your take on what has happened here -- or what hasn't happened i should say, at this point. >> i want to go back to the point joe made earlier on. at the time that carlyle group put $500 million down for a minority interest in beats, the company was making about a billion dollars. well, david rubenstein, he's not like venture capitalists who will buy companies that are losing money. let's start with the assumption that there's probably a reasonably attractive profit

margin on the billion dollars. the billion dollars was being realized before they started the music streaming business. let's say they made 40% margins on the billion dollars. it says apple is buying beats for eight times ebitda, which is not a crazy number. it also says that the music business is something that engages consumers, brings people back to apple. if we have to go back and look at what launched the ascension of apple in the consumer market was the launch of the ipod back in 2003. clearly a defensive move but i don't think it's a bad use of apple's capital. obviously at $150 billion of cash. >> a good deal, you like it? >> you know, i think financially it makes sense. people will be critical of it because it's not necessarily move nothing a new product area, which is what investors have been looking for but i think for an area that continues to be so

in the future, there are worst ways. >> i told you. because i didn't understand it, it would probably make sense. >> can i ask you a question? >> the consensus is nobody likes it. >> why not spotify? >> spotify didn't have the 50% margin. >> why don't you buy the best thing. >> when you have the most money and you want to get into an area, buy the absolute best. >> beats is nothing. it's a fashion accessory that will be unfashionable in a year or two. >> you know tim cook. >> i implore tim cook to think about this. >> were you thinking about this on the bridge. >> i've been thinking about this a lot. i'm upset about it. >> if you went out and got spotify, looking at beats, you're actually -- >> you broke up. why would it not make sense for

april toll buy spotify? how much would it cost? do they make as much money as beats? >> no, they don't. spotify's multiple would be higher. with beats you are picking up some product design capability. at the end of the day, beats probably makes a lot more sense because they get more for it -- >> beats has products and some designs that apple just could not stomach keeping around. if you imagine apple taking the business and you justify it based on what they're making right now, i don't think you can do that. they make silly looking stuff. >> can i say they make some crappy stuff? >> we talked about that. they're plastic. >> it's a fashion accessory. that's what it is. >> but it cost $30 to make and they sell it for 400. >> that may very well be. this does not help change apple. >> no one said it. you missed all the earlier

conversation. >> i did. i apologize. >> it immediately raises the question, wow, are they desperate? can't they come up with anything new? >> they should just buy victoria's secret. >> come on, beats is more closely related than underwear. >> not really. >> it's a new category for apple and they're growing. >> the more the criticism comes, the more -- >> we're together on this. >> the more criticism from the unsophisticated types, right? >> thanks to david, john, thank you. i think we'll see you a little bit later. when we come back, how to make yourself happier than you are right now. the author of "10% happier" tells us about reducing stress without losing your edge. more happy "squawk" right after this.

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was another huge week on "squawk box," buffett, gates, brans branson, feldstein and joe meeting the other most interesting man in the world, all covered in this week's talking squawk blog, squawk.cnbc.com. plus it has our jumble record for the week. >> did you win 2-1 or something. >> i think we only played once. >> she won one time. >> i will remind you of that because it's a rare occasion when i can win the week. >> you thought it was --

>> you don't have the "k." >> for an ox that is smart. >> is an ox a yak? i don't think that way. >> i won. >> i have no idea. that's all she's focused on, the winning part. >> brainiac. >> you're hitting abou about .300, .320. >> a sore winner. >> .320. >> i'm the boast winner, i will admit it. gap issued an upbeat profit report as they reported sales, that topped expectations. >> wow. >> gap says that it expects fiscal first quarter per share earnings of 56 cents to 57 cents, beating analyst expectations of 53 cents. the company said net sales for the quarter increased 1% to 3.77 billion. also beating analyst forecast which called for revenue of 3.6

billion. comps were up from a year ago. if you check out shares of gap, you'll see they're up to 41.06. >> we'll talk about being happy this morning. can we play the happy song? we'll play executive edge. the question, how far would you go to be 10% happier? how about 10% more productive or at peace? >> i want more than 10%. >> you want more than 10%. we'll talk about that, too. you might be able to have all three if you turned inward. and just meditate. we always talk about meditating on this show. with us now, author of "10% happier" how i tamed the voice in my head, reduced stress without losing the edge. >> it's like a fiona apple record title, it's really, really long. >> if you have voices in your things you

can try for that, too. >> yes. >> there are side effects for the antipsychotic -- >> do you have a hookup for me? >> there was self-medicating. you talked about that publicly, too. back in the day we used to hang out. i wasn't self-medicating. >> you were a good boy, i'll say that. >> years ago, but a decade ago in a prior life we used to see each other socially. >> are you talking alcohol or everything? >> self-medicating with cocaine and ecstasy. yes. >> that scares me. >> after coming home from covering wars in afghanistan, iraq and other places. and i got depressed, did a stupid thing and it gave me a panic attack on live television. >> no way. >> 2004, "gma." i was anchoring the news updates, lost my ability to speak. terrifying. then i knew i had to make some changes. >> what happened, what did you do? >> interestingly, my boss at the time, peter jennings, assigned

me to cover religion. i had a bar mitzvah but for the money. it ended up being a great thing for me. i met a lot of people, developed a respect for people of faith and ended up stumbling into meditation a couple years into it which i always thought was uniquely ridiculous. >> i started doing tm about a year ago. how did you get into it then? >> it's a long, strange story. >> do you do it every day? >> i do it every day for 35 minutes. i always hesitate that. i think five minutes is enough. you probably do 20 minutes twice a day. >> i do 20 minutes once a day, though i'm supposed to do 20 minutes twice a day. >> a lot of people say i don't have time for this. i think five minutes is fine. >> he may have antipsychotics for you. >> we'll talk about that. >> the look on his face when you

t'd up this segment is priceless. the camera wasn't on him. >> which part? >> when you started talking about turning inward and happiness. >> there's no one happier than me. >> really? >> than me? >> i'm prepared to believe that. >> wait. did you have to take a path before you got to meditation? >> yes, yes. >> or other things along the way. >> i went to see a doctor. he explained to me it was the drug use that most likely caused it. the meditation i found years later. i only tell the story about the panic attack. it's a great example of the type of thing you can do when you're mindless, not thinking about what's going on in your own head. >> do you have a wife and kids. >> i have a wife, working on the kid part. >> i'm done at 9:00 every day. that's a beautiful thing. i have three dogs. i'm ecstatically happy. >> you don't need the book. >> it gets to the point where i

might just worry about -- i check for -- >> lumps? >> yes, lumps. this is too good to be true. i get a lot of physicals. >> here's a question. so there's a morning show, you're on a morning show in the morning. >> yes. >> all of us never have enough sleep. i always say to myself, if i could sleep or do meditation or go to the gym, right? i could sleep, do meditation or gym, maybe play with my kids. you only have a finite amount of time. what should you do? >> you don't want meditation to be yet another thing on the list of things that stresses you out. i don't care if you have 13 jobs and spending a lot of times getting physicals and checking for lumps, you have five minutes. i think you can do it. >> i think if you have kids you don't have time to live in your own head so deeply and worry about all this stuff. >> i think that's true. you're so busy worrying about if

they're okay, if this is going to be okay. every aspect of their life. it never ends from the day they're born. >> we talk about the voice in the head. even if you have kids it doesn't stop the inner narrator that chases you out of bed and yammers at you all day long, has you casting things into the future, focusing on the past instead of what is going on right now. that is human. >> you call it meditation. is that the same thing as prayer. >> i think there's a huge overlap there, i really do. >> what is "10% happier" actually feel like. >> it's makes the bad stuff not as bad and it makes the good stuff better and compounds annually. >> compounds? that means it doubles. >> i've never been good at math. >> 7.2 years. a voice in my head told me that. >> really? will you send me the graph? >> it's the rule of 72. 72 by 10, 7.2, pretty easy.

>> it's a stock market thing. the book, "10% happier." >> if you could do math. >> i'd be wealthier, i garn it i you that. coming up, a bunch of happy people at the nfl draft last night. maybe not johnny. they call him johnny free fall in the "daily news," number 22. the other big quarterback from central florida went way before him. we'll break down the picks and which team will be the most improved for 2014. more "squawk" coming up next. if i told you that a free ten-second test could mean less waiting for things like security backups and file downloads you'd take that test, right? well, what are you waiting for? you could literally be done with the test by now. now you could have done it twice. this is awkward. check your speed. see how fast your internet can be.

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welcome back to "squawk box," everyone. it was another pix mixed day for stocks yesterday as investors sifted through a handful of earnings and technology stocks were hard hit, the nasdaq closing down for a third straight session. joining us now to talk more about the markets is allison dean, senior adviser. allison, what do you think is happening here? is the technology boom, is that over for now? are we still watching stocks push higher? >> i think we'll see back and forth for a while. two things are going on. one, from a macro perspective we've getting mixed signals. the bias is towards the positive. the buying trends are good, the retail sales are positive but the housing market is quite weak. people aren't just convinced that the second half of the year

are robust as people are forecasting. we're in a wait and see mode. the other thing that happens in a slow economic growth environment you start having to separate out the winners from the losers across different industries, including technology, stronger players with a dominant franchise and good business strategy doing well. >> what is it exactly that the street wants to see, though? we have seen better jobs numbers. you listed the better economic numbers that have gone our way. >> they want to see real economic growth being in the 3% territory or higher and translating it into top line growth. and good momentum coming out of the rest of the world or some momentum. china looks as if it's slowing down a bit more than people expected. while europe seems to be improving, draghi said we'll continue to help europe but it's not that robust right now. much clear, more consistent signs of economic growth. housing as we remember, brought down this market one way or another. i think people would like to see

strength there since it's such a key driver for economic growth. >> john, will wall street get that? >> i think they will eventually. wall street is fearful of a jump by treasury bond yields that could make matters worse for housing. my guess is that some of the forthcoming news on housing will be a bit disappointing. but the good news is that perhaps we'll see that ten-year treasury yield drop yet lower, keep falling. >> wait a second. that's good news if the ten-year yield keeps falling? >> that's going to restart -- i think financial markets are still trying to understand what the long-term underlying rate of economic growth is going to be in the united states in real terms and in nominal terms regarding inflation. >> if we see the ten-year at 2.4% and 2.3%, what does that do to the stock market? >> i think it will basically help the stock market. it will supply support. you'll find corporate bond yields will be lower. >> it means the economy stinks and it's not anywhere near --

>> it doesn't necessarily stink. i think what's happening is the equity market -- excuse me, the bond market is trying to adjust to perhaps the reality of the slower underlying rate of nominal gdp growth, real gdp growth and inflation. what's going to remain true is the fact that we're going to see profits continue to grow. and as long as you realize, growth by profits, amid relatively low bond yields that will be a positive for equities going forward. >> what do you think about that? i understand john's point, if you do see a lower ten-year yield that would be good news for the housing market. if you see the ten-year, let's say at 2.3%, where do you think stocks will be trading? >> i'm more in your camp. if interest rates start trending lower, it's a negative sign for economic growth and people are looking for stronger economic growth and stronger top line growth. what will help the housing market, maybe one of the things we come to terms with, after

what's happened in the housing market, maybe it doesn't grow the same way it has in the past. people are not as quick to buy houses, are thinking, rent, buy, a little bit differently. it won't be as much of a driver. if rates start trending lower, the overall economic growth is challenging. >> we've had the ten-year treasury yield make two attempts to reach 3% or higher. first one was back in september of last year. the most recent one -- >> i think you'd see the same thing at this point. the mark set coming around to the conclusion that the fed is not going to take there forever. you can't have this goldilocks economy. >> the fed is not the only force that determines the level of treasury bond yields. you know, right now, we havette abouter conditions in europe but the ten-year french government bond yield is at 1.9%. german government bond yields, less than 1.5%. this 3%-year-old we keep predicting for ten-year

treasury, that's exactly where the ten-year government bonds are of italy and spain. they're at 2.9%. we have to adjust to the new reality. we're not going to see the growth of inflation we had in the past, we'll see somewhat lower growth but that's not necessarily bad. >> i like this debate. we'll see you both again soon. next, joe, i hope you're paying attention to this, we haven't had any bitcoin news in sometime. the twins, that when we come back. >> i saw those guys at the white house correspondents dinner. >> you did? jobs all over america. engineering and innovation jobs. advanced safety systems & technology. shipping and manufacturing. across the united states, bp supports more than a quarter million jobs. when we set up operation in one part of the country,

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welcome back. the winklevoss twins, their bitcoin trust will be listed on the nasdaq. that decision by cameron and tyler winklevoss comes one day after the securities and exchange commission issued a warning to investors about bitcoin saying it created new concerns for investors. federal agencies have been scrambling to figure out how to regulate bitcoin since the collapse this year of mt. gox, one of the most prominent exchanges for buying and selling the virtual currency. the commission said a new product, technology or innovation such as bitcoin has the potential to give rise both to frauds and high-risk investment opportunities. >> kind of cool when they're both somewhere and then the camera, they take a shot of one, then they take a shot of another. what's the difference? that's why in the movie it was done by one guy. you really only need one of them. instead of paying for two car services to bring both of them out there. >> it's good when you have both

of them sitting next to each other. >> with the camera shots we can frame it different. >> what do you think? >> cheaper. >> easier. >> much easier. when can be xb returns, the big business of the nfl draft, jadeveon clowney goes number one while johnny manziel sat out a long time. i kind of like this, though, the browns play the bengals a lot. >> they would tell me they've gone on the dates with the same people. >> and not said anything. >> that's a little bit sick. that's a sociopath. >> you're kidding. >> no. we had a conversation. >> i'm mortified. >> get to know the girl? >> i don't know about that part. >> it's sick, andrew. it's sick that you brought it up. we'll have a draft breakdown, next. passenger: road trip buddy. let's put some music on.

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with the first pick in the 2014 nfl draft, the houston texans select jadeveon clowney. defensive end, south carolina. >> his father said jadeveon. >> the name has been debated for the better part of year as has the top pick in the draft. jadeveon is what his dad said. >> he didn't pronounce the "e." >> the first night of the draft was last night. here to talk winners and losers, dave briggs is host of "sports dash" on nbc sports network. i don't know whether it's me or

just sports but for the first time ever, you know, i was very interested. i wanted to watch it and i was unable to. it's like all sports is getting more valuable and more compelling. >> you were more interested this year? >> yes. >> that's interesting. were you, sorkin? >> yes. >> becky? >> i'm interested in manziel. >> there was more hype, more talk, more press. a lot of that was johnny manziel, where he would go, an extra two weeks to talk about it, later on the calendar because of scheduling conflicts. >> leading up to the playoffs and the super bowl last year i was more interested. i'm interested in houston because they already have that incredible defensive player. now, they're going to be really solid. >> it's a great pick. you can't miss on a guy like jadeveon clowney. if you miss the next lawrence taylor for the next 10 or 15 years you'll be reminded of that. >> he used to watch tape of j.j. watt, want be to be like him. now he'll be his teammate.

>> he'll be an outside linebacker, yes. you don't still don't have a quarterback in houston. this is a quarterback lead. that is the one thing you have to have, even if you have a great defense, you have to have a quarterback. they don't have a great guy on the roster. >> a lot of teams up on defense or offensive line. but i like -- like the giants needed a wide receiver. nine defensive backs. this was the theme of the draft. and johnny manziel really was the story. the best way to watch the draft is through twitter. and the trend last night was before manziel gets drafted. it was a hashtag. people talking about things that could happen before. >> i didn't understand it. it said joe would get a crew cut. >> so you were part of this? >> i was.

>> there was even a photo of manziel drinking a beer in the greenroom. it was obviously photo shopped. this is twitter. so people believed it. it went viral. thought he was actually drinking before getting drafted. >> do you think he was surprised? >> stunned. when you saw the initial reaction when he got the phone call it looks like he just got a call from miss mother-in-law. once it settled in he was going to a great tight end, very good defense. he gets up there and does the money sign. >> millions of people watch. this. it is the best reality show ever. >> the last four or five years. >> the production value raised the whole stakes. >> millions of viewers. and all the mock drafts leading

up. it's just going to get bigger and bigger as they move it out of new york, on it of radio city. they are probably trying to squeeze it. if they move it around, let cities bid on it, it's just going to get bigger and bigger. >> this quarterback, is there anybody better? >> look, he's a guy from central florida that not many people know about. he was the least talked about of the three quarterbacks. he's a great talent. unfinished product. he needs a couple of years before he is an nfl talent. he's going to jacksonville where he may have to start right away. now we look forward to michael sam, the first openly gay nfl player. will he get drafted at all? if he doesn't get drafted, are there going to be bad things said about the league? he is a projected six rounder. it's possible he's not drafted.

that's entirely based on his talent. today, a the more rounds. nothing sexy as we go on. carr is one to watch. you will have to see the houston texans. >> from first to worst anyway, didn't he? the reason i know this, didn't they play the bengals? >> many thought they would go to the super bowl. >> we lose to anyone. the year before, they rolled all around. >> you feel good about your bengals? >> i never feel good about your bengals. >> no, i wouldn't feel great about your bengals either. >> struggled in the stretch. struggled in the postseason. >> can you give us a sterling update? >> the question is about the wife now.

she wants to keep her part of the team. she feels she didn't do anything wrong. she wants to be a minority owner. no one wants that. they want to turn the page and wipe it clean and sell it to someone like magic, oprah, or ellison. the legal battle is going to be tough. who is going to be able to force her out? i don't think anyone can-can. >> you think she can sue to keep her stay? i don't know the legal jargon. she stuck around that guy for decades. >> doesn't that set a scary precedent? >> terrifying precedent. the whole thing is a scary precedent. even forcing his out. what happens when they come anti-gay marriage down in orlando and try to force him out? but forcing a private business

owner out of their business no matter how despicable -- >> you work for nbc. >> i do. >> i did multiple back flips. i understand when -- i remember johnny -- i think the most johnny made was 300 grand. i don't know for sure. but to not understand that by 2032, do you know what the olympics will be worth? >> they're saying how great a deal the -- >> we had marc faber talking about it will eventually come back. the same thing for the olympics, to have that same price for 2032. a billion dollars per game. >> that's a heck of a guy. >> it will be 50 cents on the dollar. >> nbc does the inches inches best. they don't want them to leave. it's a good deal. >> and there are political rings. god knows.

yesterday i was joking but i said by then it's all going to be summer olympics because there will be no more snow. >> of course. climate change. >> you're absolutely right about that. >> or tidal waves. >> money is going to continue to get bigger. >> it is. >> this is live tv too. thanks for coming in. appreciate it. >> nice jacket. >> our guest host today is harvard economics professor.

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where are we? this is where we bring together reliably fast internet and the best in entertainment. we call it the x1 entertainment operating system. it looks like the future! we must have encountered a temporal vortex. further analytics are necessary. beam us up. ♪ that's my phone. hey. [ female announcer ] the x1 entertainment operating system. only from xfinity. tv and internet together like never before.

apple may be about to spend some of their cash. they are in talks to buy an electronic companies. >> corporate tax reform, income and in equality. retailers feeling the need for speed. we have amazon versus google. the second hour of "squawk box" begins right now. >> good morning, everybody. our guest host this hour is professor of public policy and economics at harvard university. we will get to him in just a moment. first, let's give you some of today's headlines. futures are up after yesterday ending near the lows of the

recession. this is essential. it's flat. dow indicated to open down four points. s&p down by less than a point. nasdaq, four and a half points. the yield at this point sitting just at 2.6%. interesting debate in the last half hour whether it would be good news more bad news. what it would mean about the economy would be scary things. a $35 billion merger has been called off. the two sides say it couldn't be overcome. they are down 2.75%. several companies beg bottom line. cbs was 4 cents better than expected. renew did fall short. news core, 11 cents a share.

and monster beat estimates. monster also saw revenue fall short of consensus. upbeat news for gap. it reported april same store sales increase of 9%, well better than expected. it projected current current profit that is above forecast. that stock up 4.6%. 41.06 is the last trade. >> apple, as you have probably heard about now, about to strike a daily for beats for $3.2 billion. john fort joins us with more. is this a strategy? >> i don't know if this is a strategy. some companies are so quiet about their plans. people feel free to talk about discussions they are having at every stage and speculate on what they might buy. there were rumors they would buy hulu, invest in barnes & noble.

this is probably a conversation they have had. they have told to jeremy for a long time. it's a head skwacratcher for me. itunes was $16 billion last fiscal year, up 25% from the year before. accessories was $5.7 billion. so this is small ball just in general. all the beats business. when you talk about discussing this, that's assuming that the beats business, the core business sticks around. these are plastic headphones. they don't really carry apple's design dna. they basically have to rip it apart and kill the brand too. apple's brand in music is stronger than beats is. then the streaming business, yes, this is an interesting business. itunes radio is doing okay. there was a survey back in

february showing they were in third place ahead of spotify before spotify started doing this free mobile stream business. beats streaming business is based on technology they acquired for less than $20 million. why pay more than $3 billion for it? doesn't make a ton of sense. >> i want you to stick around. more on this rumored apple deal. brian blair, good morning to you. >> good morning. >> tim cook, i'm sorry. i live with this company. i feel like i have an emotional stake in this situation. >> many of us do. >> and i have been perplexed. i'm almost upset about it. i'm anxious. >> i don't think it is going to happen. this is not about acquiring inexpensive plastic headphones. dr. dre started this.

this is not a technology company. they're not in the market of buying cheap plastic headphones. some of them are nice. but they are not high quality products. apple does need to do something about itunes platform. digital downloads have been in decline. everybody streams it. you see with spotify, pandora, the only thing that makes sense, would apple want to buy this actual beats audio streaming service. >> why buy that when you can buy spotify. >> spotify is supposed to go public at the end of the year. i think if they care to own the space, they would buy spotify. i've been thinking that was possible the last couple of years. that's the only reason that could make any sense. there is value there. they need to do something about being in the streaming audio

service. >> i'm finally downloading music. >> people do download apps. >> sure. >> it makes sense for them to keep something away from amazon or google that doesn't have the design and hardware sensibility that apple has already. i don't see what value apple gets out of owning and operating it. >> they need to transition itunes to something else the next few years. but this is reactive. if apple really does this, this is reacting to what's been out there for a few years. that's not the old steve jobs way. this looks like a reactive -- >> how will apple get held to the card if that's not the way steve jobs would do it. >> i think it's actually not going to happen. they're talking.

they do have a relationship with beats. >> what's the relationship? >> they have a relationship where you can actually access beats audio through apple app store and apple gets paid a small amount of it. most of beats comes through at&t because it was free. >> here is apple's strategic move. do something on android. they want that to work on android too. i'm backing away from the whole beats thing. the key strategic move is to have something that works across all of the mobile. >> that's interesting. people say black berry done messaging and made it broad. could you do that with imessage?

could you actually take itunes and put it on android? >> it is definitely possible. but i still -- >> do you think they would do that? it's always been a closed system. you need to get the music on the device. >> if you have a wearable, a watch or something like that, who says it has to work with an iphone. if they are getting a decent margin -- >> it's always been a tight integration. >> the new model is to give it away for free and add support. samsung has a new service called samsung milk. this is available across all their samsung devices. it's going to be popular. itunes will continue to decline if they don't do just that, which is give music away across all the platforms.

>> you guys are so dismissive. no love to beats. here you have dr. dre and this guy. a couple years ago, hey, let's make headphones. $3.2 billion. how cool are these guys? >> the power of great marketing. >> how cool are these guys? how much are they going to make on this? god bless them. >> you're like. it's plastic. it breaks. what are they thinking? >> htc actually owned half of beats. now they only own 25%. >> david rubenstein. >> this gives me chills. >> it's the way it is supposed to work. $3.2 billion created out of thin air. when we return, we'll tap into growth, jobs in america, and corporate tax reform with our

guest host. and competition in same-day delivery. "squawk box" will come back in just a minute.

playing some billy joel this

morning. it is the piano man's birthday today. he's 65 years old today. wow. let's get a check on the futures right now. i'm so sick of that song. >> i love that song and you say you're sick of it. >> it's going to be stuck in my head. the futures this morning are indicated slightly lower. dow futures down 9 points. s&p off 1.5. the headquarters of the fiat/chrysler will be moved to london. that was politically sensitive because it has caused utley home for 115 years. the ceo says the company needs to operate out of london but doesn't mean it would give up operational responsibilities in the u.s. unions and politicians in italy have been concerned about any potential job cuts as a result of the move of headquarters. but they said it would have no impact on jobs. this is another challenge to tesla's push to by cast car

dealers. missouri would stop tesla from selling directly to consumers. >> finally, finally to our guest host to talk economy and more. professor of public policy and economics at harvard university. right out of the gate. i love this, ken. income in equality is horrible. we know that. nobody benefits from it. but you point out the last 30 years globally you put china and india together. and what has happened in terms of rising, so many people taken from the poverty level to where they are now. it's been the greatest 30 years in the history in terms of sheer numbers in the history of the world. both china and india, you have to -- the it's free markets and capitalism. how quickly are we to throw it under the bus because we have income in equality in this country.

>> that's exactly right. income and in equality is a big deal. and there are things that need to be done. but if you're stepping back and looking at the history of the world and you say was this a period when income and equality exploded. you want to care about citizens in mumbai as much as about citizens in paris. if we were growing slower, it wouldn't have exploded. but they wouldn't have done as well. you know, it is certainly true. there are things like inheritance tax we need to have and stuff. that's a problem. >> if you pay taxes on it once, i don't want to pay on it again. the next part, this makes me excited to go here. you are also a person that says that the talk about secular stagnation is overdone and that recession advice a way of cleaning out the system to where

you are set up for probably a very good period. but we need infrastructure and education to make it happen. >> yeah. we're still seeing the smoke clear from the financial crisis. i do think we are hitting theened of this at least in the united states and emerging. it's hard to get a clear picture after you have just been bombed basically. >> it started improving, probably. >> certainly if we're talking about technology not growing, that's crazy. we have gone through an extraordinary period where everyone will benefit 20, 30 years. today just as i think they benefit more today from things invented 20 or 30 years ago that show up in the numbers. >> now i will get back to the second thing they were talking about. that is what we do with corporate taxes. because i think you think at the situation in the way the arbitrage is playing out with different tax rates globally and, territorial systems, and money that's left overseas to

get to infrastructure and education. if we could figure out a way to bring some back and to become more competitive, we could pay for a lot of it would w that, could we not? fits the corporate side, personal side. >> absolutely. we set up our corporate tax structure in a day when we ruled the roost. we could just do whatever we wanted. that's not true today. some of our allies are sort of leaving the fold. the uk, who is the center of the debate at the moment, has been cutting their rates because they had been losing a lot of business to other countries like ireland, with much lower rates. we will be forced to respond to that. if you just lower the corporate tax rate, there are problems with bringing it in line. it is way complicated. >> a race to the bottom with corporate rates something to worry about globally?

if all corporations are less incumbered, i don't see how it is that bad. go to consumption. >> ideal would be consumption, tax, raise, same system used for income tax. >> he knows exactly what to do in the world. >> i can't imagine that actually happens. i mantle we slap it on top of an already broken tax system. i think amt is much more likely to happen without everything else getting fixed. >> i think unfortunately you're absolutely right. there was this brief ray of light where they proposed something would be much better. it's hard to say we shouldn't have a corporate tax given the

system. >> they are minor fixes. president obama has proposed some. the larger picture -- we're in a competitive world that we weren't 30 years ago. it forces us to fix the whole system. although you're saying that's impossible. we'll figure it out. >> we pointed out, many people, that it takes 5, 6, 7 years to do tax reform. we have elections every two years. the most pressing thing for the people in office is 2014. the senate, the house, whatever. they come up with wage issues like minimum wage. >> we haven't been doing anything. that's a huge disappointment. >> have you read the pickity book? >> most of it. >> you disagree with the prescriptions and probably agree

with the data? >> yeah. other people have gotten results other ways. particularly the share of labor. the question of will this continue indefinitely, we don't know. and the prescriptions, definitely not. >> my question is, how long -- do you think we'll be having this debate the next decade or two decades? how do we get the middleclass to grow? it doesn't sound nearly as polarizing. >> well, both of them will continue. we're getting healthier. poverty gets to be an issue. in equality gets to be bigger. i've been writing about that myself for a very long time. so some of the question of how the middleclass -- it's hard to tell over short periods. >> did you the read the piece in the "times," if you have a car, flat screen tv and a house, you can be boar. it shows you have have great clothes, a tv, but when it comes

to education and health care, it becomes totally out of the league. that unto itself is what has created the chasm. >> absolutely. it depends how you measure things. if we're comparing somebody to new york to somebody in africa or india, there's a giant gap. if you're asking 20 or 30 years, if the advances being made today in medications and health care, i think a lot of people will benefit. that isn't to say things aren't broken. i'm not saying that. but i think the statistics -- we just talked about itunes. now it's free. that doesn't measure into the statistics of how well people are. and a lot of other things. i think the statistics don't exaggerate in equality. that's there. but they do exaggerate the level of middleclass, which i think has been improvement. >> the "times" said that too the. >> how much do we worry about in

equality unto itself? >> it's a political issue. we have eliminated the inheritance tax. sorry, joe. and we don't tax really high income in the same way we tax almost very high income. that's a political problem because they come to the dominant the political process. you worry about that. and i think that is an issue that needs to be addressed. >> optics issue, if nothing else. it's the -- it's not an optical illusion. it's the optics of what that looks like. >> and there are ways to fix it, like bring back the inheritance tax. when marx wrote capitalism is failing, there were some a justments made. we need to make some back at this point. >> all right. we will have more with ken throughout the show. >> okay. coming up, a big coin entering

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what is this place? where are we? this is where we bring together reliably fast internet and the best in entertainment. we call it the x1 entertainment operating system. it looks like the future! we must have encountered a temporal vortex. further analytics are necessary. beam us up. ♪ that's my phone. hey. [ female announcer ] the x1 entertainment operating system. only from xfinity. tv and internet together like never before.

welcome back to "squawk box". apple is reportedly close to buying beats electronics for $3.2 billion. beats is a maker of headphones and has a music streaming business. it was founded by dr. dre and jenny eirby. retailer radioshack is modifying its plan to close as many as 1,100 stores. the current agreements keep it from closing any more than 200 stores without lender approval. the company has a total of 4,300 locations. and hilton worldwide beating estimates and raising its forecast for the year. hilton results were driven by

6.6% jump in revenue and 17% gain in management and franchise fees. >> let the delivery wars begin. retailers are competing on speed as well as price these days with same-day delivery becoming more prominent. >> google shopping express launched a pilot in manhattan and los angeles offering same-day delivery. amazon also offers same-day delivery in new york and other cities. i put both to the test. we have to start early to get the orders in before the cut-off time for amazon and before the delivery slots ran out for google. here's what i found. well, it's the morning. but it's time to go shopping. welcome to google shopping express. i need toothpaste. shampoo. google express is going to pick

this up at target. free delivery. this is part of our six month trial. it asks a delivery window 9:00 a.m. to 1:00. it operates like a same-day delivery system for several retailers in new york city. the regular amazon.com right now. looking for our products. it's a really couple better some search to find same day delivery product. >> are these the items? >> you're logged in, right? >> is it like a surprise? i'm going to add this. just regular lotion. it tells me on the screen guaranteed delivery if you order in the next 8:49 and counting. thank you. your order has been placed. it is 7:06. let's see how long this takes.

hi. do you have a delivery? less than four hours after we replaced the order, google shop is here. amazon says it will be delivered by 9:00 p.m. so amazon order did arrive at 7:21 p.m., about 11 1/2 hours after we placed the order. i'm not sure how it was delivered. i actually wasn't there when it got there. i was not still on the stoop. the google folks got out of a toyota with no logo. but they were wearing google apparel. the search was really, really hard to figure out. >> would they just leave it for you at the door? >> that's the thing we don't know. >> i asked. he said i'm not sure. this is only my second day. i asked him a bunch of questions. he wasn't sure how the whole thing worked. i said did you pack this bag?

he said no. i didn't even pack it. >> do you understand the economics. the cost to get that stuff to you that quickly is astronomical. >> we reached out to all the retailers involved. eight in new york, as well as google. retailers are paying google for them to become the cowurier. fairway said it is a nominal fee that google chose them to be a retailer in this google shopping express. >> do you think google is taking a loss? >> i think at the moment they are. you get six months for free. i also got $10 off my first order. six months the fee is $4.99. >> per order? >> you know, i think it's per order but it might be per month. i feel like i have to check on that. i forget which it is. for amazon prime same day is

$5.99. or i could wait until 12 hours and i wouldn't have paid that $5.99. i couldn't figure out the utilitiment if i need something that badly, isn't it faster to go to cvs. >> i get it if it's a grocery setup. if i could do same day delivery of groceries. but it would have to be there before dinner. i'm good with that. >> you could pick your delivery slot windows. there were three or four choices. >> was there a cutoff for that too? >> not a hard and fast cutoff. but the day before we heard they had ran out of slots by 10:00 a.m. we figured since we have to place the order by 8:00 a.m. for amazon. that way it's a bit more fair test if you are writing them at the same time. >> coming up, a lot more from our special guest.

we'll check futures right now. take a look at what's happening. dow looks like it would open 18 points. s&p 500 up a little over two points. a look at the 10-year as well. $2.596. we're back in just a minute. monday on "squawk box", former treasury secretary timothy geithner and his in you tell-all book. from the government's response to the recession to the controversial dogfight bill, we go inside the white house during the financial crisis with one of the president's closest first term advisers. we started zya with the thought that the kid on the back of the bus might have a song that he has in his head but he just can't get out. with the technology of cloud, we changed all that. i can sing something into my device. up to the cloud it goes. back down it comes sounding better. we break down the walls of creation, and we give music creation for the masses. ♪ ♪

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begin your legacy. get an auto insurance quote. usaa. we know what it means to serve. let's get to our guest host now for the hour and talk about the economy. squawk market investor of public policy and economics at harvard university. we talked a little bit about the big issues, income in equality. that all could bring us back to the federal reserve to some extend. saeufters have been hurt. raise the wealth effect. it will help the economy do better. the people that have the assets

do better, right? will the fed be able to the extricate itself without a huge negative effect afterwards do you think? inflation or something else? >> well, i think inflation is a very outside risk in the near teller. the larger risk is we are just in a period of low inflation for a long time. there's a lot of uncertainty. they are doing something experimental. we're in a situation after the financial crisis that's not very common. >> if it's not inflation, what would the unintended serious consequence be? >> the thing is they have trouble with their communication strategy. they're not using conventional policies. they can't use conventional communication. and the market gets confused. they start tripping over themselves. just doing 10 billion a year. 10 billion a meeting.

cutting like clock work so people don't get confused. eventually that will end. they're talking about forward guidance. there's not a real precedent for. so i think that's the bigger risk they are you introducing volatility. >> people say when there is going to be some pain, the pain does clear the markets. and japan never really cleared its markets. so it took 20 years. at this point it sounds like the fed was able to minimize a lot of pain with a lot of people with their extreme accommodation. there's no piper to be paid is what you're saying? >> they took a risk. the risk was interest rates might have jumped. >> so they were at the right. >> so far they have won. they took a risk by having this short duration of the federal government's portfolio. made our interest bill much

smaller. lowered rates for everybody. it could have backfired. it was a reasonable risk. so far they have won. but there is still a risk. if interest rates were to rise unexpectedly, say trouble in china, something. we don't know why rates went down so low. so the risk hangs over us. >> we had marty feldstein on this week. he just wrote about it. his thought is even though it's an outside risk, if inflation happens, it tends to happen quickly. >> i think the only thing i see, and i have written about this a while ago, is that they might have to do something like bring back required reserves which they have in tiny pieces. dodd/frank made it harder to do. if the the money started exiting fast and going out in the economy too fast, they would

need a tool for dealing with that. when they said it's no problem, they ran off everything smooth. they have to do something more radical. >> question for you. marc faber says we are in for another crisis in the next six months. >> six months? >> possible. >> possibly. it is due for me. historically, there will be a down turn in the stock market if not the larger economy. so when you look at this now over centuries, are we in for a double dip? >> the state of new york market is different than the larger economy. it's high. it is as likely to go up as down. it is as likely to go way up as way down. if we're talking about china, i think china we can talk about having a significant risk in the next six months. six years maybe more likely. anything is possible.

but i don't think the lights are all blinking red. >> in the united states, do you worry about any debt accumulation? people are talking about private equity and all these devices that started to permeate the system pre-2005, 2006. are we getting there? i don't want to the square people. i'm just trying understand where we are. >> certainly thing is the credit has been throwing again. that's why volatility may have become coming out. it's part of the normalization. but overall, public, private are very high. i don't think it's a big problem. since we don't know why they went down, then absolutely. >> what's going on with geithner? something, right? >> i have a big magazine article coming out over the weekend.

you can read it in the sunday "times". >> he wishes he had been harder on the banks. >> i thought the headline rewrite -- >> would you say he has been stung more from criticism from the far left than you would have thought he would have been stung by criticism from the right? >> i think absolutely the far left has much more criticism for what he did. >> i'm going to ask you, going back for a while i thought you were the darling the of the left because you ascribed all the weakness in the recovery to the depth of the recession and not to owe bam that care, regulation. the left loved you. >> i don't know if i would exactly say that. >> that's the way i saw it. >> then you did a piece where lo and behold, if you have a lot of

debt, it may hurt your growth prospects in the future. people that want to have 60% debt per gdp. >> 200%. >> nothing matters! you make one rounding error and the left abandons you. and i was joking because i was seeing on the left wing web sites. i was going to say discredited harvard economists. they made me sick. that was the term that came before your name because of that one thing that flew in the face that no amount of debt hurts. >> i guess if you think that debt is a problem and having big debt is a big problem than you're somehow enemy of the people. >> you under take a study that seems to obvious to me. >> and among dozens of studies, by the way. several studies we did. i mean, it is pretty clear --

well, if you have very high debt over the years, governments eventually are forced to reign it in. it's not something that goes up and up and up. >> i felt the sting. you said they are saying no amount of debt ever hurts. >> what sit really about is what you're spending it is on. when ronald reagan was running up debt they thought it was horrible. if you're giving it to the person year giving it to, that's good. if you run it up and give it to the person you don't want to give it to, that was bad. >> we're going to have tim on the show on monday. he's got a new back out. if you were to measure or great his tenure, how would you grade it? given how polarizing. i'm not sure he has a person is polarizing but what he represents is polarizing.

>> he did a great job. it was tricky. we did get out of it. it could have been a second great depression. it was not. what other plyemics people want to use, it could have been ten times worse. it wasn't. here's what i would have done, here's what i would have done is what i often say. i don't want to the try it my way. i'm glad we got out. i'm glad it's over. there are things we wished we had done differently. >> people say that. but when you get on the details, it gets tougher. >> i think one very clear thing, you had marty feldstein on would be to find some way to write down debts, work out subprime housing much quicker than we did. in europe, i would have written down debts in the periphery countries. that was a low hanging fruit we should have done. senior bank creditors. i would have tried to do that.

i think those are the things we should have done. and even calibrate these things by fiscal policy. >> not housing. that was the description. you're still talking about the banks. >> i said housing. no, no, no. meaning i'm going to go back before the crisis? we're not talking about that. you mean during the crisis. i would have done something on the subprime subproposals like you get people's debt mortgage lower but they lose some of the upside. that kind of thing. i think there are things we could have done. people forget when they are doing back seat driving looking at what tim did. there was this long period when it looked like the world would fall apart. >> people don't appreciate that at all. >> do you ever ride in the front seat? >> sometimes next to the driver. >> there were many leading thinkers who thought that europe was going to blow up. paul said it in the "new york

times" column that it might blow up in the next few weeks. a lot of people thought that. the leaders were looking at the situation. there was a lot of risk. >> how do you explain your former colleague elizabeth warren then? >> i think she is very interested in representing the lower middleclass. you know, she has a very passionate belief. greater equality. i think she has a lot of good issues. >> republican of the '90s. >> i didn't know that. >> ken, i want to ask you when we come back, what you would look at around the globe today, what concerns you, particularly in this country, and what you could do if you could rewrite some of the rules again to make sure this doesn't happen again. also when we come back, apple has been on beats. reports that the company may make a deal to buy the popular music service. details just ahead. and another huge week on

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we're back with more from our squawk market master at harvard university. ken, we were talking about in hindsight you can go back and say there are things you would have done differently in 2008, 2009. you'll leave it to them because

what they were doing was in real-time. you're not going to be a back seat driver. if you look at where we stand today, are there places you see in public policy that concern you that another bubble could be building up, things to prevent something from happening down the road? >> the things that concern me the most are we haven't really done our basic home work of improving education, building infrastructure to promote the growth in the future that stable theizes our economy. of course we will have crises in the future. i think the fact that you got hit with something. but the thing that is the most bother some since we haven't fixed the tax system. we talked about the corporate tax and the individual tax. everyone agrees on infrastructure. my friend and colleague larry summers talks about it because of secular stagnation. if we need to build some and the interest rates are cheap, we

need to be doing it. we're not. there is this paralysis, especially in the united states but in other countries, it's very disappointing. i hope we wake out of this. >> what about the housing sector in particular? we haven't really changed. fannie mae and freedy mack are picking out massive amount of mortgages. we are six years out and nothing has seriously changed in terms of housing. >> credit has tightened up. i remember a friend of applying for a mortgage and she said she had to get all but her third grade report card in order to clear it. there's been some stability in that. but we need to move a to a different system in the way they are not guaranteed in the way that they have been. >> tim geithner is coming on money. do you still think banks are too big to fail?

>> yes. they have to put in these things where they close themselves down and stuff. >> is that a failure of policy? the part -- one of the things tim the geithner is it is misguided. it is the idea that you can really ever be in too big to fail. >> it is very hard. we have to have things like index, mortgages, takeout basic a fm and banking services from some of the riskier things. within the current structure, it's hard to do. we have a structure proven to be flawed. but tim was placed with the problem that the whole thing is blowing up. i can't create a new legal structure overnight. and so he did something that sort of appeared at the time to be fairly conservative. it's not easy to know what we should have done.

>> did you think about it. >> i actually didn't. >> in the beginning of the game, middle of the game, what pops in your head? night move. >> ken rogoff, thank you for spending the hour. apple and beats, are they going to merge? honestly, the off-season isn't really off for me. i've got a lot to do. that's why i got my surface. it's great for watching game film

and drawing up plays. it's got onenote, so i can stay on top of my to-do list, which has been absolutely absurd since the big game. with skype, it's just really easy to stay in touch with the kids i work with. alright, russell you are good to go! alright, fellas. alright, russ. back to work!

welcome back. seriously. very much so. because "squawk box" cnbc. first in business worldwide. checking the futures right now. down most of the morning. the futures are real and spectacular. that's what we were checking out. >> we have headlines. >> these are real and spectacular as well. >> i bet you can't text these. let me tell you what's going on.

$35 billion merger has been called off. publicis and omnicorn group terminated. they said there were issues simply that could not be overcome. people on madison avenue questioning what's behind the scenes now. tesla facing a familiar battle once again. in missouri, the state legislature is considering a deal that could ban direct sales to consumers bypassing dealers. it would be the fourth state following texas, arizona and new jersey. i don't know how much the lobbyists are getting paid. they are at least doing their job for the dealers. i hate this. boeing remains ahead of airbus in the yearly battle for jet sales supremacy. 280 net orders for jets through the end of april. the financial times reporting

apple in talks to buy beats. i'm in a little bit of pain about this. morgan brennan joins us now with more. morgan? >> good morning, andrew. $3.2 billion. that's how much apple is expected to pay for beats electronics. this is not a done deal. but at that price it would represent the biggest acquisition apple has ever made for a company. why are they going after a company that makes high-end headphones? sources are tell you this is all about the headphones and the brand itself, which was created by jimmy ivy and dr. dre. the two majority stakeholders took a minority stake for $500 million last year. this represents a departure for apple. it builds its own hardware. not to mentioned fact that it

launched itunes radio just last fall. i have spoken to a number of people and they are all scratching their heads. forester analyst james mckivey said beats could bring a cool factor. they remember a higher end product that's a little bit nicer than apple's little white earbuds. not to mention the fact that beats electronics pulled in $1.2 billion in revenue last year. it's a private were company. the company has come a long way since 2011 when he said, "we're trying to eventually be second to apple and i don't think that's a bad position." a deal could officially be announced as soon as next week. becky, back to you. >> wow.

morgan, thank you. >> i'm softening my stance just in the fact that apple has so much money. maybe we can just -- >> he just went whew. god. >> wait a second. andrew is changing a little. maybe we will still go through with this. >> there you go. thank you. >> morgan, thank you. >> we have a banker coming up on the table. s&p 500 up less than 2%. our next guest says there are plenty of opportunities out there

my view buy the winner. if you're that big.

>> they have the streaming they can work on. >> they don't have the same base. >> it doesn't seem hard to get the streaming thing going. >> apple should just do the streaming thing itself. >> it's immaterial. >> the whole thing is immaterial. >> it represents something. this company doesn't make a lot of big acquisitions. so see them try to buy this first. i'm worried it's sending a signal to the market how it is too small. >> i'm sure that's the first thing they thought. people will say it's because we haven't come up with anything knew. they are going to the play right into the criticism. >> it doesn't mean they shouldn't do small inrements. >> huge acquisition. >> it's kind of like who cares? for apple it's a rounding error.

>> let's talk m and a activity. it's been phenomenal. is this signaling a change in the market? >> there are a lot of tail winds in my view for equity. and for the markets in general. growth is accelerating in the economy. we've got accomodative financial conditions and big start in m&a. i think you are going to see more m&a throughout the course of this year. and m&a presents great opportunitiesinvestors. >> is that what you need, a reason to say, get into the the stocks. you think it is valued at this point? >> i do think it is fairly valued. it is what everybody thinks will be 8% earnings growth across the board this year. and multiple 16 times versus historically forward multiple 13.8. markets as a whole are fairly

fully valued. but here's the opportunity. there are great pockets of market growth. they are easy to find. they are multiquarter earnings growth stories in some sectors and their h big, lumpy earnings upside opportunities coming out of m&a. speciality phrma, grid. super m&a. >> is that similar to what we have seen with valeant and others? >> i can't really get into individual names for compliance. but there's great opportunities coming out of m&a in phrma. and good opportunities coming out out in other sectors also. but m and a should be about

synergies and improving earnings. that's what justifies the transaction taking place to begin with. those are great opportunities. elsewhere, airlines, mobile internet. things that we talked about the last time i was on in january. huge multicorridor earnings growth opportunities where there are a lot of companies out there now that are being priced and valued at the market multiple, less than 20 times. 16, 17 times. but unlike the average stock in the index growing way more than 8%, they are growing earnings 20, 30, even 40%. >> the nasdaq has struggled. a lot of people are looking at technology. eihorn and others have said there is a tech bubble, these are momentum names you should be worried about. >> i don't really buy it? some business models in the tech

space not fully established yet. haven't really shown a track record of repeated earnings. those are traded at very high multiples of next year's earnings. we have seen the movie before. a lot of those companies have grown to be very substantial. there are other companies in the tech space that are being thrown out with the bath water of those more speculative businesses that are focused on total address theable market and how much can we get. businesses that have proven business models that have generated billions of dollars of earnings quarter after quarter and that are growing at more rationally, more of a rational pace. those businesses, in my view, should not be discarded. i don't call this a bubble as a whole. there's a lot of parallels

pointed out by our analyst justin doyle. a lot of parallels between what's going on now and in the tech sector and the banks and financial sector relative to andrew in 2008. when people were discarding everything that started with the word "b," regardless of whether it it was was implicated in the crisis. we had a systemic crisis caused bit large banks in 2008. we don't have anything like a systemic crisis today. ken rogoff was talking how things are relatively common. it's true. you have a normal market environment where stock pickers decide. >> so you think this is an opportunity if you are a company that's actually been putting up earnings and getting tainted by the same brush. >> totally. why would i not pay the market

multiple, let's say 16 times next year's earnings for a business that is growing earnings at 25% a year versus the rest of the market growing earnings at 8% a year? i'm getting a bargain. >> but where would you put a company like amazon is? that has shown a great business model. people are still waiting for the profits. >> amazon is right in between. they are grabbing more real estate, investing in sg&a. hiring people and building their business. they can turn that off any time they want and they would be generating fantastic net income, profits. >> dan, it is always a pleasure talking to you. rereally appreciate your coming in today. >> happy mother's day beck cancer and my wife marlene and my mom. >> all right. as we go to break, check out the shares of netflix.

the company says current customers can keep their current monthly pricing plan for two years. a dollar a month for new members. coming up, women in the economy. a special report about the future leadership and what happens in america. betsy stevenson, a member of the presidents council of economic advisers. check out the "squawk box" market indicator. ♪ ♪ over 1.2 billion eyeballs are on us during the two weeks at wimbledon. true tennis fans want to know what's happening, they don't want to just see what's happening, they want to know and understand why it's happening. anybody can just put data up, but we want to get a reaction, make it far more interactive. we rely on the cloud to provide that immersive digital capability.

this morning, a special look at women and the economy. steve liesman joins us now with interesting data. >> really fascinating. ahead of mother's day. interesting trends of women in the economy. a special guest in a minute. what seems unstopbl now, the leaders of tomorrow are going to be women more than men. over 50, more women have more college degrees.

40% of women 25 to 30 35 have college degrees. employers will be choosing from a larger pool of women with college degrees more than men. obviously we are seeing some of this already. janet yellen asked about the the significance of women and the challenges of in equality. >> i do think that the opportunity for women has been very important. not only recently but really over the last were century increasing opportunities for women in their expanding role in the workforce in promoting a strong economy and really a century of very solid economy performance and growth. and i hope that will continue. >> she has to sit in that position, and it's true. a slow, steady rise in the percent of women earning at least as much or more than their husband. 25% earning more straight out. that is double what it was 30 years ago.

this happens in a vacuum. among them, structure in the workplace. professional schools and family in a way that is more attractive in the existing and coming wave of professional women. joining us now betsey stevenson, president obama's council of economic advisers. looking at this data, it looks like things are going the right way. what is the intended role of the obama administration? >> well, you know what we need to do is exactly what janet yellen was just saying, making sure we are making the most of our talent in the labor force, including our female talent. you know, right now there is a transition under way. we want to make sure we have the right public policies in place as we -- as women in the labor force continues to grow.

we want to make sure that businesses are aware that this change is happening. they're taking a look at their policies to make sure they are attracting women. to give you an example, female mba students today say when they go in an interview with employers, the employers that talk to them about how they will balance their job with their families are the ones they are most attracted to. so women are telling us they are choosing employers willing to make these changes. we want to make sure all employers understand they are going to be left without the best talent if they're not willing to compete on this dimension. >> make sure how? by administration or the bully pulpit of the president's office to prompt change in this office? >> i think there is a role for voluntary business change, which is basically the president using the bully pulpit. there is a rule for public policy changes. the president included in his

budget $100 million to support states in their efforts to create paid leave policies. and we know from research that paid leave does facilitate women in the labor force. and we see states are starting to adopt these policies. there is clearly a role for policy there. >> betsey, that makes sense. extending paid leave. i can understand the need for that to make sure people have time to bond with their babies and still be able to come back to work. i think the bigger problem is one i don't see a fix around. if you have chiropractor when you're 25, 30 years old before you have worked your way to the the top, it's a lot harder to come back. if you're making $50,000, $60,000, a lot of money you pay is for child care. if you wait until you're older, more established, it's a little easier and you have more options. >> there is certainly a truth to that.

we certainly see women are making that decision. if you look at the average age of first birth of women with degrees it's 34. women are saying they are understanding this tradeoff and they are pushing age of first birth later. it is important to take a long look at our careers and employees and know people need to have the flexibility at certain points to make decisions like having children. the good news for women and women, this isn't just a women's issue anymore. men are increasingly realizing they need time off to bond with their babies. so this is a parenting issue. as an economy and society, we need to make sure we have created the space for people to parent in that way. >> let's talk about the most

incindiary. you are looking at the wrong data. there are different jobs and women are earning lessment what's the right answer here? >> fighting over what's the right number is just a way to distract us from the conversation. one of the simple things we know, even though we have anti-discrimination laws, when people are prevented from finding out how much other people make it's impossible for you as an individual to know you're being discriminated against without ratcheting the whole thing up. if you want to say to your colleague, hey, how much do you make, a lot of companies shut that down by saying you could be fired for that question. the president has supported the paycheck fairness act. not that everyone has to share but they have that right. it's not just discrimination. there are things like people choose careers based on where they are going to be able to balance the rest of their life

needs. we knew prior to the aca, a lot of people were making career choice based on where they could get health insurance. now people can choose to work where they are the most talented not where they get health insurance. >> betsey, thank you for joining us today. steve, thank you. >> steve wants to know how much you make. >> i'm not allowed to say. >> i don't want to know how much becky makes. >> he wants to know how much you made. >> how did your team do in the nfl draft? winners and losers in just a bit. and what they've been through lately. polar vortexes, road construction, and gaping potholes. so with all that behind you, you might want to make sure you're safe and in control. ford technicians are ready to find the right tires for your vehicle. get up to $120 in mail-in rebates on four select tires when you use the ford service credit card

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still to come this morning, the nfl draft kicking off last night. winners and losers and what to watch in round 2. and silicone pioneer sarah kertzig. as we head to break, u.s. equity futures. dow futures now look like the dow could be indicated up and down by 21 points. "squawk box" will be right back. . and truecar users... save time and money. so when you're... ready to buy a car, make sure you... never overpay. visit truecar.com today.

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netflix will let current customers keep their current pricing the next two years as new members will be charged $1 more a month. details on the coming price increase a few weeks ago. haven't said how long current customers would be able to escape an increase. i'm a netflix customer. >> apple shares are called lower because of you.

>> because of me? my apologies. i'm apologize to go tim cook. >> he sends you a christmas card. >> we're watching shares of hilton worldwide. the company beating estimates on both the top and bottom lines. also raised its forecast for the year. healthy increase in revenue for available rooms, management and franchise fees. >> ralph lauren, $1.68 a share, 5 cents above estimates. revenue above con census. it warns its margins may be suffering this year as it spends to build its network of stores. the stores gorgeous. the most beautiful stores. you say how can you build? it's like walking into a palace almost. >> the one thing that i just want to say one more time. the ability to start beats, dr.

dre and this guy. three years ago. $3.2 billion. the ability to do that and however they did it is so cool. i can't take a dim view of the whole deal. >> okay. we this conversation. >> aren't you excited? >> i'm very excited. i think it's marvelous. >> headphones. everybody already had headphones. the way they did it. the way they marketed it. the way they made it a must have item. the way they priced it. and the guy that apple is getting. >> the guy who broke the story, joining us now. more on that deal. matthew is the media editor of the financial times. good morning. >> good morning to all of you. >> okay. let's start. a, is this deal actually happening? >> yeah. that's what we're told.

it's going to happen we think sometime next week. it is still final stages. but it's looking like it's going to happen. >> i was already suggesting, i'm less excited as an apple enthusiast. it doesn't seem to me to be on brand. what do you make of that critique? >> it is a pretty good critique. it's a huge departure for tim cook. this company has never really gone outside for innovation. now they are spending $3.2 billion. it's cash they have down at the back of the sofa in cupertino. the jobs era, they would have gone inside for something like that. >> what do you think is happening here? is this really dinner by the fact that they want the headphones? to me they feel like a fashion accessory. i don't know how long they will be fashionable. or is it a streaming piece?

if you want to own the space? or is it about trying to hip up the brand? i don't know. is the beats band better than the apple brand? does it get you part of the market you don't have a piece in? this is acquisition of a higher? >> they are buying cool. you heard in the samsung trial in the papers that came out there is concern at apple were about their marketing, about the perception of their brand. the biggest issue is streaming. itunes is a 10-year-old platform. digital down loads -- i think last year they declined for the the first time in a decade. streaming is 30%, 40% a year. >> it's not a big price. it's three times sales. less than three times sales. look at other prices. margins, what did we decide they were, 40%?

45%? figure out whatever that was on $1.2 billion. they're buying it six or seven times earnings. >> this is the biggest deal apple has ever done. what does it say about innovation. >> they got $150 billion. for what's up, what does that cost? >> how much? $20 billion for messaging. this is $3.2 billion. >> i think it's the right move for them. spotify would cost them more money. >> spotify doesn't make any money. >> we don't know how much beats made. it had a provisional of a billion. >> what would ivine do?

the guy who helped build beats? >> he had a good relationship with steve jobs. he was trying to get jobs into streaming for the longest time. jobs wouldn't do it. jimmy has talked about this before. they were pretty close. he's the consummate marketer. >> there's a tweet going around the internet and a video of tyrese and dr. dre seemingly confirming that something is up at least. i'm trying to get sound. have you seen it? >> i haven't seen it. matthew, stay where you are. we're going to run the video right now. >> the forbes list just changed. hey, it came out like two weeks ago. they need to update the forbes list. [ bleep ] just changed.

>> in a big way. understand that. >> oh, my. >> the first in hip hip right here from the [ bleep ] west coast. >> we should tell you apparently that the video they're taking down off of its facebook page. i don't know if apple or some beats lawyer told dr. dre to get rid of that immediately. >> it may be too late. >> they are going to share $1.3 billion. good message. go to school, get a ph.d. like dr. dre. you can become a billionaire. >> thank you for joining us this morning. we'll see what happens over the weekend and whether this deal gets across the finish line. it is cool for them. may well be cool for apple. >> a tech pioneer from the valley discussing women in the economy. and round one in the books.

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welcome back to "squawk box". the futures taking a turn for the worst. down 12% right now. s&p down 2 points below fair

value. oshe became the first woman to ever take a technology company public and has been dubbed the mother of silicon valley. she's out of retirement and moved to to can andy where she says she's looking to rein vent the marketplace. she said they belong in a museum. founder and ceo of can andy. what is bad about oracle and sap? >> there's nothing bad about oracle and sap. they have had their place. they have been a duopoly for a long time. >> explain what kenandy does. >> it is the business software for enterprise. it is cash, pay, global

financials, the backbone that runs enterprise companies. >> i don't know if you had a chance to listen in to the program in the early part of the 8:00 hour. we were talking women in the workplace. and fair pay and all sorts of other issues. you have seen it all in silicon valley. i really ask more than anything else how you think it has changed, if it has at all. >> well, i think that women feel they have more of a choice these days than they do 10 or 15 years ago. some women decide the to stay home. that's great. raising children in a tough job. you can always get a new job but you can't get new children. that's one of the most important things that a woman does. so as far as equal pay, i've always agreed that we need to get ato sexless society. where sex is not important. people are paid for performance, not whether they are male or

female. >> what do you think about sandberg's campaign then? >> well, i think it works for some women. it is important to decide what makes them happy. if they're not happy, then the people around them are not going to be happy. so, you know, it is good for some people. but i think in general the first thing to do is decide what makes you happy. and then you have to design your life around what's going to make you happy and what's going to work for you. it works for some people but not for everybody. >> why did you do this? >> that's a good question actually. it's not often you get to reinvent the same industry more than twice. twice in a lifetime. the first time that i, you know, started ask computers is when there was technology from main frames to mini computers. now there is a clear technology transformation from mini computers to cloud. or from client serve tore cloud. it's a very exciting time. all software is going to have to

be rewritten over the next 10 years. to be at the ground level of that development is just very, very exciting. and besides that, mark bennihoff told me i have to do it. >> what was that conversation like? >> i had actually been doing investments. i asked who is going to win in the market. clearly there will be some winner that will develop software for the market on the cloud. and he said, you have to do it. and i said, no, no. you don't understand. it's not on my bucket list. i'm not starting another company. he said, no, go look at it. you have to do it. that started the whole movement to kenandy. >> maybe you can comment this morning. we have been talking about apple. you have seen it all with apple. a, are you an investor and, b, what do you think of the beats rumor deal at least? >> well, actually, unfortunately i sold my apple stock far too

early. so i'm not currently an investor but i have been over the time. and i know steve jobs pretty well. and i think fantastic is a fantastic company. i think beats is interesting. it's not something -- i'm not in the consumer software area, so i can't make any major comment other than i'm a very significant apple user. >> sandy, where did the kenandy name come from. >> they are my sons's names. both are entrepreneurs. andy is ce of of just answer. you answer questions 24 hours a day. ken just told his first company. now he's the ceo of a company called arisa, an aid for salesman in selling their software. >> sandy, i have a parenting

question. >> okay. >> how do you think you got two successful entrepreneurs in the family there? >> boy, you know, i don't know. # it's interesting that they followed. i'm very proud. you know, obviously think it's great they followed in my footsteps in being an entrepreneur. they saw me work hard. they saw me having fun as an entrepreneur. they seem to be having a lot of fun. so i think that's good. >> the mother of silicon valley. thank you for being with us. >> sure. >> excellent genetic trait on that chromosome. dominant. it doesn't matter what the y is. does it ever really? coming up, we'll find out if jim cramer has beats and if he thinks this deal works. if it's true. we don't know yet. i'm starting to think it might be. squawks box will be right back. >> monday on "squawk box", former treasury second timothy geithner and his new tell-all

book. from the government's response to the recession to the controversial dodd/frank bill, we go inside the white house during the financial crisis with one of the president's closest first time advisers. "squawk box" starting at 6:00 a.m. only on cnbc. ♪

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forbes list just changed. hey, it came out two weeks ago. they need to update the forbes list. [ bleep ] just changed. >> in a big way. >> oh, my. >> understand that. right here from the [ bleep ] west coast. >> let's get down to the new york stock exchange. >> that's the press release. >> my knee-jerk reaction -- >> look at him? >> my knee-jerk reaction was apple can't do it? here's what i came up with. they the got $1.2 billion in sales, number one. they're paying $3 billion. whatever it is. that's three times. if they got 50% margins or 40 times margins, it's a half a billion dollars, six times what they earned. if they get this johnny guy who can tap into music in a big

way -- and they got all this money anyway. so are you -- is this really just a stupid deal that shows they got nothing else or what? >> i think it's a rounding error. i think these aren't as cool as they were frankly. if i have them, you know very cool. some people might think this is a defensive move against harman which has a better sound system, subjective, and did a deal. is this the ability for apple to get into the 250 million cars on the roo road? i don't know. car play has not been that successful so far. >> it's like google is buying nest and now apple buying headphones. something fundamentally wrong here? >> nest was wrong. honeywell ceo dave cody on, i will sell you the thermostat business for the price they bought nest. nest was an issue that didn't work. it has a fire problem, although home depot frank blake's says it is still selling well. apple, ichlgds like to see if they're going to do a couple

billion acquisition. harman for 10, pandora for 4, for $14 billion te could own the subscription business and auto business and that's what i would do and only ask for about a $500,000 corporate finance fee. >> they can do it for 3 though if they, you know, and if you believe this guy is smart -- >> but beats is only in chrysler and fiat. actually harman's in -- is also in chrysler. >> right. >> you want to be in the car. you don't just want to be in the headphone. the headphone business is not that good and owned by harman. what i would say is look if you want that streaming just go buy pandora, splurge. >> even though they probably don't make as much money. we'll see how -- >> it's about dominance. you want to be world dominant. >> but then like at it from the other side and apple's side and i just -- just start this company a couple years ago and suddenly every kid -- my kids both have them. we paid so much money. >> two pairs for our kids too.

>> they make different colors and it's a status -- other kids know. >> i like them. i mean i like them. >> success story. why didn't we do this? here we are, blah-blah-blah, have a billion dollars if we had done it. we didn't do it, did we? >> i think we're in another business. >> so are they. >> shouldn't have limited us. the restaurant business, the inn business, should have been in the headphone business. >> i don't know you could have done the marketing like dr. dre. >> wealth creation. an american story. >> i like wealth creation, low capital gains, risk taking. this was all those and i congratulate them. >> me too. >> thanks. see you in a couple minutes. >> coming up next we'll break down round one of the nfl draft. how your team fared in last night's opening round. we're back in just a moment.

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we know we're not the center of your life, but we'll do our best to help you connect to what is. last night the first round of the nfl draft. joining us is rob host of speaking with sports with rob on nbc sports radio and senior vice president of nbc sports ventures. thank you. >> nice to be here. >> what team that was engaged last night, not one person can ever do it, who amped up their

chances. >> the cleveland blouns, you have to look at what they did, getting two players in the first round. first they trade back to get an extra draft pick for next year and then they get a defensive back in justin gilbert who they're excited about and then, you know, what do you know? they got the big guy, johnny manziel, still hanging out late in the round. they make another trade to move up to the 22nd pick and they get a quarterback. so to come away with that much in one night, two great players, they hope, and a pick for next year, is quite a -- >> it is cleveland. >> it is cleveland. >> we feel -- just, you know, we just feel they lost lebron. it's nice they got -- they could use a -- >> there was a scene last night in the same bar where they all had gathered in cleveland the night lebron left and they were all crying in their beer that night. they were gathered in the same bar last night going nuts when they got johnny manziel. nice to see that come full circle. >> sometimes, you know, you pick a big offensive linemen and you

kind of don't appreciate it or it's boring. you want to look for wide receivers or rubs or quarterbacks. >> yeah. >> which -- like did the giants do well? they needed some offense? >> the giants needed an offensive lineman in my opinion. if you looked at the way that eli manning got beat up last year. >> right. >> he was on his back half the season. >> this would be another guy you can't throw to? >> exactly. going for odell beckham jr. a wide receiver. interesting to see how that turns out. do they need another receiver? yes. was that the right pick at 129th position? i think not. i think if you look at what dallas got, a few picks later, an interesting moment last night, dallas picking 16th, everybody thinks jerry jones will try to make the splash and go for johnny manziel, the texas guy, and, you know, he made what i think was smart decision, passing on manziel getting an offensive lineman to protect tone my romo who has had a couple back surgeries. dallas made a good move as well. >> i wanted to ask and blanked.

oh, no. came back to me. what was tom brady in the draft? do you remember? >> tom brady was in the sixth round. >> never heard of him. >> no. >> is this guy from central florida, people that watched him play i guess knew about him, but most heard of him just in the last week. >> a surprise to me to see blake bortles, the guy you're talking about. >> big guy. >> big guy 6'5", and to see jacksonville make the decision to go for him. you know, they could have probably traded that pick, moved back 10 or 20 picks and still gotten blake bortles but they decided this was the guy number one and to the going to risk somebody getting him. we'll see how that turns out. when you look at quarterbacks in the history of where the best quarterbacks in the league were drafted, and very few of them were drafted in the top ten picks. >> do you think -- jacksonville, not that far from central florida. do you think they knew about this guy? >> i don't think there's any question. local guy in their backyard. that was the rationale that made people think they should get tim

tebow back in the day. they passed on him when he was available. turned out to be a good move. we'll see how this turns out with bortles. >> ticket sales, a local favorite. >> they need that in jacksonville. their games have been getting blacked out because they haven't been able to sell out. >> rub running backs, none selected. running backs have become -- you talk about asset values, that is an asset clash running backs that has been deval uds over the last few years because of the way the game of football has changed. >> although it -- it's hard to have great passing game without a running game. it's weird, right? >> used to be. but now it's pass first, run second. >> it is, yeah. >> and so -- >> nice to have that, though. establish the running game and pass. >> at least a half dozen wide receivers go yesterday. so the wide receivers has become the new running back. >> how old will you be in 20132.

>> how old will i be? >> sitting in costas' chair by then do you think? there's going to be a job opening then. >> going to be there for a long time. >> careful with the eyes. >> thank you. >> rob, thank you very much for coming in. >> appreciate it. >> that does it for us today. have a wonderful weekend and happy mother's day's to you my mom, mother-in-law, grandma. see you on monday. ♪ good morning and welcome to "squawk on the street." i am brian sullivan with jim cramer. david faber and carl are off today. we are live from the new york stock exchange. hi, everybody. here is your friday setup. stock futures indicating slightly lower open today. again watch small caps. more talk, the little guys, the ru russell 2,000 may be pulling the market down, closing below its 200 day moving age for